CASE EQUIPMENT LOAN TRUST 1997-A
SALE AND SERVICING AGREEMENT
among
CASE EQUIPMENT LOAN TRUST 1997-A,
as Issuer,
and
CASE RECEIVABLES II INC.,
as Seller,
and
CASE CREDIT CORPORATION,
as Servicer.
Dated as of March 1, 1997
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
SECTION 1.1. Definitions............................................ 1
SECTION 1.2. Other Definitional Provisions.......................... 23
ARTICLE II
Conveyance of Receivables
SECTION 2.1. Conveyance of Initial Receivables...................... 23
SECTION 2.2. Conveyance of Subsequent Receivables................... 24
ARTICLE III
The Receivables
SECTION 3.1. Representations and Warranties of Seller............... 28
SECTION 3.2. Repurchase upon Breach................................. 29
SECTION 3.3. Custody of Receivable Files............................ 30
SECTION 3.4. Duties of Servicer as Custodian........................ 30
SECTION 3.5. Instructions; Authority To Act......................... 31
SECTION 3.6. Custodian's Indemnification............................ 31
SECTION 3.7. Effective Period and Termination....................... 31
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.1. Duties of Servicer..................................... 32
SECTION 4.2. Collection and Allocation of Receivable Payments....... 33
SECTION 4.3. Realization upon Receivables........................... 33
SECTION 4.4. Maintenance of Security Interests in Financed Equipment 33
SECTION 4.5. Covenants of Servicer.................................. 34
SECTION 4.6. Purchase of Receivables upon Breach.................... 34
SECTION 4.7. Servicing Fee.......................................... 34
SECTION 4.8. Servicer's Certificate................................. 34
SECTION 4.9. Annual Statement as to Compliance; Notice of Default... 35
SECTION 4.10. Annual Independent Certified Public Accountants'
Report.............................................. 35
SECTION 4.11. Access to Certain Documentation and Information
Regarding Receivables............................... 36
SECTION 4.12. Servicer Expenses..................................... 36
SECTION 4.13. Appointment of Subservicer............................ 36
ARTICLE V
Distributions: Spread Account;
Statements to Certificateholders and Noteholders
SECTION 5.1. Establishment of Trust Accounts........................ 37
SECTION 5.2. Collections............................................ 39
SECTION 5.3. Application of Collections............................. 40
SECTION 5.4. Additional Deposits.................................... 40
SECTION 5.5. Distributions.......................................... 40
SECTION 5.6. Spread Account......................................... 41
SECTION 5.7. Pre-Funding Account.................................... 44
SECTION 5.8. Negative Carry Account................................. 44
SECTION 5.9. [Intentionally Omitted]................................ 45
SECTION 5.10. Statements to Certificateholders and Noteholders...... 45
SECTION 5.11. Net Deposits.......................................... 46
ARTICLE VI
The Seller
SECTION 6.1. Representations of Seller.............................. 46
SECTION 6.2. Corporate Existence.................................... 48
SECTION 6.3. Liability of Seller; Indemnities....................... 49
SECTION 6.4. Merger or Consolidation of, or Assumption of the
Obligations of, Seller.............................. 50
SECTION 6.5. Limitation on Liability of Seller and Others........... 50
SECTION 6.6. Seller May Own Certificates or Notes................... 50
ARTICLE VII
The Servicer
SECTION 7.1. Representations of Servicer............................ 51
SECTION 7.2. Indemnities of Servicer................................ 52
SECTION 7.3. Merger or Consolidation of, or Assumption of the
Obligations of, Servicer............................ 54
SECTION 7.4. Limitation on Liability of Servicer and Others......... 55
SECTION 7.5. Credit Not to Resign as Servicer....................... 56
SECTION 7.6. Servicer to Act as Administrator....................... 56
ARTICLE VIII
Default
SECTION 8.1. Servicer Default....................................... 56
SECTION 8.2. Appointment of Successor Servicer...................... 58
SECTION 8.3. Notification to Noteholders and Certificateholders..... 58
SECTION 8.4. Waiver of Past Defaults................................ 59
ARTICLE IX
Termination
SECTION 9.1. Optional Purchase of All Receivables................... 59
ARTICLE X
Miscellaneous Provisions
SECTION 10.1. Amendment............................................. 61
SECTION 10.2. Protection of Title to Trust.......................... 62
SECTION 10.3. Notices............................................... 65
SECTION 10.4. Assignment............................................ 65
SECTION 10.5. Limitations on Rights of Others....................... 66
SECTION 10.6. Severability.......................................... 66
SECTION 10.7. Separate Counterparts................................. 66
SECTION 10.8. Headings.............................................. 66
SECTION 10.9. Governing Law......................................... 66
SECTION 10.10. Assignment to Indenture Trustee...................... 66
SECTION 10.11. Nonpetition Covenants................................ 66
SECTION 10.12. Limitation of Liability of Trustee and Indenture
Trustee........................................... 67
SCHEDULES AND EXHIBITS
SCHEDULE A Location of Receivables Files
EXHIBIT A Form of Noteholder's Statement Pursuant to Section 5.10(a)
EXHIBIT B Form of Certificateholder's Statement Pursuant to Section
5.10(a)
EXHIBIT C Form of Servicer's Certificate
EXHIBIT D Form of Assignment
EXHIBIT E Form of Subsequent Transfer Assignment
EXHIBIT F Form of Accountants' Letter in Connection with Subsequent
Transfer Assignment
SALE AND SERVICING AGREEMENT dated as of March 1, 1997, among CASE
EQUIPMENT LOAN TRUST 1997-A, a Delaware business trust (the "Issuer"), CASE
RECEIVABLES II INC., a Delaware corporation (the "Seller"), and CASE CREDIT
CORPORATION, a Delaware corporation (the "Servicer").
RECITALS
WHEREAS, the Issuer desires to purchase a portfolio of receivables
arising in connection with equipment retail installment sale contracts
purchased by Case Credit Corporation ("Credit"), in the ordinary course of
business and sold to the Seller on a monthly basis pursuant to a Receivables
Purchase Agreement, dated as of August 1, 1994, between Credit and the
Seller (as it may be amended and supplemented from time to time, the
"Liquidity Receivables Purchase Agreement") and/or a Purchase Agreement
dated the date hereof between Credit and the Seller;
WHEREAS, the Seller is willing to sell such receivables to the Issuer;
and
WHEREAS, Credit is willing to service such receivables.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE XII.
Definitions
SECTION A. Definitions. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall
have the following meanings:
"A-1 Note Final Scheduled Maturity Date" means the March 1998 Payment
Date.
"A-1 Note Redemption Amount" has the meaning assigned to such term in
the definition of "Noteholders' Prepayment Premium".
"A-1 Noteholders" means the holders of record of the A-1 Notes.
"A-1 Noteholders' Monthly Principal Distributable Amount" means, with
respect to any Payment Date until the Payment Date on which the Outstanding
Amount of the A-1 Notes has been reduced to zero, 100% of the Principal
Distribution Amount for such Payment Date.
"A-1 Noteholders' Principal Carryover Shortfall" means, with respect
to any Payment Date, the excess of the A-1 Noteholders' Principal
Distributable Amount for the preceding Payment Date over the amount that was
actually deposited in the Note Distribution Account in respect of principal
of the A-1 Notes on such preceding Payment Date.
"A-1 Noteholders' Principal Distributable Amount" means, with respect
to any Payment Date, the sum of (a) the A-1 Noteholders' Monthly Principal
Distributable Amount for such Payment Date and (b) the A-1 Noteholders'
Principal Carryover Shortfall for such Payment Date; provided, however, that
the sum of clauses (a) and (b) shall not exceed the Outstanding Amount of
the A-1 Notes, and, on the A-1 Note Final Scheduled Maturity Date, the A-1
Noteholders' Principal Distributable Amount will include the amount, to the
extent of available funds, necessary (after giving effect to the other
amounts to be deposited in the Note Distribution Account on such Payment
Date and allocable to principal) to reduce the Outstanding Amount of the A-1
Notes to zero.
"A-2 Noteholders" means the holders of record of the A-2 Notes.
"A-2 Noteholders' Monthly Principal Distributable Amount" means, with
respect to each Payment Date on or after the Payment Date on which an amount
sufficient to reduce the Outstanding Amount of the A-1 Notes to zero has
been deposited in the Note Distribution Account, 100% of the Principal
Distribution Amount (less the portion thereof, if any, applied to reduce the
Outstanding Amount of the A-1 Notes to zero on such Payment Date).
"A-2 Noteholders' Principal Carryover Shortfall" means, with respect
to any Payment Date, the excess of the A-2 Noteholders' Principal
Distributable Amount for the preceding Payment Date over the amount that was
actually deposited in the Note Distribution Account in respect of principal
of the A-2 Notes on such preceding Payment Date.
"A-2 Noteholders' Principal Distributable Amount" means, with respect
to any Payment Date, the sum of (a) the A-2 Noteholders' Monthly Principal
Distributable Amount for such Payment Date and (b) the A-2 Noteholders'
Principal Carryover Shortfall for such Payment Date; provided, however, that
until an amount sufficient to reduce the Outstanding Amount of the A-1 Notes
to zero has been deposited in the Note Distribution Account, the A-2
Noteholders' Principal Distributable Amount shall be zero; provided,
further, that the sum of clauses (a) and (b) shall not exceed the
Outstanding Amount of the A-2 Notes, and, on the Final Scheduled Maturity
Date, the A-2 Noteholders' Principal Distributable Amount will include the
amount, to the extent of available funds, necessary (after giving effect to
the other amounts to be deposited in the Note Distribution Account on such
Payment Date and allocable to principal) to reduce the Outstanding Amount of
the A-2 Notes to zero.
"A-3 Noteholders" means the holders of record of the A-3 Notes.
"A-3 Noteholders' Monthly Principal Distributable Amount" means, with
respect to each Payment Date on or after the Payment Date on which an amount
sufficient to reduce the outstanding amount of the A-2 Notes to zero has
been deposited in the Note Distribution Account, 100% of the Principal
Distribution Amount (less the portion thereof, if any, applied to reduce the
Outstanding Amount of the A-2 Notes to zero on such Payment Date).
"A-3 Noteholders' Principal Carryover Shortfall" means, with respect
to any Payment Date, the excess of the A-3 Noteholders' Principal
Distributable Amount for the preceding Payment Date over the amount that was
actually deposited in the Note Distribution Account in respect of principal
of the A-3 Notes on such preceding Payment Date.
"A-3 Noteholders' Principal Distributable Amount" means, with respect
to any Payment Date the sum of (a) the A-3 Noteholders' Monthly Principal
Distributable Amount for such Payment Date and (b) the A-3 Noteholders'
Principal Carryover Shortfall for such Payment Date; provided, however,
that, until an amount sufficient to reduce the Outstanding Amount of the A-2
Notes to zero has been deposited in the Note Distribution Account, the A-3
Noteholders' Principal Distributable Amount shall be zero; provided,
further, that the sum of clauses (a) and (b) shall not exceed the
Outstanding Amount of the A-3 Notes, and on the Final Scheduled Maturity
Date, the A-3 Noteholders' Principal Distributable Amount will include the
amount, to the extent of available funds, necessary (after giving effect to
the other amounts to be deposited in the Note Distribution Account on such
Payment Date and allocable to principal) to reduce the Outstanding Amount of
the A-3 Notes to zero.
"Administration Fee" has the meaning assigned to such term in the
Administration Agreement.
"Agreement" means this Sale and Servicing Agreement, as the same may
be amended and supplemented from time to time.
"Amount Financed" with respect to a Receivable means the amount
advanced under the Receivable toward the purchase price of the Financed
Equipment and any related costs and any insurance financed thereby.
"Annual Percentage Rate" or "APR" of a Receivable means the annual
rate of finance charges stated in the related Contract.
"Case" means Case Corporation, a Delaware corporation, and its
successors and assigns.
"Certificate Balance" equals, initially, $11,375,000 and, thereafter,
equals such amount reduced by all amounts allocable to principal previously
distributed to Certificateholders.
"Certificate Distribution Account" has the meaning assigned to such
term in the Trust Agreement.
"Certificateholder" has the meaning assigned to such term in the Trust
Agreement.
"Certificateholders' Distributable Amount" means, with respect to any
Payment Date, the sum of the Certificateholders' Principal Distributable
Amount and the Certificateholders' Interest Distributable Amount.
"Certificateholders' Interest Carryover Shortfall" means, with respect
to any Payment Date (the "current Payment Date"), the excess of the
Certificateholders' Interest Distributable Amount for the preceding Payment
Date over the amount in respect of interest that was actually deposited in
the Certificate Distribution Account on such preceding Payment Date, plus
interest on such excess, to the extent permitted by law, at the Pass-Through
Rate from such preceding Payment Date to but excluding the current Payment
Date.
"Certificateholders' Interest Distributable Amount" means, with
respect to any Payment Date (the "current Payment Date") the sum of (a)
interest accrued from and including the preceding Payment Date (or, in the
case of the first Payment Date, the Closing Date) to but excluding the
current Payment Date at the Pass-Through Rate on the Certificate Balance on
the preceding Payment Date after giving effect to all changes therein on
such preceding Payment Date (or, in the case of the first Payment Date, on
the Closing Date), except that during the Funding Period no interest will
accrue on the Pre-Funded Percentage of the Certificate Balance plus (b) the
Certificateholders' Interest Carryover Shortfall for the current Payment
Date.
"Certificateholders' Principal Carryover Shortfall" means, with
respect to any Payment Date, the excess of the Certificateholders' Principal
Distributable Amount for the preceding Payment Date over the amount in
respect of principal that was actually deposited in the Certificate
Distribution Account on such preceding Payment Date.
"Certificateholders' Principal Distributable Amount" means, with
respect to any Payment Date on or after the Payment Date on which an amount
sufficient to reduce the outstanding amount of the Class B Notes to zero has
been deposited in the Note Distribution Account, the sum of (a) 100% of the
Principal Distribution Amount (less the portion thereof, if any, applied to
reduce the Outstanding Amount of the Class B Notes to zero on such Payment
Date) plus (b) the Certificateholders' Principal Carryover Shortfall for
such Payment Date; provided, however, that, until an amount sufficient to
reduce the outstanding amount of the Class B Notes to zero has been
deposited in the Note Distribution Account, the Certificateholders'
Principal Distributable Amount shall be zero; provided, further, that the
Certificateholders' Principal Distributable Amount will not exceed the
Certificate Balance.
"Certificate Pool Factor" means, as of the close of business on any
Payment Date, the Certificate Balance divided by the initial Certificate
Balance (carried out to the seventh decimal place). The Certificate Pool
Factor is 1.0000000 as of the Closing Date, and, thereafter, will decline to
reflect reductions in the Certificate Balance.
"Certificates" means the Trust Certificates (as defined in the Trust
Agreement).
"Class A Noteholder" means any holder of a Class A Note.
"Class A Noteholders' Distributable Amount" means, with respect to any
Payment Date, the sum of (i) the A-1 Noteholders' Principal Distributable
Amount. (ii) the A-2 Noteholders' Principal Distributable Amount, (iii) the
A-3 Noteholders' Principal Distributable Amount and (iv) the Class A
Noteholders' Interest Distributable Amount.
"Class A Noteholders' Interest Carryover Shortfall" means, with
respect to any Payment Date (the "current Payment Date"), the excess of the
Class A Noteholders' Interest Distributable Amount for the preceding Payment
Date over (ii) the amount in respect of interest on the Class A Notes that
was actually deposited in the Note Distribution Account on such preceding
Payment Date, plus interest on such excess, to the extent permitted by law,
at a rate per annum equal to the interest rate on the applicable Class of
Class A Notes, from such preceding Payment Date to but excluding the current
Payment Date.
"Class A Noteholders' Interest Distributable Amount" means, with
respect to any Payment Date (the "current Payment Date"), an amount equal to
the sum of (a) the aggregate amount of interest accrued on the Class A Notes
at their respective interest rates from and including the preceding Payment
Date (or, in the case of the initial Payment Date, from and including the
Closing Date) to but excluding the current Payment Date (based on a 360-day
year of twelve 30-day months) plus (b) the Class A Noteholders' Interest
Carryover Shortfall for the current Payment Date.
"Class A Notes" means the A-1 Notes, the A-2 Notes and the A-3 Notes.
"Class B Noteholder" means any holder of a Class B Note.
"Class B Noteholders' Distributable Amount" means, with respect to any
Payment Date, the sum of (a) the Class B Noteholders' Interest Distributable
Amount and (b) the Class B Noteholders' Principal Distributable Amount.
"Class B Noteholders' Interest Carryover Shortfall" means, with
respect to any Payment Date (the "current Payment Date"), the excess of the
Class B Noteholders' Interest Distributable Amount for the preceding Payment
Date over the amount in respect of interest on the Class B Notes that was
actually deposited in the Note Distribution Account on such preceding
Payment Date, plus interest on such excess, to the extent permitted by law,
at a rate per annum equal to the Class B Rate from such preceding Payment
Date to but excluding the current Payment Date.
"Class B Noteholders' Interest Distributable Amount" means, with
respect to any Payment Date (the "current Payment Date"): (a) the aggregate
amount of interest accrued on the Class B Notes at the Class B Rate from and
including the preceding Payment Date (or, if later, the issuance date for
the Class B Notes) to but excluding the current Payment Date plus (b) the
Class B Noteholders' Interest Carryover Shortfall for the current Payment
Date.
"Class B Noteholders' Monthly Principal Distributable Amount" means,
with respect to each Payment Date on or after the Payment Date on which an
amount sufficient to reduce the outstanding amount of the A-3 Notes to zero
has been deposited in the Note Distribution Account, 100% of the Principal
Distribution Amount (less the portion thereof, if any, applied to reduce the
Outstanding Amount of the A-3 Notes to zero on such Payment Date).
"Class B Noteholders' Principal Carryover Shortfall" means, with
respect to any Payment Date, the excess of the Class B Noteholders'
Principal Distributable Amount for the preceding Payment Date over the
amount that was actually deposited in the Note Distribution Account in
respect of principal of the Class B Notes on such preceding Payment Date.
"Class B Noteholders' Principal Distributable Amount" means, with
respect to any Payment Date, the sum of (a) the Class B Noteholders' Monthly
Principal Distributable Amount for such Payment Date and (b) the Class B
Noteholders' Principal Carryover Shortfall for such Payment Date; provided,
however, that until the Payment Date on which an amount sufficient to reduce
the Outstanding Amount of the A-3 Notes to zero has been deposited in the
Note Distribution Account, the Class B Noteholders' Principal Distributable
Amount shall be zero; and provided further, that the sum of clauses (a) and
(b) shall not exceed the Outstanding Amount of the Class B Notes, and, on
the Final Scheduled Maturity Date, the Class B Noteholders' Principal
Distributable Amount will include the amount, to the extent of available
funds, necessary (after giving effect to the other amounts to be deposited
in the Note Distribution Account on such Payment Date and allocable to
principal) to reduce the Outstanding Amount of the Class B Notes to zero.
"Collection Account" means the account designated as such, established
and maintained pursuant to Section 5.1(a).
"Collection Period" means, with respect to any Payment Date, the
period from and including the end of the preceding Collection Period (or, if
for the first Payment Date, the day after the Initial Cutoff Date) to but
excluding the sixth (6th) day of the calendar month in which the Payment
Date occurs.
"Contract" means an equipment retail installment sale contract secured
by Financed Equipment.
"Contract Value" means, with respect to any day (including the Initial
Cutoff Date or any Subsequent Cutoff Date), the present value of the unpaid
Scheduled Payments discounted monthly at an annual rate equal to: (a) in the
case of the Initial Receivables, the Initial Cutoff Date APR and (b) in the
case of the Subsequent Receivables, the applicable Subsequent Cutoff Date
APR. For purposes of calculating Contract Value, a Scheduled Payment that is
delinquent as of the day the calculation is being made is deemed to be due
on such day. There shall be deemed to be no Scheduled Payments due on a
Liquidated Receivable.
"Corporate Trust Office" means the principal office of the Indenture
Trustee at which at any particular time its corporate trust business shall
be administered, which office at the date of this Agreement is located at
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Indenture Trust Administration (facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇); or at such
other address as the Indenture Trustee may designate from time to time by
notice to the Noteholders and the Seller, or the principal corporate trust
office of any successor Indenture Trustee (the address of which the
successor Indenture Trustee will notify the Noteholders and the Seller).
"Credit" means Case Credit Corporation, a Delaware corporation, and
its successors and assigns.
"Dealer" means the dealer (which may include retail outlets owned by
Case) who sold any Financed Equipment and who originated and assigned the
respective Receivable to Credit under a Dealer Agreement.
"Dealer Agreement" means the retail financing agreement between the
applicable Dealer and Credit.
"Delivery" when used with respect to Trust Account Property means:
(a) with respect to bankers' acceptances, commercial paper,
negotiable certificates of deposit and other obligations that
constitute "instruments" within the meaning of Section 9-105(1)(i) of
the UCC and are susceptible of physical delivery, transfer thereof to
the Indenture Trustee or its nominee or custodian (the "New Owner") by
physical delivery to the New Owner endorsed to, or registered in the
name of, the New Owner or endorsed in blank, and, with respect to a
certificated security (as defined in Section 8-102 of the UCC)
transfer thereof: (i) by delivery of such certificated security
endorsed to, or registered in the name of, the New Owner or endorsed
in blank to a financial intermediary (as defined in Section 8-313 of
the UCC) and the making by such financial intermediary of entries on
its books and records identifying such certificated securities as
belonging to the New Owner and the sending by such financial
intermediary of a confirmation of the purchase of such certificated
security by the New Owner, or (ii) by delivery thereof to a "clearing
corporation" (as defined in Section 8-102(3) of the UCC) and the
making by such clearing corporation of appropriate entries on its
books reducing the appropriate securities account of the transferor
and increasing the appropriate securities account of a financial
intermediary by the amount of such certificated security, the
identification by the clearing corporation of the certificated
securities for the sole and exclusive account of the financial
intermediary, the maintenance of such certificated securities by such
clearing corporation or a "custodian bank" (as defined in Section
8-102(4) of the UCC) or the nominee of either subject to the clearing
corporation's exclusive control, the sending of a confirmation by the
financial intermediary of the purchase by the New Owner of such
securities and the making by such financial intermediary of entries on
its books and records identifying such certificated securities as
belonging to the New Owner (all of the foregoing, "Physical
Property"), and, in any event, any such Physical Property in
registered form shall be in the name of the New Owner; and such
additional or alternative procedures as may hereafter become
appropriate to effect the complete transfer of ownership of any such
Trust Account Property to the New Owner, consistent with changes in
applicable law or regulations or the interpretation thereof;
(b) with respect to any security issued by the United States
Treasury Department, the Federal Home Loan Mortgage Corporation or by
the Federal National Mortgage Association that is a book-entry
security held through the Federal Reserve System pursuant to Federal
book-entry regulations, the following procedures, all in accordance
with applicable law, including applicable Federal regulations and
Articles 8 and 9 of the UCC: book-entry registration of such security
to an appropriate book-entry account maintained with a Federal Reserve
Bank by a financial intermediary that is also a "depository" pursuant
to applicable Federal regulations and issuance by such financial
intermediary of a deposit advice or other written confirmation of such
book-entry registration to the New Owner of the purchase by the New
Owner of such book-entry securities; the making by such financial
intermediary of entries in its books and records identifying such
book-entry security held through the Federal Reserve System pursuant
to Federal book-entry regulations as belonging to the New Owner and
indicating that such custodian holds such security solely as agent for
the New Owner; and such additional or alternative procedures as may
hereafter become appropriate to effect complete transfer of ownership
of any such Trust Account Property to the New Owner, consistent with
changes in applicable law or regulations or the interpretation
thereof; and
(c) with respect to any uncertificated security under Article 8
of the UCC that is not governed by clause (b), registration on the
books and records of the issuer thereof in the name of the financial
intermediary, the sending of a confirmation by the financial
intermediary of the purchase by the New Owner of such uncertificated
security, and the making by such financial intermediary of entries on
its books and records identifying such uncertificated security as
belonging to the New Owner.
"Depositor" shall mean the Seller in its capacity as Depositor under
the Trust Agreement.
"Determination Date" means, with respect to any Transfer Date, the
second Business Day prior to such Transfer Date.
"Eligible Deposit Account" means either: (a) a segregated account with
an Eligible Institution or any other segregated account, the deposit of
funds in which satisfies the Rating Agency Condition or (b) a segregated
trust account with the corporate trust department of a depository
institution organized under the laws of the United States of America or any
State (or any domestic branch of a foreign bank), having corporate trust
powers and acting as trustee for funds deposited in such account, so long as
any of the securities of such depository institution have a credit rating
from each Rating Agency in one of its generic rating categories that
signifies investment grade.
"Eligible Institution" means: (a) the corporate trust department of
the Indenture Trustee or the Trustee or (b) a depository institution
organized under the laws of the United States of America or any State (or
any domestic branch of a foreign bank), which: (i) has either a long-term or
short-term senior unsecured debt rating or certificate of deposit rating
acceptable to the Rating Agencies and (ii) whose deposits are insured by the
FDIC.
"Eligible Investments" mean book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form that evidence:
(a) direct obligations of, and obligations fully guaranteed as to
timely payment by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit of
any depository institution or trust company incorporated under the
laws of the United States of America or any State (or any domestic
branch of a foreign bank) and subject to supervision and examination
by Federal or State banking or depository institution authorities;
provided, however, that at the time of the investment or contractual
commitment to invest therein, the commercial paper or other short-term
senior unsecured debt obligations (other than such obligations the
rating of which is based on the credit of a Person other than such
depository institution or trust company) thereof shall have a credit
rating from each of the Rating Agencies in the highest investment
category granted thereby;
(c) commercial paper having, at the time of the investment or
contractual commitment to invest therein, a rating from each of the
Rating Agencies in the highest investment category granted thereby;
(d) investments in money market funds having a rating from each
of the Rating Agencies in the highest investment category granted
thereby (including funds for which the Indenture Trustee or the
Trustee or any of their respective Affiliates is investment manager or
advisor); provided, that during the Funding Period no investments in
money market funds shall be made with funds in any Trust Account other
than the Collection Account;
(e) bankers' acceptances issued by any depository institution or
trust company referred to in clause (b);
(f) repurchase obligations with respect to any security that is a
direct obligation of, or fully guaranteed as to timely payment by, the
United States of America or any agency or instrumentality thereof the
obligations of which are backed by the full faith and credit of the
United States of America, in either case entered into with a
depository institution or trust company (acting as principal)
described in clause (b); and
(g) any other investment permitted by each of the Rating Agencies
as set forth in writing delivered to the Indenture Trustee; provided,
that investments described in clauses (d) and (g) shall be made only
so long as making such investments will not require the Issuer to
register as an investment company under the Investment Company Act of
1940, as amended.
"FDIC" means the Federal Deposit Insurance Corporation or any
successor.
"Final Scheduled Maturity Date" means the March 2004 Payment Date.
"Financed Equipment" means property, including any agricultural or
construction equipment, together with all accessions thereto, securing an
Obligor's indebtedness under the related Receivable.
"Funding Period" means the period from and including the Closing Date
and ending on the earliest of: (a) the Determination Date on which the
amount on deposit in the Pre-Funding Account (after giving effect to any
transfers therefrom in connection with the transfer of Subsequent
Receivables to the Issuer on or before such Determination Date) is less than
$100,000, (b) the date on which an Event of Default or a Servicer Default
occurs, (c) the date on which an Insolvency Event occurs with respect to the
Seller or the Servicer and (d) the close of business on the September 1997
Payment Date.
"Indenture" means the Indenture, dated the date hereof, between the
Issuer and the Indenture Trustee, as the same may be amended and
supplemented from time to time.
"Indenture Trustee" means the Person acting as Indenture Trustee under
the Indenture, its successors in interest and any successor trustee under
the Indenture.
"Initial Cutoff Date" means February 28, 1997.
"Initial Cutoff Date APR" means 8.823%, which is the weighted average
APR of the Initial Receivables as of the Initial Cutoff Date.
"Initial Pool Balance" means: (i) the Pool Balance as of the Initial
Cutoff Date, which is $335,052,051 plus (ii) the aggregate Contract Value of
all Subsequent Receivables sold to the Issuer as of their respective
Subsequent Cutoff Dates.
"Initial Receivable" means any Contract included in the schedule
delivered by the Servicer to the Trustee on the Closing Date (which schedule
may be in the form of microfiche).
"Insolvency Event" means, with respect to a specified Person: (a) the
filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of such Person or any substantial part of its property
in an involuntary case under any applicable Federal or State bankruptcy,
insolvency or other similar law now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or
ordering the winding-up or liquidation of such Person's affairs, and such
decree or order shall remain unstayed and in effect for a period of 60
consecutive days, or (b) the commencement by such Person of a voluntary case
under any applicable Federal or State bankruptcy, insolvency or other
similar law now or hereafter in effect, or the consent by such Person to the
entry of an order for relief in an involuntary case under any such law, or
the consent by such Person to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or the
making by such Person of any general assignment for the benefit of
creditors, or the failure by such Person generally to pay its debts as such
debts become due, or the taking of action by such Person in furtherance of
any of the foregoing.
"Insolvency Proceeds" has the meaning assigned to such term in Section
9.1(b).
"Interest Distribution Amount" means, with respect to any Payment
Date, the excess, if any, of the Total Distribution Amount over the
Principal Distribution Amount for such Payment Date.
"Investment Earnings" means, with respect to any Payment Date, the
interest and other investment earnings (net of losses and investment
expenses) on amounts on deposit in the Trust Accounts to be deposited into
the Collection Account on the related Transfer Date pursuant to Section
5.1(b).
"Issuer" means Case Equipment Loan Trust 1997-A.
"Lien" means a security interest, lien, charge, pledge, equity or
encumbrance of any kind, other than tax liens, mechanics' liens and any
liens that attach to the related Receivable by operation of law as a result
of any act or omission by the related Obligor.
"Liquidated Receivable" means any Receivable liquidated by the
Servicer through the sale or other disposition of the related Financed
Equipment or that the Servicer has, after using all reasonable efforts to
realize upon the Financed Equipment, determined to charge off without
realizing upon the Financed Equipment.
"Liquidation Proceeds" means, with respect to any Liquidated
Receivable, the moneys collected in respect thereof from whatever source
(including the proceeds of insurance policies with respect to the related
Financed Equipment or Obligor and payments made by a Dealer pursuant to the
related Dealer Agreement with respect to such Receivable (other than amounts
paid from Dealer reserve accounts maintained with Credit)), other than
Recoveries, net of the sum of any amounts expended by the Servicer in
connection with such liquidation and any amounts required by law to be
remitted to the Obligor on such Liquidated Receivable.
"Liquidity Receivables Purchase Agreement" has the meaning assigned to
such term in the Recitals.
"Maximum Negative Carry Amount" means the product of: (i) the
difference between: (a) the weighted average of the interest rates on the
A-1 Notes, the A-2 Notes, the A-3 Notes and the Class B Notes, minus (b)
2.5%, multiplied by (ii) the Note Percentage of the amount on deposit in the
Pre-Funding Account multiplied by (iii) the fraction of a year represented
by the number of days until the expected end of the Funding Period
(calculated on the basis of a 360-day year of twelve 30-day months).
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., or its successor.
"Negative Carry Account" means the account designated as such,
established and maintained pursuant to Section 5.1(a).
"Negative Carry Account Initial Deposit" means $5,557,380.
"Negative Carry Amount" means an amount for each Collection Period
calculated by the Servicer as the difference (if positive) between: (a) the
product of: (i) the sum of the Class A Noteholders' Interest Distributable
Amount and the Class B Noteholders' Interest Distributable Amount multiplied
by (ii) the Pre-Funded Percentage as of the immediately prior Payment Date
(or, in the case of the first Payment Date, the Closing Date) minus (b) the
Pre-Funding Account Investment Earnings.
"Note Balance" means the aggregate Outstanding Amount of the Notes
from time to time.
"Note Distribution Account" means the account designated as such,
established and maintained pursuant to Section 5.1(a).
"Note Percentage" means the percentage equivalent to a fraction the
numerator of which is the Note Balance and the denominator of which is the
sum of the Note Balance and the Certificate Balance.
"Noteholders" means the Class A Noteholders and the Class B
Noteholders.
"Noteholders' Distributable Amount" means, with respect to any Payment
Date, the sum of: (a) the Class A Noteholders' Distributable Amount and (b)
the Class B Noteholders' Distributable Amount.
"Noteholders' Prepayment Premium" means, with respect to the A-1
Notes, an amount equal to the excess, if any, discounted as described below,
of (i) the amount of interest that would have accrued on the principal
amount of the A-1 Notes that is being redeemed (the "A-1 Note Redemption
Amount") at the A-1 Note Rate during the period commencing on and including
the Payment Date on which the A-1 Note Redemption Amount is required to be
distributed to A-1 Noteholders to but excluding September 15, 1997, over
(ii) the amount of interest that would have accrued on the A-1 Note
Redemption Amount over the same period at a per annum rate of interest equal
to the bond equivalent yield to maturity on the Determination Date preceding
such Payment Date on the 5.75% United States Treasury Note due September 30,
1997. Such excess shall be discounted on a monthly basis to a present value
on such Payment Date at the bond equivalent yield described in clause (ii).
The Noteholders' Prepayment Premium, if any, with respect to the A-2 Notes
and the A-3 Notes will be calculated in the same manner, but substituting:
(w) the principal amount of the A-2 Notes (or the A-3 Notes) that is being
redeemed for the A-1 Note Redemption Amount, (x) the A-2 Note Rate (or the
A-3 Note Rate) for the A-1 Note Rate, (y) the date May 15, 1998 (or February
15, 2000, in the case of the A-3 Notes) for the date September 15, 1997, and
(z) the 6.125% United States Treasury Note due May 15, 1998 (or the 5.875%
United States Treasury Note due February 15, 2000, in the case of the A-3
Notes), for the reference Treasury Note referred to above.
"Note Pool Factor" means, as of the close of business on any Payment
Date with respect to any Class of Notes, the Outstanding Amount of that
Class of Notes divided by the original Outstanding Amount of that Class of
Notes (carried out to the seventh decimal place). The Note Pool Factor for
each Class will be 1.0000000 as of the Closing Date, and, thereafter, will
decline to reflect reductions in the Outstanding Amount of the Notes.
"Notes" means the Class A Notes and the Class B Notes.
"Obligor" on a Receivable means the purchaser or co-purchasers of the
Financed Equipment and any other Person who owes payments under the
Receivable.
"Officers' Certificate" means a certificate signed by at least one of
the Chairman of the Board, the President, the Vice Chairman of the Board, an
Executive Vice President, any Vice President, a Treasurer, Assistant
Treasurer, Secretary or Assistant Secretary of the Seller or the Servicer,
as appropriate.
"Opinion of Counsel" means a written opinion of counsel (who may,
except as otherwise expressly provided in this Agreement, be an employee of
or counsel to the Seller or the Servicer), which counsel and opinion shall
be acceptable to the Indenture Trustee, the Trustee or the Rating Agencies,
as applicable.
"Pass-Through Rate" means, with respect to the Certificates, 6.70% per
annum.
"Payment Date" means, with respect to each Collection Period, the
fifteenth day of the calendar month in which that Collection Period ends,
or, if such day is not a Business Day, the next Business Day, commencing on
April 15, 1997.
"Physical Property" has the meaning assigned to such term in the
definition of "Delivery".
"Pool Balance" means, as of the opening of business on the first day
of any Collection Period, the sum of the aggregate Contract Values of the
Receivables as of such day, after giving effect to all payments received
from Obligors and Purchase Amounts to be remitted by the Servicer or the
Seller, as the case may be, with respect to the preceding Collection Period
and all Realized Losses on Receivables liquidated during such preceding
Collection Period.
"Precomputed Receivable" means any Receivable under which the portion
of a payment allocable to earned interest (which may be referred to in the
related Contract as an add-on finance charge) and the portion allocable to
the Amount Financed are determined according to the sum of periodic
balances, the sum of monthly payments or any equivalent method or are
monthly actuarial receivables.
"Pre-Funded Amount" means, with respect to any date, the amount on
deposit in the Pre-Funding Account on such date.
"Pre-Funded Percentage" means, for each Collection Period, the
quotient (expressed as a percentage) of: (i) the Pre-Funded Amount divided
by (ii) the sum of the Pool Balance and the Pre-Funded Amount, after taking
into account all transfers of Subsequent Receivables during such Collection
Period.
"Pre-Funding Account" means the account designated as such,
established and maintained pursuant to Section 5.1(a).
"Pre-Funding Account Investment Earnings" means, with respect to any
Payment Date, the interest and other investment earnings (net of losses and
investment expenses) on amounts on deposit in the Pre-Funding Account to be
deposited into the Collection Account on the related Transfer Date pursuant
to Section 5.1(b).
"Principal Balance" of a Precomputed Receivable, as of the close of
business on the last day of a Collection Period, means the Amount Financed
minus the sum of: (i) that portion of all Scheduled Payments due on or prior
to such day allocable to principal using the actuarial or constant yield
method, (ii) any refunded portion of insurance premiums included in the
Amount Financed, (iii) any payment of the Purchase Amount with respect to
the Precomputed Receivable allocable to principal and (iv) any prepayment in
full or any partial prepayments applied to reduce the Principal Balance of
the Precomputed Receivable.
"Principal Distribution Amount" means, with respect to any Payment
Date, the amount (not less than zero) equal to: (i) the sum of the Contract
Value of all Receivables and the Pre-Funded Amount as of the beginning of
the immediately preceding Collection Period less (ii) the sum of the
Contract Value of all Receivables and the Pre-Funded Amount as of the
beginning of the current Collection Period.
"Purchase Agreement" means the Purchase Agreement dated as of the date
hereof, between the Seller and Credit, as the same may be amended and
supplemented from time to time, which term shall also include, as the
context requires, the Liquidity Receivables Purchase Agreement.
"Purchase Amount" means, as of the close of business on the last day
of a Collection Period, an amount equal to the Contract Value of the
applicable Receivable as of the first day of the immediately following
Collection Period plus interest accrued and unpaid thereon as of such last
day at a rate per annum equal to: (a) in the case of the Initial
Receivables, the Initial Cutoff Date APR and (b) in the case of the
Subsequent Receivables, the applicable Subsequent Cutoff Date APR.
"Purchased Receivable" means a Receivable purchased as of the close of
business on the last day of a Collection Period by the Servicer pursuant to
Section 4.6 or by the Seller pursuant to Section 3.2, or as of the first day
of a Collection Period by the Servicer pursuant to Section 9.1(a).
"Rating Agency" means each of Moody's and Standard & Poor's. If either
of such organizations or its successor is no longer in existence, the Seller
shall designate a nationally recognized statistical rating organization or
other comparable Person as a substitute Rating Agency, notice of which
designation shall be given to the Indenture Trustee, the Trustee and the
Servicer.
"Rating Agency Condition" means, with respect to any action, that each
Rating Agency shall have been given 10 days' prior notice thereof and that
each of the Rating Agencies shall have notified the Seller, the Servicer,
the Trustee and the Indenture Trustee in writing that such action will not
result in a reduction or withdrawal of the then current rating of any Class
of the Notes or the Certificates.
"Realized Losses" means the excess of the Principal Balance of
Liquidated Receivable plus accrued but unpaid interest thereon over
Liquidation Proceeds.
"Receivable Files" means the documents specified in Section 3.3.
"Recoveries" means, with respect to any Liquidated Receivable, monies
collected in respect thereof, from whatever source (other than from the sale
or other disposition of the Financed Equipment), during any Collection
Period following the Collection Period in which such Receivable became a
Liquidated Receivable.
"Remaining Pre-Funded Amount" has the meaning assigned thereto in
Section 5.7(b).
"Required Negative Carry Account Balance" means, as of the beginning
of each Collection Period, an amount equal to the lesser of: (a) the
Negative Carry Account Initial Deposit minus all previous withdrawals from
the Negative Carry Account and (b) the Maximum Negative Carry Amount as of
such day.
"Scheduled Payment" on a Precomputed Receivable means that portion of
the payment required to be made by the Obligor during any Collection Period
sufficient to amortize the Principal Balance under the actuarial method over
the term of the Receivable and to provide interest at the APR.
"Seller" means Case Receivables II Inc., a Delaware corporation, and
its successors in interest to the extent permitted hereunder.
"Servicer" means Credit, as the servicer of the Receivables, and each
successor to Credit (in the same capacity) pursuant to Section 7.3 or 8.2.
"Servicer Default" means an event specified in Section 8.1.
"Servicer's Certificate" means an Officers' Certificate of the
Servicer delivered pursuant to Section 4.8, substantially in the form of
Exhibit C.
"Servicing Fee" means the fee payable to the Servicer for services
rendered during the respective Collection Period, determined pursuant to
Section 4.7.
"Specified Spread Account Balance" means, with respect to any Payment
Date, the lesser of (a) 2.00% of the Initial Pool Balance and (b) the Note
Balance.
"Spread Account" means the account designated as such, established and
maintained pursuant to Section 5.1(a).
"Spread Account Initial Deposit" means, initially, $6,701,050, and,
with respect to each Subsequent Transfer Date, cash or Eligible Investments
having a value approximately equal to 2.00% of the aggregate Contract Value
of the Subsequent Receivables conveyed to the Issuer on such Subsequent
Transfer Date.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., or its successor.
"Subsequent Cutoff Date" means, with respect to any Subsequent
Receivables, the close of business on the last day of the calendar month
preceding the related Subsequent Transfer Date.
"Subsequent Cutoff Date APR" means, with respect to any Subsequent
Cutoff Date, the weighted average APR of the Subsequent Receivables being
purchased as of such Subsequent Cutoff Date.
"Subsequent Receivables" means the Receivables transferred to the
Issuer pursuant to Section 2.2, which shall be listed on Schedule A to the
related Subsequent Transfer Assignment.
"Subsequent Transfer Assignment" has the meaning assigned thereto in
Section 2.2(b)(i).
"Subsequent Transfer Date" means any Business Day during the Funding
Period on which Subsequent Receivables are to be transferred to the Issuer
and a Subsequent Transfer Assignment is executed and delivered to the
Trustee and the Indenture Trustee pursuant to Section 2.2.
"Total Distribution Amount" means, with respect to any Payment Date,
the aggregate amount of collections on or with respect to the Receivables
(including collections received after the end of the preceding calendar
month on any Subsequent Receivables added to the Trust after the end of that
preceding calendar month and on or before that Payment Date) with respect to
the related Collection Period plus the Negative Carry Amount for such
Collection Period. Collections on or with respect to the Receivables include
all payments made by or on behalf of the Obligors (including any late fees,
prepayment charges, extension fees and other administrative fees or similar
charges allowed by applicable law with respect to the Receivables),
Liquidation Proceeds, the Purchase Amount of each Receivable that became a
Purchased Receivable in respect of the related Collection Period (to the
extent deposited into the Collection Account), Investment Earnings for such
Payment Date and payments made by a Dealer pursuant to the related Dealer
Agreement with respect to such Receivable (other than amounts paid from
Dealer reserve accounts maintained with Credit); provided, however, that the
Total Distribution Amount shall not include: (i) all payments or proceeds
(including Liquidation Proceeds) of any Receivables the Purchase Amount of
which has been included in the Total Distribution Amount in a prior
Collection Period, (ii) any Recoveries or (iii) amounts released from the
Pre-Funding Account.
"Transfer Date" means the Business Day preceding the fifteenth day of
each calendar month.
"Trust" means the Issuer.
"Trust Account Property" means the Trust Accounts, all amounts and
investments held from time to time in any Trust Account (whether in the form
of deposit accounts, Physical Property, book-entry securities,
uncertificated securities or otherwise), and all proceeds of the foregoing.
"Trust Accounts" has the meaning assigned thereto in Section 5.1(b).
"Trust Agreement" means the Trust Agreement dated as of the date
hereof, between the Seller and the Trustee, as the same may be amended and
supplemented from time to time.
"Trustee" means the Person acting as Trustee under the Trust
Agreement, its successors in interest and any successor trustee under the
Trust Agreement.
"Trust Estate" has the meaning assigned to such term in the Trust
Agreement.
"Trust Officer" means, in the case of the Indenture Trustee, any
officer within the Corporate Trust Office of the Indenture Trustee,
including any Vice President, Assistant Vice President, Secretary, Assistant
Secretary or any other officer of the Indenture 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 and, with respect to the
Trustee, any officer in the Corporate Trustee Administration Department of
the Trustee with direct responsibility for the administration of the Trust
Agreement and the Basic Documents on behalf of the Trustee.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code as in effect in the relevant jurisdiction, as amended from
time to time.
SECTION B. Other Definitional Provisions. 1. Capitalized terms used
herein and not otherwise defined herein that are defined in the Indenture
have the meanings assigned to them in the Indenture.
2. 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.
3. As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto, 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 as in effect on the
date hereof. 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,
the definitions contained in this Agreement or in any such certificate or
other document shall control.
4. The words "hereof", "herein", "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; Section, Schedule and
Exhibit references contained in this Agreement are references to Sections,
Schedules and Exhibits in or to this Agreement unless otherwise specified;
and the term "including" shall mean "including, without limitation,".
5. The definitions contained in this Agreement 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.
(f) Interest shall be computed on the basis of a 360-day year of
twelve 30-day months for all purposes of this Agreement.
ARTICLE XIII.
Conveyance of Receivables
SECTION A. Conveyance of Initial Receivables. In consideration of the
Issuer's delivery to or upon the order of the Seller on the Closing Date of
the net proceeds from the sale of the Notes and the Certificates and the
other amounts to be distributed from time to time to the Seller in
accordance with this Agreement, the Seller does hereby sell, transfer,
assign, set over and otherwise convey to the Issuer, without recourse
(subject to the obligations herein), all of its right, title and interest
in, to and under:
1. the Initial Receivables, including all documents constituting
chattel paper included therewith, and all obligations of the Obligors
thereunder, including all moneys paid thereunder on or after the
Initial Cutoff Date;
2. the security interests in the Financed Equipment granted by
Obligors pursuant to the Initial Receivables and any other interest of
the Seller in such Financed Equipment;
3. any proceeds with respect to the Initial Receivables from
claims on insurance policies covering Financed Equipment or Obligors;
4. the Liquidity Receivables Purchase Agreement (only with
respect to Owned Contracts included in the Initial Receivables) and
the Purchase Agreement, including the right of the Seller to cause
Credit to repurchase Initial Receivables from the Seller under the
circumstances described therein;
5. any proceeds from recourse to Dealers with respect to the
Initial Receivables other than any interest in the Dealers' reserve
accounts maintained with Credit;
6. any Financed Equipment that shall have secured an Initial
Receivable and that shall have been acquired by or on behalf of the
Trust;
7. all funds on deposit from time to time in the Trust Accounts,
including the Spread Account Initial Deposit, the Negative Carry
Account Initial Deposit and the Pre-Funded Amount, and in all
investments and proceeds thereof (including all income thereon); and
8. the proceeds of any and all of the foregoing (other than
Recoveries).
The above assignment shall be evidenced by a duly executed written
assignment in substantially the form of Exhibit D (the "Assignment").
SECTION B. Conveyance of Subsequent Receivables. 1. Subject to the
conditions set forth in clause (b) below, in consideration of the Trustee's
delivery on the related Subsequent Transfer Date to or upon the order of the
Seller of the amount described in Section 5.7(a) to be delivered to the
Seller, the Seller does hereby sell, transfer, assign, set over and
otherwise convey to the Issuer, without recourse (subject to the obligations
herein), all of its right, title and interest in, to and under:
(a) the Subsequent Receivables listed on Schedule A to the
related Subsequent Transfer Assignment, including all documents
constituting chattel paper included therewith, and all obligations of
the Obligors thereunder, including all moneys paid thereunder on or
after the related Subsequent Cutoff Date;
(b) the security interests in the Financed Equipment granted by
Obligors pursuant to such Subsequent Receivables and any other
interest of the Seller in such Financed Equipment;
(c) any proceeds with respect to such Subsequent Receivables from
claims on insurance policies covering Financed Equipment or Obligors;
(d) the Purchase Agreement, including the right of the Seller to
cause Credit to repurchase Subsequent Receivables from the Seller
under the circumstances described therein;
(e) any proceeds with respect to such Subsequent Receivables from
recourse to Dealers other than any interest in the Dealers' reserve
accounts maintained with Credit;
(f) any Financed Equipment that shall have secured any such
Subsequent Receivable and that shall have been acquired by or on
behalf of the Trust; and
(g) the proceeds of any and all of the foregoing (other than
Recoveries).
2. The Seller shall transfer to the Issuer the Subsequent Receivables
and the other property and rights related thereto described in clause (a)
only upon the satisfaction of each of the following conditions precedent on
or prior to the related Subsequent Transfer Date:
(a) the Seller shall have delivered to the Trustee and the
Indenture Trustee a duly executed written assignment in substantially
the form of Exhibit E (the "Subsequent Transfer Assignment"), which
shall include a Schedule A to the Subsequent Transfer Assignment
listing the Subsequent Receivables;
(b) the Seller shall, to the extent required by Section 5.2, have
deposited in the Collection Account all collections in respect of the
Subsequent Receivables;
(c) as of such Subsequent Transfer Date: (A) the Seller was not
insolvent and will not become insolvent as a result of the transfer of
Subsequent Receivables on such Subsequent Transfer Date, (B) the
Seller did not intend to incur or believe that it would incur debts
that would be beyond the Seller's ability to pay as such debts
matured, (C) such transfer was not made with actual intent to hinder,
delay or defraud any Person and (D) the assets of the Seller did not
constitute unreasonably small capital to carry out its business as
conducted;
(d) the applicable Spread Account Initial Deposit for such
Subsequent Transfer Date shall have been made;
(e) [intentionally deleted];
(f) the Receivables in the Trust, including the Subsequent
Receivables to be conveyed to the Trust on such Subsequent Transfer
Date, shall meet the following criteria: (A) the weighted average
original term of the Receivables in the Trust will not be greater than
55.0 months, and (B) not more than 40% of the aggregate Contract Value
of the Receivables in the Trust will represent Contracts for the
financing of construction equipment;
(g) the Funding Period shall not have terminated;
(h) each of the representations and warranties made by the Seller
pursuant to Section 3.1 with respect to the Subsequent Receivables
shall be true and correct as of such Subsequent Transfer Date, and the
Seller shall have performed all obligations to be performed by it
hereunder on or prior to such Subsequent Transfer Date;
(i) the Seller shall, at its own expense, on or prior to such
Subsequent Transfer Date, indicate in its computer files that the
Subsequent Receivables identified in the related Subsequent Transfer
Assignment have been sold to the Issuer pursuant to this Agreement and
the Subsequent Transfer Assignment;
(j) the Seller shall have taken any action required to maintain
the first perfected ownership interest of the Issuer in the Trust
Estate and the first perfected security interest of the Indenture
Trustee in the Collateral;
(k) no selection procedures believed by the Seller to be adverse
to the interests of the Trust, the Noteholders or the
Certificateholders shall have been utilized in selecting the
Subsequent Receivables;
(l) the addition of the Subsequent Receivables will not result in
a material adverse tax consequence to the Trust, the Noteholders or
the Certificateholders;
(m) the Seller shall have provided the Indenture Trustee, the
Trustee and the Rating Agencies a statement listing the aggregate
Contract Value of such Subsequent Receivables and any other
information reasonably requested by any of the foregoing with respect
to such Subsequent Receivables;
(n) the Seller shall have delivered: (A) to the Rating Agencies,
an Opinion of Counsel with respect to the transfer of such Subsequent
Receivables substantially in the form of the Opinion of Counsel
delivered to the Rating Agencies on the Closing Date and (B) to the
Trustee and the Indenture Trustee, the Opinion of Counsel required by
Section 10.2(i)(1);
(o) the Seller shall have delivered to the Trustee and the
Indenture Trustee a letter of a firm of independent certified public
accountants confirming the satisfaction of the conditions set forth in
clause (vi) with respect to the Subsequent Receivables, and covering
substantially the same matters with respect to the Subsequent
Receivables as are set forth in Exhibit F hereto;
(p) the Seller shall have delivered to the Indenture Trustee and
the Trustee an Officers' Certificate confirming the satisfaction of
each condition specified in this clause (b) (substantially in the form
attached hereto as Annex A to the Subsequent Transfer Assignment); and
(xvii) ▇▇▇▇▇'▇ shall have received written notification from the
Seller of the addition of all such Subsequent Receivables.
3. The Seller covenants to transfer to the Issuer pursuant to clause
(a) Subsequent Receivables with an aggregate Contract Value equal to
$314,947,499. If the Seller shall fail to deliver and sell to the Issuer any
or all of such Subsequent Receivables by the date on which the Funding
Period ends, and the Pre-Funded Amount is greater than $100,000 on such
date, the Seller shall be obligated to deposit an amount equal to the
aggregate Noteholders' Prepayment Premium into the Note Distribution Account
on the Payment Date on which the Funding Period ends (or, if the Funding
Period does not end on a Payment Date, on the first Payment Date following
the end of the Funding Period); provided, however, that the foregoing shall
be the sole remedy of the Issuer, the Trustee, the Indenture Trustee, the
Noteholders or the Certificateholders with respect to a failure of the
Seller to comply with such covenant.
ARTICLE XIV.
The Receivables
SECTION A. Representations and Warranties of Seller. The Seller makes
the following representations and warranties as to the Receivables on which
the Issuer is deemed to have relied in acquiring the Receivables. Such
representations and warranties speak as of the execution and delivery of
this Agreement and as of the Closing Date, in the case of the Initial
Receivables, and as of the applicable Subsequent Transfer Date, in the case
of the Subsequent Receivables, but shall survive the sale, transfer and
assignment of the Receivables to the Issuer and the pledge thereof to the
Indenture Trustee pursuant to the Indenture.
1. Title. It is the intention of the Seller that the transfer and
assignment herein contemplated constitute a sale of the Receivables from the
Seller to the Issuer and that the beneficial interest in and title to the
Receivables not be part of the debtor's estate in the event of the filing of
a bankruptcy petition by or against the Seller under any bankruptcy or
similar law. No Receivable has been sold, transferred, assigned or pledged
by the Seller to any Person other than the Issuer. Immediately prior to the
transfer and assignment herein contemplated, the Seller had good title to
each Receivable, free and clear of all Liens and, immediately upon the
transfer thereof, the Issuer shall have good title to each Receivable, free
and clear of all Liens; and the transfer and assignment of the Receivables
to the Issuer has been perfected under the UCC.
2. All Filings Made. All filings (including UCC filings) necessary in
any jurisdiction to give the Issuer a first priority perfected ownership
interest in the Receivables, and to give the Indenture Trustee a first
priority perfected security interest therein, have been made.
SECTION B. Repurchase upon Breach. (a) The Seller, the Servicer or
the Trustee, as the case may be, shall inform the other parties to this
Agreement and the Indenture Trustee promptly, in writing, upon the discovery
of any breach of the Seller's representations and warranties made pursuant
to Section 3.1 or Section 6.1 or Credit's representations and warranties
made pursuant to Section 3.2(b) of the Liquidity Receivables Purchase
Agreement or Section 3.2(b) of the Purchase Agreement. Unless any such
breach shall have been cured by the last day of the second (or, if the
Seller elects, the first) Collection Period after such breach is discovered
by the Trustee or in which the Trustee receives written notice from the
Seller or the Servicer of such breach, the Seller shall be obligated, and,
if necessary, the Seller or the Trustee shall enforce the obligation of
Credit under the Liquidity Receivables Purchase Agreement or the Purchase
Agreement, as applicable, to repurchase any Receivable materially and
adversely affected by any such breach as of such last day. As consideration
for the repurchase of the Receivable, the Seller shall remit the Purchase
Amount in the manner specified in Section 5.4; provided, however, that the
obligation of the Seller to repurchase any Receivable arising solely as a
result of a breach of Credit's representations and warranties pursuant to
Section 3.2(b) of the Liquidity Receivables Purchase Agreement or Section
3.2(b) of the Purchase Agreement is subject to the receipt by the Seller of
the Purchase Amount from Credit. Subject to the provisions of Section 6.3,
the sole remedy of the Issuer, the Trustee, the Indenture Trustee, the
Noteholders or the Certificateholders with respect to a breach of the
representations and warranties pursuant to Section 3.1 and the agreement
contained in this Section shall be to require the Seller to repurchase
Receivables pursuant to this Section, subject to the conditions contained
herein, and to enforce Credit's obligation to the Seller to repurchase such
Receivables pursuant to the Liquidity Receivables Purchase Agreement or the
Purchase Agreement, as applicable.
(b) With respect to all Receivables repurchased by the Seller
pursuant to this Agreement, the Issuer shall sell, transfer, assign, set
over and otherwise convpresentation or warranty, all of the Issuer's right,
title and interest in, to and under such Receivables, and all security and
documents relating thereto.
SECTION C. Custody of Receivable Files. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Issuer
hereby revocably appoints the Servicer, and the Servicer hereby accepts such
appointment, to act for the benefit of the Issuer and the Indenture Trustee
as custodian of the following documents or instruments, which are hereby
constructively delivered to the Indenture Trustee, as pledgee of the Issuer
(or, in the case of the Subsequent Receivables, will as of the applicable
Subsequent Transfer Date be constructively delivered to the Indenture
Trustee, as pledgee of the Issuer) with respect to each Receivable:
1. the original fully executed copy of the Receivable;
2. a record or facsimile of the original credit application fully
executed by the Obligor;
3. the original certificate of title or file stamped copy of the
UCC financing statement or such other documents that the Servicer
shall keep on file, in accordance with its customary procedures,
evidencing the security interest of Credit in the Financed Equipment;
and
4. any and all other documents that the Servicer or the Seller
shall keep on file, in accordance with its customary procedures,
relating to a Receivable, an Obligor or any of the Financed Equipment.
SECTION D. Duties of Servicer as Custodian.
1. Safekeeping. The Servicer shall hold the Receivable Files for the
benefit of the Issuer and the Indenture Trustee and maintain such accurate
and complete accounts, records and computer systems pertaining to each
Receivable File as shall enable the Issuer to comply with this Agreement. In
performing its duties as custodian, the Servicer shall act with reasonable
care, using that degree of skill and attention that the Servicer exercises
with respect to the receivable files relating to all comparable equipment
receivables that the Servicer services for itself or others. The Servicer
shall conduct, or cause to be conducted, periodic audits of the Receivable
Files and the related accounts, records and computer systems, in such a
manner as shall enable the Issuer or the Indenture Trustee to verify the
accuracy of the Servicer's record keeping. The Servicer shall promptly
report to the Issuer and the Indenture Trustee any failure on its part to
hold the Receivable Files and maintain its accounts, records and computer
systems as herein provided and promptly take appropriate action to remedy
any such failure. Nothing herein shall be deemed to require an initial
review or any periodic review by the Issuer, the Trustee or the Indenture
Trustee of the Receivable Files.
2. Maintenance of and Access to Records. The Servicer shall maintain
each Receivable File at one of its offices specified in Schedule A to this
Agreement or at such other office as shall be specified to the Issuer and
the Indenture Trustee by written notice not later than 90 days after any
change in location. The Servicer shall make available for inspection by the
Seller, the Issuer and the Indenture Trustee or their respective duly
authorized representatives, attorneys or auditors a list of locations of the
Receivable Files and the related accounts, records and computer systems
maintained by the Servicer at such times during normal business hours as the
Seller, the Issuer or the Indenture Trustee shall instruct.
SECTION E. Instructions; Authority To Act. The Servicer shall be
deemed to have received proper instructions with respect to the Receivable
Files upon its receipt of written instructions signed by a Trust Officer of
the Indenture Trustee.
SECTION F. Custodian's Indemnification. The Servicer as custodian
shall indemnify the Trust, the Trustee and the Indenture Trustee (and each
of their officers, directors, employees and agents) for any and all
liabilities, obligations, losses, compensatory damages, payments, costs or
expenses of any kind whatsoever that may be imposed on, incurred by or
asserted against the Trust, the Trustee or the Indenture Trustee (or any of
their officers, directors and agents) as the result of any improper act or
omission in any way relating to the maintenance and custody by the Servicer
as custodian of the Receivable Files; provided, however, that the Servicer
shall not be liable: (a) to the Trustee for any portion of any such amount
resulting from the willful misfeasance, bad faith or negligence of the
Trustee and (b) to the Indenture Trustee for any portion of any such amount
resulting from the wilful misfeasance, bad faith or negligence of the
Indenture Trustee.
SECTION G. Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Initial Cutoff
Date and shall continue in full force and effect until terminated pursuant
to this Section. If any Servicer shall resign as Servicer in accordance with
this Agreement or if all of the rights and obligations of any Servicer shall
have been terminated under Section 8.1, the appointment of such Servicer as
custodian shall be terminated by: (a) the Indenture Trustee, (b) the
Noteholders of Notes evidencing not less than 25% of the Note Balance, (c)
with the consent of Noteholders of Notes evidencing not less than 25% of the
Note Balance, the Trustee or (d) Certificateholders evidencing not less than
25% of the Certificate Balance, in the same manner as the Indenture Trustee
or such Holders may terminate the rights and obligations of the Servicer
under Section 8.1. The Indenture Trustee or, with the consent of the
Indenture Trustee, the Trustee may terminate the Servicer's appointment as
custodian, with cause, at any time upon written notification to the
Servicer, and without cause upon 30 days' prior written notification to the
Servicer. As soon as practicable after any termination of such appointment,
the Servicer shall deliver the Receivable Files to the Indenture Trustee or
the Indenture Trustee's agent at such place(s) as the Indenture Trustee may
reasonably designate.
ARTICLE XV.
Administration and Servicing of Receivables
SECTION A. Duties of Servicer. The Servicer, for the benefit of the
Issuer, and (to the extent provided herein) the Indenture Trustee shall
manage, service, administer and make collections on the Receivables with
reasonable care, using that degree of skill and attention that the Servicer
exercises with respect to all comparable equipment receivables that it
services for itself or others. The Servicer's duties shall include
collection and posting of all payments, responding to inquiries of Obligors
on such Receivables, investigating delinquencies, sending payment coupons to
Obligors, reporting tax information to Obligors, accounting for collections
and furnishing monthly and annual statements to the Trustee and the
Indenture Trustee with respect to distributions. Subject to Section 4.2, the
Servicer shall follow its customary standards, policies and procedures in
performing its duties as Servicer. Without limiting the generality of the
foregoing, the Servicer is authorized and empowered to execute and deliver,
on behalf of itself, the Issuer, the Trustee, the Indenture Trustee, the
Certificateholders, the Noteholders or any of them, any and all instruments
of satisfaction or cancellation, or partial or full release or discharge,
and all other comparable instruments, with respect to such Receivables or
the Financed Equipment securing such Receivables. If the Servicer shall
commence a legal proceeding to enforce a Receivable, the Issuer shall
thereupon be deemed to have automatically assigned, solely for the purpose
of collection, such Receivable to the Servicer. If in any enforcement suit
or legal proceeding it shall be held that the Servicer may not enforce a
Receivable on the ground that it shall not be a real party in interest or a
holder entitled to enforce such Receivable, the Trustee shall, at the
Servicer's expense and direction, take steps to enforce such Receivable,
including bringing suit in its name or the name of the Trust, the Indenture
Trustee, the Certificateholders or the Noteholders. The Trustee or the
Indenture Trustee shall, upon the written request of the Servicer, furnish
thpowers of attorney and other documents reasonably necessary or appropriate
to enable the Servicer to carry out its servicing and administrative duties
hereunder.
SECTION B. Collection and Allocation of Receivable Payments. The
Servicer shall make reasonable efforts to collect all payments called for
under the Receivables as and when the same shall become due and shall follow
such collection procedures as it follows with respect to all comparable
equipment receivables that it services for itself or others. The Servicer
shall allocate collections between principal and interest in accordance with
the customary servicing procedures it follows with respect to all comparable
equipment receivables that it services for itself or others. The Servicer
may grant extensions or adjustments on a Receivable; provided, however, that
if the Servicer extends the date for final payment by the Obligor of any
Receivable beyond the Final Scheduled Maturity Date, it shall promptly
purchase the Receivable from the Issuer in accordance with Section 4.6. The
Servicer may, in its discretion, waive any late payment charge or any other
fees (other than extension fees or any other fees that represent interest
charges on deferred Scheduled Payments) that may be collected in the
ordinary course of servicing a Receivable. The Servicer shall not agree to
any decrease of the interest rate on any Receivable or reduce the aggregate
amount of the Scheduled Payments due on any Receivable.
SECTION C. Realization upon Receivables. For the benefit of the
Issuer and the Indenture Trustee, the Servicer shall use reasonable efforts,
consistent with its customary servicing procedures, to repossess or
otherwise convert the ownership of the Financed Equipment securing any
Receivable as to which the Servicer shall have determined eventual payment
in full is unlikely. The Servicer shall follow such customary and usual
practices and procedures as it shall deem necessary or advisable in its
servicing of equipment receivables, which may include reasonable efforts to
realize upon any recourse to Dealers and selling the Financed Equipment at
public or private sale. The foregoing shall be subject to the provision
that, in any case in which the Financed Equipment shall have suffered
damage, the Servicer shall not expend funds in connection with the repair or
the repossession of such Financed Equipment unless it shall determine in its
discretion that such repair and/or repossession will increase the
Liquidation Proceeds by an amount greater than the amount of such expenses.
SECTION D. Maintenance of Security Interests in Financed Equipment.
The Servicer shall, in accordance with its customary servicing procedures,
take such steps as are necessary to maintain perfection of the security
interest created by each Receivable in the related Financed Equipment. The
Servicer is hereby authorized to take such steps as are necessary to
re-perfect such security interest for the benefit of the Issuer and the
Indenture Trustee in the event of the relocation of a Financed Equipment or
for any other reason.
SECTION E. Covenants of Servicer. The Servicer shall not release the
Financed Equipment securing any Receivable from the security interest
granted by such Receivable in whole or in part except in the event of
payment in full by the Obligor thereunder or repossession, nor shall the
Servicer impair the rights of the Issuer, the Indenture Trustee, the
Certificateholders or the Noteholders or in such Receivables. The Servicer
shall, in accordance with its customary servicing procedures, require that
each Obligor shall have obtained physical damage insurance covering the
Financed Equipment as of the execution of the Receivable.
SECTION F. Purchase of Receivables upon Breach. The Servicer or the
Trustee shall inform the other party, the Indenture Trustee, the Seller and
Credit promptly, in writing, upon the discovery of any breach pursuant to
Section 4.2, 4.4 or 4.5. Unless the breach shall have been cured by the last
day of the Collection Period in which such breach is discovered, the
Servicer shall purchase any Receivable materially and adversely affected by
such breach as of such last day. If the Servicer takes any action during any
Collection Period pursuant to Section 4.2 that impairs the rights of the
Issuer, the Indenture Trustee, the Certificateholders or the Noteholders in
any Receivable or as otherwise provided in Section 4.2, the Servicer shall
purchase such Receivable as of the last day of such Collection Period. As
consideration for the purchase of any such Receivable pursuant to either of
the two preceding sentences, the Servicer shall remit the Purchase Amount in
the manner specified in Section 5.4. Subject to Section 7.2, the sole remedy
of the Issuer, the Trustee, the Indenture Trustee, the Certificateholders or
the Noteholders with respect to a breach pursuant to Section 4.2, 4.4 or 4.5
shall be to require the Servicer to purchase Receivables pursuant to this
Section. The Trustee shall have no duty to conduct any affirmative
investigation as to the occurrence of any condition requiring the purchase
of any Receivable pursuant to this Section.
SECTION G. Servicing Fee. The Servicing Fee for each Collection
Period shall be equal to 1/12th of 1.00% of the Pool Balance as of the first
day of such Collection Period.
SECTION H. Servicer's Certificate. On each Determination Date the
Servicer shall deliver to the Trustee, the Indenture Trustee and the Seller,
with a copy to the Rating Agencies, a Servicer's Certificate containing all
information necessary to make the distributions pursuant to Sections 5.5 and
5.6 and the deposits to the Collection Account pursuant to Section 5.2 for
the Collection Period preceding the date of such Servicer's Certificate.
Receivables to be repurchased by the Seller or purchased by the Servicer
shall be identified by the Servicer by account number with respect to such
Receivable (as specified in the schedule of Receivables delivered on the
Closing Date or attached to the applicable Subsequent Transfer Assignment).
SECTION I. Annual Statement as to Compliance; Notice of Default. 1.
The Servicer shall deliver to the Trustee and the Indenture Trustee, on or
before April 30th of each year, an Officers' Certificate, dated as of
December 31 of the preceding year, stating that: (i) a review of the
activities of the Servicer during the preceding 12-month period (or, in the
case of the first such certificate, from the Initial Cutoff Date to December
31, 1997) and of its performance under this Agreement has been made under
such officers' supervision and (ii) to the best of such officers' knowledge,
based on such review, the Servicer has fulfilled all its obligations under
this Agreement throughout such year or, if there has been a default in the
fulfillment of any such obligation, specifying each such default known to
such officers and the nature and status thereof. The Indenture Trustee shall
send a copy of such Certificate and the report referred to in Section 4.10
to the Rating Agencies. A copy of such Certificate and report may be
obtained by any Certificateholder or Indenture Noteholder by a request in
writing to the Trustee addressed to the Corporate Trust Office. Upon the
written request of the Trustee, the Indenture Trustee will promptly furnish
the Trustee a list of Indenture Noteholders as of the date specified by the
Trustee.
2. The Servicer shall deliver to the Trustee, the Indenture Trustee
and the Rating Agencies, promptly after having obtained knowledge thereof,
but in no event later than five Business Days thereafter, written notice in
an Officers' Certificate of any event that, with the giving of notice or
lapse of time, or both, would become a Servicer Default under Section 8.1(a)
or (b).
SECTION J. Annual Independent Certified Public Accountants' Report.
The Servicer shall cause a firm of independent certified public accountants,
which may also render other services to the Servicer or the Seller, to
deliver to the Trustee and the Indenture Trustee on or before April 30 of
each year a report, addressed to the Board of Directors of the Servicer, the
Trustee and the Indenture Trustee, summarizing the results of certain
procedures with respect to certain documents and records relating to the
servicing of the Receivables during the preceding calendar year (or, in the
case of the first such report, during the period from the Initial Cutoff
Date to December 31, 1997). The procedures to be performed and reported upon
by the independent public accountants shall be those agreed to by the
Servicer and the Indenture Trustee.
Such report will also indicate that the firm is independent of the
Servicer within the meaning of the Code of Professional Ethics of the
American Institute of Certified Public Accountants.
SECTION K. Access to Certain Documentation and Information Regarding
Receivables. The Servicer shall provide to the Trustee and the Indenture
Trustee access to the Receivable Files in such cases where the Trustee or
the Indenture Trustee shall be required by applicable statutes or
regulations to review such documentation. Access shall be afforded without
charge, but only upon reasonable request and during the normal business
hours at the respective offices of the Servicer. Nothing in this Section
shall affect the obligation of the Servicer to observe any applicable law
prohibiting disclosure of information regarding the Obligors, and the
failure of the Servicer to provide access to information as a result of such
obligation shall not constitute a breach of this Section.
SECTION L. Servicer Expenses. The Servicer shall be required to pay
all expenses incurred by it in connection with its activities hereunder,
including fees and disbursements of independent accountants, taxes imposed
on the Servicer and expenses incurred in connection with distributions and
reports to Certificateholders and the Noteholders.
SECTION M. Appointment of Subservicer. The Servicer may at any time
appoint a subservicer to perform all or any portion of its obligations as
Servicer hereunder; provided, however, that the Rating Agency Condition
shall have been satisfied in connection therewith; and provided further,
that the Servicer shall remain obligated and be liable to the Issuer, the
Trustee, the Indenture Trustee the Certificateholders and the Noteholders
for the servicing and administering of the Receivables in accordance with
the provisions hereof without diminution of such obligation and liability by
virtue of the appointment of such subservicer and to the same extent and
under the same terms and conditions as if the Servicer alone were servicing
and administering the Receivables. The fees and expenses of the subservicer
shall be as agreed between the Servicer and its subservicer from time to
time and none of the Issuer, the Trustee, the Indenture Trustee, the
Certificateholders or the Noteholders shall have any responsibility
therefor.
ARTICLE XVI.
Distributions: Spread Account;
Statements to Certificateholders and Noteholders
SECTION A. Establishment of Trust Accounts. 1.(a) The Servicer, for
the benefit of the Noteholders and the Certificateholders, shall establish
and maintain in the name of the Indenture Trustee an Eligible Deposit
Account (the "Collection Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the Noteholders
and the Certificateholders.
(b) The Servicer, for the benefit of the Noteholders, shall
establish and maintain in the name of the Indenture Trustee an
Eligible Deposit Account (the "Note Distribution Account"), bearing a
designation clearly indicating that the funds deposited therein are
held for the benefit of the Noteholders.
(c) The Servicer, for the benefit of the Noteholders, shall
establish and maintain in the name of the Indenture Trustee an
Eligible Deposit Account (the "Spread Account"), bearing a designation
clearly indicating that the funds deposited therein are held for the
benefit of the Noteholders.
(d) The Servicer, for the benefit of the Noteholders and the
Certificateholders, shall establish and maintain in the name of the
Indenture Trustee an Eligible Deposit Account (the "Pre-Funding
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Noteholders and the
Certificateholders.
(e) The Servicer, for the benefit of the Noteholders and the
Certificateholders, shall establish and maintain in the name of the
Indenture Trustee an Eligible Deposit Account (the "Negative Carry
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Noteholders and the
Certificateholders.
2. Funds on deposit in the Collection Account, the Note Distribution
Account, the Spread Account, the Pre-Funding Account and the Negative Carry
Account (collectively, the "Trust Accounts") shall be invested or reinvested
by the Indenture Trustee in Eligible Investments selected by and as directed
in writing by the Servicer (which written direction may be in the form of
standing instructions); provided, however, it is understood and agreed that
the Indenture Trustee shall not be liable for the selection of, or any loss
arising from such investment in, Eligible Investments. All such Eligible
Investments shall be held by the Indenture Trustee for the benefit of the
Noteholders and the Certificateholders or the Noteholders, as applicable;
provided, that on each Transfer Date, all Investment Earnings on funds on
deposit therein shall be deposited into the Collection Account and shall be
deemed to constitute a portion of the Total Distribution Amount. Other than
as permitted by the Rating Agencies, funds on deposit in the Trust Accounts
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 Payment Date; provided, however, that funds on
deposit in Trust Accounts may be invested in Eligible Investments of the
entity serving as Indenture Trustee that may mature so that such funds will
be available on the Payment Date. Funds deposited in a Trust Account on the
Transfer Date that precedes a Payment Date upon the maturity of any Eligible
Investments are not required to be invested overnight.
3.(a) The Indenture Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Trust Accounts and
in all proceeds thereof (including all income thereon) and all such funds,
investments, proceeds and income shall be part of the Trust Estate. The
Trust Accounts shall be under the sole dominion and control of the Indenture
Trustee for the benefit of the Noteholders and the Certificateholders or the
Noteholders, as the case may be. If, at any time, any of the Trust Accounts
ceases to be an Eligible Deposit Account, the Indenture 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 Trust Account as an Eligible Deposit Account and
shall transfer any cash and/or any investments held in the no-longer
Eligible Deposit Account to such new Trust Account.
(b) With respect to the Trust Account Property, the Indenture
Trustee agrees, by its acceptance hereof, that:
(A) any Trust Account Property that is held in deposit
accounts shall be held solely in Eligible Deposit Accounts,
subject to the last sentence of Section 5.1(c)(i); and each such
Eligible Deposit Account shall be subject to the exclusive
custody and control of the Indenture Trustee, and the Indenture
Trustee shall have sole signature authority with respect thereto;
(B) any Trust Account Property that constitutes Physical
Property shall be delivered to the Indenture Trustee in
accordance with clause (a) of the definition of "Delivery" and
shall be held, pending maturity or disposition, solely by the
Indenture Trustee or a financial intermediary (as such term is
defined in Section 8-313(4) of the UCC) acting solely for the
Indenture Trustee;
(C) any Trust Account Property that is a book-entry
security held through the Federal Reserve System pursuant to
Federal book-entry regulations shall be delivered in accordance
with clause (b) of the definition of "Delivery" and shall be
maintained by the Indenture Trustee, pending maturity or
disposition, through continued book-entry registration of such
Trust Account Property as described in such clause; and
(D) any Trust Account Property that is an "uncertificated
security" under Article 8 of the UCC and that is not governed by
clause (C) shall be delivered to the Indenture Trustee in
accordance with clause (c) of the definition of "Delivery" and
shall be maintained by the Indenture Trustee, pending maturity or
disposition, through continued registration of the Indenture
Trustee's (or its nominee's) ownership of such security.
(c) The Servicer shall have the power, revocable by the Indenture
Trustee or by the Trustee, with the consent of the Indenture Trustee,
to instruct the Indenture Trustee to make withdrawals and payments
from the Trust Accounts for the purpose of permitting the Servicer or
the Trustee to carry out its respective duties hereunder or permitting
the Indenture Trustee to carry out its duties under the Indenture.
4. All Trust Accounts will initially be established at the Indenture
Trustee.
SECTION B. Collections. The Servicer shall remit within two Business
Days of receipt thereof to the Collection Account all payments by or on
behalf of the Obligors with respect to the Receivables, and all Liquidation
Proceeds, both as collected during the Collection Period. Notwithstanding
the foregoing, for so long as: (i) Credit remains the Servicer, (ii) no
Servicer Default shall have occurred and be continuing and (iii) prior to
ceasing daily remittances, the Rating Agency Condition shall have been
satisfied (and any conditions or limitations imposed by the Rating Agencies
in connection therewith are complied with), the Servicer shall remit such
collections with respect to the related Collection Period to the Collection
Account on the Transfer Date immediately following the end of such
Collection Period. For purposes of this Article V, the phrase "payments by
or on behalf of the Obligors" shall mean payments made with respect to the
Receivables by Persons other than the Servicer or the Seller.
SECTION C. Application of Collections. 1. With respect to each
Receivable, all collections for the Collection Period shall be applied to
the related Scheduled Payment.
2. All Liquidation Proceeds shall be applied to the related
Receivable.
SECTION D. Additional Deposits. The Servicer and the Seller shall
deposit or cause to be deposited in the Collection Account the aggregate
Purchase Amount with respect to Purchased Receivables on the Transfer Date
related to the Collection Period on the last day of which the purchase
occurs, and the Servicer shall deposit therein all amounts to be paid under
Section 9.1 on the Transfer Date falling in the Collection Period referred
to in Section 9.1. The Servicer will deposit the aggregate Purchase Amount
with respect to Purchased Receivables when such obligations are due, unless
the Servicer shall not be required to make daily deposits pursuant to
Section 5.2, in which case such deposits shall be made on the Transfer Date
following the related Collection Period.
SECTION E. Distributions. 1. On each Determination Date, the Servicer
shall calculate all amounts required to determine the amounts to be
deposited in the Note Distribution Account, the Certificate Distribution
Account and the Spread Account.
2. On each Payment Date, the Servicer shall instruct the Indenture
Trustee (based on the information contained in the Servicer's Certificate
delivered on the related Determination Date pursuant to Section 4.8) to make
the following deposits and distributions for receipt by the Servicer or
deposit in the applicable Trust Account or Certificate Distribution Account,
as applicable, by 10:00 a.m. (New York time), to the extent of the Total
Distribution Amount, in the following order of priority:
(a) to the Servicer, if other than Credit or an Affiliate of
Credit, the Servicing Fee and all unpaid Servicing Fees owed to such
Servicer from prior Collection Periods;
(b) to the Administrator, from the Interest Distribution Amount,
the Administration Fee and all unpaid Administration Fees from prior
Collection Periods;
(c) to the Note Distribution Account, the Class A Noteholders'
Interest Distributable Amount;
(d) to the Note Distribution Account, the Class B Noteholders'
Interest Distributable Amount;
(e) to the Note Distribution Account, the A-1 Noteholders'
Principal Distributable Amount;
(f) to the Note Distribution Account, the A-2 Noteholders'
Principal Distributable Amount;
(g) to the Note Distribution Account, the A-3 Noteholders'
Principal Distributable Amount;
(h) to the Note Distribution Account, the Class B Noteholders'
Principal Distributable Amount;
(i) to the Certificate Distribution Account, the
Certificateholders' Interest Distributable Amount;
(j) to the Certificate Distribution Account, the
Certificateholders' Principal Distributable Amount;
(k) to the Servicer, if the Servicer is Credit or an Affiliate of
Credit, the Servicing Fee and all unpaid Servicing Fees from prior
Collection Periods; and
(l) to the Spread Account, the remaining Total Distribution
Amount.
SECTION F. Spread Account. 1. On the Closing Date and on each
Subsequent Transfer Date, the Seller shall deposit the applicable Spread
Account Initial Deposit into the Spread Account.
2. If the amount on deposit in the Spread Account on any Payment Date
(after giving effect to all deposits or withdrawals therefrom on such
Payment Date) is greater than the Specified Spread Account Balance for such
Payment Date, the Servicer shall instruct the Indenture Trustee to
distribute the amount of the excess to the Seller (and its transferees and
assignees in accordance with their respective interests); provided, that if,
after giving effect to all payments made on the Notes on such Payment Date,
the sum of the Pool Balance and the Pre-Funded Amount as of the first day of
the Collection Period in which such Payment Date occurs is less than the sum
of the Note Balance and the Certificate Balance, such excess shall not be
distributed to the Seller (or such transferees or assignees) and shall be
retained in the Spread Account for application in accordance with this
Agreement. Amounts properly distributed pursuant to this Section 5.6(b)(i)
shall be deemed released from the Trust and the security interest therein
granted to the Indenture Trustee, and the Seller (and such transferees and
assignees) shall in no event thereafter be required to refund any such
distributed amounts.
3. Following: (i) the payment in full of the aggregate Outstanding
Amount of the Notes and of all other amounts owing or to be distributed
hereunder or under the Indenture to the Noteholders, the Trustee and the
Indenture Trustee and (ii) the termination of the Trust, any amount
remaining on deposit in the Spread Account shall be distributed to the
Seller or any transferee or assignee pursuant to clause (g). The Seller (and
such transferees and assignees) shall in no event be required to refund any
amounts properly distributed pursuant to this Section 5.6(c).
4. In the event that the Noteholders' Distributable Amount for a
Payment Date exceeds the amount deposited into the Note Distribution Account
pursuant to Sections 5.5(b)(iii), (iv), (v), (vi), (vii) and (viii) on such
Payment Date, the Servicer shall instruct the Indenture Trustee on such
Payment Date to withdraw from the Spread Account on such Payment Date an
amount equal to such excess, to the extent of funds available therein (but
subject to clause (f)), and deposit such amount into the Note Distribution
Account.
5. [Reserved]
6. [Reserved]
7. The Seller may at any time, without consent of the Noteholders,
sell, transfer, convey or assign in any manner its rights to and interests
in distributions from the Spread Account, including interest and other
investment earnings thereon; provided, that: the Rating Agency Condition is
satisfied.
SECTION G. Pre-Funding Account. 1. On the Closing Date, the Trustee
will deposit, on behalf of the Seller, in the Pre-Funding Account
$314,947,499 from the net proceeds of the sale of the Notes and the
Certificates. On each Subsequent Transfer Date, the Servicer shall instruct
the Indenture Trustee to withdraw from the Pre-Funding Account (or, once the
balance on deposit in the Pre-Funding Account has been reduced to zero, will
cause the Issuer to make available from the proceeds of issuance of Class B
Notes) an amount equal to: (i) the aggregate Contract Value of the
Subsequent Receivables transferred to the Issuer on such Subsequent Transfer
Date less the Spread Account Initial Deposit for such Subsequent Transfer
Date, and distribute such amount to or upon the order of the Seller upon
satisfaction of the conditions set forth in Section 2.2(b) with respect to
such transfer, and (ii) the Spread Account Initial Deposit for such
Subsequent Transfer Date and, on behalf of the Seller, deposit such amount
in the Spread Account.
2. If: (i) the Pre-Funded Amount has not been reduced to zero on the
Payment Date on which the Funding Period ends (or, if the Funding Period
does not end on a Payment Date, on the first Payment Date following the end
of the Funding Period) or (ii) the Pre-Funded Amount has been reduced to
$100,000 or less on any Determination Date, in either case after giving
effect to any reductions in the Pre-Funded Amount on such date pursuant to
paragraph (a), the Servicer shall instruct the Indenture Trustee to withdraw
from the Pre-Funding Account, in the case of clause (i), on such Payment
Date or, in the case of clause (ii), on the Payment Date immediately
succeeding such Determination Date, the amount remaining at the time in the
Pre-Funding Account (such remaining amount being the "Remaining Pre-Funded
Amount") and deposit such amounts in the Note Distribution Account, so that
such amounts are payable: (A) first, to the A-1 Noteholders, (B) second, to
the A-2 Noteholders and (C) third, to the A-3 Noteholders. If the Remaining
Pre-Funded Amount is greater than $100,000, the Seller will deposit into the
Note Distribution Account an amount equal to the Noteholders' Prepayment
Premium; provided, that the Seller shall be liable for the payment of the
Noteholders' Prepayment Premium solely to the extent the Seller receives
such amounts from Credit pursuant to Section 5.6 of the Purchase Agreement.
SECTION H. Negative Carry Account. On the Closing Date, the Seller
shall deposit the Negative Carry Account Initial Deposit into the Negative
Carry Account. On each Payment Date, the Servicer will instruct the
Indenture Trustee to withdraw from the Negative Carry Account and deposit
into the Collection Account an amount equal to the Negative Carry Amount for
such Collection Period. If the amount on deposit in the Negative Carry
Account on any Payment Date (after giving effect to the withdrawal therefrom
of the Negative Carry Amount for such Payment Date) is greater than the
Required Negative Carry Account Balance, the excess will be released to the
Seller.
SECTION I. [Intentionally Omitted].
SECTION J. Statements to Certificateholders and Noteholders. 1.On
each Determination Date the Servicer shall provide to the Indenture Trustee
(with a copy to the Rating Agencies), for the Indenture Trustee to forward
to each Noteholder of record, and to the Trustee, for the Trustee to forward
to each Certificateholder of record, a statement substantially in the form
of Exhibits A and B, respectively, setting forth at least the following
information as to each Class of the Notes and the Certificates to the extent
applicable:
(a) the amount of such distribution allocable to principal of
each Class of Notes;
(b) the amount of the distribution allocable to interest of each
Class of Notes;
(c) the amount of the distribution allocable to principal of the
Certificates;
(d) the amount of the distribution allocable to interest of the
Certificates;
(e) the Pool Balance as of the close of business on the last day
of the preceding Collection Period;
(f) the aggregate Outstanding Amount and the Note Pool Factor for
each Class of Notes, and the Certificate Balance and the Certificate
Pool Factor as of such Payment Date, after giving effect to payments
allocated to principal reported under clauses (i) and (iii) above;
(g) the amount of the Servicing Fee paid to the Servicer with
respect to the preceding Collection Period;
(h) the amount of the Administration Fee paid to the
Administrator in respect of the preceding Collection Period;
(i) the amount of the aggregate Realized Losses, if any, for such
Collection Period;
(j) the aggregate Purchase Amounts for Receivables, if any, that
were repurchased or purchased in such Collection Period;
(k) the balance of the Spread Account on such Payment Date, after
giving effect to changes therein on such Payment Date;
(l) for Payment Dates during the Funding Period, the remaining
Pre-Funded Amount;
(m) for the final Payment Date with respect to the Funding
Period, the amount of any remaining Pre-Funded Amount that has not
been used to fund the purchase of Subsequent Receivables;
(n) [intentionally omitted]; and
(o) the balance of the Negative Carry Account on such Payment
Date, after giving effect to changes therein on such Payment Date.
Each amount set forth pursuant to clauses (i), (ii), (iii), (iv), (vii) and
(viii) shall be expressed as a dollar amount per $1,000 of original
principal balance of a Certificate or Note, as applicable.
SECTION K. Net Deposits. As an administrative convenience, unless the
Servicer is required to remit collections daily, the Servicer will be
permitted to make the deposit of collections net of distributions, if any,
to be made to the Servicer with respect to the Collection Period. The
Servicer, however, will account to the Trustee, the Indenture Trustee, the
Noteholders and the Certificateholders as if all deposits, distributions and
transfers were made individually.
ARTICLE XVII.
The Seller
SECTION A. Representations of Seller. The Seller makes the following
representations on which the Issuer is deemed to have relied in acquiring
the Receivables. The representations speak as of the execution and delivery
of this Agreement and shall survive the sale of the Receivables to the
Issuer and the pledge thereof to the Indenture Trustee pursuant to the
Indenture.
1. Organization and Good Standing. The Seller is duly organized
and validly existing as a corporation in good standing under the laws
of the State of Delaware, with the corporate power and authority to
own its properties and to conduct its business as such properties are
currently owned and such business is presently conducted, and had at
all relevant times, and has, the corporate power, authority and legal
right to acquire, own and sell the Receivables.
2. Due Qualification. The Seller is duly qualified to do
business as a foreign corporation in good standing, and has obtained
all necessary licenses and approvals, in all jurisdictions in which
the ownership or lease of property or the conduct of its business
shall require such qualifications.
3. Power and Authority. The Seller has the power and authority
to execute and deliver this Agreement and to carry out its terms; the
Seller has full power and authority to sell and assign the property to
be sold and assigned to and deposited with the Issuer and has duly
authorized such sale and assignment to the Issuer by all necessary
corporate action; and the execution, delivery and performance of this
Agreement have been, and the execution, delivery and performance of
each Subsequent Transfer Assignment have been or will be on or before
the related Subsequent Transfer Date, duly authorized by the Seller by
all necessary corporate action.
4. Binding Obligation. This Agreement constitutes, and each
Subsequent Transfer Assignment when executed and delivered by the
Seller will constitute, a legal, valid and binding obligation of the
Seller enforceable in accordance with their terms.
5. No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof
do not conflict with, result in any breach of any of the terms and
provisions of, or constitute (with or without notice or lapse of time)
a default under, the certificate of incorporation or by-laws of the
Seller, or any indenture, agreement or other instrument to which the
Seller is a party or by which it shall be bound; or result in the
creation or imposition of any Lien upon any of its properties pursuant
to the terms of any such indenture, agreement or other instrument
(other than the Basic Documents); or violate any law or, to the best
of the Seller's knowledge, any order, rule or regulation applicable to
the Seller of any court or of any Federal or state regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Seller or its properties.
6. No Proceedings. There are no proceedings or investigations
pending or, to the Seller's best knowledge, threatened, before any
court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or its properties:
(i) asserting the invalidity of this Agreement, the Indenture or any
of the other Basic Documents, the Notes or the Certificates, (ii)
seeking to prevent the issuance of the Notes or the Certificates or
the consummation of any of the transactions contemplated by this
Agreement, the Indenture or any of the other Basic Documents, (iii)
seeking any determination or ruling that could reasonably be expected
to materially and adversely affect the performance by the Seller of
its obligations under, or the validity or enforceability of, this
Agreement, the Indenture, any of the other Basic Documents, the Notes
or the Certificates or (iv) that might adversely affect the Federal or
state income tax attributes of the Notes or the Certificates.
SECTION B. Corporate Existence. 1. During the term of this Agreement,
the Seller will keep in full force and effect its existence, rights and
franchises as a corporation under the laws of the jurisdiction 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, the Basic
Documents and each other instrument or agreement necessary or appropriate to
the proper administration of this Agreement and the transactions
contemplated hereby.
2. During the term of this Agreement, the Seller shall observe the
applicable legal requirements for the recognition of the Seller as a legal
entity separate and apart from its Affiliates, including as follows:
(a) the Seller shall maintain corporate records and books of
account separate from those of its Affiliates;
(b) except as otherwise provided in this Agreement and similar
arrangements relating to other securitizations, the Seller shall not
commingle its assets and funds with those of its Affiliates;
(c) the Seller shall hold such appropriate meetings or obtain
such appropriate consents of its Board of Directors as are necessary
to authorize all the Seller's corporate actions required by law to be
authorized by the Board of Directors, shall keep minutes of such
meetings and of meetings of its stockholder(s) and observe all other
customary corporate formalities (and any successor Seller not a
corporation shall observe similar procedures in accordance with its
governing documents and applicable law);
(d) the Seller shall at all times hold itself out to the public
under the Seller's own name as a legal entity separate and distinct
from its Affiliates; and
(e) all transactions and dealings between the Seller and its
Affiliates will be conducted on an arm's-length basis.
SECTION C. Liability of Seller; Indemnities. The Seller shall be
liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Seller under this Agreement.
1. The Seller shall indemnify, defend and hold harmless the
Issuer, the Trustee and the Indenture Trustee (and their officers,
directors, employees and agents) from and against any taxes that may
at any time be asserted against any of them with respect to the sale
of the Receivables to the Issuer or the issuance and original sale of
the Certificates and the Notes, including any sales, gross receipts,
general corporation, tangible personal property, privilege or license
taxes (but, in the case of the Issuer, not including any taxes
asserted with respect to ownership of the Receivables or Federal or
other income taxes arising out of the transactions contemplated by
this Agreement) and costs and expenses in defending against the same.
2. The Seller shall indemnify, defend and hold harmless the
Issuer, the Trustee and the Indenture Trustee (and their officers,
directors, employees and agents) from and against any loss, liability
or expense incurred by reason of: (i) the Seller's willful
misfeasance, bad faith or negligence in the performance of its duties
under this Agreement, or by reason of reckless disregard of its
obligations and duties under this Agreement and (ii) the Seller's or
the Issuer's violation of Federal or State securities laws in
connection with the offering and sale of the Notes and the
Certificates.
Indemnification under this Section shall survive the resignation or
removal of the Trustee or the Indenture Trustee or the termination of this
Agreement and the Indenture and shall include reasonable fees and expenses
of counsel and expenses of litigation. If the Seller shall have made any
indemnity payments pursuant to this Section and the Person to or on behalf
of whom such payments are made thereafter shall collect any of such amounts
from others, such Person shall promptly repay such amounts to the Seller,
without interest.
SECTION D. Merger or Consolidation of, or Assumption of the
Obligations of, Seller. Any Person: (a) into which the Seller may be merged
or consolidated, (b) that may result from any merger or consolidation to
which the Seller shall be a party or (c) that may succeed to the properties
and assets of the Seller substantially as a whole, which Person (in any of
the foregoing cases) executes an agreement of assumption to perform every
obligation of the Seller under this Agreement (or is deemed by law to have
assumed such obligations), shall be the successor to the Seller hereunder
without the execution or filing of any document or any further act by any of
the parties to this Agreement; provided, however, that: (i) immediately
after giving effect to such transaction, no representation or warranty made
pursuant to Section 3.1 shall have been breached and no Servicer Default,
and no event that, after notice or lapse of time, or both, would become a
Servicer Default shall have occurred and be continuing, (ii) the Seller
shall have delivered to the Trustee and the Indenture Trustee an Officers'
Certificate and an Opinion of Counsel each stating that such consolidation,
merger or succession and such agreement of assumption comply with this
Section and that all conditions precedent, if any, provided for in this
Agreement relating to such transaction have been complied with, (iii) the
Rating Agency Condition shall have been satisfied with respect to such
transaction and (iv) the Seller shall have delivered to the Trustee and the
Indenture Trustee an Opinion of Counsel either: (A) stating that, in the
opinion of such counsel, all financing statements, continuation statements
and amendments thereto have been executed and filed that are necessary fully
to preserve and protect the interest of the Trustee and Indenture Trustee,
respectively, in the Receivables and reciting the details of such filings,
or (B) stating that, in the opinion of such counsel, no such action shall be
necessary to preserve and protect such interests. Notwithstanding anything
herein to the contrary, the execution of the foregoing agreement of
assumption and compliance with clauses (i), (ii), (iii) and (iv) shall be
conditions to the consummation of the transactions referred to in clauses
(a), (b) or (c).
SECTION E. Limitation on Liability of Seller and Others. The Seller
and any director, officer, employee or agent of the Seller may rely in good
faith on the advice of counsel or on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder. The Seller shall not be under any obligation to appear in,
prosecute or defend any legal action that shall not be incidental to its
obligations under this Agreement, and that in its opinion may involve it in
any expense or liability.
SECTION F. Seller May Own Certificates or Notes. The Seller and any
Affiliate thereof may in its individual or any other capacity become the
owner or pledgee of Certificates or the Notes with the same rights as it
would have if it were not the Seller or an Affiliate thereof, except as
expressly provided herein or in any other Basic Document.
Notwithstanding the foregoing, the Seller will not sell the
Certificates except (a) to an entity that is not an Affiliate of the Seller
or (b) to an Affiliate of the Seller that (i) is a subsidiary of Credit, the
Certificate of Incorporation of which contains restrictions substantially
similar to the restrictions contained in the Certificate of Incorporation of
the Seller and (ii) has provided an opinion of counsel regarding substantive
consolidation of such Affiliate with Credit in the event of a bankruptcy
filing by Credit which is substantially similar to the opinion of counsel
provided by Seller on March 18, 1997, and which may be subject to the same
assumptions and qualifications as that opinion.
ARTICLE XVIII.
The Servicer
SECTION A. Representations of Servicer. The Servicer makes the
following representations on which the Issuer is deemed to have relied in
acquiring the Receivables. The representations speak as of the execution and
delivery of the Agreement and as of the Closing Date, in the case of the
Initial Receivables, and as of the applicable Subsequent Transfer Date, in
the case of the Subsequent Receivables, and shall survive the sale of the
Receivables to the Issuer and the pledge thereof to the Indenture Trustee
pursuant to the Indenture.
1. Organization and Good Standing. The Servicer is duly
organized and validly existing as a corporation in good standing under
the laws of the state of its incorporation, with the corporate power
and authority to own its properties and to conduct its business as
such properties are currently owned and such business is presently
conducted, and had at all relevant times, and has, the power,
authority and legal right to acquire, own, sell and service the
Receivables and to hold the Receivable Files as custodian.
2. Due Qualification. The Servicer is duly qualified to do
business as a foreign corporation in good standing, and has obtained
all necessary licenses and approvals, in all jurisdictions in which
the ownership or lease of property or the conduct of its business
(including the servicing of the Receivables as required by this
Agreement) shall require such qualifications.
3. Power and Authority. The Servicer has the corporate power and
authority to execute and deliver this Agreement and to carry out its
terms; and the execution, delivery and performance of this Agreement
have been duly authorized by the Servicer by all necessary corporate
action.
4. Binding Obligation. This Agreement constitutes a legal, valid
and binding obligation of the Servicer enforceable against the
Servicer in accordance with its terms.
5. No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof
shall not conflict with, result in any breach of any of the terms and
provisions of, or constitute (with or without notice or lapse of time)
a default under, the articles of incorporation or by-laws of the
Servicer, or any indenture, agreement or other instrument to which the
Servicer is a party or by which it shall be bound; or result in the
creation or imposition of any Lien upon any of its properties pursuant
to the terms of any such indenture, agreement or other instrument
(other than this Agreement); or violate any law or, to the best of the
Servicer's knowledge, any order, rule or regulation applicable to the
Servicer of any court or of any Federal or state regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Servicer or its properties.
6. No Proceedings. There are no proceedings or investigations
pending, or, to the Servicer's best knowledge, threatened, before any
court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Servicer or its
properties: (i) asserting the invalidity of this Agreement, the
Indenture, any of the other Basic Documents, the Notes or the
Certificates, (ii) seeking to prevent the issuance of the Notes or the
Certificates or the consummation of any of the transactions
contemplated by this Agreement, the Indenture or any of the other
Basic Documents, (iii) seeking any determination or ruling that could
reasonably be expected to materially and adversely affect the
performance by the Servicer of its obligations under, or the validity
or enforceability of, this Agreement, the Indenture, any of the other
Basic Documents, the Notes or the Certificates or (iv) relating to the
Servicer and that might adversely affect the Federal or state income
tax attributes of the Notes or the Certificates.
7. No Insolvent Obligors. As of the Initial Cutoff Date or, in
the case of the Subsequent Receivables, as of the related Subsequent
Cutoff Date, no Obligor is shown on the Receivable Files as the
subject of a bankruptcy proceeding.
SECTION B. Indemnities of Servicer. The Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically
undertaken by the Servicer under this Agreement.
1. The Servicer shall defend, indemnify and hold harmless the
Issuer, the Trustee, the Indenture Trustee, the Noteholders, the
Certificateholders and the Seller (and any of their officers,
directors, employees and agents) from and against any and all costs,
expenses, losses, damages, claims and liabilities, arising out of or
resulting from:
(a) the use, ownership or operation by the Servicer or any
Affiliate thereof of any of the Financed Equipment;
(b) any taxes that may at any time be asserted against any
such Person with respect to the transactions contemplated herein,
including any sales, gross receipts, general corporation,
tangible personal property, privilege or license taxes (but, in
the case of the Issuer, not including any taxes asserted with
respect to, and as of the date of, the sale of the Receivables to
the Issuer or the issuance and original sale of the Certificates,
the Notes, or asserted with respect to ownership of the
Receivables, or Federal or other income taxes arising out of
distributions on the Certificates or the Notes) and costs and
expenses in defending against the same; and
(c) the negligence, willful misfeasance or bad faith of the
Servicer in the performance of its duties under this Agreement or
by reason of reckless disregard of its obligations and duties
under this Agreement.
2. The Servicer shall indemnify, defend and hold harmless the
Trustee and the Indenture Trustee (and their respective officers,
directors, employees and agents) from and against all costs, expenses,
losses, claims, damages and liabilities arising out of or incurred in
connection with the acceptance or performance of the trusts and duties
herein and, in the case of the Trustee, in the Trust Agreement
contained, and, in the case of the Indenture Trustee, in the Indenture
contained, except to the extent that such cost, expense, loss, claim,
damage or liability:
(a) shall be due to the willful misfeasance, bad faith or
negligence (except for errors in judgment) of the Trustee or the
Indenture Trustee as applicable; or
(b) shall arise from the breach by the Trustee of any of
its representations or warranties set forth in Section 7.3 of the
Trust Agreement.
3. The Servicer shall pay any and all taxes levied or assessed
upon all or any part of the Trust Estate.
4. The Servicer shall pay the Indenture Trustee and the Trustee
from time to time reasonable compensation for all services rendered by
the Indenture Trustee under the Indenture or by the Trustee under the
Trust Agreement (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an
express trust).
5. The Servicer shall, except as otherwise expressly provided in
the Indenture or the Trust Agreement, reimburse either the Indenture
Trustee or the Trustee, respectively, upon its request for all
reasonable expenses, disbursements and advances incurred or made in
accordance with the Indenture or the Trust Agreement, respectively,
(including the reasonable compensation, expenses and disbursements of
its agents and either in-house counsel or outside counsel, but not
both), except any such expense, disbursement or advance as may be
attributable to the Indenture Trustee's or the Trustee's, respectively
negligence, bad faith or willful misfeasance.
For purposes of this Section, in the event of the termination of the
rights and obligations of the Servicer pursuant to Section 8.1, or a
resignation by the Servicer pursuant to this Agreement, the Servicer shall
be deemed to be the Servicer pending appointment of a successor Servicer
pursuant to Section 8.2.
Indemnification under this Section shall survive the resignation or
removal of the Trustee or the Indenture Trustee or the termination of this
Agreement, the Trust Agreement and the Indenture and shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Servicer shall have made any indemnity payments pursuant to this Section and
the Person to or on behalf of whom such payments are made thereafter
collects any of such amounts from others, such Person shall promptly repay
such amounts to the Servicer, without interest.
SECTION C. Merger or Consolidation of, or Assumption of the
Obligations of, Servicer. Any Person: (a) into which the Servicer may be
merged or consolidated, (b) that may result from any merger or consolidation
to which the Servicer shall be a party, or (c) that may succeed to the
properties and assets of the Servicer substantially as a whole, which Person
(in any of the foregoing circumstances) executes an agreement of assumption
to perform every obligation of the Servicer hereunder (or is deemed by law
to have assumed such obligations), shall be the successor to the Servicer
under this Agreement without further act on the part of any of the parties
to this Agreement; provided, however, that: (i) immediately after giving
effect to such transaction, no Servicer Default, and no event that, after
notice or lapse of time, or both, would become a Servicer Default shall have
occurred and be continuing, (ii) the Servicer shall have delivered to the
Trustee and Indenture Trustee an Officers' Certificate and an Opinion of
Counsel each stating that such consolidation, merger or succession and such
agreement of assumption comply with this Section and that all conditions
precedent, if any, provided for in this Agreement relating to such
transaction have been complied with, (iii) the Rating Agencies shall have
received at least ten days' prior written notice of such transaction and
(iv) the Servicer shall have delivered to the Trustee and the Indenture
Trustee an Opinion of Counsel either: (A) stating that, in the opinion of
such counsel, all financing statements, continuation statements and
amendments thereto have been executed and filed that are necessary fully to
preserve and protect the interest of the Trustee and the Indenture Trustee,
respectively, in the Receivables and reciting the details of such filings,
or (B) stating that, in the opinion of such counsel, no such action shall be
necessary to preserve and protect such interests. Notwithstanding anything
herein to the contrary, the execution of the foregoing agreement of
assumption and compliance with clauses (i), (ii), (iii) and (iv) shall be
conditions to the consummation of the transactions referred to in clauses
(a), (b) or (c).
SECTION D. Limitation on Liability of Servicer and Others. Neither
the Servicer nor any of the directors, officers, employees or agents of the
Servicer shall be under any liability to the Issuer, the Noteholders or the
Certificateholders, except as provided under this Agreement, for any action
taken or for refraining from the taking of any action pursuant to this
Agreement or for errors in judgment; provided, however, that this provision
shall not protect the Servicer or any such Person against any liability that
would otherwise be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of its duties or by reason of reckless
disregard of obligations and duties under this Agreement. The Servicer and
any director, officer, employee or agent of the Servicer may rely in good
faith on the advice of counsel or on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder.
Except as provided in this Agreement, the Servicer shall not be under
any obligation to appear in, prosecute or defend any legal action that shall
not be incidental to its duties to service the Receivables in accordance
with this Agreement, and that in its opinion may involve it in any expense
or liability; provided, however, that the Servicer may undertake any
reasonable action that it may deem necessary or desirable in respect of this
Agreement, the Basic Documents and the rights and duties of the parties to
this Agreement, the other Basic Documents and the interests of the
Certificateholders under this Agreement and the Noteholders under the
Indenture.
SECTION E. Credit Not to Resign as Servicer. Subject to Section 7.3,
Credit shall not resign from the obligations and duties imposed on it as
Servicer under this Agreement except upon determination that the performance
of its duties under this Agreement shall no longer be permissible under
applicable law. Notice of any such determination shall be communicated to
the Trustee and the Indenture Trustee at the earliest practicable time (and,
if such communication is not in writing, shall be confirmed in writing at
the earliest practicable time) and any such determination shall be evidenced
by an Opinion of Counsel to such effect delivered to the Trustee and the
Indenture Trustee concurrently with or promptly after such notice. No such
resignation shall become effective until the Indenture Trustee or a
successor Servicer shall have assumed the responsibilities and obligations
of Credit in accordance with Section 8.2.
SECTION F. Servicer to Act as Administrator. In the event of the
resignation or removal of the Administrator and the failure of a successor
Administrator to have been appointed and to have accepted such appointment
as successor Administrator, the Servicer shall become the successor
Administrator and shall be bound by the terms of the Administration
Agreement.
ARTICLE XIX.
Default
SECTION A. Servicer Default. If any one of the following events (a
"Servicer Default") shall occur and be continuing:
1. any failure by the Servicer to deliver to the Indenture
Trustee for deposit in any of the Trust Accounts or the Certificate
Distribution Account any required payment or to direct the Indenture
Trustee or the Trustee to make any required distributions therefrom,
which failure continues unremedied for three Business Days after
written notice of such failure is received by the Servicer from the
Trustee or the Indenture Trustee or after discovery of such failure by
an officer of the Servicer;
2. any failure by the Servicer or the Seller, as the case may be,
duly to observe or to perform in any material respect any other
covenants or agreements (other than as set forth in clause (a)) of the
Servicer or the Seller (as the case may be) set forth in this
Agreement or any other Basic Document, which failure shall: (i)
materially and adversely affect the rights of Certificateholders or
Noteholders and (ii) continue 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: (A) to the Servicer or the
Seller (as the case may be) by the Trustee or the Indenture Trustee or
(B) to the Servicer or the Seller (as the case may be) and to the
Trustee and the Indenture Trustee, by the Noteholders or
Certificateholders, as applicable, evidencing not less than 25% of the
Outstanding Amount of the Notes or 25% of the Certificate Balance; or
3. an Insolvency Event occurs with respect to the Seller or the
Servicer;
then, and in each and every case, so long as the Servicer Default shall not
have been remedied, either the Indenture Trustee, or the Holders of Notes
evidencing not less than 25% of the Outstanding Amount of the Notes, by
notice then given in writing to the Servicer (and to the Indenture Trustee
and the Trustee if given by the Noteholders), may terminate all the rights
and obligations (other than the obligations set forth in Section 7.2) of the
Servicer under this Agreement. On or after the receipt by the Servicer of
such written notice, all authority and power of the Servicer under this
Agreement, whether with respect to the Notes, the Certificates, the
Receivables or otherwise, shall, without further action, pass to and be
vested in the Indenture Trustee or such successor Servicer as may be
appointed under Section 8.2; and, without limitation, the Indenture Trustee
and the Trustee are hereby authorized and empowered to execute and deliver,
for the benefit of the predecessor Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement of the Receivables and related documents, or otherwise. The
predecessor Servicer shall cooperate with the successor Servicer, the
Indenture Trustee and the Trustee in effecting the termination of the
responsibilities and rights of the predecessor Servicer under this
Agreement, including the transfer to the successor Servicer for
administration by it of: (i) all cash amounts that shall at the time be held
by the predecessor Servicer for deposit, or shall thereafter be received by
it with respect to a Receivable and (ii) all Receivable Files. All
reasonable costs and expenses (including attorneys' fees) incurred in
connection with transferring the Receivable Files to the successor Servicer
and amending this Agreement to reflect its succession as Servicer shall be
paid by the predecessor Servicer upon presentation of reasonable
documentation of such costs and expenses. Upon receipt of notice of the
occurrence of a Servicer Default, the Trustee shall give notice thereof to
the Rating Agencies.
SECTION B. Appointment of Successor Servicer. 1. Upon the Servicer's
receipt of notice of termination, pursuant to Section 8.1, or the Servicer's
resignation in accordance with this Agreement, the predecessor Servicer
shall continue to perform its functions as Servicer under this Agreement, in
the case of termination, only until the date specified in such termination
notice or, if no such date is specified in a notice of termination, until
receipt of such notice and, in the case of resignation, until the later of:
(x) the date 45 days from the delivery to the Trustee and the Indenture
Trustee of written notice of such resignation (or written confirmation of
such notice) in accordance with this Agreement and (y) the date upon which
the predecessor Servicer shall become unable to act as Servicer, as
specified in the notice of resignation and accompanying Opinion of Counsel.
In the event of the Servicer's termination hereunder, the Issuer shall
appoint a successor Servicer acceptable to the Indenture Trustee, and the
successor Servicer shall accept its appointment by a written assumption in
form acceptable to the Indenture Trustee. In the event that a successor
Servicer has not been appointed at the time when the predecessor Servicer
has ceased to act as Servicer in accordance with this Section, the Indenture
Trustee without further action shall automatically be appointed the
successor Servicer and shall be entitled to the Servicing Fee.
Notwithstanding the above, the Indenture Trustee shall, if it shall be
unable so to act, appoint or petition a court of competent jurisdiction to
appoint any established institution, having a net worth of not less than
$50,000,000 and whose regular business shall include the servicing of
receivables, as the successor to the Servicer under this Agreement.
2. Upon appointment, the successor Servicer (including the Indenture
Trustee acting as successor Servicer) shall be the successor in all respects
to the predecessor Servicer (except with respect to responsibilities and
obligations of the predecessor Servicer set forth in Section 7.2) and shall
be subject to all the responsibilities, duties and liabilities arising
thereafter relating thereto placed on the predecessor Servicer and shall be
entitled to the Servicing Fee and all the rights granted to the predecessor
Servicer by this Agreement.
3. Subject to the last sentence of clause (a), the Servicer may not
resign unless it is prohibited from serving as such by law as evidenced by
an Opinion of Counsel to such effect delivered to the Indenture Trustee and
the Trustee.
SECTION C. Notification to Noteholders and Certificateholders. Upon
any termination of, or appointment of a successor to, the Servicer pursuant
to this Article VIII, the Trustee shall give prompt written notice thereof
to the Certificateholders and the Indenture Trustee shall give prompt
written notice thereof to the Noteholders and the Rating Agencies.
SECTION D. Waiver of Past Defaults. The Noteholders of Notes
evidencing not less than a majority of the Note Balance (or the Holders (as
defined in the Trust Agreement) of Certificates evidencing not less than a
majority of the Certificate Balance, in the case of any default that does
not adversely affect the Indenture Trustee or the Noteholders) may, on
behalf of all the Noteholders and Certificateholders, waive in writing any
default by the Servicer in the performance of its obligations hereunder and
its consequences, except a default in making any required deposits to or
payments from any of the Trust Accounts in accordance with this Agreement.
Upon any such waiver of a past default, such default shall cease to exist,
and any Servicer 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.
ARTICLE XX.
Termination
SECTION A. Optional Purchase of All Receivables. 1. As of the first
day of any Collection Period immediately preceding a Payment Date as of
which the Pool Balance is 10% or less of the Initial Pool Balance, the
Servicer shall have the option to purchase all of the Trust Estate, other
than the Trust Accounts. To exercise such option, the Servicer shall
deposit, pursuant to Section 5.4, in the Collection Account an amount equal
to the aggregate Purchase Amount for the Receivables plus the appraised
value of any such other property held by the Trust, such value to be
determined by an appraiser mutually agreed upon by the Servicer, the Trustee
and the Indenture Trustee, and shall succeed to all interests in, to and
under the Trust Estate, other than the Trust Accounts.
2. Upon any sale of the assets of the Trust pursuant to Section 9.2
of the Trust Agreement, the Servicer shall instruct the Indenture Trustee to
deposit the proceeds from such sale after all payments and reserves
therefrom have been made (the "Insolvency Proceeds") in the Collection
Account. On the Payment Date on, or, if such proceeds are not so deposited
on a Payment Date, on the first Payment Date following the date on which the
Insolvency Proceeds are deposited in the Collection Account, the Servicer
shall instruct the Indenture Trustee to make the following deposits (after
the application on such Payment Date of the Total Distribution Amount and
funds on deposit in the Spread Account pursuant to Sections 5.5 and 5.6)
from the Insolvency Proceeds and any funds remaining on deposit in the
Spread Account (including the proceeds of any sale of investments therein as
described in the following sentence):
(a) first, to the Note Distribution Account, any portion of the
Class A Noteholders' Interest Distributable Amount and the Outstanding
Amount of the Class A Notes (after giving effect to the reduction
resulting from the deposits made in the Note Distribution Account on
such Payment Date and on prior Payment Dates) not otherwise deposited
into the Note Distribution Account on such Payment Date;
(b) second, to the Note Distribution Account, any portion of the
Class B Noteholders' Interest Distributable Amount and the Outstanding
Amount of the Class B Notes (after giving effect to the reduction
resulting from the deposits made in the Note Distribution Account on
such Payment Date and on prior Payment Dates) not otherwise deposited
into the Note Distribution Account on such Payment Date;
(c) third, to the Certificate Distribution Account, any portion
of the Certificateholders' Interest Distributable Amount not otherwise
deposited into the Certificate Distribution Account on such Payment
Date; and
(d) fourth, to the Certificate Distribution Account, the
Certificate Balance (after giving effect to the reduction resulting
from the deposits made in the Certificate Distribution Account on such
Payment Date).
Any investments on deposit in the Spread Account that will not mature on or
before such Payment Date shall be sold by the Indenture Trustee at such time
as will result in the Indenture Trustee receiving the proceeds from such
sale not later than the Transfer Date preceding such Payment Date. Any
Insolvency Proceeds remaining after the deposits described above shall be
paid to the Seller.
3. As described in Article IX of the Trust Agreement, notice of any
termination of the Trust shall be given by the Servicer to the Trustee and
the Indenture Trustee as soon as practicable after the Servicer has received
notice thereof.
4. Following the satisfaction and discharge of the Indenture and the
payment in full of the principal of and interest on the Notes, the
Certificateholders will succeed to the rights of the Noteholders hereunder
and the Trustee will succeed to the rights of, and assume the obligations
of, the Indenture Trustee pursuant to this Agreement.
ARTICLE XXI.
Miscellaneous Provisions
SECTION A. Amendment. The Agreement may be amended from time to time
by a written amendment duly executed and delivered by the Seller, the
Servicer and the Issuer, with the written consent of the Indenture Trustee,
but without the consent of any of the Noteholders or the Certificateholders,
to cure any ambiguity, to correct or supplement any provisions in this
Agreement or for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions in this Agreement or of
modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel delivered to the Trustee and the
Indenture Trustee, adversely affect in any material respect the interests of
any Noteholder or Certificateholder.
The Specified Spread Account Balance may be reduced or the definition
thereof otherwise modified without the consent of any of the Noteholders or
the Certificateholders if the Rating Agency Condition is satisfied.
This Agreement may also be amended from time to time by the Seller,
the Servicer and the Issuer, with the written consent of the Indenture
Trustee, but without the consent of any of the Noteholders or the
Certificateholders, to: (x) replace the Spread Account with another form of
credit enhancement as long as such substitution will not result in a
reduction or withdrawal of the rating of any Class of the Notes or the
Certificates or (y) add credit enhancement for the benefit of any Class of
the Notes or the Certificates.
This Agreement may also be amended from time to time by the Seller,
the Servicer and the Issuer, with the written consent of (a) the Indenture
Trustee, (b) Noteholders holding Notes evidencing not less than a majority
of the Note Balance, and (c) the Holders (as defined in the Trust Agreement)
of Certificates evidencing not less than a majority of the Certificate
Balance, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that no such amendment shall: (a)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Receivables or distributions that
shall be required to be made for the benefit of the Noteholders or the
Certificateholders or (b) reduce the aforesaid percentage of the Notes and
the Certificates that are required to consent to any such amendment, without
the consent of the holders of all the outstanding Notes and Certificates.
Promptly after the execution of any such amendment or consent (or, in
the case of the Rating Agencies, 10 days prior thereto), the Trustee shall
furnish written notification of the substance of such amendment or consent
to each Certificateholder, the Indenture Trustee and each of the Rating
Agencies.
It shall not be necessary for the consent of Certificateholders or the
Noteholders pursuant to this Section to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent
shall approve the substance thereof.
Prior to the execution of any amendment to this Agreement, the Trustee
and the Indenture Trustee shall be entitled to receive and rely upon: (i) an
Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and that all conditions precedent
to such execution and delivery by the Trustee and the Indenture Trustee have
been satisfied and (ii) the Opinion of Counsel referred to in Section
10.2(i)(1). The Trustee and the Indenture Trustee may, but shall not be
obligated to, enter into any such amendment that affects the Trustee's or
the Indenture Trustee's, as applicable, own rights, duties or immunities
under this Agreement or otherwise.
SECTION B. Protection of Title to Trust. 1. The Seller shall execute
and file such financing statements, and cause to be executed and filed such
continuation statements, all in such manner and in such places as may be
required by applicable law fully to preserve, maintain and protect the
right, title and interest of the Issuer and the interests of the Indenture
Trustee in the Receivables, the other property sold hereunder and in the
proceeds thereof. The Seller shall deliver (or cause to be delivered) to the
Trustee and the Indenture Trustee file-stamped copies of, or filing receipts
for, any document filed as provided above as soon as available following
such filing. The Issuer and the Indenture Trustee shall cooperate fully with
the Seller in connection with the obligations set forth above and will
execute any and all documents reasonably required to fulfill the intent of
this paragraph.
2. Neither the Seller nor the Servicer shall change its name,
identity or corporate structure in any manner that would, could or might
make any financing statement or continuation statement filed in accordance
with paragraph (a) seriously misleading within the applicable provisions of
the UCC, unless it shall have given the Trustee and the Indenture Trustee at
least five days' prior written notice thereof and shall have promptly filed
appropriate amendments to all previously filed financing statements or
continuation statements.
3. Each of the Seller and the Servicer shall have an obligation to
give the Trustee and the Indenture Trustee at least 60 days' prior written
notice of any relocation of its principal executive office if, 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 promptly file any such
amendment. The Servicer shall at all times maintain each office from which
it shall service Receivables, and its principal executive office, within the
United States of America.
4. The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit: (i) the reader
thereof to know at any time the status of such Receivable, including
payments and recoveries made and payments owing (and the nature of each) and
(ii) reconciliation between payments or recoveries on (or with respect to)
each Receivable and the amounts from time to time deposited in the
Collection Account in respect of such Receivable.
5. The Servicer shall maintain its computer systems so that, from and
after the time of sale under this Agreement of the Receivables, the
Servicer's master computer records (including any backup archives) that
refer to a Receivable shall indicate clearly the interest of the Issuer and
the Indenture Trustee in such Receivable and that such Receivable is owned
by the Issuer and has been pledged to ▇▇▇▇▇▇, as Indenture Trustee.
Indication of the Issuer's and the Indenture Trustee's interest in a
Receivable may be deleted from or modified on the Servicer's computer
systems when, and only when, the related Receivable shall have been paid in
full or repurchased.
6. If at any time the Seller or the Servicer shall propose to sell,
grant a security interest in, or otherwise transfer any interest in
equipment receivables to any prospective purchaser, lender or other
transferee, the Servicer shall give to such prospective purchaser, lender or
other transferee computer tapes, records or printouts (including any
restored from backup archives) that, if they shall refer in any manner
whatsoever to any Receivable, shall indicate clearly that such Receivable
has been sold and is owned by the Issuer and has been pledged to the
Indenture Trustee.
7. The Servicer shall permit the Indenture Trustee and its agents at
any time during normal business hours to inspect, audit and make copies of
and abstracts from the Servicer's records regarding any Receivable.
8. Upon request, the Servicer shall furnish to the Trustee or to the
Indenture Trustee, within five Business Days, a list of all Receivables (by
contract number and name of Obligor) then held as part of the Trust,
together with a reconciliation of such list to the Schedule of Receivables
and to each of the Servicer's Certificates furnished before such request
indicating removal of Receivables from the Trust.
9. The Servicer shall deliver to the Trustee and the Indenture
Trustee:
(1) promptly after the execution and delivery of this Agreement
and of each amendment hereto, an Opinion of Counsel either: (A)
stating that, in the opinion of such counsel, all financing statements
and continuation statements have been executed and filed that are
necessary fully to preserve and protect the interest of the Trustee
and the Indenture Trustee in the Receivables, and reciting the details
of such filings or referring to prior Opinions of Counsel in which
such details are given, or (B) stating that, in the opinion of such
counsel, no such action shall be necessary to preserve and protect
such interest; and
(2) within 90 days after the beginning of each calendar year
beginning with the first calendar year beginning more than three
months after the Initial Cutoff Date, an Opinion of Counsel, dated as
of a date during such 90-day period, either: (A) stating that, in the
opinion of such counsel, all financing statements and continuation
statements have been executed and filed that are necessary fully to
preserve and protect the interest of the Trustee and the Indenture
Trustee in the Receivables, and reciting the details of such filings
or referring to prior Opinions of Counsel in which such details are
given, or (B) stating that, in the opinion of such counsel, no such
action shall be necessary to preserve and protect such interest.
Each Opinion of Counsel referred to in clause (1) or (2) shall specify
any action necessary (as of the date of such opinion) to be taken in the
following year to preserve and protect such interest.
10. The Seller shall, to the extent required by applicable law, cause
the Certificates and the Notes to be registered with the Commission pursuant
to Section 12(b) or Section 12(g) of the Exchange Act within the time
periods specified in such sections.
SECTION C. Notices. All demands, notices, directions, instructions
and communications upon or to the Seller, the Servicer, the Issuer, the
Trustee, the Indenture Trustee or the Rating Agencies under this Agreement
shall be in writing, personally delivered or mailed by certified mail,
return receipt requested, and shall be deemed to have been duly given upon
receipt: (a) in the case of the Seller, to Case Receivables II Inc., ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of: Treasurer (telephone
(▇▇▇) ▇▇▇-▇▇▇▇ and facsimile (▇▇▇) ▇▇▇-▇▇▇▇), (b) in the case of the
Servicer, to Case Credit Corporation, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, Attention: Treasurer (telephone (▇▇▇) ▇▇▇-▇▇▇▇ and facsimile (414)
636-6284), (c) in the case of the Issuer or the Trustee, at the Corporate
Trust Office (as defined in the Trust Agreement), with a copy to The Chase
Manhattan Bank, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Structured Finance Services (ABS), (d) in the case of the
Indenture Trustee, at the Corporate Trust Office, (e) in the case of
Moody's, to ▇▇▇▇▇'▇ Investors Service, Inc., ABS Monitoring Department, ▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, and (f) in the case of Standard &
Poor's, to Standard & Poor's Ratings Services, a division of ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc., ▇▇ ▇▇▇▇▇▇▇▇ (▇▇▇▇ ▇▇▇▇▇), ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention of Asset Backed Surveillance Department; or, as to each of the
foregoing, at such other address as shall be designated by written notice to
the other parties.
SECTION D. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 6.4 and 7.3 and as provided
in the provisions of this Agreement concerning the resignation of the
Servicer, this Agreement may not be assigned by the Seller or the Servicer.
SECTION E. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Seller, the Servicer, the
Issuer, the Trustee, the Certificateholders, the Indenture Trustee and the
Noteholders, and nothing in this Agreement, whether express or implied,
shall be construed to give to any other Person any legal or equitable right,
remedy or claim in the Trust Estate or under or in respect of this Agreement
or any covenants, conditions or provisions contained herein.
SECTION F. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any 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 jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
SECTION G. Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed
and delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION H. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define
or limit any of the terms or provisions hereof.
SECTION I. 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 J. Assignment to Indenture Trustee. The Seller hereby
acknowledges and consents to any mortgage, pledge, assignment and grant of a
security interest by the Issuer to the Indenture Trustee pursuant to the
Indenture for the benefit of the Noteholders of all right, title and
interest of the Issuer in, to and under the Receivables and/or the
assignment of any or all of the Issuer's rights and obligations hereunder to
the Indenture Trustee.
SECTION K. Nonpetition Covenants. 1. Notwithstanding any prior
termination of this Agreement, the Servicer and the Seller shall not, prior
to the date that is one year and one day after the termination of this
Agreement, with respect to the Issuer, acquiesce, petition or otherwise
invoke or cause the Issuer to invoke the process of any court or
governmental authority for the purpose of commencing or sustaining a case
against the Issuer 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 Issuer or any
substantial part of its property, or ordering the winding up or liquidation
of the affairs of the Issuer. The foregoing shall not limit the right of the
Servicer and the Seller to file any claim in or otherwise take any action
with respect to any such insolvency proceeding that was instituted against
the Issuer by any Person other than the Servicer or the Seller.
2. Notwithstanding any prior termination of this Agreement, the
Servicer shall not, prior to the date that is one year and one day after the
termination of this Agreement, with respect to the Seller, acquiesce,
petition or otherwise invoke or cause the Seller to invoke the process of
any court or governmental authority for the purpose of commencing or
sustaining a case against the Seller 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 Seller or
any substantial part of its property, or ordering the winding up or
liquidation of the affairs of the Seller. The foregoing shall not limit the
right of the Servicer to file any claim in or otherwise take any action with
respect to any such insolvency proceeding that was instituted against the
Seller by any Person other than the Servicer.
SECTION L. Limitation of Liability of Trustee and Indenture Trustee.
1. Notwithstanding anything contained herein to the contrary, this Agreement
has been countersigned by Chase Manhattan Bank Delaware, not in its
individual capacity but solely in its capacity as Trustee of the Issuer, and
in no event shall Chase Manhattan Bank Delaware, in its individual capacity
or, except as expressly provided in the Trust Agreement, any beneficial
owner of the Issuer have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any
of the certificates, notices or agreements delivered pursuant hereto, as to
all of which recourse shall be had solely to the assets of the Issuer.
2. Notwithstanding anything contained herein to the contrary, this
Agreement has been accepted by ▇▇▇▇▇▇ Trust and Savings Bank, not in its
individual capacity but solely as Indenture Trustee, and in no event shall
▇▇▇▇▇▇ Trust and Savings Bank have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer
hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the
assets of the Issuer.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers as of the day and year first
above written.
CASE EQUIPMENT LOAN TRUST 1997-A
By: CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but solely
as Trustee of the Trust
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Trust Officer
CASE RECEIVABLES II INC.,
as Seller
By: /s/ ▇▇▇▇▇ ▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Treasurer
CASE CREDIT CORPORATION,
as Servicer
By: /s/ ▇▇▇▇▇ ▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Treasurer
Acknowledged and Accepted:
▇▇▇▇▇▇ TRUST AND SAVINGS BANK,
not in its individual capacity
but solely as Indenture Trustee
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Assistant Vice President
SCHEDULE A
to Sale and Servicing Agreement
LOCATION OF RECEIVABLES FILES
Documents relating to the Receivables are located at one of the
following Case Corporation locations:
1. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
2. ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
3. ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
4. ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
5. ▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
6. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
7. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
EXHIBIT A
to Sale and Servicing Agreement
FORM OF NOTEHOLDER'S
STATEMENT PURSUANT TO SECTION 5.10(A)
Payment Date: ______________________
(i) Amount of principal being paid on Notes:
A-1 Notes: ______________ ($_____ per $1,000 original principal
amount)
A-2 Notes: ______________ ($_____ per $1,000 original principal
amount)
A-3 Notes: ______________ ($_____ per $1,000 original principal
amount)
Class B Notes: _____________ ($_____ per $1,000 original principal
amount)
(ii) Amount of interest being paid on Notes:
A-1 Notes: ______________ ($_____ per $1,000 original principal
amount)
A-2 Notes: ______________ ($_____ per $1,000 original principal
amount)
A-3 Notes: ______________ ($_____ per $1,000 original principal
amount)
Class B Notes: _____________ ($_____ per $1,000 original principal
amount)
(iii) Pool Balance at end of the preceding Collection Period: _____
(iv) After giving effect to distributions on this Payment Date:
(a) (1) Outstanding Amount of A-1 Notes: _______
(2) Outstanding Amount of A-2 Notes: _______
(3) Outstanding Amount of A-3 Notes: _______
(4) Outstanding Amount of Class B Notes: _______
(5) A-1 Note Pool Factor: _____
(6) A-2 Note Pool Factor: _____
(7) A-3 Note Pool Factor: _____
(8) Class B Note Pool Factor: _____
(b) (1) Certificate Balance: __________
(2) Certificate Pool Factor: __________
(v) Amount of Servicing Fee: ____ ($_____ per $1,000 original
principal amount)
(vi) Amount of Administration Fee: ____ ($____ per $1,000 original
principal amount)
(vii) Aggregate Amount of Realized Losses for the Collection Period:
__________
(viii) Aggregate Purchase Amounts for the Collection Period: __________
(ix) Balance of Spread Account: __________
(x) Pre-funded Amount: __________
(xi) Balance of Negative Carry Account: __________
EXHIBIT B
to Sale and Servicing Agreement
FORM OF CERTIFICATEHOLDER'S
STATEMENT PURSUANT TO SECTION 5.10(A)
Payment Date: ______________________
(i) Amount of principal being paid or distributed:
(a) (1) A-1 Notes: __________
(2) A-2 Notes: __________
(3) A-3 Notes: __________
(4) Class B Notes: __________
(b) Certificates: ___________ ($_____ per $1,000 original
principal amount)
(c) Total: __________
(ii) Amount of interest being paid or distributed:
(a) (1) A-1 Notes: __________
(2) A-2 Notes: __________
(3) A-3 Notes: __________
(4) Class B Notes: __________
(b) Certificates: ___________ ($_____ per $1,000 original
principal amount)
(c) Total: __________
(iii) Pool Balance at end of the preceding Collection Period: _____
(iv) After giving effect to distributions on this Payment Date:
(a) (1) Outstanding Amount of A-1 Notes: _______
(2) Outstanding Amount of A-2 Notes: _______
(3) Outstanding Amount of A-3 Notes: _______
(4) Outstanding Amount of Class B Notes: _______
(5) A-1 Note Pool Factor: _____
(6) A-2 Note Pool Factor: _____
(7) A-3 Note Pool Factor: _____
(8) Class B Note Pool Factor: _____
(b) (1) Certificate Balance: __________
(2) Certificate Pool Factor: __________
(v) Amount of Servicing Fee: ____ ($_____ per $1,000 original
principal amount)
(vi) Amount of Administration Fee: ____ ($____ per $1,000 original
principal amount)
(vii) Aggregate amount of Realized Losses for the Collection Period:
__________
(viii) Aggregate Purchase Amounts for the Collection Period: __________
(ix) Balance of Spread Account: __________
(x) Pre-Funded Amount:__________
(xi) Balance of Negative Carry Account: __________
EXHIBIT C
to Sale and Servicing Agreement
FORM OF SERVICER'S CERTIFICATE
Chase Manhattan Bank Delaware
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust
The Chase Manhattan Bank, N.A.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Institutional Trust Group- Third Floor
▇▇▇▇▇▇ Trust and Savings Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Indenture Trust Administration
Case Receivables II Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
▇▇▇▇▇'▇ Investors Service, Inc.
ABS Monitoring Department
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Standard & Poor's Ratings Services,
a division of ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
▇▇ ▇▇▇▇▇▇▇▇ (▇▇▇▇ ▇▇▇▇▇)
New York, New York 10004
Attention: Asset Backed Surveillance Department
$71,500,000 Class A-1 Asset-Backed Notes
$282,000,000 Class A-2 Asset-Backed Notes
$259,125,000 Class A-3 Asset-Backed Notes
$26,000,000 Class B Asset-Backed Notes
$11,375,000 Certificates
Determination Date: __-___-__
DISTRIBUTIONS
(1) Total Distribution Amount $________
(2) Servicing Fee $________
(3) Administration Fee $________
(4) Class A Noteholder's Interest Distributable Amount: $________
. Interest on Class A Notes ($________)
. Class A Noteholder's Interest Carryover Shortfall,
if any ($___________)
(5) Class B Noteholders' Interest Distributable Amount $________
. Interest on Class B Notes ($_________)
. Class B Noteholders' Interest Carryover
Shortfall ($_______)
(6) A-1 Noteholders' Principal Distributable Amount $________
. A-1 Noteholders' Monthly Principal Distributable
Amount ($________)
. A-1 Noteholders' Principal Carryover
Shortfall ($________)
(7) A-2 Noteholders' Principal Distributable Amount $________
. A-2 Noteholders' Monthly Principal Distributable
Amount ($________)
. A-2 Noteholders' Principal Carryover
Shortfall ($________)
(8) A-3 Noteholders' Principal Distributable Amount $________
. A-3 Noteholders' Monthly Principal Distributable
Amount ($________)
. A-3 Noteholders' Principal Carryover
Shortfall ($________)
(9) Class B Noteholders' Principal Distributable Amount $________
. Class B Noteholders' Monthly Principal Distributable
Amount ($________)
. Class B Noteholders' Principal Carryover
Shortfall ($________)
(10) NOTEHOLDERS' DISTRIBUTABLE AMOUNT (4)+(5)+(6)+(7)+(8)+(9)$________
(11) Certificateholders' Interest Distributable Amount $________
. Interest on Certificates ($________)
. Certificateholders' Interest Carryover
Shortfall ($________)
(12) Certificateholders' Principal Distributable Amount $________
. Principal Distribution Amount remaining after Class
A Notes paid in full ($________)
. Certificateholders' Principal Carryover Shortfall
($________)
(13) CERTIFICATEHOLDERS' DISTRIBUTABLE AMOUNT (11)+(12) $________
(14) Deposit to Spread Account (1)-((2)+(3)+(10)+(13)) $________
SPREAD ACCOUNT
(15) Spread Account Balance (after deposit from (14)) $________
(16) Specified Spread Account Balance (after all distributions $________
and adjustments): the lesser of:
(a) 2.00% of the Initial Pool Balance; and
(b) the Note Balance.
(17) Spread Account Balance over the Specified Spread Account $________
Balance (15)-(16)
(18) Excess in Spread Account distributed to Seller (as $________
permitted in Sections 5.6(b) and (c) of the Sale and
Servicing Agreement)
(19) Amount to be withdrawn from the Spread Account and $________
deposited into the Note Distribution Account (as per
Sections 5.6(d) and (f) of the Sale and Servicing
Agreement)
(20) Amount to be withdrawn from the Spread Account and $________
deposited into the Certificate Distribution Account
(as per Sections 5.6(e) and (f) of the Sale and
Servicing Agreement)
(21) Final Spread Account Balance (15)-((18)+(19)+(20)) $________
MISCELLANEOUS
(22) Pool Balance at the beginning of this Collection Period $________
(23) After giving effect to all distributions on the Payment
Date during this Collection Period:
(a) Outstanding Amount of A-1 Notes $________
A-1 Note Pool Factor (_._______)
(b) Outstanding Amount of A-2 Notes $________
A-2 Note Pool Factor (_._______)
(c) Outstanding Amount of A-3 Notes $________
A-3 Note Pool Factor (_._______)
(d) Outstanding Amount of Class B Notes
Class B Note Pool Factor (_._______)
(e) Outstanding Amount of Certificates $________
Certificate Pool Factor (_._______)
(24) Aggregate Purchase Amounts for the preceding Collection $________
period
EXHIBIT D
to Sale and Servicing Agreement
FORM OF ASSIGNMENT
For value received, in accordance with and subject to the Sale and
Servicing Agreement dated as of March 1, 1997 (the "Sale and Servicing
Agreement"), among the undersigned, Case Credit Corporation and Case
Equipment Loan Trust 1997-A (the "Purchaser"), the undersigned does hereby
sell, assign, transfer set over and otherwise convey unto the Purchaser,
without recourse, all of its right, title and interest in, to and under: (a)
the Initial Receivables, including all documents constituting chattel paper
included therewith, and all obligations of the Obligors thereunder,
including all moneys paid thereunder on or after the Initial Cutoff Date,
(b) the security interests in the Financed Equipment granted by Obligors
pursuant to the Initial Receivables and any other interest of the
undersigned in such Financed Equipment, (c) any proceeds with respect to the
Initial Receivables from claims on insurance policies covering Financed
Equipment or Obligors, (d) the Liquidity Receivables Purchase Agreement
(only with respect to Contracts included in the Initial Receivables) and the
Purchase Agreement, including the right of the undersigned to cause Case
Credit Corporation to repurchase Receivables from the undersigned under the
circumstances described therein, (e) any proceeds from recourse to Dealers
with respect to the Initial Receivables other than any interest in the
Dealers' reserve accounts maintained with Case Credit Corporation, (f) any
Financed Equipment that shall have secured an Initial Receivable and that
shall have been acquired by or on behalf of the Trust, (g) all funds on
deposit from time to time in the Trust Accounts, including the Spread
Account Initial Deposit, the Negative Carry Account Initial Deposit and the
Pre-Funded Amount, and in all investments and proceeds thereof (including
all income thereon), and (h) the proceeds of any and all of the foregoing
(other than Recoveries). The foregoing sale does not constitute and is not
intended to result in any assumption by the Purchaser of any obligation of
the undersigned to the Obligors, insurers or any other person in connection
with the Initial Receivables, Receivables Files, any insurance policies or
any agreement or instrument relating to any of them.
This Assignment is made pursuant to and upon the representations,
warranties and agreements on the part of the undersigned contained in the
Sale and Servicing Agreement and is to be governed in all respects by the
Sale and Servicing Agreement. Capitalized terms used herein and not
otherwise defined shall have the meanings assigned to them in the Sale and
Servicing Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
duly executed as of ___________, 1997.
CASE RECEIVABLES II INC.,
By: ____________________________
Name: ▇▇▇▇▇ ▇▇▇▇
Title: Treasurer
EXHIBIT E
to Sale and Servicing Agreement
FORM OF SUBSEQUENT TRANSFER ASSIGNMENT
For value received, in accordance with and subject to the Sale and
Servicing Agreement dated as of March 1, 1997 (the "Sale and Servicing
Agreement"), among Case Equipment Loan Trust 1997-A, a Delaware business
trust (the "Issuer"), Case Receivables II Inc., a Delaware corporation (the
"Seller"), and Case Credit Corporation, a Delaware corporation, the Seller
does hereby sell, transfer, assign, set over and otherwise convey to the
Issuer, without recourse, all of its right, title and interest in, to and
under: (a) the Subsequent Receivables, with an aggregate Contract Value
equal to $________, listed on Schedule A hereto, including all documents
constituting chattel paper included therewith, and all obligations of the
Obligors thereunder including all moneys paid thereunder on or after the
Subsequent Cutoff Date, (b) the security interests in the Financed Equipment
granted by Obligors pursuant to such Subsequent Receivables and any other
interest of the Seller in such Financed Equipment, (c) any proceeds with
respect to such Subsequent Receivables from claims on insurance policies
covering Financed Equipment or Obligors, (d) the Purchase Agreement,
including the right of the Seller to cause Case Credit Corporation to
repurchase Subsequent Receivables from the Seller under the circumstances
described therein, (e) any proceeds from recourse to Dealers with respect to
such Subsequent Receivables other than any interest in the Dealers' reserve
accounts maintained with Case Credit Corporation, (f) any Financed Equipment
that shall have secured any such Subsequent Receivables and that shall have
been acquired by or on behalf of the Trust, and (g) the proceeds of any and
all of the foregoing (other than Recoveries). The foregoing sale does not
constitute and is not intended to result in any assumption by the Issuer of
any obligation of the Seller to the Obligors, insurers or any other person
in connection with such Subsequent Receivables, Receivable Files, any
insurance policies or any agreement or instrument relating to any of them.
This Subsequent Transfer Assignment is made pursuant to and upon the
representations, warranties and agreements on the part of the Seller
contained in the Sale and Servicing Agreement (including the Officers'
Certificate of the Seller accompanying this Agreement) and is to be governed
in all respects by the Sale and Servicing Agreement. Capitalized terms used
but not otherwise defined herein shall have the meanings assigned to them in
the Sale and Servicing Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to be
duly executed as of ________, 199_.
CASE RECEIVABLES II INC.,
By: ____________________________
Name: ________________________
Title:________________________
SCHEDULE A
to Subsequent Transfer Assignment
SCHEDULE OF SUBSEQUENT RECEIVABLES
[See attached list]
ANNEX A
to Subsequent Transfer Assignment
OFFICERS' CERTIFICATE
We, the undersigned officers of Case Receivables II Inc. (the
"Company"), do hereby certify, pursuant to Section 2.2(b)(xv) of the Sale
and Servicing Agreement dated as of March 1, 1997, among the Company, Case
Equipment Loan Trust 1997-A and Case Credit Corporation (the "Agreement"),
that all of the conditions precedent to the transfer to the Issuer of the
Subsequent Receivables listed on Schedule A to the Subsequent Transfer
Assignment delivered herewith, and the other property and rights related to
such Subsequent Receivables as described in Section 2.2(a) of the Agreement,
have been satisfied on or prior to the related Subsequent Transfer Date.
Capitalized terms used but not defined herein shall have the meanings
assigned to such terms in the Agreement.
IN WITNESS WHEREOF, the undersigned have caused this certificate to be
duly executed this _____ day of _______, 199_.
By: ____________________________
Name: ________________________
Title:________________________
By: ____________________________
Name: ________________________
Title:________________________
EXHIBIT F
to Sale and Servicing Agreement
FORM OF ACCOUNTANTS' LETTER IN CONNECTION
WITH THE SUBSEQUENT TRANSFER ASSIGNMENT PURSUANT TO
SECTION 2.2(b)(xiv) OF THE SALE AND SERVICING AGREEMENT
[Letterhead of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇]
___________, 199_
Case Receivables II Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Case Equipment Loan Trust 1997-A
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Salomon Brothers Inc.,
as Representative of the several Underwriters
____________________
____________________
____________________
____________________
▇▇▇▇▇▇ Trust and Savings Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Chase Manhattan Bank Delaware
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Dear Ladies and Gentlemen:
This letter is issued at the request of Case Receivables II Inc. (the
"Seller") with respect to the sale of certain retail receivables (the
"Subsequent Receivables") to the Case Equipment Loan Trust 1997-A (the
"Trust") pursuant to the Sale and Servicing Agreement dated as of March 1,
1997 (the "Sale and Servicing Agreement") among the Trust, the Seller and
Case Credit Corporation (the "Servicer"). The sale of the Subsequent
Receivables is described in the prospectus dated September 10, 1996 and the
prospectus supplement dated _____________, 1997 (together, the
"Prospectus"), which relates to the offering by the Trust of Class A-1
_____% Asset Backed Notes, Class A-2 _____% Asset Backed Notes, Class A-3
_____% Asset-Backed Notes and Class B Asset Backed Notes (collectively, the
"Notes") and the _____% Asset Backed Certificates (the "Certificates").
Capitalized terms used herein and not otherwise defined have the meaning
described in the Prospectus or the Sale and Servicing Agreement, as
applicable. In connection therewith, we performed or have previously
performed certain agreed upon procedures as specified in the items below:
1. As previously communicated in our letter to the Seller, the Trust,
__________________, the Indenture Trustee and the Trustee dated
___________, 1997 relating to the sale of certain retail receivables
(the "Initial Receivables") and the offering of the Notes and the
Certificates, we performed several procedures based on a computer data
file (the "Initial File") received from the Servicer, including the
following:
a. We read certain fields on the Initial File to determine whether
the data pertaining to the Initial Receivables complied with the
selection criteria as noted in our previous letter.
b. Proved the arithmetic accuracy of the Aggregate Contract Value
and the related percentage of Initial Receivables coded as
representing construction equipment and the Total Aggregate
Contract Value of the Initial Receivables as shown on Schedule B.
c. Proved the arithmetic accuracy of the Weighted Average Original
Term of the Initial Receivables as shown in Schedule B.
2. On ______________, 1997, we obtained a computer data file (the
"Subsequent File") produced by and represented by the Servicer to
contain the list of the Subsequent Receivables. The Subsequent File
was received directly by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP from the Servicer. By use
of data retrieval software, we have performed the following with
respect to the information contained in the Subsequent File:
a. We read certain fields on the Subsequent File to determine
whether the data relating to the Subsequent Receivables complied
with selection criteria 1, 2 and 4 as shown on Schedule A. For
purposes of selection criteria 3, as shown on Schedule A, we read
certain fields from the Initial File and Subsequent File to
aggregate the total Contract Value for each account number for
the purpose of determining the Contract Value for each Obligor.
The total Contract Value for each account number was then
compared to the aggregate Contract Value to determine if the
selection criteria was achieved.
b. Proved the arithmetic accuracy of the Aggregate Contract Value
and the related percentage of the Subsequent Receivables coded as
representing construction equipment and the Total Aggregate
Contract Value of the Subsequent Receivables as shown on Schedule
B.
c. Proved the arithmetic accuracy of the Weighted Average Original
Term of the Subsequent Receivables as shown in Schedule B.
3. We proved the arithmetic accuracy of the columnar totals for Aggregate
Contract Value of construction equipment and the Total Aggregate
Contract Value as shown on Schedule B.
4. We proved the arithmetic accuracy of the percent of total column as
shown in 1 on Schedule B by dividing the amount in the Total Aggregate
Contract Value of construction equipment column by the amount in the
Total Aggregate Contract Value column. We also proved the arithmetic
accuracy of the Weighted Average Original Term as shown in 2 on
Schedule B by summing the products of Total Aggregate Contract Value
times Weighted Average Original Term for the Initial Receivables and
the Subsequent Receivables and dividing the resulting sum by the
columnar total of the Total Aggregate Contract Value.
The foregoing procedures do not constitute an audit conducted in accordance
with generally accepted auditing standards, and, therefore, we are unable to
and do not express an opinion on any individual balances or summaries of
selected transactions specifically set forth in this letter. Also, these
procedures would not necessarily reveal matters of significance with respect
to the findings described herein. Accordingly, we make no representations
regarding the sufficiency of the foregoing procedures for your purposes of
for questions of legal interpretation. Had we performed additional
procedures, other matters might have come to our attention that would have
been reported to you. Further, we have addressed ourselves solely to the
foregoing data in the Sale and Servicing Agreement and the Prospectus and
make no representations regarding the adequacy of disclosure regarding
whether any material facts have been omitted.
This letter is solely for the information of the addressees and is not to be
used, circulated, quoted or otherwise referred to for any other purpose
including, but not limited to, the purchase or sale of Notes or
Certificates, nor is it to be referred to in any document. Furthermore, we
undertake no responsibility to update this letter for events and
circumstances occurring after the date of this letter.
Very truly yours,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
SCHEDULE A
to Accountant's Letter
Selection Criteria Results
1. No Subsequent Receivables was more than 90 days
past due as of the applicable Subsequent Cutoff Date.
2. Each Subsequent Receivable has an APR that is
equal to or greater than 3%.
3. Each Subsequent Receivable has a Contract Value
as of the Subsequent Cutoff Date that (when
combined with the Contract Value of any other
Receivables with the same or an affiliated
Obligor) does not exceed 1% of the aggregate
Contract Value of all Receivables.
4. Each Subsequent Receivable has a remaining term
to maturity (i.e., the period from but excluding
the applicable Subsequent Cutoff Date to and including the
Receivables' maturity date) of not more than
72 months.
SCHEDULE B
to Accountant's Letter
1. Percentage of principal balance of the Receivables that represents
construction equipment:
Aggregate
Contract Value Total
of Construction Aggregate Percent of
Equipment Contract Value Total
Initial Receivables $_________ $___________ _____%
Subsequent Receivables $ $ %
========= =========== =====
Total Receivables $ $ %
========= =========== =====
2. Weighted Average Original Term of the Receivables in the Trust.
Weighted
Total Aggregate Average Original
Contract Value Term
Initial Receivables $_________ _____ months
Subsequent Receivables $ months
========= =====
Total Receivables $ months
========= =====
As noted above, the Weighted Average Original Term does not exceed 55.0
months as required by the Sale and Servicing Agreement.
