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EXHIBIT 4.9
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NAVISTAR FINANCIAL SECURITIES CORPORATION
SELLER
NAVISTAR FINANCIAL CORPORATION
SERVICER
AND
THE BANK OF NEW YORK
MASTER TRUST TRUSTEE
ON BEHALF OF THE SERIES 1997-1 CERTIFICATEHOLDERS
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SERIES 1997-1 SUPPLEMENT
DATED AS OF _______, 1997
TO
POOLING AND SERVICING AGREEMENT
DATED AS OF JUNE 8, 1995
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FLOATING RATE
DEALER NOTE ASSET BACKED CERTIFICATES, SERIES 1997-1
DEALER NOTE MASTER TRUST
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TABLE OF CONTENTS
ARTICLE I
CREATION OF SERIES 1997-1 AND THE SERIES 1997-1 CERTIFICATES;
CONVEYANCE OF CLASS A-5 CERTIFICATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.01 Designation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.02 Conveyance of Class A-5 Investor Certificate . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 2.01 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE III
SERVICING FEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 3.01 Servicing Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE IV
RIGHTS OF SERIES 1997-1 CERTIFICATEHOLDERS AND ALLOCATION
AND APPLICATION OF COLLECTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 4.01 Rights of the Series 1997-1 Certificateholders . . . . . . . . . . . . . . . . . 17
SECTION 4.02 Establishment of Series Principal Account, Spread
Account, Negative Carry Reserve Fund and Liquidity
Reserve Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 4.03 Application of Class A-5 Investor Certificate Collections
Prior to the 1990 Trust Termination Date . . . . . . . . . . . . . . . . . . . . 21
SECTION 4.04 Application of Available Certificateholder Interest Collections
After the 1990 Trust Termination Date . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 4.05 Application of Available Seller's Finance Charge
Collections, Spread Account, Liquidity Reserve Account
and Negative Carry Reserve Fund to Deficiency Amount . . . . . . . . . . . . . . 23
SECTION 4.06 Investor Charge-Offs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.07 Application of Seller's Finance Charge Collections After the
1990 Trust Termination Date . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 4.08 Application of Series Allocable Principal Collections After
the 1990 Trust Termination Date . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 4.09 Shared Principal Collections . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 4.10 Distributions to Series 1997-1 Certificateholders . . . . . . . . . . . . . . . . 28
SECTION 4.11 Accumulation Period Length; Accumulation Period
Commencement Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 4.12 Partial Month Due Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 4.13 Closing Date Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 4.14 Additional Rights upon the Occurrence of Certain Events . . . . . . . . . . . . . 30
SECTION 4.15 Voting of the Master Trust's Interests in the 1990 Trust . . . . . . . . . . . . 30
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ARTICLE V
DISTRIBUTIONS AND REPORTS TO SERIES 1997-1
CERTIFICATEHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 5.01 Distributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 5.02 Monthly and Annual Certificateholders' Statement . . . . . . . . . . . . . . . . 31
ARTICLE VI
EARLY AMORTIZATION EVENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 6.01 Additional Early Amortization Events . . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE VII
INVESTMENT EVENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 7.01 Investment Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE VIII
OTHER SERIES PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 8.01 Effect of Fully Funded Date; Conveyance of Dealer Notes . . . . . . . . . . . . . 36
SECTION 8.02 Tax Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
ARTICLE IX
FINAL DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 9.01 Sale of Investors' Interest Pursuant to Section 2.07
of the Agreement; Distributions Pursuant to Section 2.03
or 12.03 of the Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 9.02 Distribution of Proceeds of Sale, Disposition or Liquidation
of the Dealer Notes Pursuant to Section 9.02 of the
Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 9.03 Early Distributions at the Option of the Investor
Certificateholder After the Fully Funded Date . . . . . . . . . . . . . . . . . . 39
ARTICLE X
MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 10.01 Ratification of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 10.02 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 10.03 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
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EXHIBITS
Exhibit A - Form of Investor Certificate
Exhibit B-1 - Form of Monthly Servicer and Settlement Statement
Exhibit B-2 - Form of Monthly Servicer and Settlement Statement
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SERIES 1997-1 SUPPLEMENT
TO POOLING AND SERVICING AGREEMENT
SERIES 1997-1 SUPPLEMENT dated as of _______, 1997 (the
"Series Supplement"), by and among NAVISTAR FINANCIAL SECURITIES CORPORATION, a
Delaware corporation, as Seller (the "Seller"), NAVISTAR FINANCIAL CORPORATION,
a Delaware corporation, as Servicer (the "Servicer"), and THE BANK OF NEW YORK,
a New York banking corporation, as trustee (together with its successors in
trust thereunder as provided in the Agreement referred to below, the "Master
Trust Trustee") under the Pooling and Servicing Agreement, dated as of June 8,
1995 (the "Agreement") among the Seller, the Servicer, the Master Trust Trustee
and The Chase Manhattan Bank, as trustee under the 1990 Trust Agreement.
Section 6.09 of the Agreement provides that the Seller may
from time to time direct the Master Trust Trustee to issue, on behalf of the
Master Trust, one or more new Series of Investor Certificates representing
fractional undivided interests in the Master Trust. The Principal Terms of any
new Series are to be set forth in a Supplement to the Agreement.
Pursuant to this Series Supplement, the Seller and the Master
Trust Trustee shall create a new Series of Investor Certificates and specify
the Principal Terms thereof.
ARTICLE I
CREATION OF SERIES 1997-1 AND
THE SERIES 1997-1 CERTIFICATES;
CONVEYANCE OF CLASS A-5 CERTIFICATE
SECTION 1.01 Designation.
(a) There is hereby created a new Series pursuant to the
Agreement and this Series Supplement to be known as the "Series 1997-1." The
interest of the Investor Certificateholders in Series 1997-1 shall be
represented by the Series 1997-1 Certificates.
(b) If any term or provision contained herein shall
conflict with or be inconsistent with any term or provision contained in the
Agreement, the terms and provisions of this Series Supplement shall govern with
respect to Series 1997-1.
SECTION 1.02 Conveyance of Class A-5 Investor Certificate.
(a) By execution of this Series Supplement, the Seller
does hereby sell, transfer, assign, set over and otherwise convey, without
recourse (except as otherwise expressly provided herein or in the Agreement),
to the Master Trust for the benefit of the Series 1997-1 Certificateholders and
the holders of the Master Trust Seller's Certificates all right, title and
interest of the Seller in and to the Class A-5 Investor Certificate, all
monies due or to become due with respect thereto and all proceeds (as defined
in Section 9-306 of the UCC) thereof. If such sale, transfer, assignment,
set-over or conveyance is deemed to create a security interest in such
property, the Seller does hereby grant to the Master Trust a security interest
therein (which shall be deemed to be a first perfected security interest) and
agrees that this Series Supplement shall constitute a security agreement under
applicable law.
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(b) As provided in Section 2.03(a) of the Agreement, the
Master Trust Trustee accepts delivery of the Class A-5 Investor Certificate and
agrees to maintain physical possession thereof.
ARTICLE II
DEFINITIONS
SECTION 2.01 Definitions.
(a) Whenever used in this Series Supplement, the
following words and phrases shall have the following meanings:
"1990 Trust Spread Account" shall mean the Spread Account
established and maintained pursuant to the 1990 Trust Agreement.
"Accumulation Period" shall mean, unless an Investment Event
or an Early Amortization Event shall have occurred prior thereto, the period
commencing on the Accumulation Period Commencement Date and ending upon the
first to occur of (a) the commencement of an Investment Period, (b) the
commencement of an Early Amortization Period and (c) the payment of the
Invested Amount in full.
"Accumulation Period Commencement Date" shall mean the first
day of the nth full Due Period prior to the Expected Payment Date where n is
the number of Due Periods in the Accumulation Period Length; provided, however,
that the Accumulation Period Commencement Date shall be the Specified
Accumulation Period Commencement Date if, on the Specified Accumulation Period
Commencement Date, any other outstanding Series shall have entered into an
investment period or an early amortization period; and provided further that,
if the Accumulation Period Length and the Accumulation Period Commencement Date
have been determined pursuant to Section 4.11 but the Accumulation Period has
not commenced and any other outstanding Series shall enter into an investment
period or an early amortization period, the Accumulation Period Commencement
Date shall be the date that such outstanding Series shall have entered into an
investment period or an early amortization period.
"Accumulation Period Length" shall mean a period which is
between one and nine Due Periods and which is determined by the Servicer
pursuant to Section 4.11.
"Adjusted Invested Amount" shall mean, with respect to any
Distribution Date, an amount (which shall never be less than zero) equal to the
Initial Invested Amount, plus the Available Subordinated Amount as of the end
of the related Transfer Date, plus the Negative Carry Subordinated Amount as of
the end of the related Transfer Date, minus the product of (x) the amount, if
any, of funds on deposit in the Negative Carry Reserve Fund at the end of such
Transfer Date and (y) 1.00 plus the Subordinated Percentage, minus the
aggregate amount of Investor Charge-Offs not reimbursed on or prior to such
Distribution Date, minus the aggregate Early Distribution Amounts made on or
prior to such Distribution Date.
"Amortizing/Investing Due Period" shall have the meaning
specified in Section 4.12.
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"Available Certificateholder Interest Collections" shall mean,
with respect to any Due Period commencing after the 1990 Trust Termination
Date, the sum of (a) Investor Finance Charge Collections for such Due Period
and (b) Investment Income for the related Distribution Period.
"Available Draw Funds" shall have the meaning specified in
Section 4.05(b).
"Available Seller's Finance Charge Collections" shall mean,
with respect to any Due Period commencing after the 1990 Trust Termination
Date, an amount equal to the product of (a) the excess of (i) the Seller's
Percentage for such Due Period over (ii) the result (if positive) of the Excess
Seller's Percentage for such Due Period minus the Required Excess Seller
Interest Percentage and (b) Series Allocable Finance Charge Collections for
such Due Period; provided, however, that Available Seller's Finance Charge
Collections shall be zero for any Due Period to the extent the Available
Subordinated Amount and the Negative Carry Subordinated Amount (minus the
product of (x) the amount of funds, if any, on deposit in the Negative Carry
Reserve Fund as of the end of the preceding Transfer Date and (y) 1.00 plus the
Subordinated Percentage) equals or is reduced to zero on the Transfer Date
related to such Due Period.
"Available Seller's Principal Collections" shall mean, with
respect to any Business Day after the 1990 Trust Termination Date, an amount
equal to the product of (a) the excess of (i) the Seller's Percentage for the
Due Period in which such Business Day occurs over (ii) the Excess Seller's
Percentage for such Due Period and (b) Series Allocable Principal Collections
for such Business Day; provided, however, that Available Seller's Principal
Collections shall be zero for any Business Day to the extent the Available
Subordinated Amount and the Negative Carry Subordinated Amount (minus the
product of (i) the amount of funds on deposit in the Negative Carry Reserve
Fund and (ii) 1.00 plus the Subordinated Percentage) equals or is reduced to
zero on the Transfer Date immediately preceding such Business Day.
"Available Subordinated Amount" shall mean (a) for each
Transfer Date related to a Due Period commencing prior to the 1990 Trust
Termination Date, zero, (b) on the Transfer Date related to the first Due
Period after the 1990 Trust Termination Date (before giving effect to all
adjustments in the Available Subordinated Amount on such Transfer Date), the
product of (i) the Subordinated Percentage and (ii) the Invested Amount as of
the preceding Distribution Date, and (c) for each Transfer Date thereafter
(before giving effect to all adjustments in the Available Subordinated Amount
thereto on such Transfer Date), the lesser of (i) the Maximum Subordinated
Amount as of such Transfer Date and (ii) the Available Subordinated Amount as
of the end of the preceding Transfer Date.
"Average Coverage Differential" shall be determined, on any
Determination Date, by reference to the Coverage Differentials for each of the
related Due Period and the three immediately preceding Due Periods, and shall
equal the sum of the three highest such Coverage Differentials divided by
three. Average Coverage Differential shall be expressed as a percentage, and
shall be rounded to the nearest one-hundredth of a percentage point.
"Business Day" shall mean, with respect to Series 1997-1, any
day other than a Saturday, a Sunday, or a day on which banking institutions in
New York, New York, Chicago, Illinois, or the city in which the Corporate Trust
Office is located, or in connection with the
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determination of LIBOR, London, England, are authorized or obligated by law or
executive order to be closed or remain closed.
"Certificate Rate" shall mean the interest rate on the Series
1997-1 Certificates, which shall be calculated on the basis of actual days
elapsed and a 360-day year, and will be _____% for the period from _______,
1997 through _______, 1997 and for each Distribution Period thereafter will
equal LIBOR as of the related LIBOR Determination Date plus ____%.
"Class A-5 Investor Certificate" shall mean the Class A-5
Floating Rate Pass-through Certificate issued by the 1990 Trust to the Master
Trust in connection with the issuance of the Series 1997-1 Certificates.
"Class A-5 Investor Certificate Collections" shall mean, with
respect to any Due Period, the sum of Class A-5 Investor Certificate Interest
Collections and Class A-5 Investor Certificate Principal Collections for such
Due Period.
"Class A-5 Investor Certificate Interest Collections" shall
mean, with respect to any Due Period, all interest payments received by the
Master Trust on the Distribution Date related to such Due Period in respect of
the Class A-5 Investor Certificate, plus with respect to the Initial Due
Period, the funds deposited pursuant to Section 4.13.
"Class A-5 Investor Certificate Principal Collections" shall
mean, with respect to any Due Period, all principal payments received by the
Master Trust on the Distribution Date related to such Due Period in respect of
the Class A-5 Investor Certificate.
"Closing Date" shall mean _______, 1997.
"Common Depository" shall mean Cede & Co.
"Controlled Amortization Amount" shall mean an amount equal to
the result of (a) the Invested Amount as of the Distribution Date preceding the
Specified Accumulation Period Commencement Date divided by (b) the Accumulation
Period Length.
"Controlled Deposit Amount" shall mean, with respect to any
Due Period occurring during the Accumulation Period, the excess, if any, of (a)
the product of (i) the Controlled Amortization Amount and (ii) the number of
Due Periods, including such Due Period, that have elapsed with respect to the
Accumulation Period (but not in excess of the Accumulation Period Length) over
(b) the amount on deposit in the Series Principal Account at the close of
business on the last Business Day of the preceding Due Period; provided,
however, that, notwithstanding the foregoing, the Seller may, in its sole
discretion, increase the Controlled Deposit Amount at any time and from time to
time.
"Coverage Differential" shall mean, with respect to any Due
Period, the result of (a) the Portfolio Yield for such Due Period minus (b) the
sum of (i) the Certificate Rate for the related Distribution Period and (ii)
one percent (1%). Coverage Differential shall be expressed as a percentage,
and shall be rounded to the nearest one-hundredth of a percentage point.
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"Deficiency Amount" shall have the meaning specified in
Section 4.05(a).
"Draw Amount" shall mean, with respect to any Transfer Date,
the least of (a) the Deficiency Amount for such Transfer Date, (b) the
Available Subordinated Amount as of the end of the preceding Transfer Date and
(c) Available Draw Funds for such Transfer Date.
"Early Amortization Event" shall mean, with respect to Series
1997-1, any event specified in Section 9.01(c) of the Agreement, together with
any additional Early Amortization Event specified in Section 6.01 of this
Series Supplement, but shall not mean any other event specified in Section 9.01
of the Agreement; provided, however, that for purposes of Section 6.09(b)(v) of
the Agreement, Early Amortization Event shall also include any Investment
Event.
"Early Amortization Period" shall mean an Early Amortization
Period with respect to Series 1997-1 that occurs as a result of any event
specified in Section 9.01(c) of the Agreement or any Early Amortization Event
specified in Section 6.01 of this Series Supplement.
"Early Amortization Period Shortfall Amount" shall have the
meaning specified in Section 4.08(e).
"Early Distribution" shall have the meaning specified in
Section 9.03(b).
"Early Distribution Amount" shall have the meaning specified
in Section 9.03(c).
"Early Distribution Date" shall have the meaning specified in
Section 9.03(b).
"Early Distribution Initial Invested Amount" shall have the
meaning specified in Section 9.03(b).
"Early Distribution Notice" shall have the meaning specified
in Section 9.03(b).
"Eligible Investments" shall mean
(a) book-entry securities, negotiable instruments or securities
represented by instruments in bearer or registered form having (except
in the case of clause (iv) below) remaining maturities occurring not
later than the Distribution Date next succeeding the Master Trust
Trustee's acquisition thereof, except as otherwise described herein,
that evidence:
(i) direct obligations of, and obligations fully
guaranteed as to timely payment by, the United States
of America;
(ii) demand deposits, time deposits or
certificates of deposit of, or bankers' acceptances
issued by, any depository institution or trust
company incorporated under the laws of the United
States of America or any state thereof (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 Master
Trust's investment or contractual commitment to
invest therein, the commercial
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paper or other short-term unsecured debt obligations
(other than such obligations the rating of which is
based on the credit of a person or entity other than
such depository institution or trust company) of such
depository institution or trust company shall have a
credit rating not lower than the highest investment
category for short term unsecured debt obligations
granted by the applicable Rating Agency from each
Rating Agency then Rating the affected Series of
Investor Certificates;
(iii) commercial paper having, at the time of the
Master Trust's investment or contractual commitment
to investment therein, a rating not lower than the
highest investment category for short term unsecured
debt obligations granted by the applicable Rating
Agency from each Rating Agency then Rating the
affected Series of Investor Certificates;
(iv) except during an Investment Period,
investments in money market funds having a rating not
lower than the highest investment category for short
term unsecured debt obligations granted by the
applicable Rating Agency from each Rating Agency then
Rating the affected Series of Investor Certificates
or otherwise approved in writing by each of such
Rating Agencies;
(v) repurchase obligations (x) with respect to
any security that is a direct obligation of, or fully
guaranteed 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) a depository institution or trust company
(acting as principal) described in clause (ii) or (B)
a depository institution or trust company the
deposits of which are insured by FDIC or (y) the
counterparty for which has a rating not lower than
the highest investment category for short term
unsecured debt obligations granted by the applicable
Rating Agency from each Rating Agency then Rating the
affected Series of Investor Certificates, the
collateral for which is held by a custodial bank for
the benefit of the Trust or the Indenture Trustee, is
marked to market daily and is maintained in an amount
that exceeds the amounts of such repurchase
obligation, and which required liquidation of the
collateral immediately upon the amount of such
collateral being less than the amount of such
repurchase obligation (unless the counterparty
immediately satisfies the repurchase obligation upon
being notified of such shortfall); or
(vi) commercial paper master notes where the issuer
has, at the time of the Master Trust's investment or
contractual commitment to invest therein, a rating
not lower than the highest investment category for
short term unsecured debt obligations granted by the
applicable Rating Agency from each Rating Agency then
Rating the affected Series of Investor Certificates;
and
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(b) any other investment consisting of a financial asset that
by its terms converts to cash within a finite period of time,
provided that the Rating Agency Condition is satisfied.
"Excess Seller's Percentage" shall mean, with respect to any
Due Period commencing after the 1990 Trust Termination Date, a percentage
(which percentage shall never be less than 0% nor more than 100%) equal to the
excess of (a) the Seller's Percentage for such Due Period, over (b) the
percentage equivalent (which percentage shall never be less than 0% nor more
than 100%) of a fraction, the numerator of which is the sum of (i) the
Available Subordinated Amount as of the end of the related Transfer Date and
(ii) the Negative Carry Subordinated Amount, as of the end of such Transfer
Date (minus the product of (A) the amount of funds, if any, on deposit in the
Negative Carry Reserve Fund as of the end of such Transfer Date and (B) 1.00
plus the Subordinated Percentage) and the denominator of which is the product
of (x) the sum of the aggregate principal amount of Dealer Notes in the Master
Trust and the aggregate principal amount of funds on deposit in the Excess
Funding Account, both as of the end of the immediately preceding Due Period and
(y) the Series 1997-1 Allocation Percentage for the Due Period for which the
Excess Seller's Percentage is being calculated.
"Excess Seller's Principal Collections" shall mean, with
respect to any Business Day during a Due Period commencing after the 1990 Trust
Termination Date, the product of (a) Series Allocable Principal Collections for
such Business Day and (b) the Excess Seller's Percentage for such Due Period.
"Expected Payment Date" shall mean the_____, 200__
Distribution Date.
"Floating Allocation Percentage" shall mean, with respect to
any Due Period commencing after the 1990 Trust Termination Date, the percentage
equivalent (which percentage shall never exceed 100%) of a fraction, the
numerator of which is the Invested Amount as of the immediately preceding
Distribution Date (after giving effect to all increases and reductions thereof
on such Distribution Date) and the denominator of which is the product of (a)
the sum of the aggregate principal amount of Dealer Notes in the Master Trust
and the aggregate principal amount of funds on deposit in the Excess Funding
Account, both as of the end of the immediately preceding Due Period, and (b)
the Series 1997-1 Allocation Percentage for the Due Period for which the
Floating Allocation Percentage is being calculated.
"Fully Funded Date" shall mean the first Distribution Date
falling in an Investment Period on which the amount on deposit in the Series
Principal Account (excluding any investment earnings) equals the Invested
Amount and the cumulative amount of funds deposited in the Negative Carry
Reserve Fund (excluding any investment earnings) equals the Negative Carry
Reserve Fund Required Amount (without giving effect to the proviso in the
definition thereof).
"Initial Invested Amount" shall mean $__________.
"Initial Spread Account Required Amount" shall mean the
Projected Spread as of the 1990 Trust Termination Date.
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"Invested Amount" shall mean, with respect to any Distribution
Date, an amount (which shall never be less than zero) equal to the Initial
Invested Amount, minus the sum of (a) the aggregate amount of payments of
principal in respect of the Series 1997-1 Certificates made to Series 1997-1
Certificateholders on or prior to such Distribution Date, (b) the aggregate
amount of Investor Charge-Offs not reimbursed pursuant to Section 4.04(a)(iv)
on or prior to such Distribution Date, (c) the aggregate amount of Series
Principal Account Losses on or prior to such Distribution Date and (d) the
aggregate Early Distribution Amounts made on or prior to such Distribution
Date.
"Investment Event" shall have the meaning specified in Section
7.01.
"Investment Income" shall mean, for any Distribution Period
with respect to Series 1997-1, the sum of (i) income during such Distribution
Period from the investment of funds on deposit in the Series Principal Account,
the Spread Account, and the Negative Carry Reserve Fund and (ii) the product of
(a) the Series Allocation Percentage for such Distribution Period and (b)
income from the investment of funds on deposit in the Collections Account and
the Excess Funding Account.
"Investment Period" shall mean the period beginning at the
close of business on the Investment Period Commencement Date, and ending upon
the earliest to occur of (a) the payment in full to the Series 1997-1
Certificateholders of the Invested Amount, (b) the Series Termination Date and
(c) the commencement of an Early Amortization Period.
"Investment Period Commencement Date" shall mean the Business
Day immediately preceding the date on which an Investment Event is deemed to
have occurred.
"Investment Period Shortfall Amount" shall have the meaning
specified in Section 4.08(e).
"Investor Charge-Off" shall have the meaning specified in
Section 4.06.
"Investor Dealer Note Losses" shall mean, with respect to any
Due Period commencing after the 1990 Trust Termination Date, the product of (a)
the Floating Allocation Percentage for such Due Period and (b) Series Allocable
Dealer Note Losses for such Due Period.
"Investor Finance Charge Collections" shall mean, with respect
to any Due Period commencing after the 1990 Trust Termination Date, an amount
equal to the product of (a) the Floating Allocation Percentage for such Due
Period and (b) Series Allocable Finance Charge Collections for such Due Period.
"Investor Principal Collections" shall mean, with respect to
any Business Day after the 1990 Trust Termination Date, the sum of (a) the
product of (i) with respect to the Revolving Period, the Floating Allocation
Percentage and with respect to the Accumulation Period, any Investment Period
or any Early Amortization Period, the Principal Allocation Percentage, in
either case for the Due Period in which such Business Day occurs and (ii)
Series Allocable Principal Collections for such Business Day and (b) on any
Transfer Date, the amount, if any, of Available Certificateholder Interest
Collections treated as Investor Principal Collections pursuant to Sections
4.04(a)(iii) and (iv).
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"Investor Servicing Fee" shall have the meaning specified in
Section 3.01.
"LIBOR" shall mean (a) prior to the 1990 Trust Termination
Date, the one-month London interbank offered rate as determined by the 1990
Trust Trustee in accordance with the 1990 Trust Agreement, and (b) after the
1990 Trust Termination Date, the interest rate determined by the Master Trust
Trustee in accordance with the following provisions:
(i) On each LIBOR Determination Date, LIBOR will be
determined on the basis of the offered rates for deposits in United
States Dollars having a one month maturity, which appear on the
Reuters Screen LIBO Page as of 11:00 A.M., London time, on such LIBOR
Determination Date. Such posted offered rates are for value on the
second Business Day after which dealings in deposits in United States
Dollars are transacted in the London interbank market. If at least
two such offered rates appear on the Reuters Screen LIBO Page, the
rate in respect of such LIBOR Determination Date will be the
arithmetic mean (rounded, if necessary, to the nearest one
hundred-thousandth of a percent) of such offered rates as determined
by the Master Trust Trustee. If fewer than two offered rates appear,
LIBOR in respect of such LIBOR Determination Date will be determined
as if the parties had specified the rate described in (ii) below.
(ii) On any LIBOR Determination Date on which fewer than
two offered rates appear on the Reuters Screen LIBO Page as specified
in (i) above, LIBOR will be determined on the basis of the rates at
which deposits in United States Dollars are offered by the Reference
Banks at approximately 11:00 A.M., London time, on such LIBOR
Determination Date to prime banks in the London interbank market,
having a one month maturity, such deposits commencing on the second
Business Day immediately following such LIBOR Determination Date and
in a principal amount of not less than U.S. $1,000,000 that is
representative for a single transaction in such market at such time.
The Master Trust Trustee will request the principal London office of
each of such Reference Banks to provide a quotation of its rate. If
at least two such quotations are provided, LIBOR in respect of such
LIBOR Determination Date will be the arithmetic mean (rounded, if
necessary, to the nearest one hundred-thousandth of a percent) of such
quotations. If fewer than two quotations are provided, LIBOR in
respect of such LIBOR Determination Date will be the arithmetic mean
(rounded, if necessary, to the nearest one hundred-thousandth of a
percent) of the rates quoted by three major banks in The City of New
York selected by the Master Trust Trustee at approximately 11:00 A.M.,
New York City time, on such LIBOR Determination Date for loans in
United States Dollars to leading European banks, having a one month
maturity, such loans commencing on the second Business Day immediately
following such LIBOR Determination Date and in a principal amount of
not less than U.S. $1,000,000 that is representative for a single
transaction in such market at such time, provided, however, that if
the banks in The City of New York selected as aforesaid by the Master
Trust Trustee are not quoting as mentioned in this sentence, LIBOR
with respect to such LIBOR Determination Date will be LIBOR in effect
immediately prior to such LIBOR Determination Date.
"LIBOR Determination Date" shall mean, with respect to any
Distribution Period, the date which is two Business Days prior to the start of
such Distribution Period.
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"Liquidity Reserve Account" shall have the meaning specified
in Section 4.02(d)(i).
"Maximum Subordinated Amount" shall mean, with respect to any
Transfer Date related to a Due Period commencing after the 1990 Trust
Termination Date, the product of (a) the Invested Amount as of the preceding
Distribution Date and (b) the Subordinated Percentage; provided, however, that
with respect to a Transfer Date related to a Due Period occurring during an
Early Amortization Period, the Maximum Subordinated Amount shall not decline
until the Invested Amount equals the Maximum Subordinated Amount, and
thereafter the Maximum Subordinated Amount shall equal the Invested Amount.
"Minimum Negative Carry Required Amount" shall mean, on any
LIBOR Determination Date after the Fully Funded Date, with respect to any
Transfer Date occurring on or after the Fully Funded Date, an amount equal to
the product of (a) three and (b) the Projected Investment Shortfall for such
LIBOR Determination Date.
"Minimum Series 1997-1 Seller's Interest" shall mean, with
respect to any Business Day after the 1990 Trust Termination Date, the sum of
(a) the Available Subordinated Amount as of the end of the preceding Transfer
Date, (b) the Negative Carry Subordinated Amount as of the end of the preceding
Transfer Date (minus the product of (i) 1.00 plus the Subordinated Percentage
and (ii) the amount of funds, if any, on deposit in the Negative Carry Reserve
Fund as of the end of the preceding Business Day) and (c) the Required Excess
Seller Interest as of the end of the preceding Distribution Date.
"Monthly Interest" shall mean, with respect to each Transfer
Date related to a Distribution Period, an amount equal to the product of (a)
the Certificate Rate for such Distribution Period and (b) the Invested Amount
as of the preceding Distribution Date (or the Initial Invested Amount with
respect to the first Transfer Date) and (c) a fraction, which (i) with respect
to the first Transfer Date, shall be equal to __ divided by 360 and (ii) with
respect to each subsequent Transfer Date, shall be equal to the actual number
of days in the related Distribution Period divided by 360.
"Monthly Servicing Fee" shall have the meaning specified in
Section 3.01.
"Negative Carry Reserve Fund" shall have the meaning specified
in Section 4.02(c)(i).
"Negative Carry Reserve Fund Deposit Amount" shall mean, with
respect to each Transfer Date, the excess, if any, of (a) the lesser of (i) the
Negative Carry Reserve Fund Required Amount for such Transfer Date and (ii) the
result of (A) the Negative Carry Subordinated Amount as of the end of the
preceding Transfer Date divided by (B) 1.00 plus the Subordinated Percentage
over (b) the amount of funds on deposit in the Negative Carry Reserve Fund
prior to such Transfer Date (after giving effect to any amounts that have been
withdrawn prior to such date).
"Negative Carry Reserve Fund Required Amount" means, with
respect to each Transfer Date, an amount equal to the sum of (a) the product of
(i) ___ basis points, (ii) the Invested Amount as of the preceding Distribution
Date, and (iii) the number of Due Periods remaining until the Expected Payment
Date and (b) an amount equal to the product of .___% and the Invested
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Amount as of the preceding Distribution Date; provided, however, that from and
after the Fully Funded Date, the Negative Carry Reserve Fund Required Amount
shall be zero.
"Negative Carry Subordinated Amount" shall mean, (a) on any
Transfer Date related to a Due Period occurring prior to the commencement of
the Accumulation Period, any Early Amortization Period or any Investment
Period, an amount equal to the product of (i) the Negative Carry Reserve Fund
Required Amount and (ii) 1.00 plus the Subordinated Percentage and (b) at the
beginning of each Transfer Date thereafter, an amount equal to the Negative
Carry Subordinated Amount as of the end of the immediately preceding Transfer
Date (after giving effect to all reductions in the Negative Carry Subordinated
Amount on such preceding Transfer Date).
"New Vehicle Monthly Interest Rate" shall mean, with respect
to any Due Period, the product of (a) the per annum rate of interest and
finance charges billed by NFC during such Due Period on New Vehicle Dealer
Notes and (b) the quotient of (i) the number of days during such Due Period and
(ii) the actual number of days in the related calendar year.
"Portfolio Yield" shall mean, with respect to any Due Period,
the product of (a) the quotient of (i) Finance Charges for such Due Period and
(ii) the daily average principal amount of Dealer Notes outstanding during such
Due Period and (b) a fraction, the numerator of which is 365 and the
denominator of which is the actual number of days elapsed during such Due
Period. Portfolio Yield shall be expressed as a percentage, and shall be
rounded to the nearest one-hundredth of a percentage point.
"Principal Allocation Percentage" shall mean, with respect to
any Due Period commencing on or after the 1990 Trust Termination Date and
occurring during the Accumulation Period, any Investment Period or any Early
Amortization Period, the percentage equivalent (which percentage shall never
exceed 100%) of a fraction, the numerator of which is the Invested Amount as of
the end of the Revolving Period and the denominator of which is equal to the
product of (a) the sum of the aggregate amount of Dealer Notes in the Master
Trust and the aggregate principal amount of funds on deposit in the Excess
Funding Account, both as of the end of the Revolving Period and (b) the Series
1997-1 Allocation Percentage for the Due Period for which the Principal
Allocation Percentage is being calculated.
"Principal Shortfall" shall mean, with respect to Series
1997-1, the Series 1997-1 Principal Shortfall.
"Projected Dealer Note Income" shall mean, on any Transfer
Date after the 1990 Trust Termination Date, an amount equal to the sum of (a)
the product of (i) the principal amount of Dealer Notes financing new vehicles
outstanding on such Transfer Date, (ii) the New Vehicle Monthly Interest Rate
for the Due Period in which such Transfer Date occurs and (iii) the Series
1997-1 Allocation Percentage for such Due Period and (b) the product of (i) the
principal amount of Dealer Notes financing used vehicles outstanding on such
Transfer Date, (ii) the Used Vehicle Monthly Interest Rate for such Due Period
and (iii) the Series 1997-1 Allocation Percentage for such Due Period.
"Projected Investment Income" shall mean, on any LIBOR
Determination Date after the Fully Funded Date with respect to the related
Distribution Period, the product of (a) the sum of
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the amount of funds on deposit on such LIBOR Determination Date in each of the
Spread Account and the Series Principal Account and the Series 1997-1
Allocation Percentage of the amount of funds on deposit in the Excess Funding
Account (to the extent any such amounts are not required to be paid on the
following Distribution Date) and (b) an amount equal to (i) the lesser of (A)
LIBOR as of such LIBOR Determination Date minus 0.125% and (B) the 30-day AA
Federal Reserve commercial paper composite rate, expressed on a money-market
yield basis, minus 0.125% multiplied by (ii) the result of (A) the number of
days during the related Distribution Period divided by (B) 360.
"Projected Investment Shortfall" shall mean, on any LIBOR
Determination Date after the 1990 Trust Termination Date with respect to the
related Distribution Period, the positive amount, if any, by which (a)
Projected Monthly Interest for such Distribution Period exceeds (b) Projected
Investment Income for such Distribution Period.
"Projected Monthly Interest" shall mean, on any LIBOR
Determination Date after the 1990 Trust Termination Date with respect to the
related Distribution Period, an amount equal to the product of (a) the
Certificate Rate for such Distribution Period, (b) the Invested Amount as of
the immediately preceding Distribution Date (minus, if the following
Distribution Date is an Early Distribution Date, the aggregate Early
Distribution Amounts to be paid on such following Early Distribution Date) and
(c) the result of (i) the actual number of days in such Distribution Period
divided by (ii) 360.
"Projected Monthly Servicing Fee" shall mean, on any Transfer
Date after the 1990 Trust Termination Date with respect to the Due Period in
which such Transfer Date occurs, an amount equal to one-twelfth of the product
of (a) 1%, (b) the aggregate principal amount of Dealer Notes as of such
Transfer Date, (c) the Series 1997-1 Allocation Percentage for the Due Period
related to such Transfer Date and (d) the Floating Allocation Percentage for
the Due Period related to such Transfer Date.
"Projected Spread" shall mean, on any Transfer Date after the
1990 Trust Termination Date with respect to the Distribution Period next
following the Distribution Period to which such Transfer Date relates and prior
to the Fully Funded Date, the sum of (a) the positive amount, if any, by which
(i) the sum of (A) Projected Monthly Interest for such Distribution Period, and
(B) the Projected Monthly Servicing Fee for the Due Period in which such
Transfer Date occurs exceeds (ii) the Projected Dealer Note Income as of such
Transfer Date and (b) 1.25% of the Invested Amount as of the preceding
Distribution Date.
"Reassignment Amount" shall mean, with respect to any
Distribution Date, after giving effect to any deposits and distributions
otherwise to be made on such Distribution Date, the sum of (a) the Invested
Amount on such Distribution Date, and (b) accrued and unpaid interest thereon.
"Reference Banks" shall mean the principal London offices of
Xxxxxx Guaranty Trust Company of New York, Swiss Bank Corporation and Barclays
Bank PLC.
"Remaining Available Seller's Principal Calculations" shall
have the meaning specified in Section 4.08(d).
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"Required Excess Seller Interest" shall mean, with respect to
any Business Day, 3.0% of the Invested Amount as of the end of the preceding
Distribution Date (and such percentage shall be the "Required Excess Seller
Interest Percentage").
"Required Subordinated Amount" shall mean, with respect to any
Transfer Date related to a Due Period commencing after the 1990 Trust
Termination Date, an amount equal to ____% of the Maximum Subordinated Amount
as of such Transfer Date.
"Revolving Due Period" shall have the meaning specified in
Section 4.12.
"Revolving Period" shall mean, unless an Investment Event or
an Early Amortization Event shall have occurred prior thereto, the period
beginning on the 1990 Trust Termination Date and ending on the earlier of (a)
the close of business on the Business Day immediately preceding the
Accumulation Period Commencement Date, (b) the close of business on the
Investment Period Commencement Date and (c) the close of business on the
Business Day immediately preceding the day on which an Early Amortization Event
occurs.
"Seller's Percentage" shall mean, with respect to any Due
Period commencing after the 1990 Trust Termination Date, 100% minus (a) the
Floating Allocation Percentage for such Due Period, when used with respect to
Finance Charge Collections and Dealer Note Losses at all times or Principal
Collections during the Revolving Period, and (b) the Principal Allocation
Percentage for such Due Period, when used with respect to Principal Collections
during the Accumulation Period, any Investment Period or any Early Amortization
Period.
"Seller's Principal Collections" shall mean, with respect to
any Business Day after the 1990 Trust Termination Date, an amount equal to the
sum of (a) Available Seller's Principal Collections for such Business Day and
(b) Excess Seller's Principal Collections for such Business Day.
"Series 1997-1" shall mean the Series of Investor
Certificates, the terms of which are specified in this Series Supplement.
"Series 1997-1 Accounts" shall mean, collectively, the Series
Principal Account, the Distribution Account maintained for the Series 1997-1
Certificateholders, the Liquidity Reserve Account, the Negative Carry Reserve
Fund and the Spread Account.
"Series 1997-1 Accumulation Period Principal Shortfall" shall
mean, with respect to any Business Day occurring during the Accumulation
Period, the excess, if any, of the Controlled Deposit Amount for the Due Period
in which such Business Day occurs over the amount of Investor Principal
Collections deposited in the Series Principal Account on such Business Day when
added to the amount of Investor Principal Collections previously deposited in
the Series Principal Account during such Due Period.
"Series 1997-1 Allocation Percentage" shall mean the Series
Allocation Percentage with respect to Series 1997-1.
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"Series 1997-1 Certificateholders" shall mean the holders of
Series 1997-1 Certificates.
"Series 1997-1 Certificateholders' Interest" shall mean that
portion of the Certificateholders' Interest evidenced by the Series 1997-1
Certificates.
"Series 1997-1 Certificates" shall mean any one of the
certificates executed by the Seller and authenticated by the Master Trust
Trustee, substantially in the form of Exhibit A.
"Series 1997-1 Principal Shortfall" shall equal either (a)
with respect to any Business Day occurring during the Accumulation Period, the
Series 1997-1 Accumulation Period Principal Shortfall or (b) with respect to
any Business Day during any Early Amortization Period or Investment Period, the
excess, if any, of the Invested Amount (reduced by (i) amounts on deposit in
the Series Principal Account and (ii) the aggregate amount of Series Principal
Account Losses for the Distribution Period in which such Business Day occurs)
as of the immediately preceding Distribution Date over Investor Principal
Collections for such Business Day.
"Series 1997-1 Rating Agency Condition" shall mean, with
respect to any action, that each Rating Agency shall have notified the Seller,
the Servicer, and the Master Trust Trustee in writing that such action will not
result in a reduction or withdrawal of the rating of the Series 1997-1
Certificates with respect to which it is a Rating Agency.
"Series 1997-1 Shared Principal Collections" shall have the
meaning specified in Section 4.09(b).
"Series 1997-1 Shared Seller Principal Collections" shall have
the meaning specified in Section 4.08(d)(iv).
"Series Allocable Dealer Note Losses" shall mean, with respect
to any Due Period commencing after the 1990 Trust Termination Date, the product
of (a) the Series 1997-1 Allocation Percentage for such Due Period and (b)
Dealer Note Losses for such Due Period.
"Series Allocable Finance Charge Collections" shall mean, with
respect to any Due Period, the product of (a) the Series 1997-1 Allocation
Percentage for such Due Period and (b) the amount of Finance Charge Collections
for such Due Period.
"Series Allocable Principal Collections" shall mean, with
respect to any Business Day, the sum of (a) the product of (i) the Series
1997-1 Allocation Percentage for the related Due Period and (ii) the amount of
Principal Collections deposited in the Collections Account on such Business Day
and (b) if the Accumulation Period Commencement Date occurs on such Business
Day, the product of (i) the Series 1997-1 Allocation Percentage for such Due
Period and (ii) the amount of funds on deposit in the Excess Funding Account on
such Accumulation Period Commencement Date.
"Series Invested Amount" shall mean, with respect to Series
1997-1, the Invested Amount.
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"Series Principal Account" shall have the meaning specified in
Section 4.02(a)(i).
"Series Principal Account Losses" shall mean losses of
principal on investment of funds in the Series Principal Account.
"Series Termination Date" shall mean the ______, 20__
Distribution Date.
"Special Servicer Agent" shall have the meaning specified in
Section 4.02(f).
"Specified Accumulation Period Commencement Date" shall mean
_______, 200__.
"Spread Account" shall have the meaning specified in Section
4.02(b)(i).
"Spread Account Deposit Amount" shall mean, with respect to
any Transfer Date prior to the Fully Funded Date, the amount, if any, by which
the Projected Spread exceeds the amount of funds on deposit in the Spread
Account.
"Subject Month" shall have the meaning specified in Section
4.12.
"Subordinated Percentage" shall mean ___%.
"Turnover" shall have the meaning specified in Section
7.01(i).
"Used Vehicle Monthly Interest Rate" shall mean, with respect
to any Due Period, the product of (i) the per annum rate of interest and
finance charges billed by NFC during such Due Period on Used Vehicle Dealer
Notes and (ii) the quotient of (a) a number equal to the number of days during
such Due Period and (b) the actual number of days in the related calendar year.
(b) Notwithstanding anything to the contrary in this
Series Supplement or the Agreement, the term "Rating Agency" shall mean,
whenever used in this Series Supplement or the Agreement with respect to Series
1997-1, Moody's and Standard & Poor's. As used in this Series Supplement and
in the Agreement with respect to Series 1997-1, "highest investment category"
shall mean (i) in the case of Standard & Poor's, A-1+ or AAA, as applicable,
and (ii) in the case of Moody's, P-1 or Aaa, as applicable.
(c) All capitalized terms used herein and not otherwise
defined herein have the same meanings ascribed to them in the Agreement.
(d) The words "hereof," "herein" and "hereunder" and
words of similar import when used in this Series Supplement shall refer to this
Series Supplement as a whole and not to any particular provision of this Series
Supplement; references to any Article, Section or Exhibit are references to
Articles, Sections and Exhibits in or to this Series Supplement unless
otherwise specified; and the term "including" means "including without
limitation."
(e) As used in this Series Supplement, references to the
Available Subordinated Amount "as of the end" of a Transfer Date and the
Negative Carry Subordinated Amount "as of the end" of a Transfer Date shall
mean the Available Subordinated Amount or the Negative Carry
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Subordinated Amount, each as of such Transfer Date, after giving effect to all
increases and reductions thereof pursuant to Article IV hereof.
(f) As used in this Series Supplement, accounting terms
which are not defined, and accounting terms partly defined, herein 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 Series Supplement are inconsistent with the
meanings of such terms under generally accepted accounting principles, the
definitions contained in this Series Supplement will control.
(g) With respect to any Distribution Date or Transfer
Date, the "related Due Period" and the "related Distribution Period" will mean
the Due Period and Distribution Period, respectively, immediately preceding
such Distribution Date or Transfer Date, and the relationships between Due
Periods and Distribution Periods will be correlative to the foregoing
relationships. With respect to any LIBOR Determination Date, the "related
Distribution Period" will mean the Distribution Period beginning on the
Distribution Date immediately following such LIBOR Determination Date.
(h) Each defined term used in this Series Supplement has
a comparable meaning when used in its plural or singular form. Each
gender-specific term used in this Series Supplement has a comparable meaning
whether used in a masculine, feminine or gender-neutral form.
ARTICLE III
SERVICING FEE
SECTION 3.01 Servicing Compensation. The monthly servicing fee (the
"Monthly Servicing Fee") shall be payable to the Servicer, in arrears, on each
Distribution Date in respect of a Due Period (or portion thereof) commencing
after the 1990 Trust Termination Date and occurring prior to the earlier of the
first Distribution Date following the Series Termination Date and the first
Distribution Date on which the Invested Amount is zero, in an amount equal to
one-twelfth of the result of (a) 1% multiplied by (b) the aggregate principal
amount of Dealer Notes outstanding as of the last day of such Due Period and
multiplied by (c) the Series 1997-1 Allocation Percentage with respect to such
Due Period; provided, however, that the Monthly Servicing Fee shall be zero
with respect to each Due Period following the Fully Funded Date. The share of
the Monthly Servicing Fee allocable to the Series 1997-1 Certificateholders
with respect to any Transfer Date (the "Investor Servicing Fee") shall be equal
to the product of (a) the Monthly Servicing Fee and (b) the Floating Allocation
Percentage with respect to such Due Period. The remainder of the Monthly
Servicing Fee shall be paid by the Seller and in no event shall the Master
Trust, the Master Trust Trustee or the Series 1997-1 Certificateholders be
liable for the share of the Monthly Servicing Fee to be paid by the Seller; and
the remainder of the Servicing Fee shall be paid by the Seller and the Investor
Certificateholders of other Series and the Series 1997-1 Certificateholders
shall in no event be liable for the share of the Servicing Fee to be paid by
the Seller or the Investor Certificateholders of other Series. The Investor
Servicing Fee shall be payable to the Servicer solely to the extent amounts are
available for distribution in accordance with the terms of this Series
Supplement.
The Servicer will be permitted, in its sole discretion, to
waive the Monthly Servicing Fee for any Distribution Date by notice to the
Master Trust Trustee on or before the related
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Determination Date; provided, however, that the Servicer believes that
sufficient Series Allocable Finance Charge Collections will be available on any
future Distribution Date to pay the Investor Servicing Fee relating to the
waived Monthly Servicing Fee. If the Servicer so waives the Monthly Servicing
Fee for any Distribution Date, the Monthly Servicing Fee and the Investor
Servicing Fee for such Distribution Date shall be deemed to be zero for all
purposes of this Series Supplement and the Agreement; provided, however, that
such Investor Servicing Fee shall be paid on a future date solely to the extent
amounts are available therefor pursuant to Section 4.04(a)(vi); and provided
further that, to the extent any such waived Investor Servicing Fee is so paid,
the related portion of the Monthly Servicing Fee to be paid by the Seller shall
be paid by the Seller to the Servicer.
ARTICLE IV
RIGHTS OF SERIES 1997-1 CERTIFICATEHOLDERS
AND ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 4.01 Rights of the Series 1997-1 Certificateholders.
The Series 1997-1 Certificates shall represent fractional undivided interests
in the Master Trust, consisting of the right to receive, to the extent
necessary to make the required payments with respect to the Series 1997-1
Certificates at the times and in the amounts specified in this Series
Supplement, Collections allocated to Series 1997-1 pursuant to Article IV of
the Agreement and this Article IV, funds on deposit in the Collections Account
and the Excess Funding Account allocable to Series 1997-1 Certificateholders
pursuant to Article IV of the Agreement and this Article IV, and funds on
deposit in the Series 1997-1 Accounts (collectively, the "Series 1997-1
Certificateholders' Interest"), it being understood that the Series 1997-1
Certificates shall not represent any interest in any Series Account or
Enhancement for the benefit of any other Series or Class. The Servicer shall
apply, or instruct the Master Trust Trustee to apply, all funds on deposit in
the Collections Account and Excess Funding Account allocable to the Series
1997-1 Certificates, and all funds on deposit in the Series Principal Account,
the Spread Account, the Negative Carry Reserve Fund and the Distribution
Account maintained for the Series 1997-1 Certificateholders, as described in
this Article IV.
SECTION 4.02 Establishment of Series Principal Account, Spread
Account, Negative Carry Reserve Fund and Liquidity Reserve Account.
(a) Series Principal Account.
(i) On or prior to the commencement of an
Investment Period, an Early Amortization Period or the Accumulation
Period, the Master Trustee, for the benefit of the Series 1997-1
Certificateholders, shall establish and maintain in the name of the
Master Trust an Eligible Deposit Account bearing a designation clearly
indicating that the funds deposited therein are held for the benefit
of the Series 1997-1 Certificateholders (the "Series Principal
Account"). The Master Trust Trustee shall possess all right, title
and interest in all funds on deposit from time to time in the Series
Principal Account and in all proceeds thereof. Pursuant to authority
granted to it pursuant to Section 3.01(b) of the Agreement, the
Servicer shall have the revocable power to instruct the Master Trust
Trustee to withdraw funds from the Series Principal Account for the
purpose of carrying out the duties of the Servicer under this Series
Supplement and the Agreement. The Servicer at all times shall
maintain accurate records reflecting each transaction in the Series
Principal Account.
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(ii) Funds on deposit in the Series Principal
Account overnight or for a longer period shall at all times be
invested in Eligible Investments at the direction of the Servicer or
its agent, subject to the restrictions set forth in the Agreement and
subject to the requirement that each such Eligible Investment shall
have a stated maturity on or prior to the following Transfer Date (or
such longer maturity as shall be allowed upon satisfaction of the
Series 1997-1 Rating Agency Condition). Net interest and earnings
(less investment expenses) on funds on deposit in the Series Principal
Account, if any, shall be allocated and distributed as provided in
Section 4.03(a) or Section 4.04, as applicable.
(b) Spread Account.
(i) On or prior to the 1990 Trust Termination
Date, the Master Trust Trustee, for the benefit of the Series 1997-1
Certificateholders, shall cause to be established and maintained in
the name of the Master Trust, an Eligible Deposit Account bearing a
designation clearly indicating that the funds deposited therein are
held for the benefit of the Series 1997-1 Certificateholders (the
"Spread Account"). The Master Trust Trustee shall possess all right,
title and interest in all funds on deposit from time to time in the
Spread Account and in all proceeds thereof. Pursuant to authority
granted to it pursuant to Section 3.01(b) of the Agreement, the
Servicer shall have the revocable power to instruct the Master Trust
Trustee to withdraw funds from the Spread Account for the purpose of
carrying out the duties of the Servicer under this Series Supplement
and the Agreement. The Servicer at all times shall maintain accurate
records reflecting each transaction in the Spread Account. As of the
1990 Trust Termination Date, the Servicer shall cause to be deposited
in the Spread Account an amount equal to the lesser of (A) the
Projected Spread as of the immediately preceding Transfer Date and (B)
the amount of funds on deposit in the 1990 Trust Spread Account
multiplied by a fraction, the numerator of which is the Projected
Spread as of the immediately preceding Transfer Date, and the
denominator of which is the projected spreads as of the immediately
preceding Transfer Date for all outstanding Series which have spread
accounts.
(ii) Funds on deposit in the Spread Account
overnight or for a longer period shall at all times be invested in
Eligible Investments at the direction of the Servicer or its agent,
subject to the restrictions set forth in the Agreement and subject to
the requirement that each such Eligible Investment shall have a stated
maturity on or prior to the following Transfer Date. Net interest and
earnings (less investment expenses) on funds on deposit in the Spread
Account, if any, shall be allocated and distributed as provided in
Section 4.04.
(iii) On any Transfer Date related to a Due Period
commencing after the 1990 Trust Termination Date on which the amount
of funds on deposit in the Spread Account is greater than the
Projected Spread on such Transfer Date, the Servicer shall withdraw
the amount of such excess from the Spread Account and allocate and pay
such excess to the Seller. On the Transfer Date related to the Due
Period which follows the Fully Funded Date, the Servicer shall
withdraw the amount of funds on deposit in the Spread Account and
allocate and pay such amount to the Seller.
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(iv) Upon the commencement of and during an
Investment Period or an Early Amortization Period, the Master Trust
Trustee will deposit all funds in the Spread Account into the
Liquidity Account, and no additional funds shall be deposited into the
Spread Account.
(c) Negative Carry Reserve Fund.
(i) On or prior to the commencement of an
Investment Period, an Early Amortization Period or the Accumulation
Period, the Master Trust Trustee, for the benefit of the Series 1997-1
Certificateholders, shall establish and maintain in the name of the
Master Trust Trustee, on behalf of the Master Trust, an Eligible
Deposit Account bearing a designation clearly indicating that the
funds deposited therein are held for the benefit of the Series 1997-1
Certificateholders (the "Negative Carry Reserve Fund"). The Master
Trust Trustee shall possess all right, title and interest in all funds
on deposit from time to time in the Negative Carry Reserve Fund and in
all proceeds thereof. Pursuant to authority granted to it pursuant to
Section 3.01(b) of the Agreement, the Servicer shall have the
revocable power to instruct the Master Trust Trustee to withdraw funds
from the Negative Carry Reserve Fund for the purpose of carrying out
the duties of the Servicer under this Series Supplement and the
Agreement. The Servicer at all times shall maintain accurate records
reflecting each transaction in the Negative Carry Reserve Fund.
(ii) Funds on deposit in the Negative Carry
Reserve Fund overnight or for a longer period shall at all times be
invested in Eligible Investments at the direction of the Servicer or
its agent, subject to the restrictions set forth in the Agreement and
subject to the requirement that each such Eligible Investment shall
have a stated maturity on or prior to the following Transfer Date.
Net interest and earnings (less investment expenses) on funds on
deposit in the Negative Carry Reserve Fund, if any, shall be allocated
and distributed as provided in Section 4.03(a) or Section 4.04, as
applicable.
(d) Liquidity Reserve Account.
(i) The Master Trust Trustee, for the benefit of
the Seller, shall establish on or prior to the commencement of an
Early Amortization Period or an Investment Period and maintain or
cause to be established and maintained in the name of the Master Trust
Trustee, an Eligible Deposit Account bearing a designation clearly
indicating that the funds deposited therein are held for the benefit
of the Seller (the "Liquidity Reserve Account"). The Seller shall
possess all right, title and interest in all funds on deposit from
time to time in the Liquidity Reserve Account and in all proceeds
thereof; provided, however, that no funds on deposit in the Liquidity
Reserve Account shall be paid to the Seller if such payment would
reduce the funds in such account below an amount equal to the
Available Subordinated Amount. Pursuant to authority granted to it
pursuant to Section 3.01(b) of the Agreement, the Servicer shall have
the revocable power to instruct the Master Trust Trustee to withdraw
funds from the Liquidity Reserve Account for the purpose of fulfilling
the obligations of the Seller under this Series Supplement and the
Agreement. The Servicer at all times shall maintain accurate records
reflecting transactions in the Liquidity Reserve Account.
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(ii) Funds on deposit in the Liquidity Reserve
Account overnight or for a longer period shall at all times be
invested in Eligible Investments at the direction of the Seller or its
agent, subject to the restrictions set forth in the Agreement. Any
Eligible Investment with a stated maturity shall mature on or prior to
the following Transfer Date. All net interest and earnings (less
investment expenses) on funds on deposit in the Liquidity Reserve
Account, if any, shall be paid to the Seller. On any Transfer Date
commencing after the 1990 Trust Termination Date on which the amount
on deposit in the Liquidity Reserve Account exceeds the Available
Subordinated Amount as of the end of such Transfer Date, the Servicer
shall withdraw the amount of such excess from the Liquidity Reserve
Account and allocate and pay such excess to the Seller.
(e) Replacement Series 1997-1 Accounts. If, at any time,
any of the Series 1997-1 Accounts ceases to be an Eligible Deposit Account, the
Master Trust Trustee (or the Servicer on its behalf) shall upon the earlier of
(a) 30 calendar days, or (b) the next Determination Date, establish a new
Series 1997-1 Account meeting the conditions specified in paragraphs (a), (b),
(c) or (d) above, as applicable, as an Eligible Deposit Account and shall
transfer any cash and/or any investments to such new Series 1997-1 Account.
Neither the Seller, the Servicer nor any person or entity claiming by, through
or under the Seller, the Servicer or any such person or entity shall have any
right, title or interest in, or any right to withdraw any amount from, any
Series 1997-1 Account, except as expressly provided herein.
(f) Special Servicer Agent. Promptly following the
commencement of an Investment Period and effective for the duration thereof,
the Servicer shall select and appoint an agent, which initially will be the
Master Trust Trustee (the "Special Servicer Agent") as the Servicer's agent for
purposes of selecting investments as described in this Section 4.02(f). The
Special Servicer Agent will be compensated by the Servicer and will be
obligated to perform its duties hereunder whether or not it receives such
compensation. Notwithstanding any other provision of this Section 4.02 or
Section 4.03 or Section 4.04 of the Agreement, during any Investment Period,
funds on deposit in the Series 1997-1 Accounts will be invested at the
direction of the Special Servicer Agent in Eligible Investments selected by the
Special Servicer Agent, and on each Distribution Date during an Investment
Period, the Special Servicer Agent shall deliver a report to the Servicer, the
Master Trust Trustee and to each Series 1997-1 Certificateholder which shall
state, as of the last day of the related Due Period, the aggregate amount of
funds invested by the Special Servicer Agent, a brief description of each
Eligible Investment in which such funds are invested and the amount invested in
each such Eligible Investment, the rate of interest applicable to each such
Eligible Investment and the rating of each such Eligible Investment. The
Special Servicer Agent shall not (i) acquire or dispose of Eligible Investments
for the primary purpose of recognizing gains or decreasing losses resulting
from market value changes or (ii) dispose of Eligible Investments prior to
maturity at less than face value. The Special Servicer Agent may be removed at
any time by the Servicer; provided that, prior to such removal, (i) a successor
Special Servicer Agent shall have been selected by the Servicer and accepted
its appointment and (ii) the Series 1997-1 Rating Agency Condition shall have
been satisfied prior to the effectiveness of such appointment. So long as the
Master Trust Trustee is acting as the Special Servicer Agent, the Special
Servicer Agent shall be entitled to the same rights and remedies under the
Agreement as the Master Trust Trustee.
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SECTION 4.03 Application of Class A-5 Investor Certificate Collections
Prior to the 1990 Trust Termination Date.
(a) Class A-5 Investor Certificate Interest Collections.
On each Distribution Date related to a Due Period commencing prior to the 1990
Trust Termination Date, the Master Trust Trustee, acting in accordance with
instructions from the Servicer, shall apply Class A-5 Investor Certificate
Interest Collections for such Due Period and Investment Income for the related
Distribution Period in the following amounts and in the following order of
priority:
(i) Monthly Interest. An amount equal to Monthly
Interest for the related Distribution Period plus any Monthly Interest
due with respect to any prior Distribution Period not previously
distributed to the Series 1997-1 Certificateholders on a prior
Distribution Date, plus to the extent permitted by law, interest at
the Certificate Rate that has accrued on Monthly Interest that was due
pursuant to this clause (i) but was not previously distributed to the
Series 1997-1 Certificateholders on a prior Distribution Date shall be
deposited in the Distribution Account.
(ii) Negative Carry Reserve Fund Deposit Amount.
For any Distribution Date related to a Due Period occurring during an
Investment Period or an Early Amortization Period, an amount equal to
the Negative Carry Reserve Fund Deposit Amount shall be deposited in
the Negative Carry Reserve Fund.
(iii) Allocation to Seller. Any remaining Class A-5
Investor Certificate Interest Collections for the related Due Period
and Investment Income for the related Distribution Period shall be
allocated and paid to the Seller.
If during any Investment Period or Early Amortization Period, Class A-5
Investor Certificate Interest Collections for the related Due Period and
Investment Income for the related Distribution Period are not sufficient to
make all distributions required by Section 4.03(a)(i), the Master Trust Trustee
shall withdraw funds from the Negative Carry Reserve Fund to the extent of such
insufficiency and apply such funds in the same manner as Class A-5 Investor
Certificate Interest Collections pursuant to Section 4.03(a)(i). The Negative
Carry Subordinated Amount shall be reduced by the product of (i) the amount so
applied and (ii) 1.00 plus the Subordinated Percentage.
(b) Class A-5 Investor Certificate Principal Collections.
On each Transfer Date related to a Due Period commencing prior to the 1990
Trust Termination Date and occurring during an Investment Period or Early
Amortization Period, the Master Trust Trustee, acting in accordance with
instructions from the Servicer, shall withdraw from the Collections Account and
apply Class A-5 Investor Certificate Principal Collections, if any, for the
related Due Period in the following amounts and in the following order of
priority:
(i) Invested Amount and Negative Carry Reserve
Fund. On a pro rata basis between clauses (x) and (y), an amount
equal to (x) the excess of the Invested Amount over the amount of all
previous deposits to the Series Principal Account pursuant to this
Section 4.03(b)(i) shall be deposited in the Series Principal Account
and (y) the Negative Carry Reserve Fund Deposit Amount (reduced by the
amount deposited pursuant to Section 4.03(a)(ii)) shall be deposited
in the Negative Carry Reserve Fund.
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(ii) Allocation to Seller. Any remaining Class
A-5 Investor Certificate Principal Collections for such Due Period
shall be allocated and paid to the Seller.
SECTION 4.04 Application of Available Certificateholder Interest
Collections After the 1990 Trust Termination Date.
(a) Application of Available Certificateholder Interest
Collections Prior to the Fully Funded Date. On each Transfer Date related to a
Due Period commencing after the 1990 Trust Termination Date but ending prior to
the Fully Funded Date, the Master Trust Trustee, acting in accordance with
instructions from the Servicer, shall apply Available Certificateholder
Interest Collections for such Due Period in the following amounts and in the
following order of priority:
(i) Investor Servicing Fee. An amount equal to
the Investor Servicing Fee for such Due Period (unless such amount has
been netted against deposits to the Collections Account or waived)
shall be allocated and paid to the Servicer.
(ii) Monthly Interest. An amount equal to Monthly
Interest for the Distribution Period, plus any Monthly Interest due
with respect to any prior Distribution Period but not previously
distributed to the Series 1997-1 Certificateholders on a prior
Distribution Date, plus to the extent permitted by law, additional
interest at the Certificate Rate for such Distribution Period that has
accrued on Monthly Interest that was due pursuant to this clause (ii)
but was not previously distributed to the Series 1997-1
Certificateholders on a prior Distribution Date shall be deposited in
the Distribution Account.
(iii) Investor Dealer Note Losses. An amount equal
to the Investor Dealer Note Losses, if any, for such Due Period shall
be reimbursed by being treated as Investor Principal Collections for
such Transfer Date.
(iv) Reimbursement of Investor Charge-Offs. An
amount equal to the aggregate amount of unreimbursed Investor
Charge-Offs, if any, for any prior Due Period shall be reimbursed by
being treated as Investor Principal Collections for such Transfer
Date.
(v) Spread Account Deposit Amount. An amount
equal to the Spread Account Deposit Amount, if any, for such Transfer
Date shall be deposited into the Spread Account.
(vi) Deferred Investor Servicing Fee. An amount
equal to the aggregate outstanding amounts of the Investor Servicing
Fee which have been previously waived pursuant to Section 3.01 (unless
such amounts have been waived again) shall be allocated and paid to
the Servicer.
(vii) Reinstatement of Available Subordinated
Amount. An amount equal to the excess, if any, of the Maximum
Subordinated Amount as of the end of the preceding Transfer Date over
the Available Subordinated Amount as of the end of the preceding
Transfer Date shall be (A) during the Revolving Period or the
Accumulation Period, allocated and paid to the Seller or (B) during an
Investment Period or an Early Amortization Period, deposited in the
Liquidity Reserve Account, and in either case (A) or (B) the
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Available Subordinated Amount shall be reinstated by the amount of
such payment or deposit.
(viii) Excess Interest Collections. Any remaining
Available Certificateholder Interest Collections shall be treated as
Excess Interest Collections, and applied pursuant to Section 4.03(f)
of the Agreement.
If Available Certificateholder Interest Collections are not sufficient to
satisfy each of the applications described in clauses (i) through (vii) above
on any Transfer Date, then Excess Interest Collections from other Series
allocable to Series 1997-1 will be applied as Available Certificateholder
Interest Collections in the priority and the manner described in clauses (i)
through (vii) above. If Excess Interest Collections are less than the
shortfalls for all Series that provide for allocations of Excess Interest
Collections, such Excess Interest Collections shall be allocable to shortfalls
for Series 1997-1 and any other Series that so provides pro rata based on the
relative amounts of each Series' shortfall.
(b) Monthly Interest After the Fully Funded Date. On
each Transfer Date related to a Due Period commencing after the Due Period
related to the Fully Funded Date, the Master Trust Trustee, acting in
accordance with instructions from the Servicer, shall apply Available
Certificateholder Interest Collections for such Due Period in an amount equal
to Monthly Interest for the Distribution Period, plus any Monthly Interest due
with respect to any prior Distribution Period but not previously distributed to
the Series 1997-1 Certificateholders on a prior Distribution Date, plus to the
extent permitted by law, additional interest at the Certificate Rate that has
accrued on Monthly Interest that was due but was not previously distributed to
the Series 1997-1 Certificateholders on a prior Distribution Date, which amount
shall be deposited in the Distribution Account. Any remaining Available
Certificateholder Interest Collections shall be retained in the accounts in
which they were generated and invested. If such amounts are insufficient to
pay Monthly Interest, funds up to such insufficiency shall be withdrawn from
the Negative Carry Reserve Fund and applied for such purpose. The Negative
Carry Subordinated Amount shall be reduced by the product of (i) the amount so
applied and (ii) 1.00 plus the Subordinated Percentage.
SECTION 4.05 Application of Available Seller's Finance Charge
Collections, Spread Account, Liquidity Reserve Account and Negative Carry
Reserve Fund to Deficiency Amount.
(a) On each Transfer Date commencing after the 1990 Trust
Termination Date, the Servicer shall determine the amount (the "Deficiency
Amount"), if any, by which the amount of the entire allocations required on
such Transfer Date by Sections 4.04(a)(i) through (iv) exceeds the amount of
Available Certificateholder Interest Collections for such Due Period and Excess
Interest Collections allocated to Series 1997-1 on such Transfer Date, if any,
for the related Due Period.
(b) If the Deficiency Amount for any Transfer Date is
greater than zero, the Master Trust Trustee, acting in accordance with
instructions from the Servicer, shall apply available funds from the following
sources in the following order of priority in the same manner as Available
Certificateholder Interest Collections, each of which applications shall reduce
such Deficiency Amount (all such available funds being the "Available Draw
Funds" for such Transfer Date):
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(i) Available Seller's Finance Charge
Collections;
(ii) funds on deposit in the Spread Account;
(iii) for any Transfer Date occurring during any
Investment Period or Early Amortization Period, funds on deposit in
the Liquidity Reserve Account;
provided, however, that the amount applied pursuant to this Section 4.05(b)
shall not exceed the Draw Amount. The Available Subordinated Amount shall be
reduced by the aggregate amount of Available Draw Funds applied pursuant to
this Section 4.05(b).
(c) If during any Investment Period, Early Amortization
Period or Accumulation Period, Available Certificateholder Interest
Collections, Excess Interest Collections and Available Draw Funds applied
pursuant to this Article IV are insufficient to make all the applications
described in Section 4.04(a)(ii) or 4.04(b), the Master Trust Trustee shall
withdraw funds from the Negative Carry Reserve Fund and apply such funds in the
same manner as Available Certificateholder Interest Collections pursuant to
Section 4.04(a)(ii) or 4.04(b). If such funds are applied pursuant to Section
4.04(a)(ii), the Deficiency Amount shall be reduced by the amount so applied
and the Negative Carry Subordinated Amount shall be reduced by the product of
(i) the amount so applied and (ii) 1.00 plus the Subordinated Percentage.
(d) If all of the amounts applied pursuant to Section
4.05(a) and (b) are insufficient to make the entire application described in
Section 4.04(a)(iii), the Available Subordinated Amount shall be reduced (but
not below zero) by the amount of such deficiency and any remaining Investor
Dealer Note Losses shall be deemed to be reimbursed to the extent of such
reduction.
SECTION 4.06 Investor Charge-Offs. If, for any Transfer Date on which
the Available Subordinated Amount equals or is reduced to zero (after giving
effect to the allocations, distributions, withdrawals and deposits to be made
on such Transfer Date) and the Deficiency Amount for such Transfer Date (as
reduced by the applications required by Section 4.05 of this Series Supplement)
is greater than zero, the Invested Amount shall be reduced by the lesser of (i)
such remaining Deficiency Amount for such Transfer Date and (ii) the amount of
Investor Dealer Note Losses for the related Due Period remaining unreimbursed
after all applications of funds or reductions of the Available Subordinated
Amount pursuant to Sections 4.04 and 4.05 (such lesser amount being an
"Investor Charge-Off").
SECTION 4.07 Application of Seller's Finance Charge Collections After
the 1990 Trust Termination Date.
(a) Application of Available Seller's Finance Charge
Collections. On each Transfer Date related to a Due Period commencing after
the 1990 Trust Termination Date, the Master Trust Trustee, acting in accordance
with instructions from the Servicer, shall withdraw and apply from the
Collections Account to the extent of Available Seller's Finance Charge
Collections for such Due Period, the following amounts in the following order
of priority:
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(i) On each Transfer Date related to a Due Period
for which a Deficiency Amount exists, the amount required by Section
4.05(b)(i) shall be applied as specified in Section 4.05(b).
(ii) On each Transfer Date related to a Due Period
(x) occurring during an Investment Period or (y) commencing after the
Accumulation Period Commencement Date, an amount equal to the Negative
Carry Reserve Fund Deposit Amount for such Transfer Date shall be
deposited in the Negative Carry Reserve Fund.
(iii) On each Transfer Date related to a Due Period
occurring during an Investment Period or an Early Amortization Period,
the amount, if any, by which the Available Subordinated Amount as of
the end of such Transfer Date exceeds the amount of funds on deposit
in the Liquidity Reserve Account shall be deposited in the Liquidity
Reserve Account.
(iv) On each Transfer Date related to a Due Period
occurring during an Early Amortization Period, an amount equal to the
Negative Carry Reserve Fund Deposit Amount for such Transfer Date
shall be deposited in the Negative Carry Reserve Fund.
(v) On each Transfer Date on which the full
Spread Account Deposit Amount was not deposited in the Spread Account
pursuant to Section 4.04(a)(v), an amount equal to the shortfall in
such Spread Account Deposit Amount shall be deposited in the Spread
Account.
(vi) Any remaining Available Seller's Finance
Charge Collections for the related Due Period shall be allocated and
paid to the Seller.
(b) Application of Series Allocable Finance Charge
Collections to the Seller. On each Transfer Date related to a Due Period
commencing after the 1990 Trust Termination Date, the Master Trust Trustee,
acting in accordance with instructions from the Servicer, shall withdraw from
the Collections Account and allocate and pay to the Seller an amount equal to
the product of (i) the result of the Excess Seller's Percentage for such Due
Period minus the Required Excess Seller Interest Percentage and (ii) Series
Allocable Finance Charge Collections for such Due Period.
SECTION 4.08 Application of Series Allocable Principal Collections
After the 1990 Trust Termination Date. On each Business Day after the 1990
Trust Termination Date, the Master Trust Trustee, acting in accordance with
instructions from the Servicer, shall withdraw Series Allocable Principal
Collections for such Business Day from the Collections Account and apply such
funds in the following amounts:
(a) Investor Principal Collections During Revolving
Period. During the Revolving Period, an amount equal to Investor Principal
Collections for such Business Day shall be treated as Shared Principal
Collections, and applied, pursuant to the written direction of the Servicer,
pursuant to Section 4.03(e) of the Agreement.
(b) Investor Principal Collections during Accumulation
Period, Investment Period, or Early Amortization Period. During the
Accumulation Period, any Investment Period, or
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any Early Amortization Period, Investor Principal Collections for such
Business Day shall be allocated to the Series 1997-1 Certificateholders and
deposited into the Series Principal Account to the extent the Invested Amount
as of the preceding Distribution Date exceeds the amount of funds on deposit in
the Series Principal Account on such Business Day; provided, however, that for
each Business Day of a Due Period occurring during the Accumulation Period, the
amount of Investor Principal Collections deposited in the Series Principal
Account on such Business Day, when added to the amount of Investor Principal
Collections previously deposited in the Series Principal Account during such
Due Period, shall not exceed the Controlled Deposit Amount for such Due Period.
Any Investor Principal Collections remaining after the applications described
in the preceding sentence shall be treated as Shared Principal Collections, and
applied, pursuant to the written direction of the Servicer, pursuant to Section
4.03(e) of the Agreement.
(c) Seller's Principal Collections During the Revolving
Period. During the Revolving Period, all Seller's Principal Collections for
such Business Day shall be allocated as follows: first, Excess Seller's
Principal Collections shall be retained in the Excess Funding Account to the
extent necessary to maintain the Master Trust Seller's Interest at an amount
equal to (or, in the Seller's discretion, greater than) the Minimum Master
Trust Seller's Interest, second, Available Seller's Principal Collections shall
be retained in the Excess Funding Account to the extent necessary to maintain
the Master Trust Seller's Interest at an amount equal to (or, in the Seller's
discretion, greater than) the Minimum Master Trust Seller's Interest, and
third, all remaining Seller's Principal Collections shall be deemed to be
Series 1997-1 Shared Seller Principal Collections and shall be allocated as
provided in Section 4.08(d)(iii).
(d) Seller's Principal Collections During Accumulation
Period, Investment Period or Early Amortization Period; Shared Seller Principal
Collections.
(i) During the Accumulation Period, Available
Seller's Principal Collections for such Business Day shall be
deposited in the Negative Carry Reserve Fund in an amount equal to the
Negative Carry Reserve Fund Deposit Amount (reduced by the amount
deposited pursuant to Section 4.07(a)(ii)). Any remaining Available
Seller's Principal Collections for such Business Day shall be deemed
to be "Remaining Available Seller's Principal Collections," which
shall be included in Series 1997-1 Shared Seller Principal Collections
and allocated as provided in clause (iii) below. During the
Accumulation Period, Excess Seller's Principal Collections shall be
included in Series 1997-1 Shared Seller Principal Collections and
allocated as provided in clause (iii) below.
(ii) During any Early Amortization Period or
Investment Period (prior to the Fully Funded Date), Available Seller's
Principal Collections for such Business Day shall be, on a pro rata
basis between clauses (A) and (B) below based on the respective
amounts owed, (A) deposited in the Liquidity Reserve Account to the
extent the Available Subordinated Amount as of the end of the
immediately preceding Transfer Date exceeds the amount of funds on
deposit in the Liquidity Reserve Account (including amounts deposited
pursuant to Section 4.07(a)(iii)), and (B) deposited in the Negative
Carry Reserve Fund in an amount equal to the Negative Carry Reserve
Fund Deposit Amount (reduced by the amounts deposited pursuant to by
Sections 4.07(a)(ii) and (a)(iv)). The amounts required to be
deposited pursuant to the preceding sentence shall be reduced by the
amount of Available Seller's Finance Charge Collections deposited in
the Negative Carry Reserve Fund
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or the Liquidity Reserve Account, as applicable, on such Business Day.
Any remaining Available Seller's Principal Collections for such
Business Day shall be deemed to be "Remaining Available Seller's
Principal Collections." During any Investment Period or any Early
Amortization Period, all Excess Seller's Principal Collections, all
Remaining Available Seller's Principal Collections and all shared
principal collections not allocated in respect of principal shortfalls
shall be allocated and paid to the Seller or deposited in the Excess
Funding Account to the extent necessary to maintain the Master Trust
Seller's Interest at an amount equal to (or, in the Seller's
discretion, greater than) the Minimum Master Trust Seller's Interest.
(iii) During the Revolving Period or the
Accumulation Period, Shared Seller Principal Collections, if any, and
shared seller principal collections for any other Series that provides
for shared seller principal collections shall be determined on each
business day and allocated in the following priority: (i) to the
1997-1 Series to the extend of any Series 1997-1 Accumulation Period
Principal Shortfall and to any other Series to the extent such Series
provides for the use of shared seller principal collections in respect
of principal shortfalls, (ii) to the Excess Funding Account to the
extent necessary to maintain the Master Trust Seller's Interest at an
amount equal to (or, in the discretion of the Seller, greater than)
the Minimum Master Trust Seller's Interest and (iii) to the Seller.
If shared seller principal collections for all Series, including
Series 1997-1 Shared Seller Principal Collections, are less than the
shortfalls for which shared seller principal collections may be used,
including any Series 1997-1 Accumulation Period Principal Shortfall,
then such shared seller principal collections will be allocated to all
such shortfalls, including any Series 1997-1 Accumulation Period
Principal Shortfall, pro rata based on the relative amounts of each
such shortfall.
(iv) "Series 1997-1 Shared Seller Principal
Collections" means on each business day (i) during a Revolving Period,
all Available Seller's Principal Collections and all Excess Seller's
Principal Collections and (ii) during an Accumulation Period, all
Remaining Available Seller's Principal Collections and all Excess
Seller's Principal Collections. There shall be no Series 1997-1
Shared Seller Principal Collections during any Investment Period or
Early Amortization Period.
(e) If on any Distribution Date during an Investment
Period after the application of all funds to be allocated or distributed on
such date the excess, if any, of (a) the Invested Amount over (b) the amount in
the Series Principal Account (the "Investment Period Shortfall Amount") is less
than or equal to the aggregate amount of funds contained in the Liquidity
Reserve Account, then funds shall be withdrawn from the Liquidity Reserve
Account in an amount equal to the Investment Period Shortfall Amount and shall
be deposited in the Series Principal Account. If on any Distribution Date
during an Early Amortization Period after the application of all funds to be
allocated or distributed on such date the excess, if any, of (x) the Invested
Amount over (y) the amount in the Series Principal Account (the "Early
Amortization Period Shortfall Amount") is less than or equal to the aggregate
amount of funds contained in the Negative Carry Reserve Fund and the Liquidity
Reserve Account then funds shall be withdrawn first from the Negative Carry
Reserve Fund and then from the Liquidity Reserve Account in an amount equal to
the Early Amortization Period Shortfall Amount and shall be deposited in the
Series Principal Account.
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SECTION 4.09 Shared Principal Collections.
(a) That portion of Shared Principal Collections for any
Business Day equal to the amount of Series 1997-1 Shared Principal Collections
for such Business Day will be allocated to Series 1997-1 and will be applied in
the same manner as Investor Principal Collections pursuant to Section 4.08(b)
and otherwise will be deposited in the Excess Funding Account to the extent
necessary to maintain the Master Trust Seller's Interest at an amount equal to
(or, in the discretion of the Seller, greater than) the Minimum Master Trust
Seller's Interest or allocated to the Seller.
(b) "Series 1997-1 Shared Principal Collections," with
respect to any Business Day commencing after the 1990 Trust Termination Date,
shall mean an amount equal to the Series 1997-1 Principal Shortfall for such
Business Day; provided, however, that, if the aggregate amount of Shared
Principal Collections for all Series for such Business Day is less than the
aggregate amount of Principal Shortfalls for all Series for such Business Day,
then Series 1997-1 Shared Principal Collections for such Business Day shall
equal the product of (x) Shared Principal Collections for all Series for such
Business Day and (y) a fraction, the numerator of which is the Series 1997-1
Principal Shortfall for such Business Day and denominator of which is the
aggregate amount of Principal Shortfalls for all Series for such Business Day.
SECTION 4.10 Distributions to Series 1997-1 Certificateholders. On
each Transfer Date, after all allocations to the Distribution Account and the
Series Principal Account for the related Transfer Date have been made, the
Master Trust Trustee, acting in accordance with instructions from the Servicer,
shall transfer to the Distribution Account the funds on deposit in the Series
Principal Account and shall make, without duplication, the following
distributions from the Distribution Account:
(a) Interest Distributions. On each Distribution Date
(including the Expected Payment Date), Monthly Interest will be distributed to
the Series 1997-1 Certificateholders as accrued interest on the 1997-1
Certificates. To the extent any interest is due but not distributed on any
such Distribution Date, such amount will be distributed on the following
Distribution Date, along with, to the extent permitted by law, interest at the
Certificate Rate on such amount.
(b) Expected Payment Date. On the Expected Payment Date,
in addition to the amount described in (a) above, amounts on deposit in the
Series Principal Account will be distributed as principal (up to a maximum of
the Invested Amount on such Distribution Date) on the Series 1997-1
Certificates.
(c) Early Amortization Period. On each Distribution Date
related to a Due Period occurring during an Early Amortization Period, in
addition to the amount described in (a) above, amounts on deposit in the Series
Principal Account will be distributed as principal (up to a maximum of the
Invested Amount on such Distribution Date) on the Series 1997-1 Certificates;
provided, however, that upon the occurrence of an Early Amortization Event
described in clause (a) of Section 6.01, distributions in respect of the
Invested Amount will commence on the immediately succeeding Distribution Date.
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(d) Early Distributions. On any Early Distribution Date,
the amount on deposit in the Series Principal Account treated as Early
Distribution Amounts will be distributed as principal on the Series 1997-1
Certificates for which an Early Distribution election has been made.
SECTION 4.11 Accumulation Period Length; Accumulation Period
Commencement Date. On or prior to the first Due Period which is nine months
prior to the Due Period related to the Distribution Date which is the
Expected Payment Date, the Servicer shall determine in its sole discretion the
Accumulation Period Length and the Accumulation Period Commencement Date and,
promptly following such determination, the Servicer shall notify the Master
Trust Trustee and the Rating Agencies in writing of such determination.
SECTION 4.12 Partial Month Due Period. The allocation and
distribution provisions in this Series Supplement are based upon the assumptions
that each Due Period will be a calendar month and that each Due Period will
have a unique related Transfer Date and Distribution Date. However, under
certain circumstances (such as the occurrence of an Early Amortization Event or
Investment Event), the Revolving Period could end on a date other than the last
day of a calendar month (the period from the first day of such month (the
"Subject Month") to and including the date of such occurrence being referred to
herein as the "Revolving Due Period"), and an Early Amortization Period or
Investment Period could commence on a date other than the first day of a
calendar month (the period from such other date until the last day of the
Subject Month being the "Amortizing/Investing Due Period"). If such a
circumstance occurs, then the Servicer, the Seller and the Master Trust Trustee
shall observe the following rules:
(i) the Transfer Date for both the Revolving Due
Period and the Amortizing/Investing Due Period shall be the date on
which the Transfer Date would have occurred if the Subject Month had
been an ordinary Due Period;
(ii) the allocations and distributions of Finance
Charge Collections (and all items derived from Finance Charge
Collections, such as Available Certificateholder Interest Collections
and Available Seller's Finance Charge Collections) and Dealer Note
Losses occurring during the Subject Month shall be made as if the
Subject Month were one Due Period, without any distinction between the
Revolving Due Period and the Amortizing/Investing Due Period; and
(iii) two separate sets of allocations and
distributions of Principal Collections (and all items derived from
Principal Collections, such as Investor Principal Collections and
Seller's Principal Collections) shall be made on such Transfer Date,
according to whether such Principal Collections were received during
the Revolving Due Period (in which case allocations and distributions
shall be made as provided in Sections 4.08(a) and (c)) or the
Amortizing/Investing Due Period (in which case allocations and
distributions shall be made as provided in Sections 4.08(b) and (d)).
SECTION 4.13 Closing Date Allocations. On the Closing Date, proceeds
from the issuance of the Series 1997-1 Certificates in an amount equal to the
product of (a) ____ divided by 30 and (b) the quotient of (i) the Invested
Amount multiplied by the Certificate Rate, divided by (ii) twelve shall be
deposited and held in the Collections Account until the Transfer Date related to
the first
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Distribution Date for Series 1997-1, and shall be applied as Class A-5 Investor
Certificate Interest Collections. The first Distribution Date for Series
1997-1 shall be _______, 1997.
SECTION 4.14 Additional Rights upon the Occurrence of Certain Events.
Notwithstanding the provisions of Section 9.02(a) of the Agreement, if any
insolvency event occurs with respect to the Seller, Navistar International
Corporation, Navistar International Transportation Corporation or Navistar
Financial Corporation on the day of such insolvency event, the Seller will
(subject to the actions of the Certificateholders) immediately cease to transfer
Dealer Notes to the 1990 Trust or the Master Trust, as applicable, and promptly
give notice to the Master Trust Trustee of such insolvency event. Under the
terms of the Pooling and Servicing Agreement, if an insolvency event occurs with
respect to the Seller after the 1990 Trust Termination Date but prior to the
date on which the Series 1995-1 investor certificates issued by the Master Trust
have been paid in full, then within 15 days the Master Trust Trustee will
publish a notice of such insolvency event stating that the Master Trust Trustee
intends to sell, liquidate or otherwise dispose of the Dealer Notes in a
commercially reasonable manner and on commercially reasonable terms, unless
within a specified period of time Certificate holders representing more than 50%
of the aggregate series invested amount of the certificates of each such Series
and each person holding a Supplemental Certificate, instruct the Master Trust
Trustee not to sell, dispose of or otherwise liquidate the Dealer Notes and to
continue transferring Dealer Notes as before such insolvency event.
SECTION 4.15 Voting of the Master Trust's Interests in the 1990 Trust.
The Master Trust Trustee will have the right, without the consent of the
Certificateholders, to vote, or to consent or withhold consent with respect to,
the Class A-5 Investor Certificate and any other Investor Certificate on any
matter for which votes or consents are solicited under the 1990 Trust Agreement,
provided that such action will not, as evidenced by an officer's certificate of
the Servicer, have a material adverse effect on the Certificateholders of any
Series.
The Master Trust Trustee will also have the right, with the consent of the
Applicable Voting Percentage of the Certificateholders, to vote, or to consent
or withhold consent, with respect to the Class A-5 Investor Certificate and any
other Investor Certificate on any matter for which votes or consents are
solicited under the 1990 Trust Agreement.
"Applicable Voting Percentage" means, with respect to any matter for
which votes or consents are solicited under the 1990 Trust Agreement,
the percentage of votes or consents of the Investor Certificates
needed to pass the proposed matter.
ARTICLE V
DISTRIBUTIONS AND REPORTS
TO SERIES 1997-1 CERTIFICATEHOLDERS
SECTION 5.01 Distributions.
(a) The Paying Agent shall distribute (in accordance with
the Monthly Servicer Certificate and Settlement Statement delivered by the
Servicer to the Master Trust Trustee and the Paying Agent pursuant to Section
3.04(d) of the Agreement) to each Series 1997-1 Certificateholder of record on
the preceding Record Date (other than as provided in Section 12.02 of the
Agreement respecting a final distribution) (i) on each Distribution Date such
Certificateholder's pro rata share
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(based on the aggregate fractional undivided interests represented by the
Series 1997-1 Certificates held by such Certificateholder) of the amounts on
deposit in the Series 1997-1 Accounts as is payable to the Series 1997-1
Certificateholders on such Distribution Date pursuant to Sections 4.10 (a),
(b) and (c) and (ii) on the Early Distribution Date, for each Series 1997-1
Certificateholder that has elected to receive an Early Distribution, such
Certificateholder's Early Distribution Amount pursuant to Section 4.10(d).
(b) Except as provided in Section 12.03 of the Agreement
with respect to a final distribution, distributions to Series 1997-1
Certificateholders hereunder shall be made by check mailed to each Series
1997-1 Certificateholder at such Certificateholder's address appearing in the
Certificate Register without presentation or surrender of any Series 1997-1
Certificate or the making of any notation thereon; provided, however, that,
with respect to Series 1997-1 Certificates registered in the name of a Common
Depository, such distributions shall be made to such Common Depository in
immediately available funds.
SECTION 5.02 Monthly and Annual Certificateholders' Statement.
(a) Monthly Series 1997-1 Certificateholders' Statement.
At least two Business Days prior to each Distribution Date, the Servicer will
provide to the Master Trust Trustee and the Paying Agent, and on each
Distribution Date, the Paying Agent shall forward to each Series 1997-1
Certificateholder a Monthly Servicer Certificate and Settlement Statement
substantially in the form of Exhibit B-1 prior to the 1990 Trust Termination
Date or substantially in the form of Exhibit B-2 after the 1990 Trust
Termination Date, in each case with such changes as the Servicer shall deem
necessary or appropriate, prepared by the Servicer and delivered to the Master
Trust Trustee setting forth, among other things, the following information
which, prior to the 1990 Trust Termination Date, will include only the amounts
specified in (iii), (iv), (v), (xi), (xiv), (xv) and (xvi) below, and which, in
the case of (i), (ii), (iii), (viii), and (ix) below, shall be stated on the
basis of an original principal amount of $1,000 per Series 1997-1 Certificate:
(i) the aggregate amount of Collections,
including the aggregate amount of Finance Charge Collections and the
aggregate amount of Principal Collections for the related Due Period;
(ii) the Series 1997-1 Allocation Percentage, the
Floating Allocation Percentage and the Principal Allocation Percentage
(if applicable) for the related Due Period;
(iii) the total amount to be distributed on the
Series 1997-1 Certificates on such Distribution Date;
(iv) the amount, if any, of such distribution
allocable to the Invested Amount;
(v) the amount, if any, of such distribution
allocable to interest on the Series 1997-1 Certificates;
(vi) Dealer Note Losses for the related Due
Period;
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(vii) the Draw Amount as of the related Transfer
Date, if any;
(viii) the amount of the Investor Charge-Offs and
the amount of reimbursement thereof as of the related Transfer Date;
(ix) the amount of the Investor Servicing Fee to
be paid on such Distribution Date;
(x) the Controlled Deposit Amount for the related
Due Period (if applicable);
(xi) the Invested Amount (after giving effect to
all distributions that will occur on such Distribution Date);
(xii) the aggregate amount of Dealer Notes and
funds on deposit in each of the Excess Funding Account, Series
Principal Account, Negative Carry Reserve Fund and Spread Account as
of the end of the last day of the related Due Period (after giving
effect to payments and adjustments made pursuant to Article IV of this
Series Supplement and of the Agreement);
(xiii) the Available Subordinated Amount and the
Negative Carry Subordinated Amount, each as of the end of the related
Transfer Date;
(xiv) with respect to Eligible Investments in the
Series Principal Account, the Excess Funding Account, the Negative
Carry Reserve Fund and the Liquidity Reserve Account, as of the last
day of the related Due Period, the aggregate amount of funds invested
in Eligible Investments in each such Series Account, a brief
description of each such Eligible Investment and amount invested in
each such Eligible Investment, the rate of interest applicable to each
such Eligible Investment and the rating of each such Eligible
Investment;
(xv) the Dealers with the five largest aggregate
outstanding principal amounts of Dealer Notes in the 1990 Trust or the
Master Trust, as the case may be, as of the end of the related Due
Period;
(xvi) the aggregate outstanding principal amount of
Dealer Notes issued to finance OEM Vehicles as of the end of the
related Due Period;
(xvii) the percentages and all other information
calculated pursuant to Sections 6.01 and 7.01 to determine whether an
Early Amortization Event or an Investment Event, respectively, has
occurred;
(xviii) the amount of Excess Interest Collections and
Investor Principal Collections treated as Shared Principal
Collections, each for the related Due Period, and the amount of such
Excess Interest Collections and Shared Principal Collections allocated
to other Series; and
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(xix) the amount of Remaining Available Seller's
Principal Collections, the amount of Excess Seller's Principal
Collections and Remaining Available Seller's Principal Collections
treated as Series 1997-1 Shared Seller Principal Collections, the
amount of Shared Seller Principal Collections from other Series, and
the amount of Shared Seller Principal Collections allocated to Series
1997-1 and to other Series, each for the related Due Period.
(b) On each Distribution Date related to a Due Period
commencing prior to the 1990 Trust Termination Date, the Master Trust Trustee
shall furnish to the Paying Agent and the Paying Agent shall forward to each
Series 1997-1 Certificateholder the statement to be delivered pursuant to
Section 5.02(a) of the 1990 Trust Agreement.
(c) A copy of each statement provided pursuant to
subsections (a) and (b) will be made available for inspection at the Corporate
Trust Office.
(d) Annual Certificateholder's Tax Statement. On or
about January 31 of each calendar year, beginning with calendar year 1998, the
Master Trust Trustee shall furnish to the Servicer and Paying Agent a list of
each Person who at any time during the preceding calendar year was a Series
1997-1 Certificateholder and received any payment thereon and the dates such
Person held a Series 1997-1 Certificate, and the Paying Agent shall furnish to
each such Series 1997-1 Certificateholder a statement prepared by the Paying
Agent containing the information prepared by the Master Trust Trustee which is
required to be contained in the statement to Series 1997-1 Certificateholders
as set forth in Sections 5.02(a)(iii)-(a)(v) above, aggregated for such
calendar year or the applicable portion thereof during which such Person was a
Series 1997-1 Certificateholder, together with such other customary information
as the Master Trust Trustee or the Servicer deems necessary or desirable to
enable the Series 1997-1 Certificateholders to prepare their tax returns,
including information (to be supplied by the Servicer to the Master Trust
Trustee) regarding original issue discount on the Series 1997-1 Certificates,
if any. Such obligation of the Paying Agent shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Master Trust Trustee pursuant to any requirements of the
Internal Revenue Code as from time to time in effect.
ARTICLE VI
EARLY AMORTIZATION EVENTS
SECTION 6.01 Additional Early Amortization Events. The occurrence of
any of the following events shall, immediately upon the occurrence thereof
without notice or other action on the part of the Master Trust Trustee or the
Series 1997-1 Certificateholders, be deemed to be an Early Amortization Event
solely with respect to Series 1997-1:
(a) the earlier of (i) the Transfer Date on which (A) the
cumulative amount of draws from the Negative Carry Reserve Fund is equal to or
greater than (B) an amount equal to or greater than (1) the Negative Carry
Reserve Fund Required Amount as of the first Transfer Date following the
occurrence of an Investment Event (or, if earlier, the date immediately
preceding the Fully Funded Date) plus (2) any investment earnings attributable
to the Negative Carry Reserve Fund minus (3) the product of _____% multiplied
by the Invested Amount as of the preceding Distribution Date and (ii)
subsequent to the Fully Funded Date, the date on which the amount on
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deposit in the Negative Carry Reserve Fund is less than or equal to the Minimum
Negative Carry Required Amount;
(b) the Invested Amount is not reduced to zero by the
Expected Payment Date (other than after the Fully Funded Date); or
(c) the United States government or any agency or
instrumentality thereof files a notice of a lien under Internal Revenue Code
Section 6323 or any similar statutory provision (including, but not limited to,
Section 302(f) or Section 4068 of ERISA) on the assets of NFC or NFSC which is
or may in the future be prior to the lien of the Master Trust Trustee or the
assets of the Master Trust (including, without limitation, proceeds of the
Dealer Notes).
ARTICLE VII
INVESTMENT EVENTS
SECTION 7.01 Investment Events. If any one of the following events
shall occur:
(a) failure on the part of the Seller (i) to make any
payment, distribution or deposit required under the Agreement within five
business days of the date required or (ii) to observe or perform in any
material respect any other material covenants or agreements of the Seller,
which continues unremedied for a period of 60 days after written notice of such
failure shall have been given to the Seller;
(b) any representation or warranty made by the Seller
pursuant to the Agreement or any information contained in the schedule of
Dealer Notes delivered thereunder or this Series Supplement shall prove to have
been incorrect in any material respect when made or when delivered, which
representation, warranty or schedule, or the circumstances or condition that
caused such representation, warranty or schedule to be incorrect, continues to
be incorrect or uncured in any material respect for a period of 60 days after
written notice of such incorrectness shall have been given to the Seller and as
a result of which the interests of the Series 1997-1 Certificateholders are
materially and adversely affected, except that an Investment Event shall not be
deemed to occur if the Seller has repurchased the related Dealer Notes or all
such Dealer Notes, if applicable, during such period in accordance with the
provisions of the Agreement;
(c) after the 1990 Trust Termination Date, the Seller
shall become legally unable for any reason to transfer Dealer Notes to the
Master Trust in accordance with the provisions of the Agreement;
(d) on any Transfer Date related to a Due Period
commencing after the 1990 Trust Termination Date, the Available Subordinated
Amount for such Transfer Date will be reduced to an amount less than the
Required Subordinated Amount;
(e) any Servicer Termination Event shall occur (i) which
would have a material adverse effect on the Series 1997-1 Certificateholders
and (ii) for which the Servicer has received a notice of termination;
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(f) the delivery by the Seller to the Master Trust
Trustee, after the 1990 Trust Termination Date, of a notice stating that the
Seller will no longer continue to sell Dealer Notes to the Master Trust
commencing on the date specified in such notice;
(g) after the 1990 Trust Termination Date, the Average
Coverage Differential shall be equal to or less than negative two percent
(2.00%) on each of three consecutive Determination Dates;
(h) at the end of any Due Period commencing after the
1990 Trust Termination Date, the Master Trust Seller's Interest is reduced to
an amount less than the Master Trust Minimum Seller's Interest and the Seller
has failed to assign additional Dealer Notes to the Master Trust in the amount
of such deficiency within ten Business Days following the end of such Due
Period;
(i) on any Determination Date after the 1990 Trust
Termination Date, the quotient of (i) the product of (a) the sum of Dealer Note
Collections for each of the related Due Period and the two immediately
preceding Due Periods and (b) four divided by (ii) the daily average principal
amount of Dealer Notes outstanding during such Due Periods ("Turnover") is less
than 1.7;
(j) on any Determination Date after the 1990 Trust
Termination Date, the quotient of (i) the sum of Dealer Note Losses for each of
the related Due Period and the five immediately preceding Due Periods and (ii)
the sum of Principal Collections for each of the related Due Period and the
five immediately preceding Due Periods, is greater than or equal to one percent
(1.00%);
(k) at any time prior to the 1990 Trust Termination Date,
a 1990 Trust Amortization Event occurs under the 1990 Trust with respect to the
Class A-5 Investor Certificate (other than a 1990 Trust Amortization Event that
also constitutes an Early Amortization Event under the Master Trust), the
Seller is required to repurchase the Class A-5 Investor Certificate under
Section 2.06 of the 1990 Trust Agreement, or the Scheduled Class Amortization
Date occurs with respect to the Class A-5 Investor Certificate;
(l) any of the Seller, NITC, NIC or NFC shall file a
petition commencing a voluntary case under any chapter of the federal
bankruptcy laws; or the Seller or NFC shall file a petition or answer or
consent seeking reorganization, arrangement, adjustment or composition under
any other similar applicable federal law, or shall consent to the filing of any
such petition, answer or consent; or the Seller, NITC, NIC or NFC shall
appoint, or consent to the appointment of a custodian, receiver, liquidator,
trustee, assignee, sequestrator or other similar official in bankruptcy or
insolvency of it or of any substantial part of its property; or the Seller,
NITC, NIC or NFC shall make an assignment for the benefit of creditors, or
shall admit in writing its inability to pay its debts generally as they become
due;
(m) any order for relief against any of the Seller, NITC,
NIC or NFC shall have been entered by a court having jurisdiction in the
premises under any chapter of the federal bankruptcy laws, and such order shall
have continued undischarged or unstayed for a period of 120 days; or a decree
or order by a court having jurisdiction in the premises shall have been entered
approving as properly filed a petition seeking reorganization, arrangement,
adjustment, or composition of the Seller, NITC, NIC or NFC under any other
similar applicable federal law, and
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such decree or order shall have continued undischarged or unstayed for a period
of 120 days; or a decree or order of a court having jurisdiction in the
premises for the appointment of a custodian, receiver, liquidator, trustee,
assignee, sequestrator or other similar official in bankruptcy or insolvency of
the Seller, NITC, NIC or NFC of any substantial part of their property, or for
the winding up or liquidation of their affairs, shall have been entered, and
such decree or order shall have remained in force undischarged or unstayed for
a period of 120 days; and
(n) after the 1990 Trust Termination Date, failure on the
part of NITC to make a deposit in the Interest Deposit Account required by the
terms of the Interest Deposit Agreement on or before the date occurring five
Business Days after the date such deposit is required by the Interest Deposit
Agreement to be made;
then, subject to applicable law, and after the applicable grace period, if any,
an investment event (an "Investment Event") shall occur without any notice or
other action on the part of the Master Trust Trustee, any Special Servicer
Agent, any Paying Agent, the Series 1997-1 Certificateholders or any other
Beneficiary, immediately upon the occurrence of such event.
ARTICLE VIII
OTHER SERIES PROVISIONS
SECTION 8.01 Effect of Fully Funded Date; Conveyance of Dealer Notes.
(a) Notwithstanding anything to the contrary in the
Agreement, upon the occurrence of the Fully Funded Date, after giving effect to
all allocations, distributions, withdrawals and deposits to be made on such
date, the following provisions of the Agreement shall no longer apply in
respect of the Series 1997-1 Certificates to the Seller or the Servicer, as
applicable, the Series 1997-1 Certificates or the Series 1997-1
Certificateholders:
(i) Section 2.01 (except to the extent it relates
to amounts received with respect to the 1990 Seller's Certificate and
all other rights of the Seller under the 1990 Trust Agreement and
proceeds (including "proceeds" as defined in Section 9-306 of the UCC
as in effect in the State of Illinois) thereof on deposit in the
Series 1997-1 Accounts on the Fully Funded Date, after giving effect
to all such allocations, distributions, withdrawals and deposits);
(ii) Sections 2.02(a) and 2.02(b) (except to the
extent they relate to amounts received with respect to the Dealer
Notes, any security interests in the Financed Vehicles, Insurance
Proceeds, 1990 Trust Investment Securities and 1990 Trust Accounts
(including "proceeds" as defined in Section 9-306 of the UCC as in
effect in the State of Illinois) thereof on deposit in the Series
1997-1 Accounts on the Fully Funded Date, after giving effect to all
such allocations, distributions, withdrawals and deposits);
(iii) Section 2.05(a)(ii), 2.05(a)(iii),
2.05(a)(iv), 2.05(a)(v), 2.05(a)(vi), 2.05(a)(vii) and 2.05(a)(viii);
(iv) Section 2.06;
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(v) Section 2.07 (except to the extent it relates
to Section 2.05(a)(i));
(vi) Section 2.08;
(vii) Section 2.09;
(viii) Section 3.01;
(ix) Section 3.09;
(x) Section 3.10;
(xi) Section 4.03;
(xii) Section 6.09;
(xiii) Section 7.06;
(xiv) Section 8.06;
(xv) Section 8.08;
(xvi) Section 11.01(e); and
(xvii) Section 13.02.
(b) Upon the later to occur of (i) the Fully Funded Date
and the making of all allocations, distributions, withdrawals and deposits to
be made on such date and (ii) the date on which each other Series is either no
longer outstanding or the fully funded date has occurred with respect thereto,
the Master Trust Trustee shall sell, assign and convey to the Seller or its
designee, without recourse, representations or warranty, all right, title and
interest of the Master Trust in the Dealer Notes, whether then existing or
thereafter created, all security interests in the Financed Vehicles with
respect thereto, all monies due or to become due and all amounts received with
respect thereto and all proceeds thereof except for amounts on deposit in the
Collections Account that are allocable to Investor Certificates and amounts on
deposit in any Series Account. The Master Trust Trustee shall execute and
deliver such instruments of transfer and assignment, in each case without
recourse, as shall be reasonably requested by the Seller to vest in the Seller
or its designee all right, title and interest which the Master Trust had in all
such property.
SECTION 8.02 Tax Treatment. The Seller has entered into the Agreement
and this Series Supplement and the Series 1997-1 Certificates have been issued
with the intention that the Series 1997-1 Certificates will qualify under
applicable tax law as indebtedness secured by the Master Trust assets
attributable to the Series 1997-1 Certificates. The Seller and each Series
1997-1 Certificateholder and Certificate Owner, by the acceptance of its Series
1997-1 Certificate or Book-Entry Certificate, as applicable, agrees to treat
the Series 1997-1 Certificates as indebtedness secured by the Master Trust
assets attributable to the Series 1997-1 Certificates, for Federal income
taxes,
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state and local income and franchise taxes and any other taxes imposed on or
measured by income in whole or in part.
ARTICLE IX
FINAL DISTRIBUTIONS
SECTION 9.01 Sale of Investors' Interest Pursuant to Section 2.07 of
the Agreement; Distributions Pursuant to Section 2.03 or 12.03 of the
Agreement.
(a) The amount to be paid by the Seller to the
Collections Account with respect to Series 1997-1 in connection with a purchase
of the Certificateholders' Interest pursuant to Section 2.07 of the Agreement
shall equal the Reassignment Amount for the Distribution Date on which such
purchase occurs.
(b) With respect to the Reassignment Amount, if any,
deposited into the Collections Account pursuant to this Section 9.01 of this
Series Supplement or Section 2.07 of the Agreement or any proceeds deposited
into the Collections Account pursuant to Section 12.03(c) of the Agreement, the
Master Trust Trustee shall, not later than 12:00 noon, New York City time, on
the Distribution Date on which such amounts are deposited (or, if such date is
not a Distribution Date, on the immediately following Distribution Date) (in
the priority set forth below): (i) first, deposit the Invested Amount on such
Distribution Date into the Series Principal Account, (ii) second, deposit the
amount of accrued and unpaid interest on the unpaid balance of the Series
1997-1 Certificates in the Distribution Account, and (iii) third, pay the
remainder of any such Reassignment Amounts to the Seller.
(c) Notwithstanding any other provision to the contrary
in this Series Supplement or the Agreement, the entire amount deposited in the
Series Principal Account on a Distribution Date pursuant to Section 9.01(b) and
all other amounts on deposit therein shall be distributed in full to the Series
1997-1 Certificateholders on such Distribution Date and any distribution made
pursuant to this paragraph (c) shall be deemed to be a final distribution
pursuant to Section 12.03 of the Agreement with respect to Series 1997-1;
provided, however, that no such distribution shall be made on any date
occurring after the Fully Funded Date if, by reason of Section 8.01(a)(v), no
Reassignment Amount is required to be deposited in the Collections Account with
respect to Series 1997-1 on such Distribution Date.
SECTION 9.02 Distribution of Proceeds of Sale, Disposition or
Liquidation of the Dealer Notes Pursuant to Section 9.02 of the Agreement.
(a) Not later than 12:00 noon, New York City time, on the
Distribution Date following the date on which the Insolvency Proceeds are
deposited into the Collections Account pursuant to Section 9.02(b) of the
Agreement, the Master Trust Trustee shall first (in each case, after giving
effect to any deposits and distributions otherwise to be made on such
Distribution Date) deduct an amount equal to the Invested Amount on such
Distribution Date from the portion of the Insolvency Proceeds allocated to
Series Allocable Principal Collections and deposit such amount in the Series
Principal Account; provided that the amount of such deposit shall not exceed
the product of (x) the portion of the Insolvency Proceeds allocated to Series
Allocable Principal
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Collections and (y) 100% minus the Excess Seller's Percentage with respect to
the related Due Period. The remainder of the portion of the Insolvency
Proceeds allocated to Series Allocable Principal Collections shall be allocated
to the Master Trust Seller's Interest and shall be distributed on such
Distribution Date to the Seller.
(b) Not later than 12:00 noon, New York City time, on
such Distribution Date, the Master Trust Trustee shall first (in each case,
after giving effect to any deposits and distributions otherwise to be made on
such Distribution Date) deduct an amount equal to the sum of (i) Monthly
Interest for such Distribution Date, (ii) any Monthly Interest previously due
but not distributed on a prior Distribution Date and (iii) to the extent
permitted by law, interest at the Certificate Rate on Monthly Interest that was
due but not previously distributed to the Series 1997-1 Certificateholders on a
prior Distribution Date, from the portion of the Insolvency Proceeds allocated
to Series Allocable Finance Charge Collections and deposit such amount in the
Distribution Account; provided that the amount of such distribution shall not
exceed the product of (x) the portion of the Insolvency Proceeds allocated to
Series Allocable Finance Charge Collections and (y) 100% minus the Excess
Seller's Percentage with respect to the related Due Period. The remainder of
the portion of the Insolvency Proceeds allocated to Series Allocable Finance
Charge Collections shall be allocated to the Master Trust Seller's Interest and
shall be distributed on such Distribution Date to the Seller.
(c) Notwithstanding anything to the contrary in this
Series Supplement or the Agreement, the entire amount deposited in the Series
Principal Account and the Distribution Account pursuant to this Section 9.02
and all other amounts on deposit therein shall be distributed in full to the
Series 1997-1 Certificateholders on the Distribution Date on which funds are
deposited pursuant to this Section 9.02 (or, if not so deposited on a
Distribution Date, on the immediately following Distribution Date) and any
distribution made pursuant to this Section 9.02 shall be deemed to be a final
distribution pursuant to Section 12.03 of the Agreement with respect to Series
1997-1.
SECTION 9.03 Early Distributions at the Option of the Investor
Certificateholder After the Fully Funded Date.
(a) Upon the occurrence of any Investment Event, the
Servicer shall give prompt written notice thereof to the Master Trust Trustee
and the Master Trust Trustee shall give notice to the Series 1997-1
Certificateholders at their respective addresses appearing at the Certificate
Register.
(b) Each Series 1997-1 Certificateholder may request the
early distribution (an "Early Distribution") of all or a portion of the
Invested Amount related to such Certificateholder's Series 1997-1 Certificates
by providing written notice (an "Early Distribution Notice") to the Servicer
and the Master Trust Trustee in accordance with Section 13.05 of the Agreement.
Any such Early Distribution Notice shall be provided not less than 20 days
prior to the third Distribution Date following the Fully Funded Date (the
"Early Distribution Date") and shall be irrevocable when so provided. Each
such Early Distribution Notice shall specify the amount of the Initial Invested
Amount related to the Series 1997-1 Certificates owned by such Series 1997-1
Certificateholder (the "Early Distribution Initial Invested Amount") with
respect to which the Early Distribution is to be made; provided, however, that
any request for an Early Distribution with respect to a portion of such
Certificateholder's Invested Amount shall only be in integral multiples of
$1,000. Any Series 1997-
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1 Certificateholder electing an Early Distribution shall surrender its Series
1997-1 Certificates to the Master Trust Trustee within two days of the Early
Distribution Date.
(c) Upon receipt of an Early Distribution Notice by a
Series 1997-1 Certificateholder in accordance with Section 9.03(b) and delivery
of the Series 1997-1 Certificates with respect to which the Early Distribution
Amount is being paid, the Master Trust Trustee shall distribute to such Series
1997-1 Certificateholder, on the Early Distribution Date, an amount equal to
the product of (i) the result obtained by dividing the amount of the Early
Distribution Initial Invested Amount that is the subject of the Early
Distribution Notice by the Initial Invested Amount and (ii) the Invested Amount
as of the Early Distribution Date (without giving effect to the payments
required by this Section 9.03) (the "Early Distribution Amount") from the
Series Principal Account in accordance with Section 4.10(d), in addition to
making any other payments required to be made under this Series Supplement in
respect of the Series 1997-1 Certificates on such Distribution Date.
(d) In addition, on any Early Distribution Date, the
Master Trust Trustee shall withdraw from the Negative Carry Reserve Fund an
amount equal to the product of (x) the amount of funds on deposit in the
Negative Carry Reserve Fund on such Distribution Date and (y) the result
obtained by dividing the aggregate Early Distribution Amounts for such Early
Distribution Date by the Invested Amount as such Early Distribution Date
(without giving effect to the payments required by this Section 9.03), and pay
such amount to the Seller.
(e) The payment of the Early Distribution Amount to the
applicable Series 1997-1 Certificateholder shall constitute payment in full of
the Certificateholder Initial Invested Amount which was the subject of such
Certificateholder's Early Distribution Notice, and such Early Distribution
Initial Invested Amount shall cease to accrue Monthly Interest as of the
Distribution Date. If less than the aggregate total Early Distribution Initial
Invested Amount is the subject of an Early Distribution, a new Series 1997-1
Certificate representing the Early Distribution Initial Invested Amount which
was not subject to such Early Distribution shall be issued to the applicable
Series 1997-1 Certificateholder without cost to such holder within 10 days
after surrender of its Series 1997-1 Certificate to the Master Trust Trustee.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.01 Ratification of Agreement. As supplemented by this
Series Supplement, the Agreement is in all respects ratified and confirmed and
the Agreement as so supplemented by this Series Supplement shall be read, taken
and construed as one and the same instrument.
SECTION 10.02 Counterparts. This Series Supplement may be executed in
two or more counterparts (and by different parties on separate counterparts)
each of which shall be an original, but all of which together shall constitute
one and the same instrument.
SECTION 10.03 GOVERNING LAW. THIS SERIES SUPPLEMENT SHALL BE
CONSTRUED, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED, IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
40
45
PROVISIONS, EXCEPT THAT THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE MASTER
TRUST TRUSTEE SHALL BE DETERMINED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS.
[END OF PAGE]
[SIGNATURE PAGE FOLLOWS]
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46
IN WITNESS WHEREOF, the Seller, the Servicer and the Master
Trust Trustee have caused this Series Supplement to be duly executed by their
respective officers as of the day and year first above written.
NAVISTAR FINANCIAL SECURITIES
CORPORATION
as Seller
By:_____________________________________
Its:____________________________________
NAVISTAR FINANCIAL CORPORATION
as Servicer
By:_____________________________________
Its:____________________________________
THE BANK OF NEW YORK
as Master Trust Trustee
By:_____________________________________
Its:____________________________________
42
47
EXHIBIT A
FORM OF SERIES 1997-1 CERTIFICATE
[Form of the face of the Series 1997-1 Certificates]
Initial
REGISTERED Invested Amount:
Certificate No. R-__
CUSIP NO. _________
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the issuer
or its agent for registration of transfer, exchange, or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of DTC (and any payment is
made to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
DEALER NOTE MASTER TRUST
FLOATING RATE DEALER NOTE
ASSET BACKED CERTIFICATES, SERIES 1997-1
evidencing a fractional undivided interest in certain assets of the
NAVISTAR FINANCIAL DEALER NOTE MASTER TRUST,
the corpus of which consists primarily of (i) prior to the 1990 Trust
Termination Date (as defined in the Pooling and Servicing Agreement defined on
the reverse side hereof), the certificates issued or transferred under the
Pooling and Servicing Agreement dated as of December 1, 1990 (as amended or
supplemented, the "1990 Trust Agreement") by and among Navistar Financial
Corporation ("NFC"), Navistar Financial Securities Corporation ("NFSC" or the
"Seller") and The Chase Manhattan Bank, as trustee, to NFSC or The Bank of New
York, as trustee under the Pooling and Servicing Agreement (the "Master Trust
Trustee"), and all monies due or to become due with respect thereto and all
proceeds thereof, and all rights of the Seller under the terms of the 1990
Trust Agreement, or (ii) effective on the 1990 Trust Termination Date, certain
promissory notes acquired by NFC to finance certain vehicles purchased by a
dealer (the "Dealer Notes") and other property related thereto. This
certificate (a "Series 1997-1 Certificate") does not represent an interest in,
or obligation of, NFSC, NFC or any affiliate thereof.
48
Unless the certificate of authentication hereon has been
executed by or on behalf of the Master Trust Trustee, by manual signature, this
Series 1997-1 Certificate shall not be entitled to any benefit under the
Pooling and Servicing Agreement or be valid for any purpose.
THIS SERIES 1997-1 CERTIFICATE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, 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.
IN WITNESS WHEREOF, the Seller has caused this Certificate to
be duly executed.
NAVISTAR FINANCIAL
SECURITIES CORPORATION
By:
----------------------------------
Name:
Title:
Dated:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates described in the within-mentioned Pooling and
Servicing Agreement.
THE BANK OF NEW YORK,
as Master Trust Trustee
By:
--------------------------
Authorized Signatory
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49
[Form of the reverse of the Series 1997-1 Certifcates]
This certifies that Cede & Co. (the "Series 1997-1
Certificateholder"), is the registered owner of a fractional undivided interest
in certain assets of the NAVISTAR FINANCIAL DEALER NOTE MASTER TRUST (the
"Master Trust") created pursuant to a Pooling and Servicing Agreement dated as
of June 8, 1995 (and as amended and supplemented from time to time, the
"P&S"), by and among NFC, as Servicer, NFSC, as Seller, The Chase Manhattan
Bank, as 1990 Trustee, and the Master Trust Trustee, as supplemented by the
Series 1997-1 Supplement dated as of _______, 1997 (the "Series Supplement")
among the Seller, NFC and the Master Trust Trustee, that are allocated to the
Series 1997-1 Certificateholders' Interest pursuant to the P&S and the Series
Supplement. The P&S and the Series Supplement are hereinafter collectively
referred to as the "Pooling and Servicing Agreement." The corpus of the Master
Trust will include:
(i) prior to the 1990 Trust Termination Date, all
of Seller's right, title and interest in and to (a) the 1990
Trust Seller's Certificate and any 1990 Trust Investor
Certificate issued to the Master Trust, and all monies due or
to become due with respect thereto and all proceeds (as
defined in Section 9-306 of the UCC) thereof and (b) all other
rights of the Seller under the terms of the 1990 Trust
Agreement (including, without limitation, the right to
exchange the 1990 Trust Seller Certificate pursuant to Section
6.12 of the 1990 Trust Agreement, the right to receive
distributions and other payments from the 1990 Trust, the
rights of the Seller upon termination of the 1990 Trust
pursuant to Section 12.04 of the 1990 Trust Agreement and the
right to receive funds on deposit in the Liquidity Reserve
Account); and
(ii) effective on the 1990 Trust Termination Date:
(a) all of the Seller's right, title,
and interest in and to the Eligible Dealer Notes
held by the Seller as of the 1990 Trust Termination
Date, all monies due (including accrued finance
charges) or to become due with respect thereto and
all proceeds (as defined in Section 9-306 of the
UCC) of such Dealer Notes;
(b) the Seller's interest in the
security interests in the Financed Vehicles related
to such Dealer Notes granted by Dealers pursuant to
the Dealer Agreements and any accessions to such
security interests;
(c) the Seller's interest in the
Insurance Proceeds;
(d) all of the 1990 Trust's right, title
and interest in and to the Dealer Notes held by the
1990 Trust as of the 1990 Trust Termination Date,
all monies due (including accrued finance charges)
or to become due with respect thereto and all
proceeds (as defined in Section 9-306 of the UCC) of
such Dealer Notes;
(e) the 1990 Trust's interest in the
security interests in the Financed Vehicles related
to such Dealer Notes granted by Dealers pursuant to
the Dealer Agreements and any accessions to such
security interests;
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50
(f) the 1990 Trust's interest in the
Insurance Proceeds;
(g) 1990 Trust Investment Securities;
(h) funds on deposit in the 1990 Trust
Accounts (other than funds on deposit for the benefit
of, and allocated to, 1990 Trust Investor
Certificates that are not held by the Master Trust);
(i) the Seller's right, title, and
interest in and to all available Eligible Dealer
Notes existing on each Business Day and owned by the
Seller, all monies due (including accrued finance
charges) or to become due with respect thereto and
all proceeds (as defined in Section 9-306 of the
UCC) of such Dealer Notes, the Seller's interest in
the security interests in the Financed Vehicles
related to such Dealer Notes granted by Dealers
pursuant to the Dealer Agreements and any accessions
to such security interests, the Seller's interest in
the Insurance Proceeds;
(j) any Enhancements; and
(k) all other assets and interests
constituting the Master Trust.
In addition to the Investor Certificates, the Master Trust Seller's Certificate
issued pursuant to the Pooling and Servicing Agreement represents the Master
Trust Seller's Interest in the Master Trust. The Master Trust Seller's
Certificate represents the interest in the Master Trust's assets not
represented by the Investor Certificates.
The Dealer Notes consist of promissory notes acquired by NFC
to finance the purchase by certain dealers and manufacturers and other persons
having agreements with NITC to sell certain new and used medium or heavy-duty
trucks and trailers manufactured by NITC or other manufacturers. Generally,
the principal amount of a Dealer Note is equal to the wholesale purchase price
of such vehicles and, subject to certain exceptions, is due upon the retail
sale of the vehicle.
Subject to the terms and conditions of the Pooling and
Servicing Agreement, the Seller may from time to time direct the Master Trust
Trustee, on behalf of the Master Trust, to issue one or more new Series of
Investor Certificates, which will represent fractional undivided interests in
certain of the Master Trust's assets.
This Certificate is issued under and is subject to the terms,
provisions and conditions of the Pooling and Servicing Agreement to which, as
amended and supplemented from time to time, the Series 1997-1 Certificateholder
by virtue of the acceptance hereof assents and is bound. Although a summary of
certain provisions of the Pooling and Servicing Agreement is set forth below,
this Certificate does not purport to summarize the Pooling and Servicing
Agreement and reference is made to the Pooling and Servicing Agreement for
information with respect to the interest, rights, benefits, obligations,
proceeds and duties evidenced hereby and the rights, duties and obligations of
the Master Trust Trustee. A copy of the Pooling and Servicing Agreement
(without schedules and exhibits) may be requested from the Master Trust Trustee
by writing to the Master Trust Trustee at The Bank of New York, Corporate Trust
Office, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporation
Trust Department. To the extent not defined herein, the
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51
capitalized terms used herein, have the meanings ascribed to them in the
Pooling and Servicing Agreement.
The Seller has structured the Pooling and Servicing Agreement
and the Investor Certificates with the intention that the Investor Certificates
will qualify under applicable federal, state, local and foreign tax law as
indebtedness. Except to the extent expressly specified to the contrary in the
Series Supplement, the Seller, the Servicer, the Holders of the Master Trust
Seller's Certificates, each Investor Certificateholder, and each Certificate
Owner agree to treat and to take no action inconsistent with the treatment of
the Investor Certificates (or beneficial interest therein) as indebtedness for
purposes of federal, state, local and foreign income or franchise taxes and any
other tax imposed on or measured by income. Each Investor Certificateholder,
by acceptance of its Certificate and each Certificate Owner, by acquisition of
a beneficial interest in a Certificate, agree to be bound hereby. Each
Certificateholder agrees that it will cause any Certificate Owner acquiring an
interest in a Certificate through it to comply with the Pooling and Servicing
Agreement as to treatment as indebtedness under applicable tax law, as
described herein and in the Pooling and Servicing Agreement.
On each Distribution Date, the Master Trust Trustee shall
distribute to each Series 1997-1 Certificateholder of record at the close of
business on the Business Day preceding the Distribution Date for the related
Due Period (each a "Record Date") such Certificateholder's pro rata share
(based on the aggregate fractional undivided interest represented by the Series
1997-1 Certificates held by such Certificateholder, except as otherwise
provided in the Pooling and Servicing Agreement) of such amounts on deposit in
any Series Account as are payable in respect of the Series 1997-1 Certificates
pursuant to the Pooling and Servicing Agreement. Distributions with respect to
this Certificate will be made by the Master Trust Trustee by check mailed to
the address of the Certificateholder of record appearing in the Certificate
Register without the presentation or surrender of this Certificate or the
making of any notation thereon (except for the final distribution in respect of
this Certificate), except that with respect to Series 1997-1 Certificates
registered in the name of a Depository, including Cede & Co., the nominee for
The Depository Trust Company, distributions will be made in immediately
available funds. Final payment of this Certificate will be made only upon
presentation and surrender of this Certificate at the office or agency
specified in the notice of final distribution delivered by the Master Trust
Trustee to the Certificateholder in accordance with the Pooling and Servicing
Agreement.
This Certificate does not represent an obligation of, or an
interest in, the Seller, the Servicer, or any affiliate of any of them and is
not insured or guaranteed by any governmental agency or instrumentality. This
Certificate is limited in right of payment to certain Collections with respect
to the Class A-5 Investor Certificate or the Dealer Notes, as the case may be,
and certain other amounts, all as more specifically set forth herein and in the
Pooling and Servicing Agreement.
The Pooling and Servicing Agreement may be amended from time
to time (including in connection with the issuance of a Supplemental
Certificate) by the Servicer, the Seller and the Master Trust Trustee, without
the consent of any of the Series 1997-1 Certificateholders, so long as any such
action shall not, as evidenced by an Opinion of Counsel, adversely affect in
any material respect the interests of the Series 1997-1 Certificateholders or
the certificateholders of any other outstanding Series. The Master Trust
Trustee may, but shall not be obligated to, enter into any such
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52
amendment which affects the Master Trust Trustee's rights, duties or immunities
under the Pooling and Servicing Agreement or otherwise.
The Pooling and Servicing Agreement may also be amended from
time to time (including in connection with the issuance of a Supplemental
Certificate) by the Servicer, the Seller and the Master Trust Trustee with the
consent of the Holders of Investor Certificates evidencing not less than
66-2/3% of the aggregate unpaid principal amount of the Investor Certificates
of all adversely affected Series, for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of the Pooling
and Servicing Agreement or of modifying in any manner the rights of the
Investor Certificateholders; provided, however, that no such amendment to the
Pooling and Servicing Agreement shall (i) reduce in any manner the amount of or
delay the timing of distributions to be made to Investor Certificateholders or
deposits of amounts to be so distributed without the consent of such each
affected Investor Certificateholder; (ii) change the definition or the manner
of calculating the interest of any Investor Certificateholder or the amount
available under any Enhancement without the consent of each affected Investor
Certificateholder; (iii) reduce the percentage required to consent to any
amendment without the consent of each Investor Certificateholder; or (iv)
adversely affect the rating of any Series or Class by each Rating Agency
without the consent of the Holders of Investor Certificates of such Series or
Class evidencing not less than 66-2/3% of the aggregate unpaid principal amount
of the Investor Certificates of such Series or Class.
The Master Trust Trustee has the right, without the consent of
the Holders of any Investor Certificates, to vote, or to consent or withhold
consent with respect to, Class A-5 Certificate and any 1990 Trust Investor
Certificate issued to the Master Trust on any matter for which votes or
consents are solicited under the 1990 Trust Agreement, provided that such
action will not, as evidenced by an officer's certificate of the Servicer, have
a material adverse effect on the Holders of any Investor Certificates. The
Master Trust Trustee also has the right, with the consent of the Holders of the
Applicable Voting Percentage of the Holders of the Investor Certificates, to
vote, or to consent or withhold consent, with respect to the Class A-5
Certificate and any other 1990 Trust Investor Certificate issued to the Master
Trust on any matter for which votes or consents are solicited under the 1990
Trust Agreement. "Applicable Voting Percentage" means, with respect to any
matter for which votes or consents are solicited under the 1990 Trust
Agreement, the percentage of votes or consents of the 1990 Trust Investor
Certificates needed to pass the proposed matter.
As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, the transfer of this Certificate is
registrable in the Certificate Register of the Master Trust Trustee upon
surrender of this Certificate for registration of transfer at the office or
agency maintained by the Master Trust Trustee in New York, New York,
accompanied by a written instrument of transfer in form satisfactory to the
Master Trust Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized, and thereupon one or more new Series 1997-1
Certificates of authorized denominations evidencing the same aggregate
fractional undivided interest will be issued to the designated transferee or
transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Pooling and Servicing
Agreement.
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As provided in the Pooling and Servicing Agreement and subject
to certain limitations therein set forth, Series 1997-1 Certificates are
exchangeable for new Series 1997-1 Certificates evidencing like aggregate
fractional undivided interests as requested by the Certificateholder
surrendering such Certificates. No service charge may be imposed for any such
exchange but the Master Trust Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
therewith.
The Servicer, the Master Trust Trustee, the Transfer Agent and
any agent of any of them, may treat the Person in whose name this Certificate
is registered as the owner hereof for all purposes, and neither the Servicer
nor the Master Trust Trustee, the Transfer Agent, nor any agent of any of them,
shall be affected by notice to the contrary except in certain circumstances
described in the Pooling and Servicing Agreement.
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ASSIGNMENT
Social Security or other identifying number of assignee
____________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
__________________________________________
(name and address of assignee)
the within certificate and all rights thereunder, and hereby irrevocably
constitutes and appoints __________, attorney, to transfer said certificate on
the books kept for registration thereof, with full power of substitution in the
premises.
Dated: 1
------------------ ------------------------
Signature Guaranteed:
-------------------------
--------------------
1 NOTE: The signature of this assignment must correspond with the name of
the registered owner as it appears on the reverse of the within Certificate in
every particular, without alteration, enlargement or any change whatsoever.
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EXHIBIT B-1
FORM OF MONTHLY SERVICER AND SETTLEMENT CERTIFICATE
DEALER NOTE MASTER TRUST
___________________
DEALER NOTE ASSET
BACKED CERTIFICATES,
SERIES 1997-1
___________________
Under the Series 1997-1 Supplement dated as of _______, 1997 (the
"Supplement") by and among Navistar Financial Corporation, ("NFC"), Navistar
Financial Securities Corporation ("NFSC") and The Bank of New York, as trustee
(the "Master Trust Trustee") to the Pooling and Serving Agreement dated as of
June 8, 1995 (the "Agreement") by and among NFC, NFSC, the Master Trust Trustee
and The Chase Manhattan Bank, as 1990 Trust Trustee, the Master Trust Trustee
is required to prepare certain information each month regarding current
distributions to certain accounts and payment to Series 1997-1
Certificateholders as well as the performance of the Master Trust during the
previous month The information which is required to be prepared with respect
to the Distribution Date of ______ __, ____, the Transfer Date of ________, __
___ and with respect to the performance of the Master Trust during the Due
Period ended on ____ __, ____ and the Distribution Period ended _____ __, ____
is set forth below. Certain of the information is presented on the basis of an
original principal amount of $1,000 per Investor Certificate. Certain other
information is presented based on the aggregate amounts for the Master Trust as
a whole. Capitalized terms used but not otherwise defined herein shall have
the meanings assigned to such terms in the Agreement and the Supplement.
1. NFC is Servicer under the Agreement.
2. The undersigned is a Servicing Officer.
3. Eligible Investments in the Excess Funding Account:
a. The aggregate amount of funds invested in
Eligible Investments ...............................$__________
b. Description of each Eligible Investment:
c. The rate of interest applicable to each such
Eligible Investment.................................________%
d. The rating of each such Eligible Investment.........___________
56
4. The total amount to be distributed on the Series
1997-1 Certificates on the Distribution Date.................$__________
5. The total amount, if any, to be distributed on the
Series 1997-1 Certificates on the Distribution Date
allocable to the Invested Amount.............................$__________
6. The total amount, if any, to be distributed on
the Series 1997-1 Certificates on the Distribution
Date allocable to interest on the Series 1997-1
Certificates.................................................$__________
7. The Invested Amount as of the Distribution Date
(after giving effect to all distributions that will occur
on the Distribution Date)
8. Eligible Investments in the Series Principal Account:
a. The aggregate amount of funds invested in
Eligible Investments......................................$__________
b. Description of each Eligible Investment:
c. The rate of interest applicable to each such
Eligible Investment........................................_________%
d. The rating of each such Eligible Investment................__________
9. Eligible Investments in the Negative Carry Reserve
Fund:
a. The aggregate amount of funds invested in
Eligible Investments......................................$__________
b. Description of each Eligible Investment:
c. The rate of interest applicable to each such
Eligible Investment.........................................._______%
d. The rating of each such Eligible Investment................__________
10. Eligible Investments in the Liquidity Reserve
Account:
a. The aggregate amount of funds invested in
Eligible Investments......................................$__________
b. Description of each Eligible Investment:
2
57
c. The rate of interest applicable to each such
Eligible Investment........................................_______%
d. The rating of each such Eligible Investment..............__________
11. The aggregate amount of Dealer Notes issued to finance
OEM Vehicles, as of the end of the Transfer Date............$__________
12. The Dealers with the five largest aggregate outstanding
principal amounts of Dealer Notes in the 1990 Trust as of
the end of the Transfer Date:
i) ..................................................________________
ii) .................................................________________
iii) ................................................________________
iv) .................................................________________
v) ..................................................________________
13. The information set forth in appendixes B-1A nd B-1B attached
hereto.
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APPENDIX B1-A
FORM OF MONTHLY CERTIFICATEHOLDERS'
STATEMENT
NAVISTAR FINANCIAL DEALER NOTE TRUST 1990
__________
FLOATING RATE DEALER NOTE
PASS-THROUGH CERTIFICATES
__________
Under the Pooling and Servicing Agreement dated as of December 1, 1990 by
and among Navistar Financial Corporation ("NFC"), Navistar Financial Securities
Corporation and The Chase Manhattan Bank, as Trustee, the Trustee is required
to prepare certain information each month regarding current distributions to
Investor Accounts and payments to Investor Certificateholders as well as the
performance of the Trust during the previous month. The information which is
required to be prepared with respect to the distribution of __________________,
19___ and with respect to the performance of the Trust during the Due Period
ended on ____________________, 19___ is set forth below. Certain of the
information is presented on the basis of an original principal amount of $1,000
per Investor Certificate. Certain other information is presented based on the
aggregate amounts for the Trust as a whole. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned to them in the
Agreement.
A. Information Regarding Current Payments (Stated on the Basis of $1,000
Original Principal Amount).
1. The total amount of the payment to each Class of
Investor Certificateholders on _______________, 19___, per
$1,000 interest:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
59
2. The amount of the payment set forth in paragraph 1
above in respect of interest on each Class of Investor
Certificates, per $1,000 interest:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
3. The amount of the payment set forth in paragraph 1 above
in respect of principal on each Class of Investor
Certificates, per $1,000 interest:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
B. Information Regarding the Performance of the Trust.
1. Collections, Uses.
(a) The aggregate amount of Dealer Finance Charges for
the Due Period.....................................$__________
(b) The aggregate amount of NITC Finance Charges for
the Due Period.....................................$__________
(c) The aggregate amount of Principal Collections received
during the Due Period..............................$__________
(d) The aggregate amount of Principal Collections allocable
to the Amortizing Classes..........................$__________
(e) The aggregate amount of Principal Collections processed
during the Due Period which were deposited in the Spread
Account............................................$__________
2
60
(f) The aggregate amount of Principal Collections
processed during the Due Period which were
deposited in the Liquidity Reserve Account.............$__________
(g) The aggregate amount of Principal Collections
processed during the Due Period which were used
to purchase new Dealer Notes...........................$__________
(h) The aggregate amount of Principal Collections
processed during the Due Period which were used to
purchase Investment Securities.........................$__________
(i) The aggregate amount of Principal Collections
processed during the related Due Period which were paid
to the Seller..........................................$__________
2. Dealer Notes and Investment Securities in the Trust;
Certificate Principal Account.
(a) The aggregate amount of Dealer Notes and Investment
Securities in the Trust as of the end of the Due
Period ended on __________, 19___ (which reflects
the Dealer Notes and Investment Securities
represented by both the Seller Certificate and
the Investor Certificates).............................$__________
(b) The amount of Dealer Notes and Investment Securities
in the Trust represented by the Investor Certificates
(the "Total Investor Interest") as of the Due Period
ended on __________, 19___.............................$__________
(c) The Total Investor Interest set forth in paragraph
2(b) above as a percentage of the aggregate amount of
Dealer Notes and Investment Securities set forth in
paragraph 2(a).........................................__________%
(d) The Total Invested Amount after giving effect to the
payments made on the Distribution Date..............$____________
3
61
(e) The total amount withdrawn from the Certificate
Principal Account and deposited in the Distribution Account
for the benefit of each Amortizing Class in respect of
Principal Collections on the related Transfer Date:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
3. Investor Certificate Interest.
(a) The total amount withdrawn from the Collections Account
and deposited in the Distribution Account on the related
Transfer Date in respect of Investor Certificate Interest
and any previously existing Deficiency
Amount................................................$__________
(b) The amount of the payment to each
Class in respect of Class Certificate
Interest and any previously existing
Deficiency Amount on the Distribution Date:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
(c) The Deficiency Amount (if any) for such Distribution
Date.................................................$__________
(d) The amount of such Deficiency Amount allocable to each
Class:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
4
62
(e) The amount (if any) of the Deficiency Amount from the
preceding Distribution Date being reimbursed on the
Distribution Date..............................$__________
4. Losses.
(a) The aggregate amount of Dealer Notes charged-off as
uncollectible during the Due Period ended on
____________, 19__ allocable to the Investor
Certificates (the "Investor Loss Amount")......$__________
(b) The Class Loss Amount for each Class (if any):
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
5. Reimbursement of Losses; Charged-Off Amounts.
(a) The amount of Investor Loss Amount reimbursed or
allocated to the Seller on the related Transfer
Date.............................................$__________
(b) The aggregate amount of Class Loss Amounts (if any)
reimbursed or allocated to the Seller on the Distribution
Date.............................................$__________
(c) The Class Charged-Off Amount for each Class for the
immediately preceding Due Period:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
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63
(d) The Class Charged-Off Amount for each Class for the Due
Period:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
(e) For each Amortizing Class, the
positive (negative) difference between the
amounts set forth in paragraphs 5(e) and
5(f) above, per $1,000 interest (which will
have the effect of increasing (reducing),
the related Class Invested Amount and the
related Class Investor Interest):
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
6. Class Invested Amounts; Class Investor Interests.
(a) Each Class Invested Amount after giving effect to the
payments made on the Distribution Date:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
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64
(b) Each Class Investor Interest after giving effect to the
payments made on the Distribution Date:
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
Class ___ ............. $__________
7. Servicing Fee.
(a) The aggregate amount of the Monthly Servicing Fee
payable by the Trust to the Servicer for the month of
____________, 19___..................................$__________
(b) The aggregate amount of the Monthly Servicing Fee set
forth in paragraph 6(a) above allocable to the Investor
Certificateholders....................................$__________
8. Available Subordinated Amount; Minimum Seller Interest.
(a) The Available Subordinated Amount as of the end of the ___ day of
____________, 19___...................................$__________
(b) The Minimum Seller Interest as of the ___ day of
________, 19___ is equal to...........................$__________
9. Class Amortization Percentages.
The Class Amortization Percentage for each Amortizing Class:
Class ___ ............. __________%
Class ___ ............. __________%
Class ___ ............. __________%
Class ___ ............. __________%
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THE CHASE MANHATTAN BANK
By: _________________________________
Title: ______________________________
IN WITNESS WHEREOF, the undersigned has duly executed and delivered this
certificate this ___ day of ___________, _____.
NAVISTAR FINANCIAL CORPORATION,
as Servicer
By: _________________________________
Its: ________________________________
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66
APPENDIX B1-B
FORM OF MONTHLY SERVICER CERTIFICATE
DEALER NOTE TRUST 1990
_______________
FLOATING RATE
PASS-THROUGH CERTIFICATES
_______________
The undersigned, a duly authorized representative of Navistar Financial
Corporation ("NFC"), as Servicer pursuant to the Pooling and Servicing
Agreement dated as of December 1, 1990 (the "Agreement") by and among NFC,
Navistar Financial Securities Corporation and The Chase Manhattan Bank, as
Trustee, does hereby certify with respect to the Due Period ending __________
___, 19___ and the related Distribution Period ending __________ ___, 19___ as
follows:
1. NFC is Servicer under the Agreement.
2. The undersigned is a Servicing Officer.
3. The amount of the Advance, if any, for the prior Due
Period was equal to.................................$__________
4. The amount of Dealer Finance Charge Collections for
the prior Due Period was equal to...................$__________
5. The amount of NITC Finance Charges for the prior Due
Period was equal to.................................$__________
6. The aggregate amount of all payments made pursuant
to Section 4.03 on the prior Distribution Date was
equal to............................................$__________
7. The Deficiency Amount as of the immediately
preceding Distribution Date was equal to............$__________
8. The Available Subordinated Amount as of the
beginning of the Due Period was equal to.............$_________
9. The Maximum Subordinated Amount as of the beginning
of the Due Period was equal to.......................$_________
10. The Projected Spread for the Distribution Period is
equal to.............................................$__________
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11. The amount on deposit in the Spread Account as of the Spread
Account Funding Date was equal to..........................$__________
12. The principal amount of Dealer Notes outstanding as
of the end of the Due Period is equal to...................$__________
13. The average daily balance of Dealer Notes
outstanding during the Due Period is equal to..............$__________
14. The amount of the Monthly Servicing Fee for the Due
Period is equal to.........................................$__________
15. The amount of the Investor Monthly Servicing Fee
for the Due Period is equal to.............................$__________
16. The amount of Dealer Finance Charges for the Due
Period is equal to.........................................$__________
17. The amount of NITC Finance Charges for the Due Period is
equal to...................................................$__________
18. The amount of Interest Income for the Due Period is equal
to.........................................................$__________
19. The amount of Investor Interest Income for the Due Period
is equal to................................................$__________
20. The amount of the Seller Interest Income for the
Due Period is equal to.....................................$__________
21. The average daily Seller Interest during the Due
Period is equal to.........................................$__________
22. The Total Investor Percentage for the Due Period is equal
to.........................................................$__________
23. The Excess Servicing for the Due Period is equal
to.........................................................$__________
24. The Deficiency Amount as of the current
Distribution Date (after giving effect to the payments made
pursuant to Section 4.03 of the Agreement) is equal
to.........................................................$__________
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25. The amount of the Deficiency Amount specified in 24 above
allocable to each Class:
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
26. The total amount of Advance Reimbursements for the
Due Period is equal to...............................$__________
27. The aggregate amount to be deposited in the
Distribution Account on the Transfer Date for
distribution on the Distribution Date to the
Investor Certificateholders is equal to..............$__________
28. The amounts to be paid out to the Holders of each
Class on the Distribution Date in respect of Investor
Certificate Interest:
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
29. The aggregate principal amount of Dealer Notes
repaid during the Due Period is equal to.............$__________
30. The aggregate principal amount of Dealer Notes
purchased by the Trust during the Due Period is
equal to.............................................$__________
31. The aggregate principal amount of Investment
Securities as of the end of the Due Period is
equal to.............................................$__________
32. The amount of Principal Losses for the Due Period
is equal to..........................................$__________
33. The amount of the Investor Loss Amount is equal
to...................................................$__________
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34. The Maximum Subordinated Amount as of the Distribution
Date (after giving effect to the transactions set forth in
Section 4.03 of the Agreement) is equal to................$__________
35. The Available Subordinated Amount as of the
Distribution Date (after giving effect to the
transactions set forth in Section 4.03 of the Agreement)
is equal to.............................................. $__________
36. The Seller Interest as of the Distribution Date
(after giving effect to the transactions set forth in
Section 4.03 of the Agreement) is equal to............... $__________
37. The Minimum Seller Interest (after giving effect to
the transactions set forth in Section 4.03 of the
Agreement) is equal to................................... $__________
38. The amount on deposit in the Spread Account (after
giving effect to the transactions set forth in Section
4.03 of the Agreement) is equal to....................... $__________
AMORTIZATION TERM
39. The Class Loss Amount for the Due Period for each Class:
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
40. The Class Charged-Off Amounts for each Class:
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
41. The amount of Principal Collections on
deposit in the Certificate Principal
Account..................................................$__________
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42. The amount of such Principal Collections allocable to each
Amortizing Class:
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
Class ___ .................. $__________
43. The amount on deposit in the Liquidity Reserve
Account (after giving effect to the transactions made
pursuant to Section 4.03 of the Agreement) is equal
to....................................................... $__________
IN WITNESS WHEREOF, the undersigned has duly executed and delivered this
certificate this ___ day of ______________,199_.
NAVISTAR FINANCIAL CORPORATION,
as Servicer,
By: ________________________________
Its: ________________________________
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EXHIBIT B-2
FORM OF MONTHLY SERVICER AND SETTLEMENT CERTIFICATE
DEALER NOTE MASTER TRUST
___________________
DEALER NOTE ASSET
BACKED CERTIFICATES,
SERIES 1997-1
___________________
Under the Series 1997-1 Supplement dated as of _______, 1997
(the "Supplement") by and among Navistar Financial Corporation, ("NFC"),
Navistar Financial Securities Corporation ("NFSC") and The Bank of New York, as
trustee (the "Master Trust Trustee") to the Pooling and Serving Agreement dated
as of June 8, 1995 (the "Agreement") by and among NFC, NFSC, the Master Trust
Trustee and The Chase Manhattan Bank, as 1990 Trust Trustee, the Master Trust
Trustee is required to prepare certain information each month regarding current
distributions to certain accounts and payments to Series 1997-1
Certificateholders as well as the performance of the Master Trust during the
previous month The information which is required to be prepared with respect to
the Distribution Date of ______ __, ____, the Transfer Date of ________, __ ___
and with respect to the performance of the Master Trust during the Due Period
ended on ____ __, ____ and the Distribution Period ended _____ __, ____ is set
forth below. Certain of the information is presented on the basis of an
original principal amount of $1,000 per Investor Certificate. Certain other
information is presented based on the aggregate amounts for the Master Trust as
a whole. Capitalized terms used but not otherwise defined herein shall have
the meanings assigned to such terms in the Agreement and the Supplement .
1. NFC is Servicer under the Agreement.
2. The undersigned is a Servicing Officer.
3. Master Trust Information.
3.1 The amount of the Advance, if any, for the
Due Period.................................$__________
3.2 The amount of NITC Finance Charges for the
Due period.................................$__________
3.3 The average daily balance of Dealer Notes
outstanding during the Due Period..........$__________
3.4 The total amount of Advance Reimbursements
for the Due Period.........................$__________
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3.5 The aggregate principal amount of Dealer
Notes repaid during the Due Period.........$__________
3.6 The aggregate principal amount of Dealer
Notes purchased by the Master Trust
during the Due Period......................$__________
3.7 The amount of the Servicing Fee for the
Due Period.................................$__________
3.8 The average daily Master Trust Seller's
Interest during the Due Period.............$__________
3.9 The Master Trust Seller's Interest as
of the Distribution Date (after giving
effect to the transactions set forth
in Article IV of the Supplement)...........$__________
3.10 The aggregate amount of Collections
for the Due Period.........................$__________
3.11 The aggregate amount of Finance Charge
Collections for the Due Period.............$__________
3.12 The aggregate amount of Principal
Collections for the Due Period.............$__________
3.13 The amount of Dealer Note Losses
for the Due Period.........................$__________
3.14 The aggregate amount of Dealer Notes as
of the last day of the Due Period..........$__________
3.15 The aggregate amount of funds on
deposit in the Excess Funding Account as
of the end of the last day of the Due
Period (after giving effect to the
transactions set forth in Article IV of
the Supplement and Article IV of the
Agreement).................................$__________
3.16 Eligible Investments in the Excess
Funding Account:
a. The aggregate amount of funds
invested in Eligible
Investments........................$__________
b. Description of each Eligible
Investment:
c. The rate of interest applicable to
each such Eligible Investment......._________%
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d. The rating of each such Eligible
Investment..........................__________
3.17 The aggregate amount of Dealer Notes
issued to finance OEM Vehicles, as of
the end of the Due Period..................$__________
3.18 The Dealers with the five largest aggregate
outstanding principal amounts of Dealer
Notes in the Master Trust as of the end of
the Due Period:
i)......................... __________________________
ii)........................ __________________________
iii)....................... __________________________
iv)........................ __________________________
v)......................... __________________________
4. Series 1997-1 Information.
4.1 The Deficiency Amount as of the Transfer
Date (after giving effect to the
transactions set forth in Article IV of
the Supplement)............................$__________
4.2 The Maximum Subordinated Amount as of
the Transfer Date (after giving effect to
the transactions set forth in Article IV
of the Supplement).........................$__________
4.3 The Projected Spread for the following
Distribution Period........................$__________
4.4 The amount on deposit in the Spread
Account as of the Transfer Date (after
giving effect to the transactions set
forth in Article IV of the Supplement).....$__________
4.5 The aggregate amount on deposit in
the Liquidity Reserve Account as of
the Transfer Date (after giving effect
to the transactions set forth in Article
IV of the Supplement)......................$__________
4.6 The aggregate amount on deposit in the
Negative Carry Reserve Fund as of the
Transfer Date (after giving effect to the
transactions set forth in Article IV of the
Supplement)................................$__________
4.7 The Invested Amount as of the Distribution
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Date (after giving effect to the
transactions set forth in Article IV of
the Supplement and to the payments made
on the Distribution Date)..................$__________
4.8 The amount of Series Allocable Dealer
Notes Losses for the Due Period............$__________
4.9 The amount of Series Allocable Finance
Charge Collections for the Due Period......$__________
4.10 The amount of Series Allocable Principal
Collections for the Due Period.............$__________
4.11 The amount of Series Principal Account
Losses for the Due Period..................$__________
4.12 The amount of Investor Dealer Note Losses
for the Due Period.........................$__________
4.13 The amount of Investor Finance Charge
Collections for the Due Period.............$__________
4.14 The amount of Investor Principal
Collections for the Due Period.............$__________
4.15 The amount of Available Certificateholder's
Interest Collections for the Due Period....$__________
4.16 The amount of Series 1997-1 Shared
Principal Collections for the
Due Period.................................$__________
4.17 The aggregate amount of the Series 1997-1
Principal Shortfall, if any, for the
Due Period.................................$__________
4.18 The Seller's Percentage for the Due
Period...................................... ________%
4.19 The Excess Seller's Percentage for the Due
Period...................................... ________%
4.20 The aggregate amount of Seller's Principal
Collections for the Due Period.............$__________
4.21 The amount of Available Seller's Finance
Charge Collections for the Due Period......$__________
4.22 The aggregate amount of Available Seller's
Principal Collections for the Due Period...$__________
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4.23 The aggregate amount of Excess Seller's
Principal Collections for the Due Period...$__________
4.24 The Controlled Amortization Amount, if
applicable, for the Due Period.............$__________
4.25 The Minimum Series 1997-1 Master Trust
Seller's Interest as of the Distribution
Date (after giving effect to the
transactions set forth in Article IV of
the Supplement)............................$__________
4.26 The Series 1997-1 Allocation Percentage
for the Due Period.........................._________%
4.27 The Floating Allocation Percentage for the
Due Period.................................._________%
4.28 The Principal Allocation Percentage,
if applicable, for the Due Period..........._________%
4.29 The total amount to be distributed on the
Series 1997-1 Certificated on the
Distribution Date..........................$__________
4.30 The total amount, if any, to be distributed
on the Series 1997-1 Certificates on the
Distribution Date allocable to the Invested
Amount.....................................$__________
4.31 The total amount, if any, to be distributed
on the Series 1997-1 Certificates on the
Distribution Date allocable to interest on
the Series 1997-1 Certificates.............$__________
4.32 The Draw Amount as of the Transfer Date....$__________
4.33 The amount of Investor Charge-Offs as of
Transfer Date..............................$__________
4.34 The amount of reimbursement of Investor
Charge- Offs as of the Transfer Date.......$__________
4.35 The amount of the Investor Servicing Fee
to be paid on such Distribution Date.......$__________
4.36 The aggregate amount of funds on deposit
in the Negative Carry Reserve Fund as of
the end
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of the last day of the Due Period (after
giving effect to the payments and
adjustments made pursuant to Article IV
of the Supplement and of the Agreement)....$__________
4.37 The aggregate amount of funds on deposit
in the Series Principal Account as of the
end of the last day of the Due Period
(after giving effect to the payments and
adjustments made pursuant to Article IV
of the Supplement and of the Agreement)....$__________
4.38 The aggregate amount of funds on deposit
in the Spread Account as of the end of the
last day of the Due Period (after giving
effect to payments and adjustments made
pursuant to Article IV of the Supplement
and the Agreement).........................$__________
4.39 Eligible Investments in the Series
Principal Account:
a. The aggregate amount of funds
invested in Eligible Investments...$__________
b. Description of each Eligible
Investment:
c. The rate of interest applicable to
each such Eligible Investment......._________%
d. The rating of each such Eligible
Investment..........................__________
4.40 Eligible Investments in the Negative Carry
Reserve Fund:
a. The aggregate amount of funds
invested in Eligible Investments...$__________
b. Description of each Eligible
Investment:
c. The rate of interest applicable to
each such Eligible Investment......._________%
d. The rating of each such Eligible
Investment..........................__________
4.41 Eligible Investments in the Liquidity
Reserve Account:
a. The aggregate amount of funds
invested in Eligible Investments...$__________
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b. Description of each Eligible
Investment:
c. The rate of interest applicable to
each such Eligible Investment......._________%
d. The rating of each such Eligible
Investment..........................__________
4.42 The amount of Excess Interest Collections
for the Due Period.........................$__________
4.43 The amount of Investor Principal
Collections treated as Shared Principal
Collections for the Due Period.............$__________
4.44 The amount of Excess Interest Collections
for the Due Period allocated to other
Series.....................................$__________
4.45 The amount of Investor Principal
Collections treated as Shared Principal
Collections for the Due Period allocated
to Other Series............................$__________
4.46 The percentages and all other information
calculated pursuant to Sections 6.01 and
7.01 of the Supplement.....................$__________
4.47 The amount of Remaining Available Seller's
Principal Collections for the Due Period...$__________
4.48 The amount of Series 1997-1 Shared Seller's
Principal Collections for the Due Period...$__________
4.49 The aggregate amount of Shared Seller's
Principal Collections from Other Series for
the Due Period.............................$__________
4.50 The amount of all Shared Seller's Principal
Collections allocated to Series 1997-1 for
the Due Period.............................$__________
4.51 The aggregate amount of all Shared Seller's
Principal Collections allocated to Other
Series for the Due Period..................$__________
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IN WITNESS WHEREOF, the undersigned has duly executed and
delivered this certificate this ___ day of ___________, _____.
NAVISTAR FINANCIAL CORPORATION,
as Servicer
By: _________________________
Its: _________________________
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