Exhibit 10.3
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CUSTODIAN AGREEMENT
BETWEEN
NAVISTAR FINANCIAL CORPORATION
CUSTODIAN
AND
NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION
SELLER
DATED AS OF NOVEMBER 5, 1997
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THIS CUSTODIAN AGREEMENT, dated as of November 5, 1997 is made between
Navistar Financial Corporation, a Delaware corporation, as Custodian (the
"Custodian"), and Navistar Financial Retail Receivables Corporation, a Delaware
corporation (the "Seller").
WHEREAS, simultaneously herewith Navistar Financial Corporation (in its
capacity as seller, "NFC") and the Seller are entering into a Purchase Agreement
of even date herewith (the "Purchase Agreement"), pursuant to which NFC shall
sell, transfer and assign to the Seller without recourse all of its right, title
and interest in and to the Receivables and certain related rights and interests
therein;
WHEREAS, the Purchase Agreement contemplates that the Seller may enter into
the Further Transfer and Servicing Agreements with the Issuer, pursuant to which
the Seller shall sell, transfer and assign to the Issuer without recourse, all
of the Seller's right, title and interest in, to and under, among other things,
(a) the Receivables and (b) the custodian agreement to be entered into
simultaneously with the Further Transfer and Servicing Agreements, pursuant to
which the Seller shall revocably appoint the Custodian as custodian of the
Receivables Files pertaining to the Receivables; and
WHEREAS, in connection with any such sale, transfer and assignment, the
Seller desires for the Custodian to act as custodian of the Receivables for the
benefit of the Issuer.
NOW, THEREFORE, in consideration of the mutual agreements herein contained
and of other good and valuable consideration the receipt and adequacy of which
are hereby acknowledged, the parties agree as follows:
1. Certain Definitions. Capitalized terms used but not otherwise defined
herein shall have the respective meanings assigned them in Part I of Appendix A
to the Pooling and Servicing Agreement of even date herewith among the Issuer,
the Seller and Navistar Financial Corporation, as Servicer (as it may be
amended, supplemented or modified from time to time, the "Pooling and Servicing
Agreement"). All references herein to "the Agreement" or "this Agreement" are
to this Custodian Agreement as it may be amended, supplemented or modified from
time to time, the exhibits hereto and the capitalized terms used herein which
are defined in such Appendix A, and all references herein to Sections and
subsections are to Sections and subsections of this Agreement unless otherwise
specified. The rules of construction set forth in Part II of such Appendix A
shall be applicable to this Agreement.
2. Appointment of Custodian; Acknowledgment of Receipt. Subject to the
terms and conditions hereof, the Seller hereby appoints the Custodian, and the
Custodian hereby accepts such appointment, to act as agent of the Seller as
Custodian to maintain custody of the Receivable Files pertaining to the
Receivables for which from time to time the Seller is the Holder thereof. The
Custodian hereby acknowledges that the Seller may sell, transfer and assign all
of its right, title and interest under this Agreement to the Issuer pursuant to
the Further Transfer and Servicing Agreements. The Custodian hereby agrees, in
connection with any such sale, transfer and assignment, to act as Custodian for
the benefit of the Issuer with respect to those Receivables of which from time
to time the Issuer is the Holder. In performing its duties hereunder, the
Custodian agrees to act with reasonable care, using that degree of skill and
attention that the Custodian exercises with respect to receivable files relating
to comparable medium and heavy duty truck, bus
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and trailer receivables that the Custodian services and holds for itself or
others. The Custodian hereby acknowledges receipt of the Receivable File for
each Receivable listed on the Schedule of Receivables.
3. Maintenance at Office. The Custodian agrees to maintain each
Receivable File at its principal office at Navistar Financial Corporation, 0000
Xxxx Xxxx Xxxx, Xxxxxxx Xxxxxxx, Xxxxxxxx 00000, or at such other office of the
Custodian as shall from time to time be identified to the Holder of the related
Receivable upon 30 days' prior written notice.
4. Duties of Custodian.
(a) Safekeeping. The Custodian shall hold each Receivable File described
herein on behalf of the Holder of the related Receivable for the use and benefit
of such Holder and, if applicable, Interested Parties and shall maintain such
accurate and complete accounts, records and computer systems pertaining to each
Receivable File described herein as shall enable the Seller and the Issuer to
comply with their respective obligations under the Purchase Agreement and the
Further Transfer and Servicing Agreements. Each Receivable shall be identified
as such on the books and records of the Custodian to the extent the Custodian
reasonably determines to be necessary to comply with the terms and conditions of
the Purchase Agreement and, if applicable, the Further Transfer and Servicing
Agreements. The Custodian shall conduct, or cause to be conducted, periodic
physical inspections of the Receivable Files held by it under this Agreement,
and of the related accounts, records and computer systems, in such a manner as
shall enable the Issuer and the Custodian to verify the accuracy of the
Custodian's inventory and record keeping. The Custodian shall promptly report
to the Holder of a Receivable any failure on its part to hold the related
Receivable File described herein and maintain its accounts, records and computer
systems as herein provided and promptly take appropriate action to remedy any
such failure.
(b) Access to Records. Subject only to the Custodian's security
requirements applicable to its own employees having access to similar records
held by the Custodian, the Custodian shall permit the Holder of a Receivable or
its duly authorized representatives, attorneys or auditors to inspect the
related Receivable File described herein and the related accounts, records and
computer systems maintained by the Custodian pursuant hereto at such times as
such Holder may reasonably request.
(c) Release of Documents. The Custodian shall release any Receivable (and
its related Receivable File) in the Receivable Files described herein to the
Seller, the Servicer or the Issuer, as appropriate, under the circumstances
provided in the Purchase Agreement and the Further Transfer and Servicing
Agreements.
(d) Administration; Reports. In general, the Custodian shall attend to all
non-discretionary details in connection with maintaining custody of the
Receivable Files described herein. In addition, the Custodian shall assist the
Issuer generally in the preparation of routine reports to the holders of
Securities, if any, or to regulatory bodies, to the extent necessitated by the
Custodian's custody of the Receivable Files described herein.
5. Instructions; Authority to Act. The Custodian shall be deemed to have
received proper instructions from the Issuer with respect to the Receivable
Files described herein
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upon its receipt of written instructions signed by an Authorized Officer. A
certified copy of a by-law or of a resolution of the appropriate governing body
of the Issuer (or, as appropriate, the Owner Trustee on behalf of the Issuer)
may be received and accepted by the Custodian as conclusive evidence of the
authority of any such officer to act and may be considered as in full force and
effect until receipt of written notice to the contrary. Such instructions may
be general or specific in terms.
6. Indemnification By the Custodian. The Custodian agrees to indemnify
the Issuer and each Trustee with respect to any Securities for any and all
liabilities, obligations, losses, damage, payments, costs or expenses of any
kind whatsoever that may be imposed on, incurred or asserted against the Issuer
or any such Trustee as the result of any act or omission in any way relating to
the maintenance and custody by the Custodian of the Receivable Files described
herein; provided, however, that the Custodian shall not be liable to the Issuer
or any such Trustee, respectively, for any portion of any such amount resulting
from the willful misfeasance, bad faith or gross negligence of the Issuer or any
such Trustee, respectively.
7. Advice of Counsel. The Custodian, the Seller and, upon execution of
the Further Transfer and Servicing Agreements, the Issuer further agree that the
Custodian shall be entitled to rely and act upon advice of counsel with respect
to its performance hereunder and shall be without liability for any action
reasonably taken pursuant to such advice, provided that such action is not in
violation of applicable federal or state law.
8. Effective Period, Termination, and Amendment; Interpretive and
Additional Provisions. This Agreement shall become effective as of the date
hereof, shall continue in full force and effect until terminated as hereinafter
provided, may be amended at any time by mutual agreement of the parties hereto
and may be terminated by either party by written notice to the other party, such
termination to take effect no sooner than sixty (60) days after the date of such
notice. Notwithstanding the foregoing, if Navistar Financial Corporation resigns
as Servicer under the Further Transfer and Servicing Agreements or if all of the
rights and obligations of the Servicer have been terminated under the Further
Transfer and Servicing Agreements, this Agreement may be terminated by the
Issuer or by any Persons to whom the Issuer has assigned its rights hereunder.
As soon as practicable after the termination of this Agreement, the Custodian
shall deliver the Receivable Files described herein to the Issuer or the
Issuer's agent at such place or places as the Issuer may reasonably designate.
9. Governing Law. All questions concerning the construction, validity and
interpretation of this Agreement shall be governed by and construed and enforced
in accordance with the internal laws of the State of Illinois, without giving
effect to any choice of law or conflict provision or rule (whether of the State
of Illinois or any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of Illinois.
10. Notices. All demands, notices and communications upon or to the
Custodian or the Seller under this Agreement shall be delivered as specified in
Appendix B to the Pooling and Servicing Agreement.
11. Binding Effect. This Agreement shall be binding upon and shall inure
to the benefit of the Seller, the Issuer, the Custodian and their respective
successors and assigns, including the Issuer.
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12. Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
shall be deemed severable from the remaining covenants, agreements, provisions
or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.
13. Assignment. Notwithstanding anything to the contrary contained in
this Agreement, this Agreement may not be assigned by the Custodian without the
prior written consent of the Seller or any Persons to whom the Seller has
assigned its rights hereunder, as applicable.
14. Headings. The headings of the various Sections herein are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.
15. Counterparts. This Agreement may be executed by the parties in
separate counterparts, each of which when so executed and delivered shall be an
original but all such counterparts shall together constitute but one and the
same instrument.
16. No Third-Party Beneficiaries. This Agreement shall inure to the
benefit of and be binding upon the parties hereto, the Owners and their
respective successors and permitted assigns. Except as otherwise expressly
provided in this Agreement, no other Person shall have any right or obligation
hereunder.
17. Merger and Integration. Except as specifically stated otherwise
herein, this Agreement sets forth the entire understanding of the parties
relating to the subject matter hereof, and all prior understandings, written or
oral, are superseded by this Agreement. This Agreement may not be modified,
amended, waived, or supplemented except as provided herein.
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed in its name and on its behalf by a duly authorized officer as of the
day and year first above written.
NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION
By:
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Name: R. Xxxxx Xxxx
Title: Vice President and Treasurer
NAVISTAR FINANCIAL CORPORATION,
as Custodian
By:
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Name: R. Xxxxx Xxxx
Title: Vice President and Treasurer
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