CASE EQUIPMENT LOAN TRUST 1997-B
SALE AND SERVICING AGREEMENT
among
CASE EQUIPMENT LOAN TRUST 1997-B,
as Issuer,
CASE RECEIVABLES II INC.,
as Seller,
and
CASE CREDIT CORPORATION,
as Servicer.
Dated as of September 1, 1997
|| TABLE OF CONTENTS
ARTICLE I
Definitions
SECTION 1.1. Definitions . . . . . . . . . . . . . . . . . . . .1
SECTION 1.2. Other Definitional Provisions . . . . . . . . . . 24
ARTICLE II
Conveyance of Receivables
SECTION 2.1. Conveyance of Initial Receivables . . . . . . . . 25
SECTION 2.2. Conveyance of Subsequent Receivables. . . . . . . 26
ARTICLE III
The Receivables
SECTION 3.1. Representations and Warranties of Seller. . . . . 29
SECTION 3.2. Repurchase upon Breach. . . . . . . . . . . . . . 30
SECTION 3.3. Custody of Receivable Files . . . . . . . . . . . 31
SECTION 3.4. Duties of Servicer as Custodian . . . . . . . . . 31
SECTION 3.5. Instructions; Authority To Act. . . . . . . . . . 32
SECTION 3.6. Custodian's Indemnification . . . . . . . . . . . 32
SECTION 3.7. Effective Period and Termination. . . . . . . . . 32
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.1. Duties of Servicer. . . . . . . . . . . . . . . . 33
SECTION 4.2. Collection and Allocation of Receivable Payments. 34
SECTION 4.3. Realization upon Receivables. . . . . . . . . . . 34
SECTION 4.4. Maintenance of Security Interests in Financed
Equipment . . . . . . . . . . . . . . . . . . . 34
SECTION 4.5. Covenants of Servicer . . . . . . . . . . . . . . 35
SECTION 4.6. Purchase of Receivables upon Breach . . . . . . . 35
SECTION 4.7. Servicing Fee . . . . . . . . . . . . . . . . . . 35
SECTION 4.8. Servicer's Certificate. . . . . . . . . . . . . . 35
SECTION 4.9. Annual Statement as to Compliance; Notice of
Default . . . . . . . . . . . . . . . . . . . . 36
SECTION 4.10. Annual Independent Certified Public Accountants'
Report . . . . . . . . . . . . . . . . . . . . 36
SECTION 4.11. Access to Receivable Files . . . . . . . . . . . 37
SECTION 4.12. Servicer Expenses. . . . . . . . . . . . . . . . 37
SECTION 4.13. Appointment of Subservicer . . . . . . . . . . . 37
Sale and Servicing Agreement i
ARTICLE V
Distributions: Spread Account;
Statements to Certificateholders and Noteholders
SECTION 5.1. Establishment of Trust Accounts . . . . . . . . . 37
SECTION 5.2. Collections . . . . . . . . . . . . . . . . . . . 40
SECTION 5.3. Application of Collections. . . . . . . . . . . . 40
SECTION 5.4. Additional Deposits . . . . . . . . . . . . . . . 40
SECTION 5.5. Distributions . . . . . . . . . . . . . . . . . . 41
SECTION 5.6. Spread Account. . . . . . . . . . . . . . . . . . 44
SECTION 5.7. Pre-Funding Account . . . . . . . . . . . . . . . 45
SECTION 5.8. Negative Carry Account. . . . . . . . . . . . . . 45
SECTION 5.9. Calculation of Class B Net Funds Cap Carryover
Account . . . . . . . . . . . . . . . . . . . . 46
SECTION 5.10. Statements to Certificateholders and Noteholders 46
SECTION 5.11. Net Deposits . . . . . . . . . . . . . . . . . . 47
ARTICLE VI
The Seller
SECTION 6.1. Representations of Seller . . . . . . . . . . . . 48
SECTION 6.2. Corporate Existence . . . . . . . . . . . . . . . 49
SECTION 6.3. Liability of Seller; Indemnities. . . . . . . . . 50
SECTION 6.4. Merger or Consolidation of, or Assumption of
the Obligations of, the Seller . . . . . . . . 51
SECTION 6.5. Limitation on Liability of Seller and Others. . . 52
SECTION 6.6. Seller May Own Certificates or Notes. . . . . . . 52
ARTICLE VII
The Servicer
SECTION 7.1. Representations of the Servicer . . . . . . . . . .52
SECTION 7.2. Indemnities from the Servicer . . . . . . . . . . .54
SECTION 7.3. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer . . . . . . . . . .56
SECTION 7.4. Limitation on Liability of the Servicer and Others 56
SECTION 7.5. Credit Not to Resign as the Servicer. . . . . . . .57
SECTION 7.6. Servicer to Act as the Administrator. . . . . . . .57
ARTICLE VIII
Default
SECTION 8.1. Servicer Default. . . . . . . . . . . . . . . . . 57
SECTION 8.2. Appointment of Successor Servicer . . . . . . . . 59
Sale and Servicing Agreement ii
SECTION 8.3. Notification to the Noteholders and
Certificateholders . . . . . . . . . . . . . . .60
SECTION 8.4. Waiver of Past Defaults . . . . . . . . . . . . . 60
ARTICLE IX
Termination
SECTION 9.1. Optional Purchase of All Receivables. . . . . . . 60
ARTICLE X
Miscellaneous Provisions
SECTION 10.1. Amendment. . . . . . . . . . . . . . . . . . . . 61
SECTION 10.2. Protection of Title to Trust . . . . . . . . . . 62
SECTION 10.3. Notices. . . . . . . . . . . . . . . . . . . . . 64
SECTION 10.4. Assignment . . . . . . . . . . . . . . . . . . . 65
SECTION 10.5. Limitations on Rights of Others. . . . . . . . . 65
SECTION 10.6. Severability . . . . . . . . . . . . . . . . . . 65
SECTION 10.7. Separate Counterparts. . . . . . . . . . . . . . 65
SECTION 10.8. Headings . . . . . . . . . . . . . . . . . . . . 65
SECTION 10.9. Governing Law. . . . . . . . . . . . . . . . . . 66
SECTION 10.10. Assignment to Indenture Trustee . . . . . . . . 66
SECTION 10.11. Nonpetition Covenants . . . . . . . . . . . . . 66
SECTION 10.12. Limitation of Liability of the Trustee and
Indenture Trustee . . . . . . . . . . . . . . 66
||
Sale and Servicing Agreement iii
SCHEDULES AND EXHIBITS
SCHEDULE A Location of Receivables Files
EXHIBIT A Form of Noteholder's Statement Pursuant to Section 5.10(a)
EXHIBIT B Form of Certificateholder's Statement Pursuant to
Section 5.10(a)
EXHIBIT C Form of Servicer's Certificate
EXHIBIT D Form of Assignment
EXHIBIT E Form of Subsequent Transfer Assignment
EXHIBIT F Form of Accountants' Letter in Connection with Subsequent
Transfer Assignment
Sale and Servicing Agreement iv
SALE AND SERVICING AGREEMENT dated as of September 1, 1997, among
CASE EQUIPMENT LOAN TRUST 1997-B, a Delaware business trust (the "Issuer"),
CASE RECEIVABLES II INC., a Delaware corporation (the "Seller"), and CASE
CREDIT CORPORATION, a Delaware corporation (the "Servicer").
RECITALS
WHEREAS, the Issuer desires to purchase a portfolio of receivables
arising in connection with equipment retail installment sale contracts
purchased by Case Credit Corporation ("Credit") in the ordinary course of
business and sold by Credit to the Seller: (a) on a monthly basis pursuant
to a Receivables Purchase Agreement, dated as of August 1, 1994, between
Credit and the Seller (as it may be amended and supplemented from time to
time, the "Liquidity Receivables Purchase Agreement") and/or (b) pursuant
to the Purchase Agreement between Credit and the Seller;
WHEREAS, the Seller is willing to sell such receivables to the Issuer;
and
WHEREAS, Credit is willing to service such receivables;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.1. Definitions. Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the following meanings:
"A-1 Note Final Scheduled Maturity Date" means October 13, 1998.
"A-1 Noteholders" means the holders of record of the A-1 Notes.
"A-1 Noteholders' Monthly Principal Distributable Amount" means,
with respect to any Payment Date until the Payment Date on which the
Outstanding Amount of the A-1 Notes has been reduced to zero, 100% of the
Class A Noteholders' Monthly Principal Distributable Amount for such
Payment Date.
"A-1 Noteholders' Principal Carryover Shortfall" means, with
respect to any Payment Date, the excess of the A-1 Noteholders' Principal
Distributable Amount for the preceding Payment Date over the amount that
was actually deposited in the Note Distribution Account in respect of
principal of the A-1 Notes on such preceding Payment Date.
"A-1 Noteholders' Principal Distributable Amount" means, with
respect to any Payment Date, the sum of (a) the A-1 Noteholders' Monthly
Principal Distributable Amount for such Payment Date and (b) the A-1
Noteholders' Principal Carryover Shortfall for such Payment Date; provided,
however, that the sum of clauses (a) and (b) shall not exceed the
Outstanding Amount of the A-1 Notes, and, on the A-1 Note Final Scheduled
Maturity Date, the A-1 Noteholders' Principal Distributable Amount will
include the amount, to the extent of available funds, necessary (after
giving effect to the other amounts to be deposited in the Note Distribution
Account on such Payment Date and allocable to principal) to reduce the
Outstanding Amount of the A-1 Notes to zero.
"A-2 Note Final Scheduled Maturity Date" means the September 2000
Payment Date.
"A-2 Noteholders" means the holders of record of the A-2 Notes.
"A-2 Noteholders' Monthly Principal Distributable Amount" means,
with respect to each Payment Date on or after the Payment Date on which an
amount sufficient to reduce the Outstanding Amount of the A-1 Notes to zero
has been deposited in the Note Distribution Account, 100% of the Class A
Noteholders' Monthly Principal Distributable Amount (less the portion
thereof, if any, applied to reduce the Outstanding Amount of the A-1 Notes
to zero on such Payment Date).
"A-2 Noteholders' Principal Carryover Shortfall" means, with
respect to any Payment Date, the excess of the A-2 Noteholders' Principal
Distributable Amount for the preceding Payment Date over the amount that
was actually deposited in the Note Distribution Account in respect of
principal of the A-2 Notes on such preceding Payment Date.
"A-2 Noteholders' Principal Distributable Amount" means, with
respect to any Payment Date, the sum of (a) the A-2 Noteholders' Monthly
Principal Distributable Amount for such Payment Date and (b) the A-2
Noteholders' Principal Carryover Shortfall for such Payment Date; provided,
however, that until an amount sufficient to reduce the Outstanding Amount
of the A-1 Notes to zero has been deposited in the Note Distribution
Account, the A-2 Noteholders' Principal Distributable Amount shall be zero;
provided, further, that the sum of clauses (a) and (b) shall not exceed the
Outstanding Amount of the A-2 Notes, and, on the A-2 Note Final Scheduled
Maturity Date, the A-2 Noteholders' Principal Distributable Amount will
include the amount, to the extent of available funds, necessary (after
giving effect to the other amounts to be deposited in the Note Distribution
Account on such Payment Date and allocable to principal) to reduce the
Outstanding Amount of the A-2 Notes to zero.
"A-3 Noteholders" means the holders of record of the A-3 Notes.
"A-3 Noteholders' Monthly Principal Distributable Amount" means,
with respect to each Payment Date on or after the Payment Date on which an
amount sufficient to reduce the Outstanding Amount of the A-2 Notes to zero
has been deposited in the Note Distribution Account, 100% of the Class A
Noteholders' Monthly Principal Distributable Amount (less the portion
thereof, if any, applied to reduce the Outstanding Amount of the A-1 Notes
and the X- 0 Notes to zero on such Payment Date).
"A-3 Noteholders' Principal Carryover Shortfall" means, with
respect to any Payment Date, the excess of the A-3 Noteholders' Principal
Distributable Amount for the preceding Payment Date over the amount that
was actually deposited in the Note Distribution Account in respect of
principal of the A-3 Notes on such preceding Payment Date.
"A-3 Noteholders' Principal Distributable Amount" means, with
respect to any Payment Date the sum of (a) the A-3 Noteholders' Monthly
Principal Distributable Amount for such Payment Date and (b) the A-3
Noteholders' Principal Carryover Shortfall for such Payment Date; provided,
however, that, until an amount sufficient to reduce the Outstanding Amount
of the A-2 Notes to zero has been deposited in the Note Distribution
Account, the A-3 Noteholders' Principal Distributable Amount shall be zero;
provided, further, that the sum of clauses (a) and (b) shall not exceed the
Outstanding Amount of the A-3 Notes, and on the Final Scheduled Maturity
Date, the A-3 Noteholders' Principal Distributable Amount will include the
amount, to the extent of available funds, necessary (after giving effect to
the other amounts to be deposited in the Note Distribution Account on such
Payment Date and allocable to principal) to reduce the Outstanding Amount
of the A-3 Notes to zero.
"A-4 Noteholders" means the holders of record of the A-4 Notes.
"A-4 Noteholders' Monthly Principal Distributable Amount" means,
with respect to each Payment Date on or after the Payment Date on which an
amount sufficient to reduce the Outstanding Amount of the A-4 Notes to zero
has been deposited in the Note Distribution Account, 100% of the Class A
Noteholders' Monthly Principal Distributable Amount (less the portion
thereof, if any, applied to reduce the Outstanding Amount of the A-1 Notes,
the A-2 Notes and the A-3 Notes to zero on such Payment Date).
"A-4 Noteholders' Principal Carryover Shortfall" means, with
respect to any Payment Date, the excess of the A-4 Noteholders' Principal
Distributable Amount for the preceding Payment Date over the amount that
was actually deposited in the Note Distribution Account in respect of
principal of the A-4 Notes on such preceding Payment Date.
"A-4 Noteholders' Principal Distributable Amount" means, with
respect to any Payment Date the sum of (a) the A-4 Noteholders' Monthly
Principal Distributable Amount for such Payment Date and (b) the A-4
Noteholders' Principal Carryover Shortfall for such Payment Date; provided,
however, that, until an amount sufficient to reduce the Outstanding Amount
of the A-3 Notes to zero has been deposited in the Note Distribution
Account, the A-4 Noteholders' Principal Distributable Amount shall be zero;
provided, further, that the sum of clauses (a) and (b) shall not exceed the
Outstanding Amount of the A-4 Notes, and on the Final Scheduled Maturity
Date, the A-4 Noteholders' Principal Distributable Amount will include the
amount, to the extent of available funds, necessary (after giving effect to
the other amounts to be deposited in the Note Distribution Account on such
Payment Date and allocable to principal) to reduce the Outstanding Amount
of the A-4 Notes to zero.
"Administration Fee" has the meaning assigned to such term in the
Administration Agreement.
"Agreement" means this Sale and Servicing Agreement, as the same
may be amended and supplemented from time to time.
"Amount Financed" with respect to a Receivable means the amount
advanced under the Receivable toward the purchase price of the Financed
Equipment and any related costs and any insurance financed thereby.
"Annual Percentage Rate" or "APR" of a Receivable means the annual
rate of finance charges stated in the related Contract.
"Case" means Case Corporation, a Delaware corporation, and its
successors and assigns.
"Certificate Balance" equals, initially, $15,190,000 and,
thereafter, equals such amount reduced by all amounts allocable to
principal previously distributed to Certificateholders.
"Certificate Distribution Account" has the meaning assigned to such
term in the Trust Agreement.
"Certificateholder" has the meaning assigned to such term in the Trust
Agreement.
"Certificateholders' Distributable Amount" means, with respect to
any Payment Date, the sum of the Certificateholders' Principal
Distributable Amount and the Certificateholders' Interest Distributable
Amount.
"Certificateholders' Interest Carryover Shortfall" means, with
respect to any Payment Date (the "current Payment Date"), the excess of the
Certificateholders' Interest Distributable Amount for the preceding Payment
Date over the amount in respect of interest that was actually deposited in
the Certificate Distribution Account on such preceding Payment Date, plus
interest on such excess, to the extent permitted by law, at the
Pass-Through Rate from such preceding Payment Date to but excluding the
current Payment Date.
"Certificateholders' Interest Distributable Amount" means, with
respect to any Payment Date (the "current Payment Date") the sum of (a)
interest accrued from and including the preceding Payment Date (or, in the
case of the first Payment Date, the Closing Date) to but excluding the
current Payment Date at the Pass-Through Rate on the Certificate Balance on
the preceding Payment Date after giving effect to all changes therein on
such preceding Payment Date (or, in the case of the first Payment Date, on
the Closing Date), except that during the Funding Period no interest will
accrue on the Pre-Funded Percentage of the Certificate Balance, plus (b)
the Certificateholders' Interest Carryover Shortfall for the current
Payment Date.
"Certificateholders' Principal Carryover Shortfall" means, with
respect to any Payment Date, the excess of the Certificateholders'
Principal Distributable Amount for the preceding Payment Date over the
amount in respect of principal that was actually deposited in the
Certificate Distribution Account on such preceding Payment Date.
"Certificateholders' Principal Distributable Amount" means, with
respect to any Payment Date on or after the Payment Date on which an amount
sufficient to reduce the Outstanding Amount of the Notes to zero has been
deposited in the Note Distribution Account, the sum of (a) 100% of the
Principal Distribution Amount (less the portion thereof, if any, applied to
reduce the Outstanding Amount of the Notes to zero on such Payment Date)
plus (b) the Certificateholders' Principal Carryover Shortfall for such
Payment Date; provided, however, that, until an amount sufficient to reduce
the Outstanding Amount of the Notes to zero has been deposited in the Note
Distribution Account, the Certificateholders' Principal Distributable
Amount shall be zero; provided, further, that the Certificateholders'
Principal Distributable Amount will not exceed the Certificate Balance.
"Certificate Pool Factor" means, as of the close of business on any
Payment Date, the Certificate Balance divided by the initial Certificate Balance
(carried out to the seventh decimal place). The Certificate Pool Factor is
1.0000000 as of the Closing Date, and, thereafter, will decline to reflect
reductions in the Certificate Balance.
"Certificates" means the Trust Certificates (as defined in the Trust
Agreement).
"Class A Noteholder" means any holder of a Class A Note.
"Class A Noteholders' Distributable Amount" means, with respect to
any Payment Date, the sum of (i) the A-1 Noteholders' Principal
Distributable Amount, (ii) the A-2 Noteholders' Principal Distributable
Amount, (iii) the A- 3 Noteholders' Principal Distributable Amount, (iv)
the A-4 Noteholders' Principal Distributable Amount, and (v) the Class A
Noteholders' Interest Distributable Amount.
"Class A Noteholders' Interest Carryover Shortfall" means, with
respect to any Payment Date (the "current Payment Date"), the excess of the
Class A Noteholders' Interest Distributable Amount for the preceding
Payment Date over the amount in respect of interest on the Class A Notes
that was actually deposited in the Note Distribution Account on such
preceding Payment Date, plus interest on such excess, to the extent
permitted by law, at a rate per annum equal to the interest rate on the
applicable Class of Class A Notes, from such preceding Payment Date to but
excluding the current Payment Date.
"Class A Noteholders' Interest Distributable Amount" means, with
respect to any Payment Date (the "current Payment Date"), an amount equal
to the sum of (a) the aggregate amount of interest accrued on the Class A
Notes at their respective interest rates from and including the preceding
Payment Date (or, in the case of the initial Payment Date, from and
including the Closing Date) to but excluding the current Payment Date for
the A-1 Notes and A-2 Notes (based upon the actual number of days in the
Interest Period and a 360-day year) and for the A-3 Notes and the A-4 Notes
(based upon a 360-day year of twelve 30-day months plus (b) the Class A
Noteholders' Interest Carryover Shortfall for the current Payment Date.
"Class A Noteholders' Monthly Principal Distributable Amount"
means, with respect to any Payment Date, the Principal Distribution Amount
minus the Class B Noteholders' Monthly Principal Distributable Amount and
the Class C Noteholders' Monthly Principal Distributable Amount.
"Class A Notes" means the A-1 Notes, the A-2 Notes, the A-3 Notes
and the A-4 Notes.
"Class B Additional Amounts" is defined in Section 5.5(b)(3).
"Class B Net Funds Cap Carryover Amount" is defined in Section 5.9.
"Class B Noteholder" means any holder of a Class B Note.
"Class B Noteholders' Distributable Amount" means, with respect to
any Payment Date, the sum of (a) the Class B Noteholders' Interest
Distributable Amount and (b) the Class B Noteholders' Principal
Distributable Amount. Neither the Class B Net Funds Cap Carryover Amount
(if any) nor the Class B Additional Amounts (if any) shall constitute a
part of the Class B Noteholders' Distributable Amount.
"Class B Noteholders' Interest Carryover Shortfall" means, with
respect to any Payment Date (the "current Payment Date"), the excess of the
Class B Noteholders' Interest Distributable Amount for the preceding
Payment Date over the amount in respect of interest on the Class B Notes
that was actually deposited in the Note Distribution Account on such
preceding Payment Date, plus interest on such excess, to the extent
permitted by law, at a rate per annum equal to the Floating Rate from such
preceding Payment Date to but excluding the current Payment Date.
"Class B Noteholders' Interest Distributable Amount" means, with
respect to any Payment Date (the "current Payment Date"), an amount equal
to the sum of: (a) the aggregate amount of interest accrued on the Class B
Notes at the Floating Rate from and including the preceding Payment Date
(or, in the case of the initial Payment Date, from and including the
Closing Date) to but excluding the current Payment Date (based on a 360 day
year and actual days elapsed) plus (b) the Class B Noteholders' Interest
Carryover Shortfall for the current Payment Date.
"Class B Noteholders' Monthly Principal Distributable Amount"
means, until the Payment Date on which the Outstanding Amount of the Class
B Notes has been reduced to zero, 100% of the Floating Rate Principal
Distribution Amount.
"Class B Noteholders' Principal Carryover Shortfall" means, with
respect to any Payment Date, the excess of the Class B Noteholders'
Principal Distributable Amount for the preceding Payment Date over the
amount that was actually deposited in the Note Distribution Account in
respect of principal of the Class B Notes on such preceding Payment Date.
"Class B Noteholders' Principal Distributable Amount" means, with
respect to any Payment Date, the sum of (a) the Class B Noteholders'
Monthly Principal Distributable Amount for such Payment Date and (b) the
Class B Noteholders' Principal Carryover Shortfall for such Payment Date;
provided, however, that the sum of clauses (a) and (b) shall not exceed the
Outstanding Amount of the Class B Notes, and, on the Final Scheduled
Maturity Date, the Class B Noteholders' Principal Distributable Amount will
include the amount, to the extent of available funds, necessary (after
giving effect to the other amounts to be deposited in the Note Distribution
Account on such Payment Date and allocable to principal) to reduce the
Outstanding Amount of the Class B Notes to zero.
"Class C Noteholders' Distributable Amount" means, with respect to
any Payment Date, the sum of: (a) the Class C Noteholders' Interest
Distributable Amount and (ii) the Class C Noteholders' Principal
Distributable Amount.
"Class C Noteholders' Interest Carryover Shortfall" means, with
respect to any Payment Date (the "current Payment Date"), the excess of the
Class C Noteholders' Interest Distributable Amount for the preceding
Payment Date over the amount in respect of interest on the Class C Notes
that was actually deposited in the Note Distribution Account on such
preceding Payment Date, plus interest on such excess, to the extent
permitted by law, at a rate per annum equal to the Class C Rate from such
preceding Payment Date to but excluding the current Payment Date.
"Class C Noteholders' Interest Distributable Amount" means, with
respect to any Payment Date (the "current Payment Date"), an amount equal
to the sum of: (a) the aggregate amount of interest accrued on the Class C
Notes at the Class C Note Rate from and including the preceding Payment
Date (or, in the case of the initial Payment Date, from and including the
Closing Date) to but excluding the current Payment Date (based upon a 360-
day year of twelve 30-day months) plus (ii) the Class C Noteholders'
Interest Carryover Shortfall for the current Payment Date.
"Class C Noteholders' Monthly Principal Distributable Amount"
means, with respect to each Payment Date until the Payment Date on which
the Outstanding Amount of the Class C Notes has been reduced to zero, an
amount equal to the excess, if any of: (a) the Outstanding Amount of the
Class C Notes on the related Record Date minus any Class C Noteholders'
Principal Carryover Shortfall over (b) the Initial Class C Percentage of
the sum of the outstanding Pool Balance and the Pre-Funded Amount as of the
beginning of the current Collection Period; provided, however, that if on
the related Record Date any principal of the A-1 Notes remains outstanding,
then the Class C Noteholders' Monthly Principal Distributable Amount for
such Payment Date shall not exceed an amount equal to the aggregate
unscheduled principal payments on the Fixed Rate Receivables during the
related Collection Period.
"Class C Noteholders' Principal Carryover Shortfall" means, with
respect to any Payment Date, the excess of the Class C Noteholders'
Principal Distributable Amount for the preceding Payment Date over the
amount that was actually deposited in the Note Distribution Account in
respect of principal of the Class C Notes on such preceding Payment Date.
"Class C Noteholders' Principal Distributable Amount" means, with
respect to any Payment Date, the sum of: (a) the Class C Noteholders'
Monthly Principal Distributable Amount for such Payment Date and (b) the
Class C Noteholders' Principal Carryover Shortfall for such Payment Date;
provided, however, that the sum of clauses (a) and (b) shall not exceed the
Outstanding Amount of the Class C Notes, and on the Final Scheduled
Maturity Date, the Class C Noteholders' Principal Distributable Amount will
include the amount, to the extent of available funds, necessary (after
giving effect to the other amounts to be deposited in the Note Distribution
Account on such Payment Date and allocable to principal) to reduce the
Outstanding Amount of the Class C Notes to zero.
"Collection Account" means the account designated as such,
established and maintained pursuant to Section 5.1(a).
"Collection Period" means, with respect to any Payment Date, the
period from and including the end of the preceding Collection Period (or,
if for the first Payment Date, the day after the Initial Cutoff Date) to
but excluding the sixth (6th) day of the calendar month in which the
Payment Date occurs.
"Contract" means an equipment retail installment sale contract
secured by Financed Equipment.
"Contract Value" means, with respect to any day (including the
Initial Cutoff Date or any Subsequent Cutoff Date), (a) in the case of the
Fixed Rate Receivables, the present value of the unpaid Scheduled Payments
discounted monthly at an annual rate equal to: (i) in the case of the
Initial Receivables, the Initial Cutoff Date APR and (ii) in the case of
the Subsequent Receivables, the applicable Subsequent Cutoff Date APR, and
(b) in the case of the Floating Rate Receivables, the current principal
balance of the Floating Rate Receivables shown on the Servicer's records.
For purposes of calculating Contract Value, a Scheduled Payment that is
delinquent as of the day the calculation is being made is deemed to be due
on such day. The Contract Value of each Liquidated Receivable shall be
deemed to equal zero.
"Corporate Trust Office" means the principal office of the
Indenture Trustee at which at any particular time its corporate trust
business shall be administered, which office at the date of this Agreement
is located at 000 Xxxx Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxxxxx 00000,
Attention: Indenture Trust Administration (facsimile no. (000) 000-0000);
or at such other address as the Indenture Trustee may designate from time
to time by notice to the Noteholders and the Seller, or the principal
corporate trust office of any successor Indenture Trustee (the address of
which the successor Indenture Trustee will notify the Noteholders and the
Seller).
"Credit" means Case Credit Corporation, a Delaware corporation, and
its successors and assigns.
"Dealer" means the dealer (which may include retail outlets owned
by Case) who sold any Financed Equipment and who originated and assigned
the respective Receivable to Credit under a Dealer Agreement.
"Dealer Agreement" means the retail financing agreement between
the applicable Dealer and Credit.
"Delivery" when used with respect to Trust Account Property means:
(a) with respect to bankers' acceptances, commercial
paper, negotiable certificates of deposit and other obligations
that constitute "instruments" within the meaning of Section
9-105(1)(i) of the UCC and are susceptible of physical delivery,
transfer thereof to the Indenture Trustee or its nominee or
custodian (the "New Owner") by physical delivery to the New Owner
endorsed to, or registered in the name of, the New Owner or
endorsed in blank, and, with respect to a certificated security
(as defined in Section 8-102 of the UCC) transfer thereof: (i) by
delivery of such certificated security endorsed to, or registered
in the name of, the New Owner or endorsed in blank to a financial
intermediary (as defined in Section 8-313 of the UCC) and the
making by such financial intermediary of entries on its books and
records identifying such certificated securities as belonging to
the New Owner and the sending by such financial intermediary of a
confirmation of the purchase of such certificated security by the
New Owner, or (ii) by delivery thereof to a "clearing corporation"
(as defined in Section 8-102(3) of the UCC) and the making by such
clearing corporation of appropriate entries on its books reducing
the appropriate securities account of the transferor and
increasing the appropriate securities account of a financial
intermediary by the amount of such certificated security, the
identification by the clearing corporation of the certificated
securities for the sole and exclusive account of the financial
intermediary, the maintenance of such certificated securities by
such clearing corporation or a "custodian bank" (as defined in
Section 8- 102(4) of the UCC) or the nominee of either subject to
the clearing corporation's exclusive control, the sending of a
confirmation by the financial intermediary of the purchase by the
New Owner of such securities and the making by such financial
intermediary of entries on its books and records identifying such
certificated securities as belonging to the New Owner (all of the
foregoing, "Physical Property"), and, in any event, any such
Physical Property in registered form shall be in the name of the
New Owner; and such additional or alternative procedures as may
hereafter become appropriate to effect the complete transfer of
ownership of any such Trust Account Property to
the New Owner, consistent with changes in applicable law or
regulations or the interpretation thereof;
(b) with respect to any security issued by the United
States Treasury Department, the Federal Home Loan Mortgage
Corporation or the Federal National Mortgage Association that is a
book-entry security held through the Federal Reserve System
pursuant to Federal book-entry regulations, the following
procedures, all in accordance with applicable law, including
applicable Federal regulations and Articles 8 and 9 of the UCC:
book-entry registration of such security to an appropriate
book-entry account maintained with a Federal Reserve Bank by a
financial intermediary that is also a "depository" pursuant to
applicable Federal regulations and issuance by such financial
intermediary of a deposit advice or other written confirmation of
such book-entry registration to the New Owner of the purchase by
the New Owner of such book-entry securities; the making by such
financial intermediary of entries in its books and records
identifying such book-entry security held through the Federal
Reserve System pursuant to Federal book-entry regulations as
belonging to the New Owner and indicating that such custodian
holds such security solely as agent for the New Owner; and such
additional or alternative procedures as may hereafter become
appropriate to effect complete transfer of ownership of any such
Trust Account Property to the New Owner, consistent with changes
in applicable law or regulations or the interpretation thereof;
and
(c) with respect to any uncertificated security under
Article 8 of the UCC that is not governed by clause (b),
registration on the books and records of the issuer thereof in the
name of the financial intermediary, the sending of a confirmation
by the financial intermediary of the purchase by the New Owner of
such uncertificated security, and the making by such financial
intermediary of entries on its books and records identifying such
uncertificated security as belonging to the New Owner.
"Depositor" shall mean the Seller in its capacity as Depositor under
the Trust Agreement.
"Determination Date" means, with respect to any Transfer Date, the
second Business Day prior to such Transfer Date.
"Eligible Deposit Account" means either: (a) a segregated account
with an Eligible Institution or any other segregated account, the deposit
of funds in which satisfies the Rating Agency Condition, or (b) a
segregated trust account with the corporate trust department of a
depository institution organized under the laws of the United States of
America or any state (or any domestic branch
of a foreign bank), having corporate trust powers and acting as trustee for
funds deposited in such account, so long as any of the securities of such
depository institution have a credit rating from each Rating Agency in one
of its generic rating categories that signifies investment grade.
"Eligible Institution" means: (a) the corporate trust department
of the Indenture Trustee or the Trustee or (b) a depository institution
organized under the laws of the United States of America or any state (or
any domestic branch of a foreign bank), which: (i) has either a long-term
or short-term senior unsecured debt rating or certificate of deposit rating
acceptable to the Rating Agencies and (ii) whose deposits are insured by
the FDIC.
"Eligible Investments" mean book-entry securities, negotiable
instruments or securities represented by instruments in bearer or
registered form that evidence:
(a) direct obligations of, and obligations fully
guaranteed as to timely payment by, the United States of America;
(b) demand deposits, time deposits or certificates of
deposit of any depository institution or trust company
incorporated under the laws of the United States of America or any
state (or any domestic branch of a foreign bank) and subject to
supervision and examination by Federal or state banking or
depository institution authorities; provided, however, that at the
time of the investment or contractual commitment to invest
therein, the commercial paper or other short-term senior unsecured
debt obligations (other than such obligations the rating of which
is based on the credit of a Person other than such depository
institution or trust company) thereof shall have a credit rating
from each of the Rating Agencies in the highest investment
category granted thereby;
(c) commercial paper having, at the time of the
investment or contractual commitment to invest therein, a rating
from each of the Rating Agencies in the highest investment
category granted thereby;
(d) investments in money market funds having a rating
from each of the Rating Agencies in the highest investment
category granted thereby (including funds for which the Indenture
Trustee or the Trustee or any of their respective Affiliates is
investment manager or advisor); provided, that during the Funding
Period no investments in money market funds shall be made with
funds in any Trust Account other than the Collection Account;
(e) bankers' acceptances issued by any depository
institution or trust company referred to in clause (b);
(f) repurchase obligations with respect to any security
that is a direct obligation of, or fully guaranteed as to timely
payment by, the United States of America or any agency or
instrumentality thereof the obligations of which are backed by the
full faith and credit of the United States of America, in either
case entered into with a depository institution or trust company
(acting as principal) described in clause (b); and
(g) any other investment permitted by each of the Rating
Agencies as set forth in writing delivered to the Indenture
Trustee;
provided, that investments described in clauses (d) and (g) shall be made
only so long as making such investments will not require the Issuer to
register as an investment company under the Investment Company Act of 1940,
as amended.
"FDIC" means the Federal Deposit Insurance Corporation or any
successor.
"Final Scheduled Maturity Date" means the September 2004 Payment
Date.
"Financed Equipment" means property, including any agricultural or
construction equipment, together with all accessions thereto, securing an
Obligor's indebtedness under the related Receivable.
"Fixed Rate Distribution Amount" means, with respect to any
Payment Date, the portion of the Total Distribution Amount that includes
all of the aggregate collections on the Fixed Rate Receivables plus all of
the Negative Carry Amount for the related Collection Period plus all of the
Investment Earnings for such Payment Date on amounts on deposit in the
Pre-Funding Account and the Negative Carry Account plus the Fixed Rate
Percentage of all other Investment Earnings for such Payment Date.
"Fixed Rate Percentage" means, with respect to any Payment Date,
the percentage equivalent of a fraction (a) the numerator of which is the
sum of (i) the Contract Value of all Fixed Rate Receivables and (ii) the
Pre-Funded Amount and (b) the denominator of which is the sum of (i) the
Contract Value of all Receivables and (ii) the Pre-Funded Amount, all
determined as of the beginning of the immediately preceding Collection
Period.
"Fixed Rate Principal Distribution Amount" means an amount (not
less than zero) equal to: (a) the sum of the Contract Value of all Fixed
Rate Receivables and the Pre-Funded Amount as of the beginning of the
immediately preceding Collection Period minus (b) the sum of the Contract
Value of all Fixed Rate Receivables and the Pre-Funded Amount as of the
beginning of the current Collection Period.
"Fixed Rate Receivable" means any fixed rate Contract listed on
the Schedule of Receivables.
"Floating Rate" means, with respect to each Interest Period, LIBOR
as determined on the related LIBOR Determination Date, plus the "Class B
Margin" specified for such Interest Period pursuant to the Class B Note
Purchase Agreement; provided, that such rate may not exceed the Net Funds
Cap.
"Floating Rate Distribution Amount" means, with respect to any
Payment Date, the Total Distribution Amount minus the Fixed Rate
Distribution Amount.
"Floating Rate Percentage" means, with respect to any Payment
Date, 100% minus the Fixed Rate Percentage.
"Floating Rate Principal Distribution Amount" means, with respect
to any Payment Date, the amount (not less than zero) equal to: (a) the sum
of the Contract Value of all Floating Rate Receivables as of the beginning
of the immediately preceding Collection Period minus (b) the sum of the
Contract Value of all Floating Rate Receivables as of the beginning of the
Collection Period in which that Payment Date falls.
"Floating Rate Receivable" means any floating rate Contract listed
on the Schedule of Receivables.
"Funding Period" means the period from and including the Closing
Date and ending on the earliest of: (a) the Determination Date on which the
amount on deposit in the Pre-Funding Account (after giving effect to any
transfers to be made therefrom in connection with the transfer of
Subsequent Receivables to the Issuer on or before the Payment Date after
such Determination Date) is less than $100,000, (b) the date on which an
Event of Default or a Servicer Default occurs, (c) the date on which an
Insolvency Event occurs with respect to the Seller or the Servicer and (d)
the close of business on the February 1998 Payment Date.
"Indenture" means the Indenture, dated the date hereof, between
the Issuer and the Indenture Trustee, as the same may be amended and
supplemented from time to time.
"Indenture Trustee" means the Person acting as Indenture Trustee
under the Indenture, its successors in interest and any successor trustee
under the Indenture.
"Initial Class C Percentage" means the percentage equivalent of
(a) the initial balance of the Class C Notes (i.e., $34,719,000) divided by
(b) the Pool Balance as of the Initial Cutoff Date plus the Initial
Pre-Funded Amount.
"Initial Cutoff Date" means August 31, 1997.
"Initial Cutoff Date APR" means 8.637%, which is the weighted
average APR of the Initial Receivables that are Fixed Rate Receivables as
of the Initial Cutoff Date.
"Initial Pool Balance" means: (i) the Pool Balance as of the
Initial Cutoff Date, which is $456,076,215.83, plus (ii) the aggregate
Contract Value of all Subsequent Receivables sold to the Issuer as of their
respective Subsequent Cutoff Dates.
"Initial Receivable" means any Contract included in the schedule
delivered by the Servicer to the Trustee on the Closing Date (which
schedule may be in the form of microfiche).
"Insolvency Event" means, with respect to a specified Person: (a)
the filing of a decree or order for relief by a court having jurisdiction
in the premises in respect of such Person or any substantial part of its
property in an involuntary case under any applicable Federal or state
bankruptcy, insolvency or other similar law now or hereafter in effect, or
appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial
part of its property, or ordering the winding-up or liquidation of such
Person's affairs, and such decree or order shall remain unstayed and in
effect for a period of 60 consecutive days, or (b) the commencement by such
Person of a voluntary case under any applicable Federal or state
bankruptcy, insolvency or other similar law now or hereafter in effect, or
the consent by such Person to the entry of an order for relief in an
involuntary case under any such law, or the consent by such Person to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official for such Person or for
any substantial part of its property, or the making by such Person of any
general assignment for the benefit of creditors, or the failure by such
Person generally to pay its debts as such debts become due, or the taking
of action by such Person in furtherance of any of the foregoing.
"Interest Distribution Amount" means, with respect to any Payment
Date, the excess, if any, of the Total Distribution Amount over the
Principal Distribution Amount for such Payment Date.
"Interest Period" means the period from and including the Closing
Date, or from and including the most recent Payment Date, to but excluding
the following Payment Date.
"Investment Earnings" means, with respect to any Payment Date, the
interest and other investment earnings (net of losses and investment
expenses) on amounts on deposit in the Trust Accounts to be deposited into
the Collection Account on the related Transfer Date pursuant to Section
5.1(b).
"Issuer" means Case Equipment Loan Trust 1997-B.
"LIBOR" means, with respect to each Interest Period, the London
interbank offered rate for deposits in U.S. dollars having a maturity of
one month commencing on the first day of such Interest Period, as such rate
appears on Telerate Page 3750 as of 11:00 a.m. (London time) on the
applicable LIBOR Determination Date. If such rate does not appear on
Telerate Page 3750, the rate for that day will be determined on the basis
of the rates at which deposits in U.S. Dollars, for such period and in a
principal amount of not less than $1,000,000, are offered at approximately
11:00 a.m. (London time) on such LIBOR Determination Date to prime banks in
the London interbank market by the Reference Banks. The Servicer will
request the principal London office of each of the Reference Banks to
provide a quotation of its rate. If at least two such quotations are
provided, the rate for that day will be the arithmetic mean of the
quotations. If fewer than two quotations are provided, the rate for that
day will be the arithmetic mean of the rates quoted by major banks in New
York City, selected by the Servicer, at approximately 11:00 a.m. (New York
City time) on such LIBOR Determination Date for loans in U.S. Dollars, for
such period and in a principal amount of not less than $1,000,000, to
leading European banks; provided, that if the banks selected as aforesaid
are not quoting as mentioned in this sentence, LIBOR in effect for the
applicable Interest Period will be the LIBOR in effect for the previous
Interest Period. "Telerate Page 3750" means the display page so designated
on the Dow Xxxxx Telerate Service (or such other page as may replace that
page on that service for the purpose of displaying comparable rates or
prices). "Reference Bank" means a leading bank: (a) engaged in transactions
in eurodollar deposits in the international eurocurrency market, (b) not
controlling, controlled by or under common control with the Administrator
or the Seller and (c) having an established place of business in London.
"LIBOR Determination Date" means, with respect to any Interest
Period, the second London business day before the commencement of such
Interest Period. For this purpose, a "London business day" means any day on
which dealings in U.S. dollars are carried on in the London interbank
market.
"Lien" means a security interest, lien, charge, pledge, equity or
encumbrance of any kind, other than tax liens, mechanics' liens and any
liens that attach to the related Receivable by operation of law as a result
of any act or omission by the related Obligor.
"Liquidated Receivable" means any Receivable (or portion thereof)
liquidated by the Servicer through the sale or other disposition of the
related Financed Equipment or that the Servicer has, after using all
reasonable efforts to realize upon the Financed Equipment, determined to
charge off without realizing upon the Financed Equipment.
"Liquidation Proceeds" means, with respect to any Liquidated
Receivable, the moneys collected in respect thereof from whatever source
(including the proceeds of insurance policies with respect to the related
Financed Equipment or Obligor and payments made by a Dealer pursuant to the
related Dealer Agreement with respect to such Receivable (other than
amounts paid from Dealer reserve accounts maintained with Credit)), other
than Recoveries, net of the sum of any amounts expended by the Servicer in
connection with such liquidation and any amounts required by law to be
remitted to the Obligor on such Liquidated Receivable.
"Liquidity Receivables Purchase Agreement" has the meaning assigned
to such term in the Recitals.
"Maximum Negative Carry Amount" means the product of: (i) the
difference between: (a) the weighted average of the interest rates on the
A-1 Notes, the A-2 Notes, the A-3 Notes, the A-4 Notes and the Class C
Notes minus (b) 2.5%, multiplied by (ii) the Offered Note Percentage of the
amount on deposit in the Pre-Funding Account multiplied by (iii) the
fraction of a year represented by the number of days until the expected end
of the Funding Period (calculated on the basis of a 360-day year of twelve
30-day months).
"Moody's" means Xxxxx'x Investors Service, Inc., or its successor.
"Negative Carry Account" means the account designated as such,
established and maintained pursuant to Section 5.1(a).
"Negative Carry Account Initial Deposit" means $5,776,520.
"Negative Carry Amount" means, with respect to any Payment Date,
an amount calculated by the Servicer as the difference (if positive)
between: (a) the product of: (i) the sum of the Class A Noteholders'
Interest Distributable Amount and the Class C Noteholders' Interest
Distributable Amount multiplied by (ii) the Pre-Funded Percentage as of the
immediately prior Payment Date (or, in the case of the first Payment Date,
the Closing Date) minus (b) the Pre-Funding Account Investment Earnings.
"Net Funds Cap" means, for any Interest Period, the percentage
equivalent of (a) the quotient of (i) the aggregate amount of interest
payments due during the Collection Period during which such Interest Period
begins on Floating Rate Receivables that had a positive Contract Value at
the beginning of such Collection Period minus the sum of (A) if neither
Credit nor an Affiliate of Credit is the Servicer, the Floating Rate
Percentage of the Servicing Fee and (B) the Floating Rate Percentage of the
Administration Fee divided by (ii) the Outstanding Amount of the Class B
Notes at the beginning of such Interest Period (after giving effect to
payments of principal on the day that such Interest Period begins)
multiplied by (b) a fraction the numerator of which is 360 and the
denominator of which is the number of days in such Interest Period.
"Note Balance" means the aggregate Outstanding Amount of the Notes
from time to time.
"Note Distribution Account" means the account designated as such,
established and maintained pursuant to Section 5.1(a).
"Noteholders" means the Class A Noteholders and the Class B
Noteholders.
"Noteholders' Distributable Amount" means, with respect to any
Payment Date, the sum of: (a) the Class A Noteholders' Distributable Amount,
(b) the Class B Noteholders' Distributable Amount and (c) the Class C
Noteholders' Distributable Amount.
"Note Pool Factor" means, as of the close of business on any
Payment Date with respect to any Class of Notes, the Outstanding Amount of
that Class of Notes divided by the original Outstanding Amount of that
Class of Notes (carried out to the seventh decimal place). The Note Pool
Factor for each Class will be 1.0000000 as of the Closing Date, and,
thereafter, will decline to reflect reductions in the Outstanding Amount of
the Notes.
"Obligor" on a Receivable means the purchaser or co-purchasers of
the Financed Equipment and any other Person who owes payments under the
Receivable.
"Offered Note Percentage" means, with resect to any Payment Date,
the percentage equivalent of a fraction (a) the numerator of which is the
Note Balance (excluding the Class B Notes) and (b) the denominator of which
is the sum of the Note Balance (excluding the Class B Notes) and the
Certificate Balance.
"Officers' Certificate" means a certificate signed by at least one
of the Chairman of the Board, the President, the Vice Chairman of the
Board, an Executive Vice President, any Vice President, a Treasurer,
Assistant Treasurer, Secretary or Assistant Secretary of the Seller or the
Servicer, as appropriate.
"Opinion of Counsel" means a written opinion of counsel (who may,
except as otherwise expressly provided in this Agreement, be an employee of
or counsel to the Seller or the Servicer), which counsel and opinion shall
be acceptable to the Indenture Trustee, the Trustee or the Rating Agencies,
as applicable.
"Pass-Through Rate" means, with respect to the Certificates, 6.410%
per annum.
"Payment Date" means the fifteenth day of each calendar month, or,
if such day is not a Business Day, the next Business Day, commencing on
October 15, 1997.
"Physical Property" has the meaning assigned to such term in the
definition of "Delivery".
"Pool Balance" means, as of the opening of business on the first
day of any Collection Period, the sum of the aggregate Contract Values of
the Receivables as of such day, after giving effect to all payments
received from Obligors and Purchase Amounts to be remitted by the Servicer
or the Seller, as the case may be, with respect to the preceding Collection
Period and all Realized Losses on Receivables liquidated during such
preceding Collection Period.
"Precomputed Receivable" means any Receivable under which the
portion of a payment allocable to earned interest (which may be referred to
in the related Contract as an add-on finance charge) and the portion
allocable to the Amount Financed are determined according to the sum of
periodic balances, the sum of monthly payments or any equivalent method or
are monthly actuarial receivables.
"Pre-Funded Amount" means, with respect to any date, the amount on
deposit in the Pre-Funding Account on such date.
"Pre-Funded Percentage" means, for each Collection Period, the
quotient (expressed as a percentage) of: (i) the Pre-Funded Amount divided
by (ii) the sum of the Pool Balance (calculated with respect to the Fixed
Rate Receivables only) and the Pre-Funded Amount, after taking into account
all transfers of Subsequent Receivables during such Collection Period.
"Pre-Funding Account" means the account designated as such,
established and maintained pursuant to Section 5.1(a).
"Pre-Funding Account Investment Earnings" means, with respect to
any Payment Date, the interest and other investment earnings (net of losses
and investment expenses) on amounts on deposit in the Pre-Funding Account to
be deposited into the Collection Account on the related Transfer Date pursuant
to Section 5.1(b).
"Principal Balance" of a Precomputed Receivable, as of the close
of business on the last day of a Collection Period, means the Amount
Financed minus the sum of: (i) that portion of all Scheduled Payments due
on or prior to such day allocable to principal using the actuarial or
constant yield method, (ii) any refunded portion of insurance premiums
included in the Amount Financed, (iii) any payment of the Purchase Amount
with respect to the Precomputed Receivable allocable to principal and (iv)
any prepayment in full or any partial prepayments applied to reduce the
Principal Balance of the Precomputed Receivable.
"Principal Distribution Amount" means, with respect to any Payment
Date, the sum of (a) the Fixed Rate Principal Distribution Amount plus (b)
the Floating Rate Principal Distribution Amount.
"Purchase Agreement" means the Purchase Agreement, dated as of the
date hereof, between the Seller and Credit, as the same may be amended and
supplemented from time to time, which term shall also include, as the
context requires, the Liquidity Receivables Purchase Agreement.
"Purchase Amount" means, as of the close of business on the last
day of a Collection Period, an amount equal to the Contract Value of the
applicable Receivable as of the first day of the immediately following
Collection Period plus interest accrued and unpaid thereon as of such last
day at a rate per annum equal to: (a) in the case of the Initial
Receivables that are Fixed Rate Receivables, the Initial Cutoff Date APR,
(b) in the case of any Floating Rate Receivables, at the then applicable
APR and (c) in the case of the Subsequent Receivables, the applicable
Subsequent Cutoff Date APR.
"Purchased Receivable" means a Receivable purchased as of the
close of business on the last day of a Collection Period by the Servicer
pursuant to Section 4.6 or by the Seller pursuant to Section 3.2, or as of
the first day of a Collection Period by the Servicer pursuant to Section
9.1(a).
"Rating Agency" means each of Moody's and Standard & Poor's. If
either of such organizations or its successor is no longer in existence,
the Seller shall designate a nationally recognized statistical rating
organization or other comparable Person as a substitute Rating Agency,
notice of which designation shall be given to the Indenture Trustee, the
Trustee and the Servicer.
"Rating Agency Condition" means, with respect to any action, that
each Rating Agency shall have been given 10 days' prior notice thereof and
that each of the Rating Agencies shall have notified the Seller, the
Servicer, the Trustee and the Indenture Trustee in writing that such
action will not result in a reduction or withdrawal of the then
current rating of any Class of the Notes or the Certificates.
"Realized Losses" means the excess of the Principal Balance of
Liquidated Receivable plus accrued but unpaid interest thereon over
Liquidation Proceeds.
"Receivable Files" means the documents specified in Section 3.3.
"Recoveries" means, with respect to any Liquidated Receivable,
monies collected in respect thereof, from whatever source (other than from
the sale or other disposition of the Financed Equipment), during any
Collection Period following the Collection Period in which such Receivable
became a Liquidated Receivable.
"Remaining Pre-Funded Amount" has the meaning assigned thereto in
Section 5.7(b).
"Required Negative Carry Account Balance" means, as of the
beginning of each Collection Period, an amount equal to the lesser of: (a)
the Negative Carry Account Initial Deposit minus all previous withdrawals
from the Negative Carry Account and (b) the Maximum Negative Carry Amount
as of such day.
"Scheduled Payment" on a Precomputed Receivable means that portion
of the payment required to be made by the Obligor during any Collection
Period sufficient to amortize the Principal Balance under the actuarial
method over the term of the Receivable and to provide interest at the APR.
"Seller" means Case Receivables II Inc., a Delaware corporation,
and its successors in interest to the extent permitted hereunder.
"Servicer" means Credit, as the servicer of the Receivables, and
each successor to Credit (in the same capacity) pursuant to Section 7.3
or 8.2.
"Servicer Default" means an event specified in Section 8.1.
"Servicer's Certificate" means an Officers' Certificate of the
Servicer delivered pursuant to Section 4.8, substantially in the form of
Exhibit C.
"Servicing Fee" means the fee payable to the Servicer for services
rendered during the respective Collection Period, determined pursuant to
Section 4.7.
"Simple Interest Method" means the method of allocating a fixed
level payment between principal and interest, pursuant to which such
payment is allocated first to accrued and unpaid interest at the Contract
Rate on the unpaid principal balance and the remainder of such payment is
allocable to principal.
"Simple Interest Receivable" means any Receivable under which the
portion of a payment allocable to interest and the portion allocable to
principal is determined in accordance with the Simple Interest Method.
"Specified Spread Account Balance" means, with respect to any
Payment Date, the lesser of (a) 2.00% of the Initial Pool Balance and (b)
the Note Balance.
"Spread Account" means the account designated as such, established
and maintained pursuant to Section 5.1(a).
"Spread Account Initial Deposit" means, initially, $9,121,524.31,
and, with respect to each Subsequent Transfer Date, cash or Eligible
Investments having a value approximately equal to 2.00% of the aggregate
Contract Value of the Subsequent Receivables conveyed to the Issuer on such
Subsequent Transfer Date.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc., or its successor.
"Subsequent Cutoff Date" means, with respect to any Subsequent
Receivables, the close of business on the last day of the calendar month
preceding the related Subsequent Transfer Date.
"Subsequent Cutoff Date APR" means, with respect to any Subsequent
Cutoff Date, the weighted average APR of the Subsequent Receivables being
purchased as of such Subsequent Cutoff Date.
"Subsequent Receivables" means the Receivables transferred to the
Issuer pursuant to Section 2.2, which shall be listed on Schedule A to the
related Subsequent Transfer Assignment.
"Subsequent Transfer Assignment" has the meaning assigned thereto in
Section 2.2(b)(i).
"Subsequent Transfer Date" means any Business Day during the
Funding Period on which Subsequent Receivables are to be transferred to the
Issuer and a Subsequent Transfer Assignment is executed and delivered to
the Trustee and the Indenture Trustee pursuant to Section 2.2.
"Total Distribution Amount" means, with respect to any Payment
Date, the aggregate amount of collections on or with respect to the
Receivables (including collections received after the end of the preceding
calendar month on any Subsequent Receivables added to the Trust after the
end of that preceding calendar month and on or before that Payment Date)
with respect to the related Collection Period plus the Negative Carry
Amount for such Collection Period. Collections on or with respect to the
Receivables include all payments made by or on behalf of the Obligors
(including any late fees, prepayment charges, extension fees and other
administrative fees or similar charges allowed by applicable law with
respect to the Receivables), Liquidation Proceeds, the Purchase Amount of
each Receivable that became a Purchased Receivable in respect of the
related Collection Period (to the extent deposited into the Collection
Account), Investment Earnings for such Payment Date and payments made by a
Dealer pursuant to the related Dealer Agreement with respect to such
Receivable (other than amounts paid from Dealer reserve accounts maintained
with Credit); provided, however, that the Total Distribution Amount shall
not include: (i) all payments or proceeds (including Liquidation Proceeds)
of any Receivables the Purchase Amount of which has been included in the
Total Distribution Amount in a prior Collection Period, (ii) any Recoveries
or (iii) amounts released from the Pre-Funding Account.
"Transfer Date" means the Business Day preceding each Payment Date
and the Business Day preceding the A-1 Note Final Schedule Maturity Date.
"Trust" means the Issuer.
"Trust Account Property" means the Trust Accounts, all amounts and
investments held from time to time in any Trust Account (whether in the
form of deposit accounts, Physical Property, book-entry securities,
uncertificated securities or otherwise) and all proceeds of the foregoing.
"Trust Accounts" has the meaning assigned thereto in Section 5.1(b).
"Trust Agreement" means the Trust Agreement, dated as of the date
hereof, among the Seller and the Trustee, as the same may be amended and
supplemented from time to time.
"Trustee" means the Person acting as Trustee under the Trust
Agreement, its successors in interest and any successor trustee under the
Trust Agreement.
"Trust Estate" has the meaning assigned to such term in the Trust
Agreement.
"Trust Officer" means, in the case of the Indenture Trustee, any
officer within the Corporate Trust Office of the Indenture Trustee,
including any Vice President, Assistant Vice President, Secretary,
Assistant Secretary or any other officer of the Indenture Trustee
customarily performing functions similar to those performed by any of the
above designated officers and also, with respect to a particular matter,
any other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject and, with respect
to the Trustee, any officer in the Corporate Trust Administration
Department of the Trustee with direct responsibility for the administration
of the Trust Agreement and the Basic Documents on behalf of the Trustee.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code as in effect in the relevant jurisdiction, as amended from
time to time.
SECTION 1.2. Other Definitional Provisions. (a) Capitalized terms
used herein and not otherwise defined herein that are defined in the Indenture
have the meanings assigned to them in the Indenture.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement or in any such certificate or other
document to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles as in effect
on the date hereof. To the extent that the definitions of accounting terms
in this Agreement or in any such certificate or other document are
inconsistent with the meanings of such terms under generally accepted
accounting principles, the definitions contained in this Agreement or in
any such certificate or other document shall control.
(d) The words "hereof", "herein", "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole
and not to any particular provision of this Agreement; Section, Schedule
and Exhibit references contained in this Agreement are references to
Sections, Schedules and Exhibits in or to this Agreement unless otherwise
specified; and the term "including" shall mean "including, without
limitation,".
(e) The definitions contained in this Agreement are applicable to
the singular as well as the plural forms of such terms and to the masculine
as well as to the feminine and neuter genders of such terms.
(f) Interest shall be computed on the basis of a 360-day year of
twelve 30-day months for all purposes of this Agreement.
ARTICLE II
Conveyance of Receivables
SECTION 2.1. Conveyance of Initial Receivables. In consideration
of the Issuer's delivery to or upon the order of the Seller on the Closing
Date of the net proceeds from the sale of the Notes and the Certificates
and the other amounts to be distributed from time to time to the Seller in
accordance with this Agreement, the Seller does hereby sell, transfer,
assign, set over and otherwise convey to the Issuer, without recourse
(subject to the obligations herein), all of its right, title and interest
in, to and under:
(a) the Initial Receivables, including all documents
constituting chattel paper included therewith, and all obligations
of the Obligors thereunder, including all moneys paid thereunder
on or after the Initial Cutoff Date;
(b) the security interests in the Financed Equipment
granted by Obligors pursuant to the Initial Receivables and any
other interest of the Seller in such Financed Equipment;
(c) any proceeds with respect to the Initial Receivables
from claims on insurance policies covering Financed Equipment or
Obligors;
(d) the Liquidity Receivables Purchase Agreement (only
with respect to Owned Contracts (as defined in the Purchase
Agreement) included in the Initial Receivables) and the Purchase
Agreement, including the right of the Seller to cause Credit to
repurchase Initial Receivables from the Seller under the
circumstances described therein;
(e) any proceeds from recourse to Dealers with respect to
the Initial Receivables other than any interest in the Dealers'
reserve accounts maintained with Credit;
(f) any Financed Equipment that shall have secured an
Initial Receivable and that shall have been acquired by or on
behalf of the Trust;
(g) all funds on deposit from time to time in the Trust
Accounts, including the Spread Account Initial Deposit, the
Negative Carry Account Initial Deposit and the Pre-Funded Amount,
and in all investments and proceeds thereof (including all income
thereon); and
(h) the proceeds of any and all of the foregoing (other
than Recoveries).
The above assignment shall be evidenced by a duly executed written
assignment in substantially the form of Exhibit D (the "Assignment").
SECTION 2.2. Conveyance of Subsequent Receivables. (a) Subject to
the conditions set forth in clause (b) below, in consideration of the
Indenture Trustee's (on behalf of the Trustee) delivery on the related
Subsequent Transfer Date to or upon the order of the Seller of the amount
described in Section 5.7(a)(i) to be delivered to the Seller, the Seller
does hereby sell, transfer, assign, set over and otherwise convey to the
Issuer, without recourse (subject to the obligations herein), all of its
right, title and interest in, to and under:
(i) the Subsequent Receivables listed on Schedule A to
the related Subsequent Transfer Assignment, including all
documents constituting chattel paper included therewith, and all
obligations of the Obligors thereunder, including all moneys paid
thereunder on or after the related Subsequent Cutoff Date;
(ii) the security interests in the Financed Equipment
granted by Obligors pursuant to such Subsequent Receivables and
any other interest of the Seller in such Financed Equipment;
(iii) any proceeds with respect to such Subsequent
Receivables from claims on insurance policies covering Financed
Equipment or Obligors;
(iv) the Purchase Agreement, including the right of the
Seller to cause Credit to repurchase Subsequent Receivables from
the Seller under the circumstances described therein;
(v) any proceeds with respect to such Subsequent
Receivables from recourse to Dealers other than any interest in
the Dealers' reserve accounts maintained with Credit;
(vi) any Financed Equipment that shall have secured any
such Subsequent Receivable and that shall have been acquired by or
on behalf of the Trust; and
(vii) the proceeds of any and all of the foregoing (other
than Recoveries).
(b) The Seller shall transfer to the Issuer the Subsequent
Receivables and the other property and rights related thereto described in
clause (a) only
upon the satisfaction of each of the following conditions precedent on or
prior to the related Subsequent Transfer Date:
(i) the Seller shall have delivered to the Trustee and
the Indenture Trustee a duly executed written assignment in
substantially the form of Exhibit E (the "Subsequent Transfer
Assignment"), which shall include a Schedule A listing the
Subsequent Receivables;
(ii) the Seller shall, to the extent required by Section
5.2, have deposited in the Collection Account all collections in
respect of the Subsequent Receivables;
(iii) as of such Subsequent Transfer Date: (A) the Seller
was not insolvent and will not become insolvent as a result of the
transfer of Subsequent Receivables on such Subsequent Transfer
Date, (B) the Seller did not intend to incur or believe that it
would incur debts that would be beyond the Seller's ability to pay
as such debts matured, (C) such transfer was not made with actual
intent to hinder, delay or defraud any Person and (D) the assets
of the Seller did not constitute unreasonably small capital to
carry out its business as conducted;
(iv) the applicable Spread Account Initial Deposit for
such Subsequent Transfer Date shall have been made;
(v) [intentionally omitted];
(vi) the Receivables in the Trust, including the
Subsequent Receivables to be conveyed to the Trust on such
Subsequent Transfer Date, shall meet the following criteria: (A)
the weighted average original term of the Receivables in the Trust
will not be greater than 55.0 months; (B) each Fixed Rate
Receivable has an APR of at least 3.0%; (C) each Floating Rate
Receivable has a margin greater than - 3% per annum; (D) as of
each Subsequent Transfer Cutoff Date the weighted average of the
Initial Cutoff Date APR and each Subsequent Cutoff Date APR
(weighted on the basis of the respective aggregate Contract Values
of the Fixed Rate Receivables for which each such APR is used to
calculate the Contract Value) will not be less than the weighted
average interest rate on the Class A Notes and Class C Notes plus
1% per annum; and (E) not more than 45% of the aggregate Contract
Value of the Receivables in the Trust will represent Contracts for
the financing of construction equipment;
(vii) the Funding Period shall not have terminated;
(viii) each of the representations and warranties made by
the Seller pursuant to Section 3.1 with respect to the Subsequent
Receivables shall be true and correct as of such Subsequent
Transfer Date, and the Seller shall have performed all obligations
to be performed by it hereunder on or prior to such Subsequent
Transfer Date;
(ix) the Seller shall, at its own expense, on or prior to
such Subsequent Transfer Date, indicate in its computer files that
the Subsequent Receivables identified in the related Subsequent
Transfer Assignment have been sold to the Issuer pursuant to this
Agreement and the Subsequent Transfer Assignment;
(x) the Seller shall have taken any action required to
maintain the first perfected ownership interest of the Issuer in
the Trust Estate and the first perfected security interest of the
Indenture Trustee in the Collateral;
(xi) no selection procedures believed by the Seller to be
adverse to the interests of the Trust, the Noteholders or the
Certificateholders shall have been utilized in selecting the
Subsequent Receivables;
(xii) the addition of the Subsequent Receivables will not
result in a material adverse tax consequence to the Trust, the
Noteholders or the Certificateholders;
(xiii) the Seller shall have provided the Indenture
Trustee, the Trustee and the Rating Agencies a statement listing
the aggregate Contract Value of such Subsequent Receivables and
any other information reasonably requested by any of the foregoing
with respect to such Subsequent Receivables;
(xiv) the Seller shall have delivered: (A) to the Rating
Agencies, an Opinion of Counsel with respect to the transfer of
such Subsequent Receivables substantially in the form of the
Opinion of Counsel delivered to the Rating Agencies on the Closing
Date and (B) to the Trustee and the Indenture Trustee, the Opinion
of Counsel required by Section 10.2(i)(1);
(xv) the Seller shall have delivered to the Trustee and
the Indenture Trustee a letter of a firm of independent certified
public accountants confirming the satisfaction of the conditions
set forth in clause (vi) with respect to the Subsequent
Receivables, and covering substantially the same matters with
respect to the Subsequent Receivables as are set forth in Exhibit F
hereto;
(xvi) the Seller shall have delivered to the Indenture
Trustee and the Trustee an Officers' Certificate confirming the
satisfaction of each condition specified in this clause (b)
(substantially in the form attached hereto as Annex A to the
Subsequent Transfer Assignment); and
(xvii) Xxxxx'x shall have received written notification
from the Seller of the addition of all such Subsequent
Receivables.
ARTICLE III
The Receivables
SECTION 3.1. Representations and Warranties of Seller. The Seller
makes the following representations and warranties as to the Receivables on
which the Issuer is deemed to have relied in acquiring the Receivables.
Such representations and warranties speak as of the execution and delivery
of this Agreement and as of the Closing Date, in the case of the Initial
Receivables, and as of the applicable Subsequent Transfer Date, in the case
of the Subsequent Receivables, but shall survive the sale, transfer and
assignment of the Receivables to the Issuer and the pledge thereof to the
Indenture Trustee pursuant to the Indenture.
(a) Title. It is the intention of the Seller that the transfer and
assignment herein contemplated constitute a sale of the Receivables from
the Seller to the Issuer and that the beneficial interest in and title to
the Receivables not be part of the debtor's estate in the event of the
filing of a bankruptcy petition by or against the Seller under any
bankruptcy or similar law. No Receivable has been sold, transferred,
assigned or pledged by the Seller to any Person other than the Issuer.
Immediately prior to the transfer and assignment herein contemplated, the
Seller had good title to each Receivable, free and clear of all Liens and,
immediately upon the transfer thereof, the Issuer shall have good title to
each Receivable, free and clear of all Liens (other than under the
Indenture); and the transfer and assignment of the Receivables to the
Issuer has been perfected under the UCC.
(b) All Filings Made. All filings (including UCC filings)
necessary in any jurisdiction to give the Issuer a first priority perfected
ownership interest in the Receivables, and to give the Indenture Trustee a
first priority perfected security interest therein, have been made.
SECTION 3.2. Repurchase upon Breach. (a) The Seller, the Servicer
or the Trustee, as the case may be, shall inform the other parties to this
Agreement and the Indenture Trustee promptly, in writing, upon the
discovery of any breach of the Seller's representations and warranties made
pursuant to Section 3.1 or Section 6.1 or Credit's representations and
warranties made pursuant to Section 3.2(b) of the Liquidity Receivables
Purchase Agreement or Section 3.2(b) of the Purchase Agreement. Unless any
such breach shall have
been cured by the last day of the second (or, if the Seller elects, the
first) Collection Period after such breach is discovered by the Trustee or
in which the Trustee receives written notice from the Seller or the
Servicer of such breach, the Seller shall be obligated, and, if necessary,
the Seller or the Trustee shall enforce the obligation of Credit under the
Liquidity Receivables Purchase Agreement or the Purchase Agreement, as
applicable, to repurchase any Receivable materially and adversely affected
by any such breach as of such last day. As consideration for the repurchase
of the Receivable, the Seller shall remit the Purchase Amount in the manner
specified in Section 5.4; provided, however, that the obligation of the
Seller to repurchase any Receivable arising solely as a result of a breach
of Credit's representations and warranties pursuant to Section 3.2(b) of
the Liquidity Receivables Purchase Agreement or Section 3.2(b) of the
Purchase Agreement is subject to the receipt by the Seller of the Purchase
Amount from Credit. Subject to the provisions of Section 6.3, the sole
remedy of the Issuer, the Trustee, the Indenture Trustee, the Noteholders
or the Certificateholders with respect to a breach of the Seller's
representations and warranties made pursuant to Section 3.1 or Section 6.1
(or Credit's representations and warranties made pursuant to Section 3.2(b)
of the Liquidity Receivables Purchase Agreement or Section 3.2(b) of the
Purchase Agreement) and the agreement contained in this Section shall be to
require the Seller to repurchase Receivables pursuant to this Section,
subject to the conditions contained herein, and to enforce Credit's
obligation to the Seller to repurchase such Receivables pursuant to the
Liquidity Receivables Purchase Agreement or the Purchase Agreement, as
applicable.
(b) With respect to all Receivables repurchased by the Seller
pursuant to this Agreement, the Issuer shall sell, transfer, assign, set
over and otherwise convey to the Seller, without recourse, representation
or warranty, all of the Issuer's right, title and interest in, to and under
such Receivables, and all security and documents relating thereto.
SECTION 3.3. Custody of Receivable Files. To assure uniform
quality in servicing the Receivables and to reduce administrative costs,
the Issuer hereby revocably appoints the Servicer, and the Servicer hereby
accepts such appointment, to act for the benefit of the Issuer and the
Indenture Trustee as custodian of the following documents or instruments,
which are hereby constructively delivered to the Indenture Trustee, as
pledgee of the Issuer (or, in the case of the Subsequent Receivables, will
as of the applicable Subsequent Transfer Date be constructively delivered
to the Indenture Trustee, as pledgee of the Issuer) with respect to each
Receivable:
(a) the original fully executed copy of the Receivable;
(b) a record or facsimile of the original credit
application fully executed by the Obligor (if any);
(c) the original certificate of title or file stamped
copy of the UCC financing statement or such other documents that
the Servicer shall keep on file, in accordance with its customary
procedures, evidencing the security interest of Credit in the
Financed Equipment; and
(d) any and all other documents that the Servicer or the
Seller shall keep on file, in accordance with its customary
procedures, relating to a Receivable, an Obligor or any of the
Financed Equipment.
SECTION 3.4. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer shall hold the Receivable Files for
the benefit of the Issuer and the Indenture Trustee and maintain such
accurate and complete accounts, records and computer systems pertaining to
each Receivable File as shall enable the Issuer to comply with this
Agreement. In performing its duties as custodian, the Servicer shall act
with reasonable care, using that degree of skill and attention that the
Servicer exercises with respect to the receivable files relating to all
comparable equipment receivables that the Servicer services for itself or
others. The Servicer shall conduct, or cause to be conducted, periodic
audits of the Receivable Files and the related accounts, records and
computer systems, in such a manner as shall enable the Issuer or the
Indenture Trustee to verify the accuracy of the Servicer's record keeping.
The Servicer shall promptly report to the Issuer and the Indenture Trustee
any failure on its part to hold the Receivable Files and maintain its
accounts, records and computer systems as herein provided and promptly take
appropriate action to remedy any such failure. Nothing herein shall be
deemed to require an initial review or any periodic review by the Issuer,
the Trustee or the Indenture Trustee of the Receivable Files.
(b) Maintenance of and Access to Records. The Servicer shall
maintain each Receivable File at one of its offices specified in Schedule A
to this Agreement or at such other office as shall be specified to the
Issuer and the Indenture Trustee by written notice not later than 90 days
after any change in location. The Servicer shall make available for
inspection by the Seller, the Issuer and the Indenture Trustee or their
respective duly authorized representatives, attorneys or auditors a list of
locations of the Receivable Files and the related accounts, records and
computer systems maintained by the Servicer at such times during normal
business hours as the Seller, the Issuer or the Indenture Trustee shall
instruct.
SECTION 3.5. Instructions; Authority To Act. The Servicer shall be
deemed to have received proper instructions with respect to the Receivable
Files upon its receipt of written instructions signed by a Trust Officer of
the Indenture Trustee.
SECTION 3.6. Custodian's Indemnification. The Servicer as
custodian shall indemnify the Trust, the Trustee and the Indenture Trustee
(and each of their officers, directors, employees and agents) for any and
all liabilities, obligations, losses, compensatory damages, payments, costs
or expenses of any kind whatsoever that may be imposed on, incurred by or
asserted against the Trust, the Trustee or the Indenture Trustee (or any of
their officers, directors, employees and agents) as the result of any
improper act or omission in any way relating to the maintenance and custody
by the Servicer as custodian of the Receivable Files; provided, however,
that the Servicer shall not be liable: (a) to the Trustee for any portion
of any such amount resulting from the willful misfeasance, bad faith or
negligence of the Trustee and (b) to the Indenture Trustee for any portion
of any such amount resulting from the wilful misfeasance, bad faith or
negligence of the Indenture Trustee.
SECTION 3.7. Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Initial Cutoff
Date and shall continue in full force and effect until terminated pursuant
to this Section. If the Servicer shall resign as Servicer in accordance
with this Agreement or if all of the rights and obligations of the Servicer
shall have been terminated under Section 8.1, the appointment of such
Servicer as custodian shall be terminated by: (a) the Indenture Trustee,
(b) the Holders of Notes evidencing not less than 25% of the Note Balance,
(c) with the consent of Holders of Notes evidencing not less than 25% of
the Note Balance, the Trustee or (d) the Certificateholders holding
Certificates evidencing not less than 25% of the Certificate Balance, in
the same manner as the Indenture Trustee or such Noteholders may terminate
the rights and obligations of the Servicer under Section 8.1. The Indenture
Trustee or, with the consent of the Indenture Trustee, the Trustee may
terminate the Servicer's appointment as custodian of the Receivable Files,
with cause, at any time upon written notification to the Servicer, and
without cause upon 30 days' prior written notification to the Servicer. As
soon as practicable after any termination of such appointment, the Servicer
shall deliver the Receivable Files to the Indenture Trustee or the
Indenture Trustee's agent at such place(s) as the Indenture Trustee may
reasonably designate.
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.1. Duties of Servicer. The Servicer, for the benefit of
the Issuer, and (to the extent provided herein) the Indenture Trustee shall
manage, service, administer and make collections on the Receivables with
reasonable care, using that degree of skill and attention that the Servicer
exercises with respect to all comparable equipment receivables that it
services for itself or others. The Servicer's duties shall include
collection and posting of all
payments, responding to inquiries of Obligors on such Receivables,
investigating delinquencies, sending payment coupons to Obligors, reporting
tax information to Obligors, accounting for collections and furnishing
monthly and annual statements to the Trustee and the Indenture Trustee with
respect to distributions. Subject to Section 4.2, the Servicer shall follow
its customary standards, policies and procedures in performing its duties
as Servicer. Without limiting the generality of the foregoing, the Servicer
is authorized and empowered to execute and deliver, on behalf of itself,
the Issuer, the Trustee, the Indenture Trustee, the Certificateholders, the
Noteholders or any of them, any and all instruments of satisfaction or
cancellation, or partial or full release or discharge, and all other
comparable instruments, with respect to such Receivables or the Financed
Equipment securing such Receivables. If the Servicer shall commence a legal
proceeding to enforce a Receivable, the Issuer shall thereupon be deemed to
have automatically assigned, solely for the purpose of collection, such
Receivable to the Servicer. If in any enforcement suit or legal proceeding
it shall be held that the Servicer may not enforce a Receivable on the
ground that it shall not be a real party in interest or a holder entitled
to enforce such Receivable, the Trustee shall, at the Servicer's expense
and direction, take steps to enforce such Receivable, including bringing
suit in its name or the name of the Trust, the Indenture Trustee, the
Certificateholders or the Noteholders. The Trustee or the Indenture Trustee
shall, upon the written request of the Servicer, furnish the Servicer with
any powers of attorney and other documents reasonably necessary or
appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
SECTION 4.2. Collection and Allocation of Receivable Payments. The
Servicer shall make reasonable efforts to collect all payments called for
under the Receivables as and when the same shall become due and shall
follow such collection procedures as it follows with respect to all
comparable equipment receivables that it services for itself or others. The
Servicer shall allocate collections between principal and interest in
accordance with the customary servicing procedures it follows with respect
to all comparable equipment receivables that it services for itself or
others. The Servicer may grant extensions or adjustments on a Receivable;
provided, however, that if the Servicer extends the date for final payment
by the Obligor of any Receivable beyond the Final Scheduled Maturity Date,
it shall promptly purchase the Receivable from the Issuer in accordance
with Section 4.6. The Servicer may, in its discretion, waive any late
payment charge or any other fees (other than extension fees or any other
fees that represent interest charges on deferred Scheduled Payments) that
may be collected in the ordinary course of servicing a Receivable. The
Servicer shall not agree to any decrease of the interest rate on any
Receivable or reduce the aggregate amount of the Scheduled Payments due on
any Receivable.
SECTION 4.3. Realization upon Receivables. For the benefit of the
Issuer and the Indenture Trustee, the Servicer shall use reasonable efforts,
consistent with its customary servicing procedures, to repossess or
otherwise convert the ownership of the Financed Equipment securing any
Receivable as to which the Servicer shall have determined eventual payment
in full is unlikely. The Servicer shall follow such customary and usual
practices and procedures as it shall deem necessary or advisable in its
servicing of equipment receivables, which may include reasonable efforts to
realize upon any recourse to Dealers and selling the Financed Equipment at
public or private sale. The foregoing shall be subject to the provision
that, in any case in which the Financed Equipment shall have suffered
damage, the Servicer shall not expend funds in connection with the repair
or the repossession of such Financed Equipment unless it shall determine in
its discretion that such repair and/or repossession will increase the
Liquidation Proceeds by an amount greater than the amount of such expenses.
SECTION 4.4. Maintenance of Security Interests in Financed
Equipment. The Servicer shall, in accordance with its customary servicing
procedures, take such steps as are necessary to maintain perfection of the
security interest created by each Receivable in the related Financed
Equipment. The Servicer is hereby authorized to take such steps as are
necessary to re- perfect such security interest for the benefit of the
Issuer and the Indenture Trustee in the event of the relocation of a
Financed Equipment or for any other reason.
SECTION 4.5. Covenants of Servicer. The Servicer shall not release
the Financed Equipment securing any Receivable from the security interest
granted by such Receivable in whole or in part except in the event of
payment in full by the Obligor thereunder or repossession, nor shall the
Servicer impair the rights of the Issuer, the Indenture Trustee, the
Certificateholders or the Noteholders in such Receivables. The Servicer
shall, in accordance with its customary servicing procedures, require that
each Obligor shall have obtained physical damage insurance covering the
Financed Equipment as of the execution of the Receivable.
SECTION 4.6. Purchase of Receivables upon Breach. The Servicer or
the Trustee shall inform the other party, the Indenture Trustee, the Seller
and Credit promptly, in writing, upon the discovery of any breach pursuant
to Section 4.2, 4.4 or 4.5. Unless the breach shall have been cured by the
last day of the Collection Period in which such breach is discovered, the
Servicer shall purchase any Receivable materially and adversely affected by
such breach as of such last day. If the Servicer takes any action during
any Collection Period pursuant to Section 4.2 that impairs the rights of
the Issuer, the Indenture Trustee, the Certificateholders or the
Noteholders in any Receivable or as otherwise provided in Section 4.2, the
Servicer shall purchase such Receivable as of the last day of such
Collection Period. As consideration for the purchase of any such Receivable
pursuant to either of the two preceding sentences, the Servicer shall remit
the Purchase Amount in the manner
specified in Section 5.4. Subject to Section 7.2, the sole remedy of the
Issuer, the Trustee, the Indenture Trustee, the Certificateholders or the
Noteholders with respect to a breach pursuant to Section 4.2, 4.4 or 4.5
shall be to require the Servicer to purchase Receivables pursuant to this
Section. The Trustee shall have no duty to conduct any affirmative
investigation as to the occurrence of any condition requiring the purchase
of any Receivable pursuant to this Section.
SECTION 4.7. Servicing Fee. The Servicing Fee for each Collection
Period shall be equal to 1/12th of 1.00% of the Pool Balance as of the first
day of such Collection Period.
SECTION 4.8. Servicer's Certificate. On each Determination Date
the Servicer shall deliver to the Trustee, the Indenture Trustee and the
Seller, with a copy to the Rating Agencies, a Servicer's Certificate
containing all information necessary to make the distributions pursuant to
Sections 5.5 and 5.6 and the deposits to the Collection Account pursuant to
Section 5.2 for the Collection Period preceding the date of such Servicer's
Certificate. Receivables to be repurchased by the Seller or purchased by
the Servicer shall be identified by the Servicer by account number with
respect to such Receivable (as specified in the Schedule of Receivables
delivered on the Closing Date or attached to the applicable Subsequent
Transfer Assignment).
SECTION 4.9. Annual Statement as to Compliance; Notice of Default.
(a) The Servicer shall deliver to the Trustee and the Indenture Trustee, on
or before April 30th of each year, an Officers' Certificate, dated as of
December 31 of the preceding year, stating that: (i) a review of the
activities of the Servicer during the preceding 12-month period (or, in the
case of the first such certificate, from the Initial Cutoff Date to
December 31, 1997) and of its performance under this Agreement has been
made under such officers' supervision and (ii) to the best of such
officers' knowledge, based on such review, the Servicer has fulfilled all
its obligations under this Agreement throughout such year or, if there has
been a default in the fulfillment of any such obligation, specifying each
such default known to such officers and the nature and status thereof. The
Indenture Trustee shall send a copy of such Officers' Certificate and the
report referred to in Section 4.10 to the Rating Agencies. A copy of such
Officer's Certificate and report may be obtained by any Certificateholder
or Noteholder by a request in writing to the Trustee addressed to the
Corporate Trust Office. Upon the written request of the Trustee, the
Indenture Trustee will promptly furnish the Trustee a list of Noteholders
as of the date specified by the Trustee.
(b) The Servicer shall deliver to the Trustee, the Indenture
Trustee and the Rating Agencies, promptly after having obtained knowledge
thereof, but in no event later than five Business Days thereafter, written
notice in an Officers' Certificate of any event that, with the giving
of notice or lapse of time, or both, would become a Servicer Default under
Section 8.1(a) or (b).
SECTION 4.10. Annual Independent Certified Public Accountants'
Report. The Servicer shall cause a firm of independent certified public
accountants, which may also render other services to the Servicer or the
Seller, to deliver to the Trustee and the Indenture Trustee on or before
April 30 of each year a report, addressed to the Board of Directors of the
Servicer, the Trustee and the Indenture Trustee, summarizing the results of
certain procedures with respect to certain documents and records relating
to the servicing of the Receivables during the preceding calendar year (or,
in the case of the first such report, during the period from the Initial
Cutoff Date to December 31, 1997). The procedures to be performed and
reported upon by the independent certified public accountants shall be
those agreed to by the Servicer and the Indenture Trustee.
Such report will also indicate that the firm is independent of the
Servicer within the meaning of the Code of Professional Ethics of the
American Institute of Certified Public Accountants.
SECTION 4.11. Access to Receivable Files. The Servicer shall
provide to the Trustee and the Indenture Trustee access to the Receivable
Files in such cases where the Trustee or the Indenture Trustee shall be
required by applicable statutes or regulations to review such
documentation. Access shall be afforded without charge, but only upon
reasonable request and during the normal business hours at the respective
offices of the Servicer. Nothing in this Section shall affect the
obligation of the Servicer to observe any applicable law prohibiting
disclosure of information regarding the Obligors, and the failure of the
Servicer to provide access to information as a result of such obligation
shall not constitute a breach of this Section.
SECTION 4.12. Servicer Expenses. The Servicer shall be required to
pay all expenses incurred by it in connection with its activities
hereunder, including fees and disbursements of independent accountants,
taxes imposed on the Servicer and expenses incurred in connection with
distributions and reports to Certificateholders and the Noteholders.
SECTION 4.13. Appointment of Subservicer. The Servicer may at any
time appoint a subservicer to perform all or any portion of its obligations
as Servicer hereunder; provided, however, that the Rating Agency Condition
shall have been satisfied in connection therewith; and provided further,
that the Servicer shall remain obligated and be liable to the Issuer, the
Trustee, the Indenture Trustee, the Certificateholders and the Noteholders
for the servicing and administering of the Receivables in accordance with
the provisions hereof without diminution of such obligation and liability
by virtue of the appointment of such subservicer and to the same extent and
under the same terms and
conditions as if the Servicer alone were servicing and administering the
Receivables. The fees and expenses of the subservicer shall be as agreed
between the Servicer and its subservicer from time to time and none of the
Issuer, the Trustee, the Indenture Trustee, the Certificateholders or the
Noteholders shall have any responsibility therefor.
ARTICLE V
Distributions: Spread Account;
Statements to Certificateholders and Noteholders
SECTION 5.1. Establishment of Trust Accounts. (a)(i) The Servicer,
for the benefit of the Noteholders and the Certificateholders, shall
establish and maintain in the name of the Indenture Trustee an Eligible
Deposit Account (the "Collection Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Noteholders and the Certificateholders.
(ii) The Servicer, for the benefit of the Noteholders,
shall establish and maintain in the name of the Indenture Trustee
an Eligible Deposit Account (the "Note Distribution Account"),
bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Noteholders.
(iii) The Servicer, for the benefit of the Noteholders,
shall establish and maintain in the name of the Indenture Trustee
an Eligible Deposit Account (the "Spread Account"), bearing a
designation clearly indicating that the funds deposited therein
are held for the benefit of the Noteholders.
(iv) The Servicer, for the benefit of the Noteholders and
the Certificateholders, shall establish and maintain in the name
of the Indenture Trustee an Eligible Deposit Account (the
"Pre-Funding Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Noteholders and the Certificateholders.
(v) The Servicer, for the benefit of the Fixed Rate
Offered Noteholders and the Class B Noteholders, shall establish
and maintain in the name of the Indenture Trustee an Eligible
Deposit Account (the "Negative Carry Account"), bearing a
designation clearly indicating that the funds deposited therein
are held for the benefit of the Noteholders and the
Certificateholders.
(b) Funds on deposit in the Collection Account, the Note
Distribution Account, the Spread Account, the Pre-Funding Account and the
Negative Carry Account (collectively, the "Trust Accounts") shall be
invested or reinvested by the Indenture Trustee in Eligible Investments
selected by and as directed in writing by the Servicer (which written
direction may be in the form of standing instructions); provided, however,
it is understood and agreed that the Indenture Trustee shall not be liable
for the selection of, or any loss arising from such investment in, Eligible
Investments. All such Eligible Investments shall be held by the Indenture
Trustee for the benefit of the Noteholders and the Certificateholders or
the Noteholders, as applicable; provided, that on each Transfer Date, all
Investment Earnings on funds on deposit in the Trust Accounts shall be
deposited into the Collection Account and shall be deemed to constitute a
portion of the Total Distribution Amount. Other than as permitted by the
Rating Agencies, funds on deposit in the Trust Accounts shall be invested
in Eligible Investments that will mature so that such funds will be
available at the close of business on the Transfer Date preceding the
following Payment Date; provided, however, that funds on deposit in Trust
Accounts may be invested in Eligible Investments of the entity serving as
Indenture Trustee that may mature so that such funds will be available on
the Payment Date. Funds deposited in a Trust Account on the Transfer Date
that precedes a Payment Date upon the maturity of any Eligible Investments
are not required to be invested overnight.
(c)(i) The Indenture Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Trust Accounts
and in all proceeds thereof (including all income thereon) and all such
funds, investments, proceeds and income shall be part of the Trust Estate.
The Trust Accounts shall be under the sole dominion and control of the
Indenture Trustee for the benefit of the Noteholders and the
Certificateholders or the Noteholders, as the case may be. If, at any time,
any of the Trust Accounts ceases to be an Eligible Deposit Account, the
Indenture Trustee (or the Servicer on its behalf) shall within 10 Business
Days (or such longer period, not to exceed 30 calendar days, as to which
each Rating Agency may consent) establish a new Trust Account as an
Eligible Deposit Account and shall transfer any cash and/or any investments
held in the no-longer Eligible Deposit Account to such new Trust Account.
(ii) With respect to the Trust Account Property, the
Indenture Trustee agrees, by its acceptance hereof, that:
(A) any Trust Account Property that is held in
deposit accounts shall be held solely in Eligible Deposit
Accounts, subject to the last sentence of Section
5.1(c)(i); and each such Eligible Deposit Account shall
be subject to the exclusive custody and control of the
Indenture Trustee, and the Indenture Trustee shall have
sole signature authority with respect thereto;
(B) any Trust Account Property that constitutes
Physical Property shall be delivered to the Indenture
Trustee in accordance with clause (a) of the definition
of "Delivery" and shall be held, pending maturity or
disposition, solely by the Indenture Trustee or a
financial intermediary (as such term is defined in
Section 8-313(4) of the UCC) acting solely for the
Indenture Trustee;
(C) any Trust Account Property that is a
book-entry security held through the Federal Reserve
System pursuant to Federal book-entry regulations shall
be delivered in accordance with clause (b) of the
definition of "Delivery" and shall be maintained by the
Indenture Trustee, pending maturity or disposition,
through continued book-entry registration of such Trust
Account Property as described in such clause; and
(D) any Trust Account Property that is an
"uncertificated security" under Article 8 of the UCC and
that is not governed by clause (C) shall be delivered to
the Indenture Trustee in accordance with clause (c) of
the definition of "Delivery" and shall be maintained by
the Indenture Trustee, pending maturity or disposition,
through continued registration of the Indenture Trustee's
(or its nominee's) ownership of such security.
(iii) The Servicer shall have the power, revocable by the
Indenture Trustee or by the Trustee, with the consent of the
Indenture Trustee, to instruct the Indenture Trustee to make
withdrawals and payments from the Trust Accounts for the purpose
of permitting the Servicer or the Trustee to carry out its
respective duties hereunder or permitting the Indenture Trustee to
carry out its duties under the Indenture.
(d) All Trust Accounts will initially be established at the
Indenture Trustee.
SECTION 5.2. Collections. The Servicer shall remit within two
Business Days of receipt thereof to the Collection Account all payments by
or on behalf of the Obligors with respect to the Receivables, and all
Liquidation Proceeds. Notwithstanding the foregoing, for so long as: (i)
Credit remains the Servicer, (ii) no Servicer Default shall have occurred
and be continuing and (iii) prior to ceasing daily remittances, the Rating
Agency Condition shall have been satisfied (and any conditions or
limitations imposed by the Rating Agencies in connection therewith are
complied with), the Servicer shall remit such collections with respect to
the related Collection Period to the Collection Account on the Transfer
Date immediately following the end of such Collection Period. For purposes
of this Article V, the phrase "payments by or
on behalf of the Obligors" shall mean payments made with respect to the
Receivables by Persons other than the Servicer or the Seller.
SECTION 5.3. Application of Collections. (a) With respect to each
Receivable, all collections for the Collection Period shall be applied to the
related Scheduled Payment.
(b) All Liquidation Proceeds shall be applied to the related
Receivable.
SECTION 5.4. Additional Deposits. The Servicer and the Seller
shall deposit or cause to be deposited in the Collection Account the
aggregate Purchase Amount with respect to Purchased Receivables on the
Transfer Date related to the Collection Period on the last day of which the
purchase occurs, and the Servicer shall deposit therein all amounts to be
paid under Section 9.1 on the Transfer Date falling in the Collection
Period referred to in Section 9.1. The Servicer will deposit the aggregate
Purchase Amount with respect to Purchased Receivables when such obligations
are due, unless the Servicer shall not be required to make daily deposits
pursuant to Section 5.2, in which case such deposits shall be made on the
Transfer Date following the related Collection Period.
SECTION 5.5. Distributions. (a) On each Determination Date, the
Servicer shall calculate all amounts required to be deposited in the Note
Distribution Account, the Certificate Distribution Account and the Spread
Account.
(b) On each Payment Date, the Servicer shall instruct the
Indenture Trustee (based on the information contained in the Servicer's
Certificate delivered on the related Determination Date pursuant to Section
4.8) to make the following deposits and distributions for receipt by the
Servicer or the Administrator or deposit in the applicable Trust Account or
Certificate Distribution Account, as applicable, by 10:00 a.m. (New York
time), in the following order of priority:
(i) To the extent of the Fixed Rate Distribution Amount:
(1) to the Servicer, if neither Credit nor an
Affiliate of Credit is the Servicer, the Fixed Rate
Percentage of the Servicing Fee and all unpaid Servicing
Fees owed to such Servicer from prior Collection Periods;
(2) to the Administrator, the Fixed Rate
Percentage of the Administration Fee and all unpaid
Administration Fees from prior Collection Periods;
(3) to pay such amounts in the order and as
above provided, the amount, if any, by which (a) the sum
of (i) if neither Credit nor an Affiliate of Credit is
the Servicer, the Floating Rate Percentage of the
Servicing Fee and all unpaid Servicing Fees owed to such
Servicer from prior Collection Periods plus (ii) the
Floating Rate Percentage of the Administration Fee and
all unpaid Administration Fees from prior Collection
Periods, exceeds (b) the Floating Rate Distribution
Amount;
(4) to the Note Distribution Account, the Class A
Noteholders' Interest Distributable Amount;
(5) to the Note Distribution Account, the Class C
Noteholders' Interest Distributable Amount;
(6) to the Note Distribution Account, the A-1
Noteholders' Principal Distributable Amount;
(7) to the Note Distribution Account, the A-2
Noteholders' Principal Distributable Amount;
(8) to the Note Distribution Account, the A-3
Noteholders' Principal Distributable Amount;
(9) to the Note Distribution Account, the A-4
Noteholders' Principal Distributable Amount;
(10) to the Note Distribution Account to pay
such amounts in the priority indicated, the amount, if
any, by which (a) the sum of (i) the Class B Noteholders'
Interest Distributable Amount and (ii) the Class B
Noteholders' Principal Distributable Amount exceeds (b)
the amounts available for distribution as described in
clauses (b)(ii)(4) and (5) below; and
(11) the remaining Fixed Rate Distribution
Amount to be distributed pursuant to clause (b)(iii)
below.
(ii) To the extent of the Floating Rate Distribution Amount:
(1) to the Servicer, if neither Credit nor an
Affiliate of Credit is the Servicer, the Floating Rate
Percentage of the Servicing Fee and all unpaid Servicing
Fees owed to such Servicer from prior Collection Periods;
(2) to the Administrator, the Floating Rate
Percentage of the Administration Fee and all unpaid
Administration Fees from prior Collection Periods;
(3) to pay such amounts in the order and as
above provided, the amount, if any, by which (a) the sum
of (i) if neither Credit nor an Affiliate of Credit is
the Servicer, the Fixed Rate Percentage of the Servicing
Fee and all unpaid Servicing Fees owed to such Servicer
from prior Collection Periods plus (ii) the Fixed Rate
Percentage of the Administration Fee and all unpaid
Administration Fees from prior Collection Periods,
exceeds (b) the Fixed Rate Distribution Amount;
(4) to the Note Distribution Account, the Class B
Noteholders' Interest Distributable Amount;
(5) to the Note Distribution Account, the Class B
Noteholders' Principal Distributable Amount;
(6) to the Note Distribution Account, to pay
such amounts in the priority indicated, the amount, if
any, by which (a) the sum of (i) the Class A Noteholders'
Interest Distributable Amount, (ii) the Class C
Noteholders' Interest Distributable Amount and (iii) the
Class A Noteholders' Monthly Principal Distributable
Amount, exceeds (b) the amounts available for
distribution as described in clauses (b)(i)(4), (5), (6),
(7), (8) and (9) above; and
(7) the remaining Floating Rate Distribution
Amount to be distributed pursuant to clause (b)(iii)
below.
(iii) From the sum of the amounts available under clauses
(b)(i)(11) and (b)(ii)(7) above:
(1) to the Note Distribution Account, the Class C
Noteholders' Principal Distributable Amount;
(2) to the Spread Account, to the extent
necessary so that the balance on deposit therein will
equal the Specified Spread Account Balance;
(3) to the Note Distribution Account, the Class
B Net Funds Cap Carryover Amount and any other amounts
not named above payable by the Trust to the Class B
Noteholders ("Class B Additional Amounts"), if any;
(4) to the Certificate Distribution Account, the
Certificateholders' Interest Distributable Amount;
(5) to the Certificate Distribution Account, the
Certificateholders' Principal Distributable Amount;
(6) to the Servicer, if Credit or an Affiliate
of Credit is the Servicer, the Servicing Fee and all
unpaid Servicing Fees owed to such Servicer from prior
Collection Periods; and
(7) to the Spread Account, the remaining
balance, if any.
(c) On the A-1 Note Final Scheduled Maturity Date, the Servicer
shall instruct the Indenture Trustee (based on the information contained in
the Servicer's Certificate delivered on the related Determination Date
pursuant to Section 4.8) to deposit by 10:00 a.m. (New York time) the A-1
Noteholders' Principal Distributable Amount in the Note Distribution
Account.
SECTION 5.6. Spread Account. (a) On the Closing Date and on each
Subsequent Transfer Date, the Seller shall deposit the applicable Spread
Account Initial Deposit into the Spread Account.
(b) If the amount on deposit in the Spread Account on any Payment
Date (after giving effect to all deposits or withdrawals therefrom on such
Payment Date) is greater than the Specified Spread Account Balance for such
Payment Date, the Servicer shall instruct the Indenture Trustee to
distribute the amount of the excess to the Seller (and its transferees and
assignees in accordance with their respective interests); provided, that
if, after giving effect to all payments made on the Notes on such Payment
Date, the sum of the Pool Balance and the Pre-Funded Amount as of the first
day of the Collection Period in which such Payment Date occurs is less than
the sum of the Note Balance and the Certificate Balance, such excess shall
not be distributed to the Seller (or such transferees or assignees) and
shall be retained in the Spread Account for application in accordance with
this Agreement. Amounts properly distributed pursuant to this Section
5.6(b) shall be deemed released from the Trust and the security interest
therein granted to the Indenture Trustee, and the Seller (and such
transferees and assignees) shall in no event thereafter be required to
refund any such distributed amounts.
(c) Following: (i) the payment in full of the aggregate
Outstanding Amount of the Notes and of all other amounts owing or to be
distributed hereunder or under the Indenture to the Noteholders, the
Trustee and the Indenture Trustee and (ii) the termination of the Trust,
any amount remaining on deposit in the Spread Account shall be distributed
to the Seller or any transferee or assignee pursuant to clause (g). The
Seller (and such transferees
and assignees) shall in no event be required to refund any amounts properly
distributed pursuant to this Section 5.6(c).
(d) In the event that the Noteholders' Distributable Amount for a
Payment Date exceeds the amount deposited into the Note Distribution
Account pursuant to Sections 5.5(b) on such Payment Date, the Servicer
shall instruct the Indenture Trustee on such Payment Date to withdraw from
the Spread Account on such Payment Date an amount equal to such excess, to
the extent of funds available therein, and deposit such amount into the
Note Distribution Account, for distribution to cover the Noteholders'
Distributable Amount in the order specified in Section 5.5(b) (but only as
such Section relates to the Noteholders' Distributable Amount), provided
that if on any Payment Date the funds available for this purpose in the
Spread Account are less than the sum of the shortfalls in the Class A
Noteholders' Distributable Amount and the Class B Noteholders'
Distributable Amount, on that Payment Date, the remaining funds in the
Spread Account will be applied to such shortfalls pro rata on the basis of
the Outstanding Amount of the Class A Notes and the Class B Notes..
(e) [Reserved]
(f) [Reserved]
(g) The Seller may at any time, without consent of the
Noteholders, sell, transfer, convey or assign in any manner its rights to
and interests in distributions from the Spread Account, including interest
and other investment earnings thereon; provided, that the Rating Agency
Condition is satisfied.
SECTION 5.7. Pre-Funding Account. (a) On the Closing Date, the
Indenture Trustee will deposit, on behalf of the Seller, in the Pre-Funding
Account $411,884,035.48 from the net proceeds of the sale of the Notes and
the Certificates. On each Subsequent Transfer Date, the Servicer shall
instruct the Indenture Trustee to withdraw from the Pre-Funding Account
(or, once the balance on deposit in the Pre-Funding Account has been
reduced to zero, will cause the Issuer to make available from the proceeds
of issuance of Class B Notes) an amount equal to: (i) the aggregate
Contract Value of the Subsequent Receivables transferred to the Issuer on
such Subsequent Transfer Date less the Spread Account Initial Deposit for
such Subsequent Transfer Date, and distribute such amount to or upon the
order of the Seller upon satisfaction of the conditions set forth in
Section 2.2(b) with respect to such transfer, plus (ii) the Spread Account
Initial Deposit for such Subsequent Transfer Date and, on behalf of the
Seller, deposit such amount in the Spread Account.
(b) If: (i) the Pre-Funded Amount has not been reduced to zero on
the Payment Date on which the Funding Period ends (or, if the Funding
Period does not end on a Payment Date, on the first Payment Date following
the end
of the Funding Period) or (ii) the Pre-Funded Amount has been reduced to
$100,000 or less on any Determination Date, in either case after giving
effect to any reductions in the Pre-Funded Amount on such date pursuant to
paragraph (a), the Servicer shall instruct the Indenture Trustee to
withdraw from the Pre-Funding Account, in the case of clause (i), on such
Payment Date or, in the case of clause (ii), on the Payment Date
immediately succeeding such Determination Date, the amount remaining at the
time in the Pre-Funding Account (such remaining amount being the "Remaining
Pre-Funded Amount") and deposit such amounts in the Note Distribution
Account, so that such amounts are payable to redeem the Offered Notes (in
the same proportions and sequence that would apply if such remaining funds
were a part of the Fixed Rate Principal Distribution Amount).
SECTION 5.8. Negative Carry Account. On the Closing Date, the
Seller shall deposit the Negative Carry Account Initial Deposit into the
Negative Carry Account. On each Payment Date, the Servicer will instruct
the Indenture Trustee to withdraw from the Negative Carry Account and
deposit into the Collection Account an amount equal to the Negative Carry
Amount for such Collection Period. If the amount on deposit in the Negative
Carry Account on any Payment Date (after giving effect to the withdrawal
therefrom of the Negative Carry Amount for such Payment Date) is greater
than the Required Negative Carry Account Balance, the excess will be
released to the Seller.
SECTION 5.9. Calculation of Class B Net Funds Cap Carryover
Account. If the effective Floating Rate for any Interest Period is
determined by the Net Funds Cap, then prior to the related Payment Date the
Servicer will calculate the excess of (i) the amount of interest on the
Class B Notes that would have accrued in respect of such Interest Period
had the Floating Rate been calculated without regard to the Net Funds Cap
over (ii) the amount of interest on the Class B Notes actually accrued
during such Interest Period, and such excess shall be payable on the
related Payment Date to the extent that funds are available for that
purpose pursuant to Section 5.5(b)(iii)(3) on such related Payment Date. To
the extent that sufficient funds are not available to make such payment on
such related Payment Date, such amount shall be payable on each following
Payment Date until paid in full. Interest shall accrue on such unpaid
amount from the Payment Date on which it was first payable as provided
above until it has been paid in full at a rate equal to the Floating Rate
(calculated without regard to the Net Funds Cap), calculated on the basis
of the number of days in each applicable Interest Period and a year of 360
days. The aggregate amount accrued and payable pursuant to this Section 5.9
from time to time is referred to as the "Class B Net Funds Cap Carryover
Amount."
SECTION 5.10. Statements to Certificateholders and Noteholders. (a)
On each Determination Date, the Servicer shall provide to the Indenture
Trustee (with a copy to the Rating Agencies), for the Indenture Trustee to
forward to each Noteholder of record, and to the Trustee, for the Trustee
to forward to each Certificateholder of record, a statement substantially
in the form of Exhibits A and B, respectively, setting forth at least the
following information as to each Class of the Notes and the Certificates to
the extent applicable (together with delinquency information consistent
with the information that the Servicer provides with respect to other
similar transactions):
(i) the amount of such distribution allocable to principal
of each Class of Notes;
(ii) the amount of the distribution allocable to interest
of each Class of Notes;
(iii) the amount of the distribution allocable to
principal of the Certificates;
(iv) the amount of the distribution allocable to interest
of the Certificates;
(v) the Pool Balance as of the close of business on the
last day of the preceding Collection Period;
(vi) the aggregate Outstanding Amount and the Note Pool
Factor for each Class of Notes, and the Certificate Balance and
the Certificate Pool Factor as of such Payment Date, after giving
effect to payments allocated to principal reported under clauses
(i) and (iii) above;
(vii) the amount of the Servicing Fee paid to the
Servicer with respect to the preceding Collection Period;
(viii) the amount of the Administration Fee paid to the
Administrator in respect of the preceding Collection Period;
(ix) the amount of the aggregate Realized Losses, if any,
for such Collection Period;
(x) the aggregate Purchase Amounts for Receivables, if
any, that were repurchased or purchased in such Collection Period;
(xi) the balance of the Spread Account on such Payment
Date, after giving effect to changes therein on such Payment Date;
(xii) for Payment Dates during the Funding Period, the
remaining Pre-Funded Amount;
(xiii) for the final Payment Date with respect to the
Funding Period, the amount of any remaining Pre-Funded Amount that
has not been used to fund the purchase of Subsequent Receivables;
(xiv) [intentionally omitted]; and
(xv) the balance of the Negative Carry Account on such
Payment Date, after giving effect to changes therein on such
Payment Date.
Each amount set forth pursuant to clauses (i), (ii), (iii), (iv), (vii) and
(viii) shall be expressed as a dollar amount per $1,000 of original
principal balance of a Certificate or Note, as applicable.
SECTION 5.11. Net Deposits. As an administrative convenience,
unless the Servicer is required to remit collections daily, the Servicer
will be permitted to make the deposit of collections net of distributions,
if any, to be made to the Servicer with respect to the Collection Period.
The Servicer, however, will account to the Trustee, the Indenture Trustee,
the Noteholders and the Certificateholders as if all deposits,
distributions and transfers were made individually.
ARTICLE VI
The Seller
SECTION 6.1. Representations of Seller. The Seller makes the
following representations on which the Issuer is deemed to have relied in
acquiring the Receivables. The representations speak as of the execution
and delivery of this Agreement and shall survive the sale of the
Receivables to the Issuer and the pledge thereof to the Indenture Trustee
pursuant to the Indenture.
(a) Organization and Good Standing. The Seller is duly
organized and validly existing as a corporation in good standing
under the laws of the State of Delaware, with the corporate power
and authority to own its properties and to conduct its business as
such properties are currently owned and such business is presently
conducted, and had at all relevant times, and has, the corporate
power, authority and legal right to acquire, own and sell the
Receivables.
(b) Due Qualification. The Seller is duly qualified to do
business as a foreign corporation in good standing, and has
obtained all necessary licenses and approvals, in all
jurisdictions in which the
ownership or lease of property or the conduct of its business shall
require such qualifications.
(c) Power and Authority. The Seller has the power and
authority to execute and deliver this Agreement and to carry out
its terms; the Seller has full power and authority to sell and
assign the property to be sold and assigned to and deposited with
the Issuer and has duly authorized such sale and assignment to the
Issuer by all necessary corporate action; and the execution,
delivery and performance of this Agreement have been, and the
execution, delivery and performance of each Subsequent Transfer
Assignment will be on or before the related Subsequent Transfer
Date, duly authorized by the Seller by all necessary corporate
action.
(d) Binding Obligation. This Agreement constitutes, and
each Subsequent Transfer Assignment when executed and delivered by
the Seller will constitute, a legal, valid and binding obligation
of the Seller enforceable in accordance with their terms.
(e) No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms
hereof do not conflict with, result in any breach of any of the
terms and provisions of, or constitute (with or without notice or
lapse of time) a default under, the certificate of incorporation
or by-laws of the Seller, or any indenture, agreement or other
instrument to which the Seller is a party or by which it shall be
bound; or result in the creation or imposition of any Lien upon
any of its properties pursuant to the terms of any such indenture,
agreement or other instrument (other than the Basic Documents); or
violate any law or, to the best of the Seller's knowledge, any
order, rule or regulation applicable to the Seller of any court or
of any Federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the
Seller or its properties.
(f) No Proceedings. There are no proceedings or
investigations pending or, to the Seller's best knowledge,
threatened before any court, regulatory body, administrative
agency or other governmental instrumentality having jurisdiction
over the Seller or its properties: (i) asserting the invalidity of
this Agreement, the Indenture or any of the other Basic Documents,
the Notes or the Certificates, (ii) seeking to prevent the
issuance of the Notes or the Certificates or the consummation of
any of the transactions contemplated by this Agreement, the
Indenture or any of the other Basic Documents, (iii) seeking any
determination or ruling that could reasonably be expected to
materially and adversely affect the performance by the Seller of
its obligations under, or the validity or enforceability of, this
Agreement,
the Indenture, any of the other Basic Documents, the Notes or the
Certificates or (iv) that might adversely affect the Federal or
state income tax attributes of the Notes or the Certificates.
SECTION 6.2. Corporate Existence. (a) During the term of this
Agreement, the Seller will keep in full force and effect its existence,
rights and franchises as a corporation under the laws of the jurisdiction
of its incorporation and will obtain and preserve its qualification to do
business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Agreement, the
other Basic Documents and each other instrument or agreement necessary or
appropriate to the proper administration of this Agreement and the
transactions contemplated hereby.
(b) During the term of this Agreement, the Seller shall observe
the applicable legal requirements for the recognition of the Seller as a
legal entity separate and apart from its Affiliates, including as follows:
(i) the Seller shall maintain corporate records and books
of account separate from those of its Affiliates;
(ii) except as otherwise provided in this Agreement and
similar arrangements relating to other securitizations, the Seller
shall not commingle its assets and funds with those of its
Affiliates;
(iii) the Seller shall hold such appropriate meetings or
obtain such appropriate consents of its Board of Directors as are
necessary to authorize all the Seller's corporate actions required
by law to be authorized by the Board of Directors, shall keep
minutes of such meetings and of meetings of its stockholder(s) and
observe all other customary corporate formalities (and any
successor Seller not a corporation shall observe similar
procedures in accordance with its governing documents and
applicable law);
(iv) the Seller shall at all times hold itself out to the
public under the Seller's own name as a legal entity separate and
distinct from its Affiliates; and
(v) all transactions and dealings between the Seller and
its Affiliates will be conducted on an arm's-length basis.
SECTION 6.3. Liability of Seller; Indemnities. The Seller shall be
liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Seller under this Agreement.
(a) The Seller shall indemnify, defend and hold harmless
the Issuer, the Trustee and the Indenture Trustee (and their
officers,
directors, employees and agents) from and against any taxes that
may at any time be asserted against any of them with respect to
the sale of the Receivables to the Issuer or the issuance and
original sale of the Certificates and the Notes, including any
sales, gross receipts, general corporation, tangible personal
property, privilege or license taxes (but, in the case of the
Issuer, not including any taxes asserted with respect to ownership
of the Receivables or Federal or other income taxes arising out of
the transactions contemplated by this Agreement) and costs and
expenses in defending against the same.
(b) The Seller shall indemnify, defend and hold harmless
the Issuer, the Trustee and the Indenture Trustee (and their
officers, directors, employees and agents) from and against any
loss, liability or expense incurred by reason of: (i) the Seller's
willful misfeasance, bad faith or negligence in the performance of
its duties under this Agreement, or by reason of reckless
disregard of its obligations and duties under this Agreement, and
(ii) the Seller's or the Issuer's violation of Federal or state
securities laws in connection with the offering and sale of the
Notes and the Certificates.
Indemnification under this Section shall survive the resignation
or removal of the Trustee or the Indenture Trustee or the termination of
this Agreement and the Indenture and shall include reasonable fees and
expenses of counsel and expenses of litigation. If the Seller shall have
made any indemnity payments pursuant to this Section and the Person to or
on behalf of whom such payments are made thereafter shall collect any of
such amounts from others, such Person shall promptly repay such amounts to
the Seller, without interest.
SECTION 6.4. Merger or Consolidation of, or Assumption of the
Obligations of, the Seller. Any Person: (a) into which the Seller may be
merged or consolidated, (b) that may result from any merger or
consolidation to which the Seller shall be a party or (c) that may succeed
to the properties and assets of the Seller substantially as a whole, which
Person (in any of the foregoing cases) executes an agreement of assumption
to perform every obligation of the Seller under this Agreement (or is
deemed by law to have assumed such obligations), shall be the successor to
the Seller hereunder without the execution or filing of any document or any
further act by any of the parties to this Agreement; provided, however,
that: (i) immediately after giving effect to such transaction, no
representation or warranty made pursuant to Section 3.1 shall have been
breached and no Servicer Default, and no event that, after notice or lapse
of time, or both, would become a Servicer Default shall have occurred and
be continuing, (ii) the Seller shall have delivered to the Trustee and the
Indenture Trustee an Officers' Certificate and an Opinion of Counsel each
stating that such consolidation, merger or succession and such agreement of
assumption comply with this Section and that all conditions
precedent, if any, provided for in this Agreement relating to such
transaction have been complied with, (iii) the Rating Agency Condition
shall have been satisfied with respect to such transaction and (iv) the
Seller shall have delivered to the Trustee and the Indenture Trustee an
Opinion of Counsel either: (A) stating that, in the opinion of such
counsel, all financing statements, continuation statements and amendments
thereto have been executed and filed that are necessary fully to preserve
and protect the interest of the Issuer, the Trustee and Indenture Trustee,
respectively, in the Receivables and reciting the details of such filings,
or (B) stating that, in the opinion of such counsel, no such action shall
be necessary to preserve and protect such interests. Notwithstanding
anything herein to the contrary, the execution of the foregoing agreement
of assumption and compliance with clauses (i), (ii), (iii) and (iv) shall
be conditions to the consummation of the transactions referred to in
clauses (a), (b) or (c).
SECTION 6.5. Limitation on Liability of Seller and Others. The
Seller and any director, officer, employee or agent of the Seller may rely
in good faith on the advice of counsel or on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder. The Seller shall not be under any obligation to appear
in, prosecute or defend any legal action that shall not be incidental to
its obligations under this Agreement, and that in its opinion may involve
it in any expense or liability.
SECTION 6.6. Seller May Own Certificates or Notes. The Seller and
any Affiliate thereof may in its individual or any other capacity become
the owner or pledgee of Certificates or the Notes with the same rights as
it would have if it were not the Seller or an Affiliate thereof, except as
expressly provided herein or in any other Basic Document.
Notwithstanding the foregoing, the Seller will not sell the
Certificates except: (a) to an entity that is not an Affiliate of the
Seller or (b) to an Affiliate of the Seller that: (i) is a subsidiary of
Credit, the Certificate of Incorporation of which contains restrictions
substantially similar to the restrictions contained in the Certificate of
Incorporation of the Seller, and (ii) has provided an opinion of counsel
regarding substantive consolidation of such Affiliate with Credit in the
event of a bankruptcy filing by Credit which is substantially similar to
the opinion of counsel provided by the Seller on the Closing Date and which
may be subject to the same assumptions and qualifications as that opinion.
ARTICLE VII
The Servicer
SECTION 7.1. Representations of the Servicer. The Servicer makes
the following representations on which the Issuer is deemed to have relied
in acquiring the Receivables. The representations speak as of the execution
and delivery of this Agreement and as of the Closing Date, in the case of
the Initial Receivables, and as of the applicable Subsequent Transfer Date,
in the case of the Subsequent Receivables, and shall survive the sale of
the Receivables to the Issuer and the pledge thereof to the Indenture
Trustee pursuant to the Indenture.
(a) Organization and Good Standing. The Servicer is duly
organized and validly existing as a corporation in good standing
under the laws of the state of its incorporation, with the
corporate power and authority to own its properties and to conduct
its business as such properties are currently owned and such
business is presently conducted, and had at all relevant times,
and has, the power, authority and legal right to acquire, own,
sell and service the Receivables and to hold the Receivable Files
as custodian.
(b) Due Qualification. The Servicer is duly qualified to
do business as a foreign corporation in good standing, and has
obtained all necessary licenses and approvals, in all
jurisdictions in which the ownership or lease of property or the
conduct of its business (including the servicing of the
Receivables as required by this Agreement) shall require such
qualifications.
(c) Power and Authority. The Servicer has the corporate
power and authority to execute and deliver this Agreement and to
carry out its terms; and the execution, delivery and performance
of this Agreement have been duly authorized by the Servicer by all
necessary corporate action.
(d) Binding Obligation. This Agreement constitutes a
legal, valid and binding obligation of the Servicer enforceable
against the Servicer in accordance with its terms.
(e) No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms
hereof do not conflict with, result in any breach of any of the
terms and provisions of, or constitute (with or without notice or
lapse of time) a default under, the articles of incorporation or
by-laws of the Servicer, or any indenture, agreement or other
instrument to which the Servicer is a party or by which it shall
be bound; or result in the creation or
imposition of any Lien upon any of its properties pursuant to the
terms of any such indenture, agreement or other instrument (other
than this Agreement); or violate any law or, to the best of the
Servicer's knowledge, any order, rule or regulation applicable to
the Servicer of any court or of any Federal or state regulatory
body, administrative agency or other governmental instrumentality
having jurisdiction over the Servicer or its properties.
(f) No Proceedings. There are no proceedings or
investigations pending or, to the Servicer's best knowledge,
threatened before any court, regulatory body, administrative
agency or other governmental instrumentality having jurisdiction
over the Servicer or its properties: (i) asserting the invalidity
of this Agreement, the Indenture, any of the other Basic
Documents, the Notes or the Certificates, (ii) seeking to prevent
the issuance of the Notes or the Certificates or the consummation
of any of the transactions contemplated by this Agreement, the
Indenture or any of the other Basic Documents, (iii) seeking any
determination or ruling that could reasonably be expected to
materially and adversely affect the performance by the Servicer of
its obligations under, or the validity or enforceability of, this
Agreement, the Indenture, any of the other Basic Documents, the
Notes or the Certificates or (iv) relating to the Servicer and
that might adversely affect the Federal or state income tax
attributes of the Notes or the Certificates.
(g) No Insolvent Obligors. As of the Initial Cutoff Date
or, in the case of the Subsequent Receivables, as of the related
Subsequent Cutoff Date, no Obligor is shown on the Receivable
Files as the subject of a bankruptcy proceeding.
SECTION 7.2. Indemnities from the Servicer. The Servicer shall be
liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Servicer under this Agreement.
(a) The Servicer shall defend, indemnify and hold
harmless the Issuer, the Trustee, the Indenture Trustee, the
Noteholders, the Certificateholders and the Seller (and any of
their officers, directors, employees and agents) from and against
any and all costs, expenses, losses, damages, claims and
liabilities, arising out of or resulting from:
(i) the use, ownership or operation by the Servicer or
any Affiliate thereof of any of the Financed Equipment;
(ii) any taxes that may at any time be asserted
against any such Person with respect to the transactions
contemplated herein, including any sales, gross receipts,
general corporation,
tangible personal property, privilege or license taxes
(but, in the case of the Issuer, not including any taxes
asserted with respect to, and as of the date of, the sale
of the Receivables to the Issuer or the issuance and
original sale of the Certificates and the Notes, or
asserted with respect to ownership of the Receivables, or
Federal or other income taxes arising out of
distributions on the Certificates or the Notes) and costs
and expenses in defending against the same; and
(iii) the negligence, willful misfeasance or bad
faith of the Servicer in the performance of its duties
under this Agreement or by reason of reckless disregard
of its obligations and duties under this Agreement.
(b) The Servicer shall indemnify, defend and hold
harmless the Trustee and the Indenture Trustee (and their
respective officers, directors, employees and agents) from and
against all costs, expenses, losses, claims, damages and
liabilities arising out of or incurred in connection with the
acceptance or performance of the trusts and duties herein and, in
the case of the Trustee, in the Trust Agreement contained, and, in
the case of the Indenture Trustee, in the Indenture contained,
except to the extent that such cost, expense, loss, claim, damage
or liability:
(i) shall be due to the willful misfeasance, bad
faith or negligence (except for errors in judgment) of
the Trustee or the Indenture Trustee as applicable; or
(ii) shall arise from the breach by the Trustee
of any of its representations or warranties set forth in
Section 7.3 of the Trust Agreement.
(c) The Servicer shall pay any and all taxes levied or
assessed upon all or any part of the Trust Estate.
(d) The Servicer shall pay the Indenture Trustee and the
Trustee from time to time reasonable compensation for all services
rendered by the Indenture Trustee under the Indenture or by the
Trustee under the Trust Agreement (which compensation shall not be
limited by any provision of law in regard to the compensation of a
trustee of an express trust).
(e) The Servicer shall, except as otherwise expressly
provided in the Indenture or the Trust Agreement, reimburse either
the Indenture Trustee or the Trustee, respectively, upon its
request for all reasonable expenses, disbursements and advances
incurred or made in accordance
with the Indenture or the Trust Agreement, respectively,
(including the reasonable compensation, expenses and disbursements
of its agents and either in-house counsel or outside counsel, but
not both), except any such expense, disbursement or advance as may
be attributable to the Indenture Trustee's or the Trustee's,
respectively, negligence, bad faith or willful misfeasance.
For purposes of this Section, in the event of the termination of
the rights and obligations of the Servicer pursuant to Section 8.1, or a
resignation by the Servicer pursuant to this Agreement, the Servicer shall
be deemed to be the Servicer pending appointment of a successor Servicer
pursuant to Section 8.2.
Indemnification under this Section shall survive the resignation
or removal of the Trustee or the Indenture Trustee or the termination of
this Agreement, the Trust Agreement and the Indenture and shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Servicer shall have made any indemnity payments pursuant to this Section
and the Person to or on behalf of whom such payments are made thereafter
collects any of such amounts from others, such Person shall promptly repay
such amounts to the Servicer, without interest.
SECTION 7.3. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer. Any Person: (a) into which the Servicer may
be merged or consolidated, (b) that may result from any merger or
consolidation to which the Servicer shall be a party or (c) that may
succeed to the properties and assets of the Servicer substantially as a
whole, which Person (in any of the foregoing circumstances) executes an
agreement of assumption to perform every obligation of the Servicer
hereunder (or is deemed by law to have assumed such obligations) shall be
the successor to the Servicer under this Agreement without further act on
the part of any of the parties to this Agreement; provided, however, that:
(i) immediately after giving effect to such transaction, no Servicer
Default, and no event that, after notice or lapse of time, or both, would
become a Servicer Default, shall have occurred and be continuing, (ii) the
Servicer shall have delivered to the Trustee and Indenture Trustee an
Officers' Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption comply
with this Section and that all conditions precedent, if any, provided for
in this Agreement relating to such transaction have been complied with,
(iii) the Rating Agencies shall have received at least ten days' prior
written notice of such transaction and (iv) the Servicer shall have
delivered to the Trustee and the Indenture Trustee an Opinion of Counsel
either: (A) stating that, in the opinion of such counsel, all financing
statements, continuation statements and amendments thereto have been
executed and filed that are necessary fully to preserve and protect the
interest of the Issuer, the Trustee and the Indenture Trustee,
respectively, in the Receivables and reciting the
details of such filings, or (B) stating that, in the opinion of such
counsel, no such action shall be necessary to preserve and protect such
interests. Notwithstanding anything herein to the contrary, the execution
of the foregoing agreement of assumption and compliance with clauses (i),
(ii), (iii) and (iv) shall be conditions to the consummation of the
transactions referred to in clause (a), (b) or (c).
SECTION 7.4. Limitation on Liability of the Servicer and Others.
Neither the Servicer nor any of the directors, officers, employees or
agents of the Servicer shall be under any liability to the Issuer, the
Trustee, the Indenture Trustee, the Noteholders or the Certificateholders,
except as provided under this Agreement, for any action taken or for
refraining from the taking of any action pursuant to this Agreement or for
errors in judgment; provided, however, that this provision shall not
protect the Servicer or any such Person against any liability that would
otherwise be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of its duties or by reason of reckless
disregard of obligations and duties under this Agreement. The Servicer and
any director, officer, employee or agent of the Servicer may rely in good
faith on the advice of counsel or on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters
arising hereunder.
Except as provided in this Agreement, the Servicer shall not be
under any obligation to appear in, prosecute or defend any legal action
that shall not be incidental to its duties to service the Receivables in
accordance with this Agreement, and that in its opinion may involve it in
any expense or liability; provided, however, that the Servicer may
undertake any reasonable action that it may deem necessary or desirable in
respect of this Agreement, the other Basic Documents and the rights and
duties of the parties to this Agreement, the other Basic Documents and the
interests of the Certificateholders under this Agreement and the Trust
Agreement and the Noteholders under the Indenture.
SECTION 7.5. Credit Not to Resign as the Servicer. Subject to
Section 7.3, Credit shall not resign from the obligations and duties
imposed on it as the Servicer under this Agreement except upon
determination that the performance of its duties under this Agreement shall
no longer be permissible under applicable law. Notice of any such
determination shall be communicated to the Trustee and the Indenture
Trustee at the earliest practicable time (and, if such communication is not
in writing, shall be confirmed in writing at the earliest practicable time)
and any such determination shall be evidenced by an Opinion of Counsel to
such effect delivered to the Trustee and the Indenture Trustee concurrently
with or promptly after such notice. No such resignation shall become
effective until the Indenture Trustee or a successor Servicer shall have
assumed the responsibilities and obligations of Credit in accordance with
Section 8.2.
SECTION 7.6. Servicer to Act as the Administrator. In the event of
the resignation or removal of the Administrator and the failure of a
successor Administrator to have been appointed and to have accepted such
appointment as successor Administrator, the Servicer shall become the
successor Administrator and shall be bound by the terms of the
Administration Agreement.
ARTICLE VIII
Default
SECTION 8.1. Servicer Default. If any one of the following events (a
"Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to deliver to the
Indenture Trustee for deposit in any of the Trust Accounts or the
Certificate Distribution Account any required payment or to direct
the Indenture Trustee or the Trustee to make any required
distributions therefrom, which failure continues unremedied for
three Business Days after written notice of such failure is
received by the Servicer from the Trustee or the Indenture Trustee
or after discovery of such failure by an officer of the Servicer;
(b) any failure by the Servicer or the Seller, as the
case may be, duly to observe or to perform in any material respect
any covenants or agreements (other than as set forth in clause
(a)) of the Servicer or the Seller (as the case may be) set forth
in this Agreement or any other Basic Document, which failure
shall: (i) materially and adversely affect the rights of the
Certificateholders or Noteholders and (ii) continue unremedied for
a period of 60 days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given:
(A) to the Servicer or the Seller (as the case may be) by the
Trustee or the Indenture Trustee or (B) to the Servicer or the
Seller (as the case may be) and to the Trustee and the Indenture
Trustee by the Noteholders or Certificateholders, as applicable,
evidencing not less than 25% of the Note Balance or 25% of the
Certificate Balance; or
(c) an Insolvency Event occurs with respect to the Seller
or the Servicer;
then, and in each and every case, so long as the Servicer Default shall not
have been remedied, either the Indenture Trustee, or the Holders of Notes
evidencing not less than 25% of the Note Balance, by notice then given in
writing to the Servicer (and to the Indenture Trustee and the Trustee if
given by the Noteholders), may terminate all the rights and obligations
(other than
the obligations set forth in Section 7.2) of the Servicer under this
Agreement. On or after the receipt by the Servicer of such written notice,
all authority and power of the Servicer under this Agreement, whether with
respect to the Notes, the Certificates, the Receivables or otherwise,
shall, without further action, pass to and be vested in the Indenture
Trustee or such successor Servicer as may be appointed under Section 8.2;
and, without limitation, the Indenture Trustee and the Trustee are hereby
authorized and empowered to execute and deliver, on behalf of the
predecessor Servicer, as attorney-in-fact or otherwise, any and all
documents and other instruments, and to do or accomplish all other acts or
things, necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement of the
Receivables and related documents or otherwise. The predecessor Servicer
shall cooperate with the successor Servicer, the Indenture Trustee and the
Trustee in effecting the termination of the responsibilities and rights of
the predecessor Servicer under this Agreement, including the transfer to
the successor Servicer for administration by it of: (i) all cash amounts
that shall at the time be held by the predecessor Servicer for deposit or
shall thereafter be received by it with respect to a Receivable and (ii)
all Receivable Files. All reasonable costs and expenses (including
attorneys' fees) incurred in connection with transferring the Receivable
Files to the successor Servicer and, if necessary, amending this Agreement
to reflect its succession as Servicer shall be paid by the predecessor
Servicer upon presentation of reasonable documentation of such costs and
expenses. Upon receipt of notice of the occurrence of a Servicer Default,
the Trustee shall give notice thereof to the Rating Agencies.
SECTION 8.2. Appointment of Successor Servicer. (a) Upon the
Servicer's receipt of notice of termination, pursuant to Section 8.1, or
the Servicer's resignation in accordance with this Agreement, the
predecessor Servicer shall continue to perform its functions as the
Servicer under this Agreement, in the case of termination, only until the
date specified in such termination notice or, if no such date is specified
in a notice of termination, until receipt of such notice and, in the case
of resignation, until the earlier of: (x) the date 45 days from the
delivery to the Trustee and the Indenture Trustee of written notice of such
resignation (or written confirmation of such notice) in accordance with
this Agreement and (y) the date upon which the predecessor Servicer shall
become unable to act as Servicer, as specified in the notice of resignation
and accompanying Opinion of Counsel. In the event of the Servicer's
termination hereunder, the Issuer shall appoint a successor Servicer
acceptable to the Indenture Trustee, and the successor Servicer shall
accept its appointment by a written assumption in form acceptable to the
Indenture Trustee. In the event that a successor Servicer has not been
appointed at the time when the predecessor Servicer has ceased to act as
Servicer in accordance with this Section, the Indenture Trustee without
further action shall automatically be appointed the successor Servicer and
shall be entitled to the Servicing Fee. Notwithstanding the above, the
Indenture Trustee shall, if it
shall be unable so to act, appoint or petition a court of competent
jurisdiction to appoint any established institution, having a net worth of
not less than $50,000,000 and whose regular business shall include the
servicing of receivables, as the successor to the Servicer under this
Agreement.
(b) Upon appointment, the successor Servicer (including the
Indenture Trustee acting as the successor Servicer) shall be the successor
in all respects to the predecessor Servicer (except with respect to
responsibilities and obligations of the predecessor Servicer set forth in
Section 7.2) and shall be subject to all the responsibilities, duties and
liabilities arising thereafter relating thereto placed on the predecessor
Servicer and shall be entitled to the Servicing Fee and all the rights
granted to the predecessor Servicer by this Agreement.
(c) Subject to the last sentence of clause (a), the Servicer may
not resign unless it is prohibited from serving as such by law as evidenced
by an Opinion of Counsel to such effect delivered to the Indenture Trustee
and the Trustee.
SECTION 8.3. Notification to the Noteholders and
Certificateholders. Upon any termination of, or appointment of a successor
to, the Servicer pursuant to this Article VIII, the Trustee shall give
prompt written notice thereof to the Certificateholders and the Indenture
Trustee shall give prompt written notice thereof to the Noteholders and the
Rating Agencies.
SECTION 8.4. Waiver of Past Defaults. The Noteholders of Notes
evidencing not less than a majority of the Note Balance (or the
Certificateholders holding Certificates evidencing not less than a majority
of the Certificate Balance, in the case of any default that does not
adversely affect the Indenture Trustee or the Noteholders) may, on behalf
of all the Noteholders and Certificateholders, waive in writing any default
by the Servicer in the performance of its obligations hereunder and its
consequences, except a default in making any required deposits to or
payments from any of the Trust Accounts or the Certificate Distribution
Account in accordance with this Agreement. Upon any such waiver of a past
default, such default shall cease to exist, and any Servicer Default
arising therefrom shall be deemed to have been remedied for every purpose
of this Agreement. No such waiver shall extend to any subsequent or other
default or impair any right consequent thereto.
ARTICLE IX
Termination
SECTION 9.1. Optional Purchase of All Receivables. (a) As of the
first day of any Collection Period immediately preceding a Payment Date as
of which the Pool Balance is 10% or less of the Initial Pool Balance, the
Servicer shall have the option to purchase all of the Trust Estate, other
than the Trust Accounts. To exercise such option, the Servicer shall
deposit, pursuant to Section 5.4, in the Collection Account an amount equal
to the aggregate Purchase Amount for the Receivables plus the appraised
value of any such other property held by the Trust, such value to be
determined by an appraiser mutually agreed upon by the Servicer, the
Trustee and the Indenture Trustee, and shall succeed to all interests in,
to and under the Trust Estate, other than the Trust Accounts.
(b) [Intentionally Omitted].
(c) As described in Section 9.1(c) of the Trust Agreement, notice
of any termination of the Trust shall be given by the Servicer to the
Trustee and the Indenture Trustee as soon as practicable after the Servicer
has received notice thereof.
(d) Following the satisfaction and discharge of the Indenture and
the payment in full of the principal of and interest on the Notes, the
Certificateholders will succeed to the rights of the Noteholders hereunder
and the Trustee will succeed to the rights of, and assume the obligations
of, the Indenture Trustee pursuant to this Agreement.
ARTICLE X
Miscellaneous Provisions
SECTION 10.1. Amendment. This Agreement may be amended from time
to time by a written amendment duly executed and delivered by the Seller,
the Servicer and the Issuer, with the written consent of the Indenture
Trustee, but without the consent of any of the Noteholders or the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions in this Agreement or for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions in this
Agreement or of modifying in any manner the rights of the Noteholders or
the Certificateholders; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel delivered to the Trustee and the
Indenture Trustee, adversely affect in any material respect the interests
of any Noteholder or Certificateholder.
The Specified Spread Account Balance may be reduced or the
definition thereof otherwise modified without the consent of any of the
Noteholders or the Certificateholders if the Rating Agency Condition is
satisfied.
This Agreement may also be amended from time to time by the
Seller, the Servicer and the Issuer, with the written consent of the
Indenture Trustee, but without the consent of any of the Noteholders or the
Certificateholders, to: (x) replace the Spread Account with another form of
credit enhancement as long as such substitution will not result in a
reduction or withdrawal of the rating of any Class of the Notes or the
Certificates or (y) add credit enhancement for the benefit of any Class of
the Notes or the Certificates.
This Agreement may also be amended from time to time by the
Seller, the Servicer and the Issuer, with the written consent of: (a) the
Indenture Trustee, (b) Holders of Offered Notes evidencing not less than a
majority of the Outstanding Amount of the Offered Notes, (c) Holders of
Class B Notes evidencing not less than a majority of the Outstanding Amount
of the Class B Notes and (d) Certificateholders holding Certificates
evidencing not less than a majority of the Certificate Balance, for the
purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Noteholders or the Certificateholders; provided,
however, that no such amendment shall: (1) increase or reduce in any manner
the amount of, or accelerate or delay the timing of, collections of
payments on Receivables or distributions that shall be required to be made
for the benefit of the Noteholders or the Certificateholders or (2) reduce
the aforesaid percentage of the Notes and the Certificates that are
required to consent to any such amendment, without the consent of the
holders of all the outstanding Notes and Certificates.
Promptly after the execution of any such amendment or consent (or,
in the case of the Rating Agencies, 10 days prior thereto), the Trustee
shall furnish written notification of the substance of such amendment or
consent to each Certificateholder, the Indenture Trustee and each of the
Rating Agencies.
It shall not be necessary for the consent of the
Certificateholders or the Noteholders pursuant to this Section to approve
the particular form of any proposed amendment or consent, but it shall be
sufficient if such consent shall approve the substance thereof.
Prior to the execution of any amendment to this Agreement, the Trustee
and the Indenture Trustee shall be entitled to receive and rely upon: (i)
an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and that all conditions precedent
to such execution and delivery by the Trustee and the Indenture Trustee
have been satisfied and (ii) the Opinion of Counsel referred to in
Section 10.2(i)(1). The Trustee and the Indenture Trustee may, but shall not
be obligated to, execute any such amendment that affects the Trustee's or
the Indenture Trustee's, as applicable, own rights, duties or immunities
under this Agreement or otherwise.
SECTION 10.2. Protection of Title to Trust. (a) The Seller shall
execute and file such financing statements, and cause to be executed and
filed such continuation statements, all in such manner and in such places
as may be required by applicable law fully to preserve, maintain and
protect the right, title and interest of the Issuer and the interests of
the Indenture Trustee in the Receivables, the other property sold hereunder
and in the proceeds thereof. The Seller shall deliver (or cause to be
delivered) to the Trustee and the Indenture Trustee file-stamped copies of,
or filing receipts for, any document filed as provided above as soon as
available following such filing. The Issuer and the Indenture Trustee shall
cooperate fully with the Seller in connection with the obligations set
forth above and will execute any and all documents reasonably required to
fulfill the intent of this paragraph.
(b) Neither the Seller nor the Servicer shall change its name,
identity or corporate structure in any manner that would, could or might
make any financing statement or continuation statement filed in accordance
with paragraph (a) seriously misleading within the applicable provisions of
the UCC, unless it shall have given the Trustee and the Indenture Trustee
at least five days' prior written notice thereof and shall have promptly
filed appropriate amendments to all previously filed financing statements
or continuation statements.
(c) Each of the Seller and the Servicer shall have an obligation
to give the Trustee and the Indenture Trustee at least 60 days' prior
written notice of any relocation of its principal executive office if, as a
result of such relocation, the applicable provisions of the UCC would
require the filing of any amendment of any previously filed financing or
continuation statement or of any new financing statement and shall promptly
file any such amendment. The Servicer shall at all times maintain each
office from which it shall service Receivables, and its principal executive
office, within the United States of America.
(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit: (i) the reader
thereof to know at any time the status of such Receivable, including
payments and recoveries made and payments owing (and the nature of each)
and (ii) reconciliation between payments or recoveries on (or with respect
to) each Receivable and the amounts from time to time deposited in the
Collection Account in respect of such Receivable.
(e) The Servicer shall maintain its computer systems so that, from
and after the time of sale under this Agreement of the Receivables, the
Servicer's master computer records (including any backup archives) that
refer to a Receivable shall indicate clearly the interest of the Issuer and
the Indenture Trustee in such Receivable and that such Receivable is owned
by the Issuer and has been pledged to the Indenture Trustee. Indication of
the Issuer's and the Indenture Trustee's interest in a Receivable may be
deleted from or modified on the Servicer's computer systems when, and only
when, the related Receivable shall have been paid in full or repurchased.
(f) If at any time the Seller or the Servicer shall propose to
sell, grant a security interest in, or otherwise transfer any interest in
equipment receivables to any prospective purchaser, lender or other
transferee, the Servicer shall give to such prospective purchaser, lender
or other transferee computer tapes, records or printouts (including any
restored from backup archives) that, if they shall refer in any manner
whatsoever to any Receivable, shall indicate clearly that such Receivable
has been sold and is owned by the Issuer and has been pledged to the
Indenture Trustee.
(g) The Servicer shall permit the Indenture Trustee and its agents
at any time during normal business hours to inspect, audit and make copies
of and abstracts from the Servicer's records regarding any Receivable.
(h) Upon request, the Servicer shall furnish to the Trustee or to
the Indenture Trustee, within five Business Days, a list of all Receivables
(by contract number and name of Obligor) then held as part of the Trust,
together with a reconciliation of such list to the Schedule of Receivables
and to each of the Servicer's Certificates furnished before such request
indicating removal of Receivables from the Trust.
(i) The Servicer shall deliver to the Trustee and the Indenture
Trustee:
(1) promptly after the execution and delivery of this
Agreement and of each amendment hereto, an Opinion of Counsel
either: (A) stating that, in the opinion of such counsel, all
financing statements and continuation statements have been
executed and filed that are necessary fully to preserve and
protect the interest of the Issuer, the Trustee and the Indenture
Trustee in the Receivables, and reciting the details of such
filings or referring to prior Opinions of Counsel in which such
details are given, or (B) stating that, in the opinion of such
counsel, no such action shall be necessary to preserve and protect
such interest; and
(2) within 90 days after the beginning of each calendar
year beginning with the first calendar year beginning more than
three months after the Initial Cutoff Date, an Opinion of Counsel,
dated as of
a date during such 90-day period, either: (A) stating that, in the
opinion of such counsel, all financing statements and continuation
statements have been executed and filed that are necessary fully
to preserve and protect the interest of the Issuer, the Trustee
and the Indenture Trustee in the Receivables, and reciting the
details of such filings or referring to prior Opinions of Counsel
in which such details are given, or (B) stating that, in the
opinion of such counsel, no such action shall be necessary to
preserve and protect such interest.
Each Opinion of Counsel referred to in clause (1) or (2) shall
specify any action necessary (as of the date of such opinion) to be taken
in the following year to preserve and protect such interest.
(j) The Seller shall, to the extent required by applicable law,
cause the Certificates and the Notes to be registered with the Commission
pursuant to Section 12(b) or Section 12(g) of the Exchange Act within the
time periods specified in such sections.
SECTION 10.3. Notices. All demands, notices, directions,
instructions and communications upon or to the Seller, the Servicer, the
Issuer, the Trustee, the Indenture Trustee or the Rating Agencies under
this Agreement shall be in writing, personally delivered or mailed by
certified mail, return receipt requested, and shall be deemed to have been
duly given upon receipt: (a) in the case of the Seller, to Case Receivables
II Inc., 000 Xxxx Xxxxxx, Xxxxxx, Xxxxxxxxx 00000, Attention: Treasurer
(telephone (000) 000-0000 and facsimile (000) 000-0000), (b) in the case of
the Servicer, to Case Credit Corporation, 000 Xxxx Xxxxxx, Xxxxxx,
Xxxxxxxxx 00000, Attention: Treasurer (telephone (000) 000-0000 and
facsimile (000) 000-0000), (c) in the case of the Issuer or the Trustee, at
the Corporate Trust Office (as defined in the Trust Agreement), (d) in the
case of the Indenture Trustee, at the Corporate Trust Office, (e) in the
case of Moody's, to Xxxxx'x Investors Service, Inc., ABS Monitoring
Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, and (f) in the case
of Standard & Poor's, to Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc., 00 Xxxxxxxx (00xx Xxxxx), Xxx Xxxx, Xxx
Xxxx 00000, Attention: Asset Backed Surveillance Department; or, as to each
of the foregoing, at such other address as shall be designated by written
notice to the other parties.
SECTION 10.4. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 6.4 and 7.3 and as
provided in the provisions of this Agreement concerning the resignation of
the Servicer, this Agreement may not be assigned by the Seller or the
Servicer.
SECTION 10.5. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Seller, the Servicer, the
Issuer, the Trustee, the Certificateholders, the Indenture Trustee and the
Noteholders, and
nothing in this Agreement, whether express or implied, shall be construed
to give to any other Person any legal or equitable right, remedy or claim
in the Trust Estate or under or in respect of this Agreement or any
covenants, conditions or provisions contained herein.
SECTION 10.6. Severability. Any provision of this Agreement that
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
SECTION 10.7. Separate Counterparts. This Agreement may be
executed by the parties hereto in separate counterparts, each of which when
so executed and delivered shall be an original, but all such counterparts
shall together constitute but one and the same instrument.
SECTION 10.8. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 10.9. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
SECTION 10.10. Assignment to Indenture Trustee. The Seller hereby
acknowledges and consents to any mortgage, pledge, assignment and grant of
a security interest by the Issuer to the Indenture Trustee pursuant to the
Indenture for the benefit of the Noteholders of all right, title and
interest of the Issuer in, to and under the Receivables and/or the
assignment of any or all of the Issuer's rights and obligations hereunder
to the Indenture Trustee.
SECTION 10.11. Nonpetition Covenants. (a) Notwithstanding the
termination of this Agreement, the Servicer and the Seller shall not, prior
to the date that is one year and one day after the termination of this
Agreement, with respect to the Issuer, acquiesce, petition or otherwise
invoke or cause the Issuer to invoke the process of any court or
governmental authority for the purpose of commencing or sustaining a case
against the Issuer under any Federal or state bankruptcy, insolvency or
similar law or appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Issuer or any
substantial part of its property, or ordering the winding up or liquidation
of the affairs of the Issuer. The foregoing shall not limit the right of
the Servicer and the Seller to file any claim in or otherwise take any
action with respect to any such insolvency proceeding that was
instituted against the Issuer by any Person other than the Servicer or the
Seller.
(b) Notwithstanding the termination of this Agreement, the
Servicer shall not, prior to the date that is one year and one day after
the termination of this Agreement, with respect to the Seller, acquiesce,
petition or otherwise invoke or cause the Seller to invoke the process of
any court or governmental authority for the purpose of commencing or
sustaining a case against the Seller under any Federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Seller or
any substantial part of its property, or ordering the winding up or
liquidation of the affairs of the Seller. The foregoing shall not limit the
right of the Servicer to file any claim in or otherwise take any action
with respect to any such insolvency proceeding that was instituted against
the Seller by any Person other than the Servicer.
SECTION 10.12. Limitation of Liability of the Trustee and
Indenture Trustee. (a) Notwithstanding anything contained herein to the
contrary, this Agreement has been countersigned by The Bank of New York,
not in its individual capacity but solely in its capacity as Trustee of the
Issuer, and in no event shall: (i) The Bank of New York, in its individual
capacity, or (ii) except as expressly provided in the Trust Agreement, any
beneficial owner of the Issuer, have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer
hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the
assets of the Issuer.
(b) Notwithstanding anything contained herein to the contrary,
this Agreement has been acknowledged and accepted by Xxxxxx Trust and
Savings Bank, not in its individual capacity but solely as Indenture
Trustee, and in no event shall Xxxxxx Trust and Savings Bank have any
liability for the representations, warranties, covenants, agreements or
other obligations of the Issuer hereunder or in any of the certificates,
notices or agreements delivered pursuant hereto, as to all of which
recourse shall be had solely to the assets of the Issuer.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective officers as of the day and year
first above written.
CASE EQUIPMENT LOAN TRUST 1997-B
By: THE BANK OF NEW YORK,
not in its individual capacity
but solely as Trustee of the Trust
By: /s/ Xxxxxx X. Laser
Name: Xxxxxx X. Laser
Title: Assistant Vice President
CASE RECEIVABLES II INC.,
as Seller
By: /s/ Xxxxx Xxxx
Name: Xxxxx Xxxx
Title: Treasurer
CASE CREDIT CORPORATION,
as Servicer
By: /s/ Xxxxx Xxxx
Name: Xxxxx Xxxx
Title: Treasurer
Acknowledged and Accepted as of the date first above written:
XXXXXX TRUST AND SAVINGS BANK,
not in its individual capacity
but solely as Indenture Trustee
By: /s/ Xxxxx Xxxxxxxxxx
Name: Xxxxx Xxxxxxxxxx
Title: Assistant Vice President
SCHEDULE A
to Sale and Servicing Agreement
LOCATION OF RECEIVABLES FILES
Documents relating to the Receivables are located at one of the
following Case Corporation locations:
1. 000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxx 00000
2. 0000 Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxx 00000
3. 000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxx 00000
4. 0000 Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxxx 00000
5. 0000 X. 00xx Xxxxxx
Xxxxx 000
Xxxxxxxxxxx, Xxxxxxxxx 00000
6. 0000 Xxxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
7. 0000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxx 00000-0000
EXHIBIT A
to Sale and Servicing Agreement
FORM OF NOTEHOLDER'S
STATEMENT PURSUANT TO SECTION 5.10(a)
Payment Date: ______________________
(i) Amount of principal being paid on Notes:
A-1 Notes: ______________ ($_____ per $1,000 original principal amount)
A-2 Notes: ______________ ($_____ per $1,000 original principal amount)
A-3 Notes: ______________ ($_____ per $1,000 original principal amount)
A-4 Notes: ______________ ($_____ per $1,000 original principal amount)
Class B Notes: _____________ ($_____ per $1,000 original principal amount)
Class C Notes: _____________ ($_____ per $1,000 original principal amount)
(ii) Amount of interest being paid on Notes:
A-1 Notes: ______________ ($_____ per $1,000 original principal amount)
A-2 Notes: ______________ ($_____ per $1,000 original principal amount)
A-3 Notes: ______________ ($_____ per $1,000 original principal amount)
A-4 Notes: ______________ ($_____ per $1,000 original principal amount)
Class B Notes*: _____________ ($_____ per $1,000 original principal amount)
Class C Notes: _____________ ($_____ per $1,000 original principal amount)
(iii) Pool Balance as of the close of business on the last day of the preceding Collection
Period: _____
(iv) After giving effect to distributions on this Payment Date:
------------
*/ Including Class B Net Funds Cap Carryover Amount
Sale and Servicing Agreement - Exhibit A - 1
(a) (1) Outstanding Amount of A-1 Notes: _______
(2) Outstanding Amount of A-2 Notes: _______
(3) Outstanding Amount of A-3 Notes: _______
(4) Outstanding Amount of A-4 Notes: _______
(5) Outstanding Amount of Class B Notes: _______
(6) Outstanding Amount of Class C Notes: _______
(7) A-1 Note Pool Factor: _____
(8) A-2 Note Pool Factor: _____
(9) A-3 Note Pool Factor: _____
(10) A-4 Note Pool Factor: _____
(11) Class B Note Pool Factor: _____
(11) Class C Note Pool Factor: _____
(b) (1) Certificate Balance: __________
(2) Certificate Pool Factor: __________
(v) Amount of Servicing Fee: ____ ($_____ per $1,000 original principal amount)
(vi) Amount of Administration Fee: ____ ($____ per $1,000 original principal amount)
(vii) Class B Net Funds Cap Carryover Amount: __________
(viii) Aggregate Amount of Realized Losses for the Collection Period: __________
(ix) Aggregate Purchase Amounts for the Collection Period: __________
(x) Balance of the Spread Account: __________
(xi) Remaining Pre-funded Amount: __________
(xii) Balance of the Negative Carry Account: __________
Sale and Servicing Agreement - Exhibit A - 2
EXHIBIT B
to Sale and Servicing Agreement
FORM OF CERTIFICATEHOLDER'S
STATEMENT PURSUANT TO SECTION 5.10(a)
Payment Date: ______________________
(i) Amount of principal being paid or distributed:
(a) (1) A-1 Notes: __________
(2) A-2 Notes: __________
(3) A-3 Notes: __________
(4) A-4 Notes: __________
(5) Class B Notes: __________
(6) Class B Net Funds Cap Carryover Amount: __________
(7) Class C Notes: __________
(b) Certificates: ___________ ($_____ per $1,000 original
principal amount)
(c) Total: __________
(ii) Amount of interest being paid or distributed:
(a) (1) A-1 Notes: __________
(2) A-2 Notes: __________
(3) A-3 Notes: __________
(4) A-4 Notes: __________
(5) Class B Notes: __________
(6) Class C Notes: __________
(b) Certificates: ___________ ($_____ per $1,000 original
principal amount)
(c) Total: __________
(iii) Pool Balance as of the close of business on the last day of the
preceding Collection Period: _____
(iv) After giving effect to distributions on this Payment Date:
(a) (1) Outstanding Amount of A-1 Notes: _______
(2) Outstanding Amount of A-2 Notes: _______
(3) Outstanding Amount of A-3 Notes: _______
(4) Outstanding Amount of A-3 Notes: _______
Sale and Servicing Agreement - Exhibit B - 1
(5) Outstanding Amount of Class B Notes: _______
(6) Outstanding Amount of Class C Notes: _______
(7) A-1 Note Pool Factor: _____
(8) A-2 Note Pool Factor: _____
(9) A-3 Note Pool Factor: _____
(10) A-4 Note Pool Factor: _____
(11) Class B Note Pool Factor: _____
(12) Class C Note Pool Factor: _____
(b) (1) Certificate Balance: __________
(2) Certificate Pool Factor: __________
(v) Amount of Servicing Fee: ____ ($_____ per $1,000 original
principal amount)
(vi) Amount of Administration Fee: ____ ($____ per $1,000 original
principal amount)
(vii) Class B Net Funds Cap Carryover Amount: __________
(viii) Aggregate amount of Realized Losses for the Collection Period: ______
(ix) Aggregate Purchase Amounts for the Collection Period: __________
(x) Balance of the Spread Account: __________
(xi) Remaining Pre-Funded Amount:__________
(xii) Balance of the Negative Carry Account: __________
Sale and Servicing Agreement - Exhibit B - 2
EXHIBIT C
to Sale and Servicing Agreement
FORM OF SERVICER'S CERTIFICATE
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration - Asset Back Finance Unit
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Indenture Trust Administration
Case Receivables II Inc.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxx 00000
Attention: Treasurer
Xxxxx'x Investors Service, Inc.
ABS Monitoring Department
00 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Standard & Poor's Ratings Services,
a division of The XxXxxx-Xxxx Companies, Inc.
00 Xxxxxxxx (00xx Xxxxx)
New York, New York 10004
Attention: Asset Backed Surveillance Department
Sale and Servicing Agreement - Exhibit C - 1
$90,000,000 Class A-1 Asset-Backed Notes
$204,500,000 Class A-2 Asset-Backed Notes
$237,000,000 Class A-3 Asset-Backed Notes
$188,591,000 Class A-4 Asset-Backed Notes
$34,719,000 Class B Asset-Backed Notes
$15,190,000 Certificates
Determination Date: __-___-__
DISTRIBUTIONS
(1) Fixed Rate Distribution Amount $________
(2) Fixed Rate Percentage of Servicing Fee* $________
(3) Fixed Rate Percentage of Administration Fee $________
(4) Excess of
Floating Rate Percentage of the Servicing Fee* ($________) $________
plus +
Floating Rate Percentage of the Administration Fee ($ )
========
($ )
over ========
Floating Rate Distribution Amount - ($________)
($ )
========
(5) Class A Noteholder's Interest Distributable Amount: $________
o Interest on Class A Notes ($________)
o Class A Noteholder's Interest Carryover Shortfall, if any ($___________)
(6) Class C Noteholders' Interest Distributable Amount $________
o Interest on Class B Notes ($_________)
o Class B Noteholders' Interest Carryover Shortfall, if any ($_______)
----------------
*/ If neither Credit nor an Affiliate is Servicer.
Sale and Servicing Agreement - Exhibit C - 2
(7) A-1 Noteholders' Principal Distributable Amount $________
o A-1 Noteholders' Monthly Principal Distributable Amount ($________)
o A-1 Noteholders' Principal Carryover Shortfall ($________)
(8) A-2 Noteholders' Principal Distributable Amount $________
o A-2 Noteholders' Monthly Principal Distributable Amount ($________)
o A-2 Noteholders' Principal Carryover Shortfall ($________)
(9) A-3 Noteholders' Principal Distributable Amount $________
o A-3 Noteholders' Monthly Principal Distributable Amount ($________)
o A-3 Noteholders' Principal Carryover Shortfall ($________)
(10) A-4 Noteholders' Principal Distributable Amount $________
o A-4 Noteholders' Monthly Principal Distributable Amount ($________)
o A-4 Noteholders' Principal Carryover Shortfall ($________)
(11) Excess of $________
Class B Noteholders' Interest Distributable Amount ($________)
plus +
Class B Noteholders' Principal Distributable Amount ($ )
========
($ )
========
over -
Amounts available under (17) and (18) below ($________)
($ )
========
(12) Remaining Fixed Rate Distribution Amount to (21) below $________
(1) - (2) - (3) - (4) - (5) - (6) - (7) - (8) - (9) - (10) - (11)
(13) Floating Rate Distribution Amount $________
(14) Floating Rate Percentage of Servicing Fee* $________
(15) Floating Rate Percentage of Administration Fee $________
-------------
*/ If neither Credit nor an Affiliate is Servicer.
Sale and Servicing Agreement - Exhibit C - 3
(16) Excess of
Fixed Rate Percentage of the Servicing Fee* ($________)
plus +
Fixed Rate Percentage of the Administration Fee ($ )
========
($ )
========
over -
Fixed Rate Distribution Amount ($________)
($ ) $________
========
(17) Class B Noteholder's Interest Distributable Amount: $________
o Interest on Class B Notes ($________)
o Class B Noteholder's Interest Carryover Shortfall, if any ($___________)
(18) Class B Noteholders' Principal Distributable Amount $________
o Class B Noteholders' Monthly Principal Distributable Amount ($________)
o Class B Noteholders' Principal Carryover Shortfall ($________)
(19) Excess of
Class A Noteholders' Interest Distributable Amount ($________)
plus +
Class C Noteholders' Interest Distributable Amount ($________)
plus +
Class A Noteholders' Monthly Principal Distributable Amount ($ )
========
($ )
========
over -
Amounts available under (5) through (10) above ($________)
((5) + (6) + (7) + (8) + (9) + (10)) ($ ) $________
=========
(20) Remaining Floating Rate Distribution Amount to (21) below $________
(13) - (14) - (15) - (16) - (17) - (18) - (19)
(21) Remaining Fixed Rate Distribution Amount (12) $_______
plus +
Remaining Floating Rate Distribution Amount (20)
(22) Class C Noteholders' Principal Distributable Amount $________
o Class C Noteholders' Monthly Principal Distributable Amount ($________)
o Class C Noteholders' Principal Carryover Shortfall ($________)
Sale and Servicing Agreement - Exhibit C - 4
(23) NOTEHOLDERS' DISTRIBUTABLE AMOUNT : $________
(5)+(6)+(7)+(8)+(9)+(10)+(17)+(18)
(24) Amount necessary to achieve Specified Spread Account Balance $________
Specified Spread Account Balance: $________
the lesser of (after all distributions and
adjustments):
(a) 2.00% of the Initial Pool Balance; and
(b) the Note Balance
(25) Class B Net Funds Cap Carryover Shortfall and $________
other amounts owed by the Trust to Class B Noteholders
(26) Certificateholders' Interest Distributable Amount $________
o Interest on Certificates ($________)
o Certificateholders' Interest Carryover Shortfall ($________)
(27) Certificateholders' Principal Distributable Amount $________
o Principal Distribution Amount remaining after all the Notes paid
in full ($________) o Certificateholders' Principal Carryover
Shortfall ($________)
(28) CERTIFICATEHOLDERS' DISTRIBUTABLE AMOUNT (26)+(27) $________
(29) Servicing Fee* $________
(30) Deposit to Spread Account (21)-(22)-(24)-(25)-(26)-(27) $________
SPREAD ACCOUNT
(31) Spread Account Balance (after deposits from (24) and (30)) $________
(32) Excess in Spread Account distributed to Seller (as permitted $________
in Sections 5.6(b) and (c) of the Sale and Servicing Agreement)
-------------
*/ If Credit or an Affiliate is the Servicer.
Sale and Servicing Agreement - Exhibit C - 5
(33) Amount to be withdrawn from the Spread Account and deposited $________
into the Note Distribution Account (as per Section 5.6(d) of
the Sale and Servicing Agreement)
(34) Final Spread Account Balance (31)-(32)-(33) $________
MISCELLANEOUS
(35) Pool Balance at the beginning of this Collection Period $________
(36) After giving effect to all distributions on the Payment Date
during this Collection Period:
(a) Outstanding Amount of A-1 Notes $________
A-1 Note Pool Factor (_._______)
(b) Outstanding Amount of A-2 Notes $________ A-2 Note Pool
Factor (_._______)
(c) Outstanding Amount of A-3 Notes $________ A-3 Note Pool
Factor (_._______)
(d) Outstanding Amount of A-3 Notes $________ A-4 Note Pool
Factor (_._______)
(d) Outstanding Amount of Class B Notes
Class B Note Pool Factor (_._______)
(e) Outstanding Amount of Class C Notes
Class C Note Pool Factor (_._______)
(f) Outstanding Amount of Certificates $________
Certificate Pool Factor (_._______)
(24) Aggregate Purchase Amounts for the preceding Collection Period $________
Sale and Servicing Agreement - Exhibit C - 6
EXHIBIT D
to Sale and Servicing Agreement
FORM OF ASSIGNMENT
For value received, in accordance with and subject to the Sale and
Servicing Agreement dated as of September 1, 1997 (the "Sale and Servicing
Agreement"), among the undersigned, Case Credit Corporation and Case
Equipment Loan Trust 1997-B (the "Purchaser"), the undersigned does hereby
sell, assign, transfer set over and otherwise convey unto the Purchaser,
without recourse, all of its right, title and interest in, to and under:
(a) the Initial Receivables, including all documents constituting chattel
paper included therewith, and all obligations of the Obligors thereunder,
including all moneys paid thereunder on or after the Initial Cutoff Date,
(b) the security interests in the Financed Equipment granted by Obligors
pursuant to the Initial Receivables and any other interest of the
undersigned in such Financed Equipment, (c) any proceeds with respect to
the Initial Receivables from claims on insurance policies covering Financed
Equipment or Obligors, (d) the Liquidity Receivables Purchase Agreement
(only with respect to Contracts included in the Initial Receivables) and
the Purchase Agreement, including the right of the undersigned to cause
Case Credit Corporation to repurchase Receivables from the undersigned
under the circumstances described therein, (e) any proceeds from recourse
to Dealers with respect to the Initial Receivables other than any interest
in the Dealers' reserve accounts maintained with Case Credit Corporation,
(f) any Financed Equipment that shall have secured an Initial Receivable
and that shall have been acquired by or on behalf of the Trust, (g) all
funds on deposit from time to time in the Trust Accounts, including the
Spread Account Initial Deposit, the Negative Carry Account Initial Deposit
and the Pre-Funded Amount, and in all investments and proceeds thereof
(including all income thereon), and (h) the proceeds of any and all of the
foregoing (other than Recoveries). The foregoing sale does not constitute
and is not intended to result in any assumption by the Purchaser of any
obligation of the undersigned to the Obligors, insurers or any other person
in connection with the Initial Receivables, Receivables Files, any
insurance policies or any agreement or instrument relating to any of them.
This Assignment is made pursuant to and upon the representations,
warranties and agreements on the part of the undersigned contained in the
Sale and Servicing Agreement and is to be governed in all respects by the
Sale and Servicing Agreement. Capitalized terms used herein and not
otherwise defined shall have the meanings assigned to them in the Sale and
Servicing Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to
be duly executed as of ___________, 1997.
CASE RECEIVABLES II INC.,
By:_______________________
Name: Xxxxx Xxxx
Title: Treasurer
Sale and Servicing Agreement - Exhibit D - 1
EXHIBIT E
to Sale and Servicing Agreement
FORM OF SUBSEQUENT TRANSFER ASSIGNMENT
For value received, in accordance with and subject to the Sale and
Servicing Agreement dated as of September 1, 1997 (the "Sale and Servicing
Agreement"), among Case Equipment Loan Trust 1997-B, a Delaware business
trust (the "Issuer"), Case Receivables II Inc., a Delaware corporation (the
"Seller"), and Case Credit Corporation, a Delaware corporation, the Seller
does hereby sell, transfer, assign, set over and otherwise convey to the
Issuer, without recourse, all of its right, title and interest in, to and
under: (a) the Subsequent Receivables, with an aggregate Contract Value
equal to $________, listed on Schedule A hereto, including all documents
constituting chattel paper included therewith, and all obligations of the
Obligors thereunder including all moneys paid thereunder on or after the
Subsequent Cutoff Date, (b) the security interests in the Financed
Equipment granted by Obligors pursuant to such Subsequent Receivables and
any other interest of the Seller in such Financed Equipment, (c) any
proceeds with respect to such Subsequent Receivables from claims on
insurance policies covering Financed Equipment or Obligors, (d) the
Purchase Agreement, including the right of the Seller to cause Case Credit
Corporation to repurchase Subsequent Receivables from the Seller under the
circumstances described therein, (e) any proceeds from recourse to Dealers
with respect to such Subsequent Receivables other than any interest in the
Dealers' reserve accounts maintained with Case Credit Corporation, (f) any
Financed Equipment that shall have secured any such Subsequent Receivables
and that shall have been acquired by or on behalf of the Trust, and (g) the
proceeds of any and all of the foregoing (other than Recoveries). The
foregoing sale does not constitute and is not intended to result in any
assumption by the Issuer of any obligation of the Seller to the Obligors,
insurers or any other person in connection with such Subsequent
Receivables, Receivable Files, any insurance policies or any agreement or
instrument relating to any of them.
This Subsequent Transfer Assignment is made pursuant to and upon
the representations, warranties and agreements on the part of the Seller
contained in the Sale and Servicing Agreement (including the Officers'
Certificate of the Seller accompanying this Agreement) and is to be
governed in all respects by the Sale and Servicing Agreement. Capitalized
terms used but not otherwise defined herein shall have the meanings
assigned to them in the Sale and Servicing Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Assignment to
be duly executed as of _______________, 199_.
CASE RECEIVABLES II INC.,
By:__________________________
Name:_____________________
Title:____________________
Sale and Servicing Agreement - Exhibit E - 1
SCHEDULE A
to Subsequent Transfer Assignment
SCHEDULE OF SUBSEQUENT RECEIVABLES
[To be attached]
Sale and Servicing Agreement - Exhibit E - 2
ANNEX A
to Subsequent Transfer Assignment
OFFICERS' CERTIFICATE
We, the undersigned officers of Case Receivables II Inc. (the
"Company"), do hereby certify, pursuant to Section 2.2(b)(xvi) of the Sale
and Servicing Agreement dated as of September 1, 1997, among the Company,
Case Equipment Loan Trust 1997-B and Case Credit Corporation (the
"Agreement"), that all of the conditions precedent to the transfer to the
Issuer of the Subsequent Receivables listed on Schedule A to the Subsequent
Transfer Assignment delivered herewith, and the other property and rights
related to such Subsequent Receivables as described in Section 2.2(a) of
the Agreement, have been satisfied on or prior to the related Subsequent
Transfer Date.
Capitalized terms used but not defined herein shall have the
meanings assigned to such terms in the Agreement.
IN WITNESS WHEREOF, the undersigned have caused this certificate
to be duly executed this _____ day of _______, 199_.
By:_________________________
Name:_____________________
Title:____________________
By:_________________________
Name:_____________________
Title:____________________
Sale and Servicing Agreement - Exhibit E - 3
EXHIBIT F
to Sale and Servicing Agreement
FORM OF ACCOUNTANTS' LETTER IN CONNECTION
WITH THE SUBSEQUENT TRANSFER ASSIGNMENT PURSUANT TO
SECTION 2.2(b)(xv) OF THE SALE AND SERVICING AGREEMENT
[Letterhead of Xxxxxx Xxxxxxxx]
___________, 199_
Case Receivables II Inc.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxx 00000
Case Equipment Loan Trust 1997-B
000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxx 00000
Credit Suisse First Boston Corporation,
as Representative of the several Underwriters
00xx Xxxxx
Xxxxxx Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, Xxx Xxxx 00000
Dear Ladies and Gentlemen:
This letter is issued at the request of Case Receivables II Inc. (the
"Seller") with respect to the sale of certain retail receivables (the
"Subsequent Receivables") to the Case Equipment Loan Trust 1997-B (the
"Trust") pursuant to the Sale and Servicing Agreement dated as of September
1, 1997 (the "Sale and Servicing Agreement") among the Trust, the Seller
and Case Credit Corporation (the "Servicer"). The sale of the Subsequent
Receivables is described in the prospectus dated September 11, 1997 and the
Sale and Servicing Agreement - Exhibit F - 1
Page 2
_________, 199_
prospectus supplement dated September [___], 1997 (together, the
"Prospectus"), which relates to the offering by the Trust of Class A-1
5.612% Asset Backed Notes, Class A-2 5.914% Asset Backed Notes, Class A-3
6.240% Asset-Backed Notes, Class A-4 6.410% Asset-Backed Notes and Class B
Asset Backed Notes (collectively, the "Notes") and the 6.410% Asset Backed
Certificates (the "Certificates"). Capitalized terms used herein and not
otherwise defined have the meaning described in the Prospectus or the Sale
and Servicing Agreement, as applicable. In connection therewith, we
performed or have previously performed certain agreed upon procedures as
specified in the items below:
1. As previously communicated in our letter to the Seller, the Trust,
__________________, the Indenture Trustee and the Trustee dated
___________, 1997 relating to the sale of certain retail
receivables (the "Initial Receivables") and the offering of the
Notes and the Certificates, we performed several procedures based
on a computer data file (the "Initial File") received from the
Servicer, including the following:
a. We read certain fields on the Initial File to determine
whether the data pertaining to the Initial Receivables
complied with the selection criteria as noted in our
previous letter.
b. Proved the arithmetic accuracy of the Aggregate Contract
Value and the related percentage of Initial Receivables
coded as representing construction equipment and the
Total Aggregate Contract Value of the Initial Receivables
as shown on Schedule B.
c. Proved the arithmetic accuracy of the Weighted Average
Original Term of the Initial Receivables as shown in
Schedule B.
2. On ______________, 1997, we obtained a computer data file (the
"Subsequent File") produced by and represented by the Servicer to
contain the list of the Subsequent Receivables. The Subsequent
File was received directly by Xxxxxx Xxxxxxxx LLP from the
Servicer. By use of data retrieval software, we have performed the
following with respect to the information contained in the
Subsequent File:
a. We read certain fields on the Subsequent File to
determine whether the data relating to the Subsequent
Receivables complied with selection criteria 1, 2 and 4
as shown on Schedule A. For purposes of selection
criteria 3, as shown on Schedule A, we read certain
fields from the Initial File and Subsequent File to
aggregate the total Contract Value for each account
number for the purpose of determining the Contract Value
for each Obligor. The total Contract Value for
Sale and Servicing Agreement - Exhibit F - 2
Page 3
_________, 199_
each account number was then compared to the aggregate
Contract Value to determine if the selection criteria was
achieved.
b. Proved the arithmetic accuracy of the Aggregate Contract
Value and the related percentage of the Subsequent
Receivables coded as representing construction equipment
and the Total Aggregate Contract Value of the Subsequent
Receivables as shown on Schedule B.
c. Proved the arithmetic accuracy of the Weighted Average
Original Term of the Subsequent Receivables as shown in
Schedule B.
3. We proved the arithmetic accuracy of the columnar totals for
Aggregate Contract Value of construction equipment and the Total
Aggregate Contract Value as shown on Schedule B.
4. We proved the arithmetic accuracy of the percent of total column as
shown in 1 on Schedule B by dividing the amount in the Total Aggregate
Contract Value of construction equipment column by the amount in the
Total Aggregate Contract Value column. We also proved the arithmetic
accuracy of the Weighted Average Original Term as shown in 2 on
Schedule B by summing the products of Total Aggregate Contract Value
times Weighted Average Original Term for the Initial Receivables and
the Subsequent Receivables and dividing the resulting sum by the
columnar total of the Total Aggregate Contract Value.
The foregoing procedures do not constitute an audit conducted in accordance
with generally accepted auditing standards, and, therefore, we are unable
to and do not express an opinion on any individual balances or summaries of
selected transactions specifically set forth in this letter. Also, these
procedures would not necessarily reveal matters of significance with
respect to the findings described herein. Accordingly, we make no
representations regarding the sufficiency of the foregoing procedures for
your purposes of for questions of legal interpretation. Had we performed
additional procedures, other matters might have come to our attention that
would have been reported to you. Further, we have addressed ourselves
solely to the foregoing data in the Sale and Servicing Agreement and the
Prospectus and make no representations regarding the adequacy of disclosure
regarding whether any material facts have been omitted.
Sale and Servicing Agreement - Exhibit F - 3
Page 4
_________, 199_
This letter is solely for the information of the addressees and is not to
be used, circulated, quoted or otherwise referred to for any other purpose
including, but not limited to, the purchase or sale of Notes or
Certificates, nor is it to be referred to in any document. Furthermore, we
undertake no responsibility to update this letter for events and
circumstances occurring after the date of this letter.
Very truly yours,
XXXXXX XXXXXXXX LLP
Sale and Servicing Agreement - Exhibit F - 4
SCHEDULE A
to Accountant's Letter
Selection Criteria Results
1. No Subsequent Receivables was more than 90 days past due as of the
applicable Subsequent Cutoff Date.
2. Each Subsequent Receivable has an APR that is equal to or greater
than 3%
3. The weighted average of the Initial Cutoff Date APR and each
Subsequent Cutoff Date APR (weighted on the basis of the
respective aggregate Contract Values of the Fixed Rate Receivables
for which each such APR is used to calculate the Contract Value)
is not less than the weighted average interest rate on the Class A
Notes and Class C Notes plus 1% per annum
4. Each Subsequent Receivable has a Contract Value as of the
Subsequent Cutoff Date that (when combined with the Contract Value
of any other Receivables with the same or an affiliated Obligor)
does not exceed 1% of the aggregate Contract Value of all
Receivables.
5. Each Subsequent Receivable has a remaining term to maturity (i.e.,
the period from but excluding the applicable Subsequent Cutoff
Date to and including the Receivables' maturity date) of not more
than 72 months.
Sale and Servicing Agreement - Exhibit F - 5
SCHEDULE B
to Accountant's Letter
1. Percentage of principal balance of the Receivables that represents
construction equipment:
Aggregate
Contract Value Total
of Construction Aggregate Percent of
Equipment Contract Value Total
--------------- -------------- ----------
Initial Receivables $_________ $___________ _____%
Subsequent Receivables $ $ %
========== =========== ======
Total Receivables $ $ %
========== =========== ======
2. Weighted Average Original Term of the Receivables in the Trust.
Weighted
Total Aggregate Average Original
Contract Value Term
--------------- ----------------
Initial Receivables $_________ _____ months
Subsequent Receivables $ months
========= =====
Total Receivables $ months
========= =====
As noted above, the Weighted Average Original Term does not exceed 55.0
months as required by the Sale and Servicing Agreement.
Sale and Servicing Agreement - Exhibit F - 6
