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EXHIBIT 4.1
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NAVISTAR FINANCIAL SECURITIES CORPORATION
SELLER
NAVISTAR FINANCIAL CORPORATION
SERVICER
AND
THE BANK OF NEW YORK
MASTER TRUST TRUSTEE
ON BEHALF OF THE SERIES 2000-1 CERTIFICATEHOLDERS
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SERIES 2000-1 SUPPLEMENT
DATED AS OF JULY 13, 2000
TO
POOLING AND SERVICING AGREEMENT
DATED AS OF JUNE 8, 1995
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CLASS A, FLOATING RATE
DEALER NOTE ASSET BACKED CERTIFICATES, SERIES 2000-1
CLASS B, FLOATING RATE
DEALER NOTE ASSET BACKED CERTIFICATES, SERIES 2000-1
NAVISTAR FINANCIAL DEALER NOTE MASTER TRUST
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TABLE OF CONTENTS
ARTICLE I
CREATION OF SERIES 2000-1 AND THE SERIES 2000-1 CERTIFICATES.......................................1
SECTION 1.01 Designation..........................................................................1
ARTICLE II
DEFINITIONS........................................................................................1
SECTION 2.01 Definitions..........................................................................1
ARTICLE III
SERVICING FEE.....................................................................................15
SECTION 3.01 Servicing Compensation..............................................................15
ARTICLE IV
RIGHTS OF SERIES 2000-1 CERTIFICATEHOLDERS AND ALLOCATION AND APPLICATION OF COLLECTIONS..........16
SECTION 4.01 Rights of the Series 2000-1 Certificateholders......................................16
SECTION 4.02 Establishment of Series Principal Account, Spread Account and Liquidity
Reserve Account.....................................................................16
SECTION 4.03 [Reserved.].........................................................................18
SECTION 4.04 Application of Available Certificateholder Interest Collections.....................19
SECTION 4.05 Application of Available Seller's Finance Charge Collections, Spread
Account and Liquidity Reserve Account to Deficiency Amount..........................20
SECTION 4.06 Certificateholder Charge-Offs.......................................................21
SECTION 4.07 Application of Seller's Finance Charge Collections..................................21
SECTION 4.08 Application of Series Allocable Principal Collections...............................22
SECTION 4.09 Shared Principal Collections........................................................24
SECTION 4.10 Distributions to Series 2000-1 Certificateholders...................................24
SECTION 4.11 Accumulation Period Length; Accumulation Period Commencement Date...................25
SECTION 4.12 Partial Month Due Period............................................................25
SECTION 4.13 Additional Rights upon the Occurrence of Certain Events.............................26
ARTICLE V
DISTRIBUTIONS AND REPORTS TO SERIES 2000-1 CERTIFICATEHOLDERS.....................................26
SECTION 5.01 Distributions.......................................................................26
SECTION 5.02 Monthly and Annual Certificateholders' Statement....................................27
ARTICLE VI
EARLY AMORTIZATION EVENTS.........................................................................29
SECTION 6.01 Additional Early Amortization Events................................................29
ARTICLE VII
OTHER SERIES PROVISIONS...........................................................................32
SECTION 7.01 Conveyance of Dealer Notes..........................................................32
SECTION 7.02 Tax Treatment.......................................................................32
ARTICLE VIII
FINAL DISTRIBUTIONS...............................................................................32
SECTION 8.01 Sale of Investors' Interest Pursuant to Section 2.07 of the Agreement;
Distributions Pursuant to Section 2.03 or 12.03 of the Agreement....................32
SECTION 8.02 Distribution of Proceeds of Sale, Disposition or Liquidation of the Dealer
Notes Pursuant to Section 9.02 of the Agreement.....................................33
ARTICLE IX
MISCELLANEOUS PROVISIONS..........................................................................34
SECTION 9.01 Ratification of Agreement...........................................................34
SECTION 9.02 Counterparts........................................................................34
SECTION 9.03 GOVERNING LAW.......................................................................34
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SIGNATURES.................................................................................................36
EXHIBITS
Exhibit A-1 - Form of Class A Certificate
Exhibit A-2 - Form of Class B Certificate
Exhibit B - Form of Monthly Servicer and Settlement Statement
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SERIES 2000-1 SUPPLEMENT
TO POOLING AND SERVICING AGREEMENT
SERIES 2000-1 SUPPLEMENT dated as of July 13, 2000 (the "Series
Supplement"), by and among NAVISTAR FINANCIAL SECURITIES CORPORATION, a Delaware
corporation, as Seller (the "Seller"), NAVISTAR FINANCIAL CORPORATION, a
Delaware corporation, as Servicer (the "Servicer"), and THE BANK OF NEW YORK, a
New York banking corporation, as trustee (together with its successors in trust
thereunder as provided in the Agreement referred to below, the "Master Trust
Trustee") under the Pooling and Servicing Agreement, dated as of June 8, 1995
(as amended and supplemented, the "Agreement") among the Seller, the Servicer
and the Master Trust Trustee.
Section 6.09 of the Agreement provides that the Seller may from time
to time direct the Master Trust Trustee to issue, on behalf of the Master Trust,
one or more new Series of Investor Certificates representing fractional
undivided interests in the Master Trust. The Principal Terms of any new Series
are to be set forth in a Supplement to the Agreement.
Pursuant to this Series Supplement, the Seller and the Master Trust
Trustee shall create a new Series of Investor Certificates and specify the
Principal Terms thereof.
ARTICLE I
CREATION OF SERIES 2000-1 AND
THE SERIES 2000-1 CERTIFICATES
SECTION 1.01 Designation.
(a) There is hereby created a new Series pursuant to the Agreement and
this Series Supplement to be known as the "Series 2000-1." The interest of the
Investor Certificateholders in Series 2000-1 shall be represented by the "Class
A Certificates" and the "Class B Certificates" (collectively, the "Series 2000-1
Certificates").
(b) If any term or provision contained herein shall conflict with or
be inconsistent with any term or provision contained in the Agreement, the terms
and provisions of this Series Supplement shall govern with respect to Series
2000-1.
ARTICLE II
DEFINITIONS
SECTION 2.01 Definitions.
(a) Whenever used in this Series Supplement, the following words and
phrases shall have the following meanings:
"Accumulation Period" shall mean, unless an Early Amortization Event
shall have occurred prior thereto, the period commencing on the Accumulation
Period Commencement Date
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and ending upon the first to occur of (a) the commencement of an Early
Amortization Period and (b) the payment of the Invested Amount in full.
"Accumulation Period Commencement Date" shall mean the first day of
the nth full Due Period prior to the Expected Principal Payment Date where n is
the number of Due Periods in the Accumulation Period Length; provided, however,
that the Accumulation Period Commencement Date shall be the Specified
Accumulation Period Commencement Date if, on the Specified Accumulation Period
Commencement Date, any other outstanding Series shall have entered into an
investment period or an early amortization period; and provided further that, if
the Accumulation Period Length and the Accumulation Period Commencement Date
have been determined pursuant to Section 4.11 but the Accumulation Period has
not commenced and any other outstanding Series shall enter into an investment
period or an early amortization period, the Accumulation Period Commencement
Date shall be the date that such outstanding Series shall have entered into an
investment period or an early amortization period.
"Accumulation Period Length" shall mean a period which is between one
and nine Due Periods and which is determined by the Servicer pursuant to Section
4.11.
"Adjusted Invested Amount" shall mean, with respect to any
Distribution Date, an amount (which shall never be less than zero) equal to (1)
the sum of the Class A Initial Invested Amount, and the Class B Initial Invested
Amount, plus (2) the Available Subordinated Amount as of the end of the related
Transfer Date, minus (3) the sum of (a) the aggregate amount of Class A
Certificateholder Charge-Offs not reimbursed on or prior to such Distribution
Date and (b) the aggregate amount of Class B Certificateholder Charge-Offs not
reimbursed on or prior to such Distribution Date; provided that, for purposes of
calculating the Series Allocation Percentage, the Series 2000-1 shall be deemed
to have been outstanding as of June 26, 2000 with respect to allocations of
Principal Collections and related concepts and as of June 26, 2000 with respect
to Finance Charge Collections and related concepts, in each case with an
Adjusted Invested Amount of $231,080,000.
"Amortizing Due Period" shall have the meaning specified in Section
4.12.
"Available Certificateholder Interest Collections" shall mean, with
respect to any Due Period, the sum of (a) Investor Finance Charge Collections
for such Due Period and (b) Investment Income for that Due Period.
"Available Draw Funds" shall have the meaning specified in Section
4.05(b).
"Available Seller's Finance Charge Collections" shall mean, with
respect to any Due Period, an amount equal to the product of (a) the excess of
(i) the Seller's Percentage for such Due Period over (ii) the result (if
positive) of the Excess Seller's Percentage for such Due Period minus the
Required Excess Seller Interest Percentage and (b) Series Allocable Finance
Charge Collections for such Due Period; provided, however, that Available
Seller's Finance Charge Collections shall be zero for any Due Period to the
extent the Available Subordinated Amount equals or is reduced to zero on the
Transfer Date related to such Due Period.
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"Available Seller's Principal Collections" shall mean, with respect to
any Business Day, an amount equal to the product of (a) the excess of (i) the
Seller's Percentage for the Due Period in which such Business Day occurs over
(ii) the Excess Seller's Percentage for such Due Period and (b) Series Allocable
Principal Collections for such Business Day; provided, however, that Available
Seller's Principal Collections shall be zero for any Business Day to the extent
the Available Subordinated Amount equals or is reduced to zero on the Transfer
Date immediately preceding such Business Day.
"Available Subordinated Amount" shall mean for the first Transfer Date
after the Closing Date, $19,080,000, and for each Transfer Date thereafter
(before giving effect to all adjustments in the Available Subordinated Amount
thereto on such Transfer Date), the lesser of (i) the Maximum Subordinated
Amount as of such Transfer Date and (ii) the Available Subordinated Amount as of
the end of the preceding Transfer Date.
"Average Coverage Differential" shall be determined, on any
Determination Date, by reference to the Coverage Differentials for each of the
related Due Period and the three immediately preceding Due Periods, and shall
equal the sum of the three highest such Coverage Differentials divided by three.
Average Coverage Differential shall be expressed as a percentage, and shall be
rounded to the nearest one-hundredth of a percentage point.
"Business Day" shall mean, with respect to Series 2000-1, any day
other than a Saturday, a Sunday, or a day on which banking institutions in New
York, New York, Chicago, Illinois, or the city in which the Corporate Trust
Office is located, or in connection with the determination of LIBOR, London,
England, are authorized or obligated by law or executive order to be closed or
remain closed.
"Certificateholder Charge-Off" shall have the meaning specified in
Section 4.06.
"Class A Certificate Rate" shall mean the interest rate on the Class A
Certificates, which shall equal 6.88% for the Initial Distribution Period and
for each Distribution Period thereafter will equal LIBOR as of the related LIBOR
Determination Date plus 0.25%.
"Class A Certificateholder Charge-Off" shall have the meaning
specified in Section 4.06.
"Class A Certificateholders" shall mean the holders of Class A
Certificates.
"Class A Certificates" shall mean any one of the certificates executed
by the Seller and authenticated by the Master Trust Trustee, substantially in
the form of Exhibit A-1.
"Class A Initial Invested Amount" shall mean $200,000,000.
"Class A Invested Amount" shall mean, with respect to any Distribution
Date, an amount (which shall never be less than zero) equal to the Class A
Initial Invested Amount, minus the sum of (a) the aggregate amount of payments
of principal in respect of the Class A Certificates made to Class A
Certificateholders on or prior to such Distribution Date, (b) the aggregate
amount of Class
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A Certificateholder Charge-Offs not reimbursed pursuant to Section 4.04(a)(v) on
or prior to such Distribution Date, and (c) the aggregate amount of Class A
Principal Account Losses on or prior to such Distribution Date.
"Class A Monthly Interest" shall mean, with respect to each Transfer
Date related to a Distribution Period, an amount equal to the product of (a) the
Class A Certificate Rate for such Distribution Period and (b) the Class A
Invested Amount (calculated without giving effect to clauses (b) and (c) of the
definition thereof) as of the preceding Distribution Date (or the Class A
Initial Invested Amount with respect to the first Transfer Date) and (c) a
fraction, which (i) with respect to the first Transfer Date, shall be equal to
43 divided by 360 and (ii) with respect to each subsequent Transfer Date, shall
be equal to the actual number of days in the related Distribution Period divided
by 360.
"Class A Principal Account Losses" means, with respect to any
Distribution Date, the amount of Series Principal Account Losses since the prior
Distribution Date that are not Class B Principal Account Losses, but not more
than the amount that would reduce the Class A Invested Amount to zero.
"Class B Certificate Rate" shall mean the interest rate on the Class B
Certificates, which shall equal 7.18% for the Initial Distribution Period and
for each Distribution Period thereafter will equal LIBOR as of the related LIBOR
Determination Date plus 0.55%.
"Class B Certificateholder Charge-Off" shall have the meaning
specified in Section 4.06.
"Class B Certificateholders" shall mean the holders of Class B
Certificates.
"Class B Certificates" shall mean any one of the certificates executed
by the Seller and authenticated by the Master Trust Trustee, substantially in
the form of Exhibit A-2.
"Class B Initial Invested Amount" shall mean $12,000,000.
"Class B Invested Amount" shall mean, with respect to any Distribution
Date, an amount (which shall never be less than zero) equal to the Class B
Initial Invested Amount, minus the sum of (a) the aggregate amount of payments
of principal in respect of the Class B Certificates made to Class B
Certificateholders on or prior to such Distribution Date, (b) the aggregate
amount of Class B Certificateholder Charge-Offs not reimbursed pursuant to
Section 4.04(a)(vi) on or prior to such Distribution Date, and (c) the aggregate
amount of Class B Principal Account Losses on or prior to such Distribution
Date.
"Class B Monthly Interest" shall mean, with respect to each Transfer
Date related to a Distribution Period, an amount equal to the product of (a) the
Class B Certificate Rate for such Distribution Period and (b) the Class B
Invested Amount (calculated without giving effect to clauses (b) and (c) of the
definition thereof) as of the preceding Distribution Date (or the Class B
Initial Invested Amount with respect to the first Transfer Date) and (c) a
fraction, which (i) with respect to the first Transfer Date, shall be equal to
43 divided by 360 and (ii) with respect to each subsequent
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Transfer Date, shall be equal to the actual number of days in the related
Distribution Period divided by 360.
"Closing Date" shall mean July 13, 2000.
"Class B Principal Account Losses" means, with respect to any
Distribution Date, the amount of Series Principal Account Losses since the prior
Distribution Date, but not more than the amount that would reduce the Class B
Invested Amount to zero.
"Common Depository" shall mean Cede & Co.
"Controlled Amortization Amount" shall mean an amount equal to the
result of (a) the Invested Amount as of the Distribution Date preceding the
Specified Accumulation Period Commencement Date divided by (b) the Accumulation
Period Length.
"Controlled Deposit Amount" shall mean, with respect to any Due Period
occurring during the Accumulation Period, the excess, if any, of (a) the product
of (i) the Controlled Amortization Amount and (ii) the number of Due Periods
that have elapsed with respect to the Accumulation Period through and including
that Due Period (but not in excess of the Accumulation Period Length) over (b)
the amount on deposit in the Series Principal Account at the close of business
on the last Business Day of the preceding Due Period; provided, however, that,
notwithstanding the foregoing, the Seller may, in its sole discretion, increase
the Controlled Deposit Amount at any time and from time to time.
"Coverage Differential" shall mean, with respect to any Due Period,
the result of (a) the Portfolio Yield for such Due Period minus (b) the sum of
(i) the Weighted Average Certificate Rate for the related Distribution Period
and (ii) one percent (1%). Coverage Differential shall be expressed as a
percentage, and shall be rounded to the nearest one-hundredth of a percentage
point.
"Deficiency Amount" shall have the meaning specified in Section
4.05(a).
"Draw Amount" shall mean, with respect to any Transfer Date, the least
of (a) the Deficiency Amount for such Transfer Date, (b) the Available
Subordinated Amount as of the end of the preceding Transfer Date and (c)
Available Draw Funds for such Transfer Date.
"Early Amortization Event" shall mean, with respect to Series 2000-1,
any event specified in Section 9.01(c) of the Agreement, together with any
additional Early Amortization Event specified in Section 6.01 of this Series
Supplement, but shall not mean any other event specified in Section 9.01 of the
Agreement.
"Early Amortization Period" shall mean an Early Amortization Period
with respect to Series 2000-1 that occurs as a result of any event specified in
Section 9.01(c) of the Agreement or any Early Amortization Event specified in
Section 6.01 of this Series Supplement.
"Early Amortization Period Shortfall Amount" shall have the meaning
specified in Section 4.08(e).
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"Eligible Investments" shall mean
(a) book-entry securities, negotiable instruments or securities represented
by instruments in bearer or registered form having (except in the case of
clause (iv) below) remaining maturities occurring not later than the
Distribution Date next succeeding the Master Trust Trustee's acquisition
thereof, except as otherwise described herein, that evidence:
(i) direct obligations of, and obligations fully guaranteed as to
timely payment by, the United States of America;
(ii) demand deposits, time deposits or certificates of deposit
of, or bankers' acceptances issued by, any depository institution
or trust company incorporated under the laws of the United States
of America or any state thereof (or any domestic branch of a
foreign bank) and subject to supervision and examination by
federal or state banking or depository institution authorities;
provided, however, that at the time of the Master Trust's
investment or contractual commitment to invest therein, the
commercial paper or other short-term unsecured debt obligations
(other than such obligations the rating of which is based on the
credit of a person or entity other than such depository
institution or trust company) of such depository institution or
trust company shall have a credit rating not lower than the
highest investment category for short term unsecured debt
obligations granted by the applicable Rating Agency from each
Rating Agency then Rating the affected Series of Investor
Certificates;
(iii) commercial paper having, at the time of the Master Trust's
investment or contractual commitment to invest therein, a rating
not lower than the highest investment category for short term
unsecured debt obligations granted by the applicable Rating
Agency from each Rating Agency then Rating the affected Series of
Investor Certificates;
(iv) investments in money market funds or common trust funds
having a rating not lower than the highest investment category
for short term unsecured debt obligations granted by the
applicable Rating Agency from each Rating Agency then Rating the
affected Series of Investor Certificates or otherwise approved in
writing by each of such Rating Agencies (including funds for
which the Master Trust Trustee or any of its affiliates is
investment manager or advisor, so long as such fund shall have
such rating);
(v) repurchase obligations (x) with respect to any security that
is a direct obligation of, or fully guaranteed by, the United
States of America or any agency or instrumentality thereof the
obligations of which are backed by the full faith and credit of
the United States of America, in either case, entered into with a
depository institution or trust company (acting as principal)
described in clause (ii) or (y) the counterparty for which has a
rating not lower than the highest investment category for short
term unsecured debt obligations
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granted by the applicable Rating Agency from each Rating Agency
then Rating the affected Series of Investor Certificates, the
collateral for which is held by a custodial bank for the benefit
of the Master Trust or the Master Trust Trustee, is marked to
market daily and is maintained in an amount that exceeds the
amounts of such repurchase obligation, and which required
liquidation of the collateral immediately upon the amount of such
collateral being less than the amount of such repurchase
obligation (unless the counterparty immediately satisfies the
repurchase obligation upon being notified of such shortfall); or
(vi) commercial paper master notes where the issuer has, at the
time of the Master Trust's investment or contractual commitment
to invest therein, a rating not lower than the highest investment
category for short term unsecured debt obligations granted by the
applicable Rating Agency from each Rating Agency then Rating the
Series 2000-1; and
(b) any other investment consisting of a financial asset that by its
terms converts to cash within a finite period of time, provided that
the Rating Agency Condition is satisfied.
Unless the Rating Agency Condition is satisfied, Eligible Investments
of funds in the Series Principal Account and the Liquidity Reserve Account will
be subject to the following additional restrictions: (x) no more than the
greater of (A) $1,000,000 and (B) 20% of the aggregate Eligible Investments in
all such accounts collectively shall be obligations of or investments in any
single issuer (except that such 20% limitation shall not apply to Eligible
Investments of the type specified in clause (a)(i)); and (y) each Eligible
Investment shall be denominated and be payable solely in U.S. dollars, shall
bear interest at a specified rate that is, or is based upon, LIBOR or a
commercial paper rate, shall entitle the holder to a fixed principal amount at
maturity and shall have a yield that is not inversely or disproportionately
affected by changes in interest rates.
"Excess Seller's Percentage" shall mean, with respect to any Due
Period, a percentage (which percentage shall never be less than 0% nor more than
100%) equal to the excess of (a) the Seller's Percentage for such Due Period,
over (b) the percentage equivalent (which percentage shall never be less than 0%
nor more than 100%) of a fraction, the numerator of which is the Available
Subordinated Amount as of the end of the related Transfer Date and the
denominator of which is the product of (x) the sum of the aggregate principal
amount of Dealer Notes in the Master Trust and the aggregate principal amount of
funds on deposit in the Excess Funding Account, both as of the end of the
immediately preceding Due Period and (y) the Series 2000-1 Allocation Percentage
for the Due Period for which the Excess Seller's Percentage is being calculated.
"Excess Seller's Principal Collections" shall mean, with respect to
any Business Day during a Due Period, the product of (a) Series Allocable
Principal Collections for such Business Day and (b) the Excess Seller's
Percentage for such Due Period.
"Expected Principal Payment Date" shall mean the June 2005
Distribution Date.
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"Floating Allocation Percentage" shall mean, with respect to any Due
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Invested Amount as of the immediately
preceding Distribution Date (after giving effect to all increases and reductions
thereof on such Distribution Date) and the denominator of which is the product
of (a) the sum of the aggregate principal amount of Dealer Notes in the Master
Trust and the aggregate principal amount of funds on deposit in the Excess
Funding Account, both as of the end of the immediately preceding Due Period, and
(b) the Series 2000-1 Allocation Percentage for the Due Period for which the
Floating Allocation Percentage is being calculated.
"Initial Distribution Period" shall mean the period from July 13, 2000
through August 24, 2000.
"Initial Invested Amount" shall mean the sum of the Class A Initial
Invested Amount and the Class B Initial Invested Amount.
"Initial Spread Account Required Amount" shall mean $2,650,000.
"Invested Amount" shall mean, with respect to any Distribution Date,
the sum of the Class A Invested Amount as of such Distribution Date and the
Class B Invested Amount as of such Distribution Date.
"Investment Income" shall mean, for any Due Period with respect to
Series 2000-1, the sum of (i) income (net of investment expenses and losses)
during such Due Period from the investment of funds on deposit in the Series
Principal Account and the Spread Account and (ii) the product of (a) the Series
Allocation Percentage for such Due Period and (b) income (net of investment
expenses and losses) from the investment of funds on deposit in the Collections
Account and the Excess Funding Account.
"Investor Dealer Note Losses" shall mean, with respect to any Due
Period , the product of (a) the Floating Allocation Percentage for such Due
Period and (b) Series Allocable Dealer Note Losses for such Due Period.
"Investor Finance Charge Collections" shall mean, with respect to any
Due Period, an amount equal to the product of (a) the Floating Allocation
Percentage for such Due Period and (b) Series Allocable Finance Charge
Collections for such Due Period.
"Investor Principal Collections" shall mean, with respect to any
Business Day, the sum of (a) the product of (i) with respect to the Revolving
Period, the Floating Allocation Percentage and with respect to the Accumulation
Period or any Early Amortization Period, the Principal Allocation Percentage, in
either case for the Due Period in which such Business Day occurs and (ii) Series
Allocable Principal Collections for such Business Day and (b) on any Transfer
Date, the amount, if any, of Available Certificateholder Interest Collections
treated as Investor Principal Collections pursuant to Sections 4.04(a)(iv), (v)
and (vi).
"Investor Servicing Fee" shall have the meaning specified in Section
3.01.
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"ITEC" shall mean International Truck and Engine Corporation (formerly
known as Navistar International Transportation Corp.).
"LIBOR" shall mean the interest rate determined by the Master Trust
Trustee in accordance with the following provisions:
(i) On each LIBOR Determination Date, LIBOR will be determined on the
basis of the offered rates for deposits in United States Dollars having a
one month maturity, which appear on the Reuters Screen LIBO Page as of
11:00 A.M., London time, on such LIBOR Determination Date. Such posted
offered rates are for value on the second Business Day after which dealings
in deposits in United States Dollars are transacted in the London interbank
market. If at least two such offered rates appear on the Reuters Screen
LIBO Page, the rate in respect of such LIBOR Determination Date will be the
arithmetic mean (rounded, if necessary, to the nearest one
hundred-thousandth of a percent) of such offered rates as determined by the
Master Trust Trustee. If fewer than two offered rates appear, LIBOR in
respect of such LIBOR Determination Date will be determined as if the
parties had specified the rate described in (ii) below.
(ii) On any LIBOR Determination Date on which fewer than two offered
rates appear on the Reuters Screen LIBO Page as specified in (i) above,
LIBOR will be determined on the basis of the rates at which deposits in
United States Dollars are offered by the Reference Banks at approximately
11:00 A.M., London time, on such LIBOR Determination Date to prime banks in
the London interbank market, having a one month maturity, such deposits
commencing on the second Business Day immediately following such LIBOR
Determination Date and in a principal amount of not less than U.S.
$1,000,000 that is representative for a single transaction in such market
at such time. The Master Trust Trustee will request the principal London
office of each of such Reference Banks to provide a quotation of its rate.
If at least two such quotations are provided, LIBOR in respect of such
LIBOR Determination Date will be the arithmetic mean (rounded, if
necessary, to the nearest one hundred-thousandth of a percent) of such
quotations. If fewer than two quotations are provided, LIBOR in respect of
such LIBOR Determination Date will be the arithmetic mean (rounded, if
necessary, to the nearest one hundred-thousandth of a percent) of the rates
quoted by three major banks in The City of New York selected by the Master
Trust Trustee at approximately 11:00 A.M., New York City time, on such
LIBOR Determination Date for loans in United States Dollars to leading
European banks, having a one month maturity, such loans commencing on the
second Business Day immediately following such LIBOR Determination Date and
in a principal amount of not less than U.S. $1,000,000 that is
representative for a single transaction in such market at such time,
provided, however, that if the banks in The City of New York selected as
aforesaid by the Master Trust Trustee are not quoting as mentioned in this
sentence, LIBOR with respect to such LIBOR Determination Date will be LIBOR
in effect immediately prior to such LIBOR Determination Date.
"LIBOR Determination Date" shall mean, with respect to any
Distribution Period, the date which is two Business Days prior to the start of
such Distribution Period, or with respect to the Initial Distribution Period is
July 11, 2000.
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"Liquidity Reserve Account" shall have the meaning specified in
Section 4.02(c)(i).
"Maximum Subordinated Amount" shall mean, with respect to any Transfer
Date, the product of (a) the Invested Amount as of the preceding Distribution
Date and (b) the Subordinated Percentage; provided, however, that with respect
to a Transfer Date related to a Due Period occurring during an Early
Amortization Period, the Maximum Subordinated Amount shall not decline until the
Invested Amount equals the Maximum Subordinated Amount, and thereafter the
Maximum Subordinated Amount shall equal the Invested Amount.
"Minimum Series 2000-1 Seller's Interest" shall mean, with respect to
any Business Day, the sum of (a) the Available Subordinated Amount as of the end
of the preceding Transfer Date and (b) the Required Excess Seller Interest as of
the end of the preceding Distribution Date.
"Monthly Servicing Fee" shall have the meaning specified in Section
3.01.
"New Vehicle Monthly Interest Rate" shall mean, with respect to any
Due Period, the product of (a) the per annum rate of interest and finance
charges billed by NFC during such Due Period on New Vehicle Dealer Notes and (b)
the quotient of (i) the number of days during such Due Period and (ii) the
actual number of days in the related calendar year.
"Portfolio Yield" shall mean, with respect to any Due Period, the
product of (a) the quotient of (i) Finance Charges for such Due Period and (ii)
the daily average principal amount of Dealer Notes outstanding during such Due
Period and (b) a fraction, the numerator of which is 365 and the denominator of
which is the actual number of days elapsed during such Due Period. Portfolio
Yield shall be expressed as a percentage, and shall be rounded to the nearest
one-hundredth of a percentage point.
"Principal Allocation Percentage" shall mean, with respect to any Due
Period occurring during the Accumulation Period or any Early Amortization
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Invested Amount as of the end of the
Revolving Period and the denominator of which is equal to the product of (a) the
sum of the aggregate amount of Dealer Notes in the Master Trust and the
aggregate principal amount of funds on deposit in the Excess Funding Account,
both as of the end of the Revolving Period and (b) the Series 2000-1 Allocation
Percentage for the Due Period for which the Principal Allocation Percentage is
being calculated.
"Principal Shortfall" shall mean, with respect to Series 2000-1, the
Series 2000-1 Principal Shortfall.
"Projected Dealer Note Income" shall mean, on any Transfer Date, an
amount equal to the sum of (a) the product of (i) the principal amount of Dealer
Notes financing new vehicles outstanding on such Transfer Date, (ii) the New
Vehicle Monthly Interest Rate for the Due Period in which such Transfer Date
occurs and (iii) the Series 2000-1 Allocation Percentage for such Due Period and
(b) the product of (i) the principal amount of Dealer Notes financing used
vehicles outstanding on such Transfer Date, (ii) the Used Vehicle Monthly
Interest Rate for such Due Period and (iii) the Series 2000-1 Allocation
Percentage for such Due Period.
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"Projected Monthly Interest" shall mean, on any Transfer Date with
respect to the Distribution Period immediately following such Transfer Date, an
amount equal to the sum of (1) the product of (A) the Class A Certificate Rate
for the Distribution Period immediately following such Transfer Date, (B) the
Class A Invested Amount (calculated without giving effect to clauses (b) and (c)
of the definition thereof) as of such Transfer Date and (C) the result of (i)
the actual number of days in such immediately following Distribution Period
divided by (ii) 360 and (2) the product of (A) the Class B Certificate Rate for
the Distribution Period immediately following such Transfer Date, (B) the Class
B Invested Amount (calculated without giving effect to clauses (b) and (c) of
the definition thereof) as of such Transfer Date and (C) the result of (i) the
actual number of days in such immediately following Distribution Period divided
by (ii) 360.
"Projected Monthly Servicing Fee" shall mean, on any Transfer Date
with respect to the Due Period in which such Transfer Date occurs, an amount
equal to one-twelfth of the product of (a) 1%, (b) the aggregate principal
amount of Dealer Notes as of such Transfer Date, (c) the Series 2000-1
Allocation Percentage for the Due Period related to such Transfer Date and (d)
the Floating Allocation Percentage for the Due Period related to such Transfer
Date.
"Projected Spread" shall mean, on any Transfer Date with respect to
the Distribution Period next following the Distribution Period to which such
Transfer Date relates, the sum of (a) the positive amount, if any, by which (i)
the sum of (A) Projected Monthly Interest for such Distribution Period and (B)
the Projected Monthly Servicing Fee for the Due Period in which such Transfer
Date occurs exceeds (ii) the Projected Dealer Note Income as of such Transfer
Date and (b) 1.25% of the Invested Amount as of the preceding Distribution Date.
"Reassignment Amount" shall mean, with respect to any Distribution
Date, after giving effect to any deposits and distributions otherwise to be made
on such Distribution Date, the sum of (a) the Invested Amount on such
Distribution Date, and (b) accrued and unpaid interest thereon.
"Reference Banks" shall mean the principal London offices of Xxxxxx
Guaranty Trust Company of New York, Swiss Bank Corporation and Barclays Bank
PLC.
"Remaining Available Seller's Principal Calculations" shall have the
meaning specified in Section 4.08(d).
"Required Excess Seller Interest" shall mean, with respect to any
Business Day, 3.0% of the Invested Amount as of the end of the preceding
Distribution Date (and such percentage shall be the "Required Excess Seller
Interest Percentage").
"Required Subordinated Amount" shall mean, with respect to any
Transfer Date related to a Due Period, an amount equal to 79.0% of the Maximum
Subordinated Amount as of such Transfer Date.
"Revolving Due Period" shall have the meaning specified in Section
4.12.
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"Revolving Period" shall mean, unless an Early Amortization Event
shall have occurred prior thereto, the period beginning on the Closing Date and
ending on the earlier of (a) the close of business on the Business Day
immediately preceding the Accumulation Period Commencement Date and (b) the
close of business on the Business Day immediately preceding the day on which an
Early Amortization Event occurs.
"Seller's Percentage" shall mean, with respect to any Due Period, 100%
minus (a) the Floating Allocation Percentage for such Due Period, when used with
respect to Finance Charge Collections and Dealer Note Losses at all times or
Principal Collections during the Revolving Period, and (b) the Principal
Allocation Percentage for such Due Period, when used with respect to Principal
Collections during the Accumulation Period or any Early Amortization Period.
"Seller's Principal Collections" shall mean, with respect to any
Business Day, an amount equal to the sum of (a) Available Seller's Principal
Collections for such Business Day and (b) Excess Seller's Principal Collections
for such Business Day.
"Series 2000-1" shall mean the Series of Investor Certificates, the
terms of which are specified in this Series Supplement.
"Series 2000-1 Accounts" shall mean, collectively, the Series
Principal Account, the Distribution Account maintained for the Series 2000-1
Certificateholders, the Liquidity Reserve Account and the Spread Account.
"Series 2000-1 Accumulation Period Principal Shortfall" shall mean,
with respect to any Business Day occurring during the Accumulation Period, the
excess, if any, of the Controlled Deposit Amount for the Due Period in which
such Business Day occurs over the amount of Investor Principal Collections
deposited in the Series Principal Account on such Business Day when added to the
amount of Investor Principal Collections previously deposited in the Series
Principal Account during such Due Period.
"Series 2000-1 Allocation Percentage" shall mean the Series Allocation
Percentage with respect to Series 2000-1.
"Series 2000-1 Certificateholders" shall mean the Class A
Certificateholders and the Class B Certificateholders.
"Series 2000-1 Certificateholders' Interest" shall mean that portion
of the Certificateholders' Interest evidenced by the Series 2000-1 Certificates.
"Series 2000-1 Certificates" shall mean the Class A Certificates and
the Class B Certificates.
"Series 2000-1 Principal Shortfall" shall equal either (a) with
respect to any Business Day occurring during the Accumulation Period, the Series
2000-1 Accumulation Period Principal Shortfall or (b) with respect to any
Business Day during any Early Amortization Period, the excess, if any, of the
Invested Amount (reduced by (i) amounts on deposit in the Series Principal
Account and (ii) the aggregate amount of Series Principal Account Losses for the
Due Period in which such
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Business Day occurs) as of the immediately preceding Distribution Date over
Investor Principal Collections for such Business Day.
"Series 2000-1 Rating Agency Condition" shall mean, with respect to
any action, that each Rating Agency shall have notified the Seller, the
Servicer, and the Master Trust Trustee in writing that such action will not
result in a reduction or withdrawal of the rating of the Series 2000-1
Certificates with respect to which it is a Rating Agency.
"Series 2000-1 Shared Principal Collections" shall have the meaning
specified in Section 4.09(b).
"Series 2000-1 Shared Seller Principal Collections" shall have the
meaning specified in Section 4.08(d)(iv).
"Series Allocable Dealer Note Losses" shall mean, with respect to any
Due Period, the product of (a) the Series 2000-1 Allocation Percentage for such
Due Period and (b) Dealer Note Losses for such Due Period.
"Series Allocable Finance Charge Collections" shall mean, with respect
to any Due Period, the product of (a) the Series 2000-1 Allocation Percentage
for such Due Period and (b) the amount of Finance Charge Collections for such
Due Period.
"Series Allocable Principal Collections" shall mean, with respect to
any Business Day, the sum of (a) the product of (i) the Series 2000-1 Allocation
Percentage for the related Due Period and (ii) the amount of Principal
Collections deposited in the Collections Account on such Business Day and (b) if
the Accumulation Period Commencement Date occurs on such Business Day, the
product of (i) the Series 2000-1 Allocation Percentage for such Due Period and
(ii) the amount of funds on deposit in the Excess Funding Account on such
Accumulation Period Commencement Date.
"Series Invested Amount" shall mean, with respect to Series 2000-1,
the Invested Amount.
"Series Principal Account" shall have the meaning specified in Section
4.02(a)(i).
"Series Principal Account Losses" shall mean losses of principal on
investment of funds in the Series Principal Account.
"Series Termination Date" shall mean the June 2008 Distribution Date.
"Specified Accumulation Period Commencement Date" shall mean September
1, 2004.
"Spread Account" shall have the meaning specified in Section
4.02(b)(i).
"Spread Account Deposit Amount" shall mean, with respect to any
Transfer Date prior to the commencement of an Early Amortization Period, the
amount, if any, by which the
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Projected Spread for that Transfer Date exceeds the amount of funds on deposit
in the Spread Account.
"Subject Month" shall have the meaning specified in Section 4.12.
"Subordinated Percentage" shall mean 9.0%.
"Turnover" shall have the meaning specified in Section 6.01(k).
"Used Vehicle Monthly Interest Rate" shall mean, with respect to any
Due Period, the product of (i) the per annum rate of interest and finance
charges billed by NFC during such Due Period on Used Vehicle Dealer Notes and
(ii) the quotient of (a) a number equal to the number of days during such Due
Period and (b) the actual number of days in the related calendar year.
"Weighted Average Certificate Rate" shall mean, for any Distribution
Period, the sum of (i) the Class A Certificate Rate for such Distribution
Period, multiplied by a fraction, (a) the numerator of which is the Class A
Invested Amount as of the first day of such Distribution Period and (b) the
denominator of which is the Invested Amount as of the first day of such
Distribution Period, plus (ii) the Class B Certificate Rate for such
Distribution Period, multiplied by a fraction, (a) the numerator of which is the
Class B Invested Amount as of the first day of such Distribution Period and (b)
the denominator of which is the Invested Amount as of the first day of such
Distribution Period.
(b) Notwithstanding anything to the contrary in this Series Supplement
or the Agreement, the term "Rating Agency" shall mean, whenever used in this
Series Supplement or the Agreement with respect to Series 2000-1, Moody's and
Standard & Poor's. As used in this Series Supplement and in the Agreement with
respect to Series 2000-1, "highest investment category" shall mean (i) in the
case of Standard & Poor's, A-1+, AAA, AAAm, or AAAm-G, as applicable, and (ii)
in the case of Moody's, P-1 or Aaa, as applicable.
(c) All capitalized terms used herein and not otherwise defined herein
have the same meanings ascribed to them in the Agreement.
(d) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Series Supplement shall refer to this Series Supplement
as a whole and not to any particular provision of this Series Supplement;
references to any Article, Section or Exhibit are references to Articles,
Sections and Exhibits in or to this Series Supplement unless otherwise
specified; and the term "including" means "including without limitation."
(e) As used in this Series Supplement, references to the Available
Subordinated Amount "as of the end" of a Transfer Date shall mean the Available
Subordinated Amount as of such Transfer Date, after giving effect to all
increases and reductions thereof pursuant to Article IV hereof.
(f) As used in this Series Supplement, accounting terms which are not
defined, and accounting terms partly defined, herein shall have the respective
meanings given to them under generally accepted accounting principles as in
effect on the date hereof. To the extent that the
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definitions of accounting terms in this Series Supplement are inconsistent with
the meanings of such terms under generally accepted accounting principles, the
definitions contained in this Series Supplement will control.
(g) With respect to any Distribution Date or Transfer Date, the
"related Due Period" and the "related Distribution Period" will mean the Due
Period and Distribution Period, respectively, immediately preceding such
Distribution Date or Transfer Date, and the relationships between Due Periods
and Distribution Periods will be correlative to the foregoing relationships.
With respect to any LIBOR Determination Date, the "related Distribution Period"
will mean the Distribution Period beginning on the Distribution Date immediately
following such LIBOR Determination Date.
(h) Each defined term used in this Series Supplement has a comparable
meaning when used in its plural or singular form. Each gender-specific term used
in this Series Supplement has a comparable meaning whether used in a masculine,
feminine or gender-neutral form.
ARTICLE III
SERVICING FEE
SECTION 3.01 Servicing Compensation. The monthly servicing fee (the
"Monthly Servicing Fee") shall be payable to the Servicer, in arrears, on each
Distribution Date in respect of a Due Period (or portion thereof) occurring
prior to the earlier of the first Distribution Date following the Series
Termination Date and the first Distribution Date on which the Invested Amount is
zero, in an amount equal to one-twelfth of the result of (a) 1% multiplied by
(b) the aggregate principal amount of Dealer Notes outstanding as of the last
day of such Due Period and multiplied by (c) the Series 2000-1 Allocation
Percentage with respect to such Due Period. The share of the Monthly Servicing
Fee allocable to the Series 2000-1 Certificateholders with respect to any
Transfer Date (the "Investor Servicing Fee") shall be equal to the product of
(a) the Monthly Servicing Fee and (b) the Floating Allocation Percentage with
respect to such Due Period. The remainder of the Monthly Servicing Fee shall be
paid by the Seller and in no event shall the Master Trust, the Master Trust
Trustee or the Series 2000-1 Certificateholders be liable for the share of the
Monthly Servicing Fee to be paid by the Seller; and the remainder of the
Servicing Fee shall be paid by the Seller and the Investor Certificateholders of
other Series and the Series 2000-1 Certificateholders shall in no event be
liable for the share of the Servicing Fee to be paid by the Seller or the
Investor Certificateholders of other Series. The Investor Servicing Fee shall be
payable to the Servicer solely to the extent amounts are available for
distribution in accordance with the terms of this Series Supplement.
The Servicer will be permitted, in its sole discretion, to waive the
Monthly Servicing Fee for any Distribution Date by notice to the Master Trust
Trustee on or before the related Determination Date; provided, however, that the
Servicer believes that sufficient Series Allocable Finance Charge Collections
will be available on any future Distribution Date to pay the Investor Servicing
Fee relating to the waived Monthly Servicing Fee. If the Servicer so waives the
Monthly Servicing Fee for any Distribution Date, the Monthly Servicing Fee and
the Investor Servicing Fee for such Distribution Date shall be deemed to be zero
for all purposes of this Series Supplement and the Agreement; provided, however,
that such Investor Servicing Fee shall be paid on a future date solely to the
extent amounts are available therefor pursuant to Section 4.04(a)(viii); and
provided
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further that, to the extent any such waived Investor Servicing Fee is so paid,
the related portion of the Monthly Servicing Fee to be paid by the Seller shall
be paid by the Seller to the Servicer.
ARTICLE IV
RIGHTS OF SERIES 2000-1 CERTIFICATEHOLDERS
AND ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 4.01 Rights of the Series 2000-1 Certificateholders. The Series
2000-1 Certificates shall represent fractional undivided interests in the Master
Trust, consisting of the right to receive, to the extent necessary to make the
required payments with respect to the Series 2000-1 Certificates at the times
and in the amounts and priorities specified in this Series Supplement,
Collections allocated to Series 2000-1 pursuant to Article IV of the Agreement
and this Article IV, funds on deposit in the Collections Account and the Excess
Funding Account allocable to Series 2000-1 Certificateholders pursuant to
Article IV of the Agreement and this Article IV, and funds on deposit in the
Series 2000-1 Accounts (collectively, the "Series 2000-1 Certificateholders'
Interest"), it being understood that the Series 2000-1 Certificates shall not
represent any interest in any Series Account or Enhancement for the benefit of
any other Series or Class. The Servicer shall apply, or instruct the Master
Trust Trustee to apply, all funds on deposit in the Collections Account and
Excess Funding Account allocable to the Series 2000-1 Certificates, and all
funds on deposit in the Series Principal Account, the Spread Account and the
Distribution Account maintained for the Series 2000-1 Certificateholders, as
described in this Article IV.
SECTION 4.02 Establishment of Series Principal Account, Spread Account and
Liquidity Reserve Account.
(a) Series Principal Account.
(i) On or prior to the commencement of an Early Amortization Period
or the Accumulation Period, the Master Trust Trustee, for the benefit of
the Series 2000-1 Certificateholders, shall establish and maintain in the
name of the Master Trust an Eligible Deposit Account bearing a designation
clearly indicating that the funds deposited therein are held for the
benefit of the Series 2000-1 Certificateholders (the "Series Principal
Account"). The Master Trust Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Series Principal
Account and in all proceeds thereof. Pursuant to authority granted to it
pursuant to Section 3.01(b) of the Agreement, the Servicer shall have the
revocable power to instruct the Master Trust Trustee to withdraw funds from
the Series Principal Account for the purpose of carrying out the duties of
the Servicer under this Series Supplement and the Agreement. The Servicer
at all times shall maintain accurate records reflecting each transaction in
the Series Principal Account.
(ii) Funds on deposit in the Series Principal Account overnight or
for a longer period shall at all times be invested in Eligible Investments
at the direction of the Servicer or its agent, subject to the restrictions
set forth in the Agreement and subject to the requirement that each such
Eligible Investment shall have a stated maturity on or prior to the
following Transfer Date (or such longer maturity as shall be allowed upon
satisfaction of the Series 2000-1 Rating Agency Condition). Net interest
and earnings (less investment
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expenses) on funds on deposit in the Series Principal Account, if any,
shall be allocated and distributed as provided in Section 4.04(a).
(b) Spread Account.
(i) On or prior to the Closing Date, the Master Trust Trustee, for
the benefit of the Series 2000-1 Certificateholders, shall cause to be
established and maintained in the name of the Master Trust, an Eligible
Deposit Account bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Series 2000-1
Certificateholders (the "Spread Account"). The Master Trust Trustee shall
possess all right, title and interest in all funds on deposit from time to
time in the Spread Account and in all proceeds thereof. Pursuant to
authority granted to it pursuant to Section 3.01(b) of the Agreement, the
Servicer shall have the revocable power to instruct the Master Trust
Trustee to withdraw funds from the Spread Account for the purpose of
carrying out the duties of the Servicer under this Series Supplement and
the Agreement. The Servicer at all times shall maintain accurate records
reflecting each transaction in the Spread Account. On the Closing Date, the
Seller shall deposit into the Spread Account an amount equal to the Initial
Spread Account Required Amount.
(ii) Funds on deposit in the Spread Account overnight or for a
longer period shall at all times be invested in Eligible Investments at the
direction of the Servicer or its agent, subject to the restrictions set
forth in the Agreement and subject to the requirement that each such
Eligible Investment shall have a stated maturity on or prior to the
following Transfer Date. Net interest and earnings (less investment
expenses) on funds on deposit in the Spread Account, if any, shall be
allocated and distributed as provided in Section 4.04.
(iii) On any Transfer Date on which the amount of funds on deposit
in the Spread Account is greater than the Projected Spread on such Transfer
Date, the Servicer shall withdraw the amount of such excess from the Spread
Account and allocate and pay such excess to the Seller.
(iv) Upon the commencement of and during an Early Amortization
Period, the Master Trust Trustee will deposit all funds in the Spread
Account into the Liquidity Reserve Account, and no additional funds shall
be deposited into the Spread Account.
(c) Liquidity Reserve Account.
(i) The Master Trust Trustee, for the benefit of the Seller, shall
establish on or prior to the commencement of an Early Amortization Period
and maintain or cause to be established and maintained in the name of the
Master Trust Trustee, an Eligible Deposit Account bearing a designation
clearly indicating that the funds deposited therein are held for the
benefit of the Seller (the "Liquidity Reserve Account"). The Seller shall
possess all right, title and interest in all funds on deposit from time to
time in the Liquidity Reserve Account and in all proceeds thereof;
provided, however, that no funds on deposit in the Liquidity Reserve
Account shall be paid to the Seller if such payment would reduce the funds
in such account below an amount equal to the Available Subordinated Amount.
Pursuant to authority
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granted to it pursuant to Section 3.01(b) of the Agreement, the Servicer
shall have the revocable power to instruct the Master Trust Trustee to
withdraw funds from the Liquidity Reserve Account for the purpose of
fulfilling the obligations of the Seller under this Series Supplement and
the Agreement. The Servicer at all times shall maintain accurate records
reflecting transactions in the Liquidity Reserve Account.
(ii) Funds on deposit in the Liquidity Reserve Account overnight or
for a longer period shall at all times be invested in Eligible Investments
at the direction of the Seller or its agent, subject to the restrictions
set forth in the Agreement. Any Eligible Investment with a stated maturity
shall mature on or prior to the following Transfer Date. All net interest
and earnings (less investment expenses) on funds on deposit in the
Liquidity Reserve Account, if any, shall be paid to the Seller. On any
Transfer Date on which the amount on deposit in the Liquidity Reserve
Account exceeds the Available Subordinated Amount as of the end of such
Transfer Date, the Servicer shall withdraw the amount of such excess from
the Liquidity Reserve Account and allocate and pay such excess to the
Seller.
(d) Replacement Series 2000-1 Accounts. If, at any time, any of the
Series 2000- 1 Accounts ceases to be an Eligible Deposit Account, the Master
Trust Trustee (or the Servicer on its behalf) shall upon the earlier of (a) 30
calendar days, or (b) the next Determination Date, establish a new Series 2000-1
Account meeting the conditions specified in paragraphs (a), (b) or (c) above, as
applicable, as an Eligible Deposit Account and shall transfer any cash and/or
any investments to such new Series 2000-1 Account. Neither the Seller, the
Servicer nor any person or entity claiming by, through or under the Seller, the
Servicer or any such person or entity shall have any right, title or interest
in, or any right to withdraw any amount from, any Series 2000-1 Account, except
as expressly provided herein.
SECTION 4.03 [Reserved.]
SECTION 4.04 Application of Available Certificateholder Interest
Collections.
(a) Application of Available Certificateholder Interest Collections. On
each Transfer Date related to a Due Period, the Master Trust Trustee, acting in
accordance with instructions from the Servicer, shall apply Available
Certificateholder Interest Collections for such Due Period in the following
amounts and in the following order of priority:
(i) Investor Servicing Fee. An amount equal to the Investor
Servicing Fee for such Due Period (unless such amount has been netted
against deposits to the Collections Account or waived) shall be allocated
and paid to the Servicer.
(ii) Class A Monthly Interest. An amount equal to Class A Monthly
Interest for the related Distribution Period, plus any Class A Monthly
Interest due with respect to any prior Distribution Period but not
previously distributed to the Class A Certificateholders on a prior
Distribution Date, plus to the extent permitted by law, additional interest
at the Class A Certificate Rate for such Distribution Period that has
accrued on Class A Monthly Interest that was due pursuant to this clause
(ii) but was not previously distributed to the Class A Certificateholders
on a prior Distribution Date shall be deposited in the Distribution
Account.
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(iii) Class B Monthly Interest. An amount equal to Class B Monthly
Interest for the related Distribution Period, plus any Class B Monthly
Interest due with respect to any prior Distribution Period but not
previously distributed to the Class B Certificateholders on a prior
Distribution Date, plus to the extent permitted by law, additional interest
at the Class B Certificate Rate for such Distribution Period that has
accrued on Class B Monthly Interest that was due pursuant to this clause
(iii) but was not previously distributed to the Class B Certificateholders
on a prior Distribution Date shall be deposited in the Distribution
Account.
(iv) Investor Dealer Note Losses. An amount equal to the Investor
Dealer Note Losses, if any, for such Due Period shall be treated as
Investor Principal Collections for such Transfer Date and shall reimburse
an equal amount of Investor Dealer Note Losses.
(v) Reimbursement of Class A Certificateholder Charge-Offs. An
amount equal to the aggregate amount of unreimbursed Class A
Certificateholder Charge-Offs, if any, for any prior Due Period shall be
treated as Investor Principal Collections for such Transfer Date and shall
reimburse an equal amount of Class A Certificateholder Charge-Offs.
(vi) Reimbursement of Class B Certificateholder Charge-Offs. An
amount equal to the aggregate amount of unreimbursed Class B
Certificateholder Charge-Offs, if any, for any prior Due Period shall be
treated as Investor Principal Collections for such Transfer Date and shall
reimburse an equal amount of Class B Certificateholder Charge-Offs.
(vii) Spread Account Deposit Amount. An amount equal to the Spread
Account Deposit Amount, if any, for such Transfer Date shall be deposited
into the Spread Account.
(viii) Deferred Investor Servicing Fee. An amount equal to the
aggregate outstanding amounts of the Investor Servicing Fee which have been
previously waived pursuant to Section 3.01 (unless such amounts have been
waived again) shall be allocated and paid to the Servicer.
(ix) Reinstatement of Available Subordinated Amount. An amount equal
to the excess, if any, of the Maximum Subordinated Amount as of the end of
the preceding Transfer Date over the Available Subordinated Amount as of
the end of the preceding Transfer Date shall be (A) during the Revolving
Period or the Accumulation Period, allocated and paid to the Seller or (B)
during an Early Amortization Period, deposited in the Liquidity Reserve
Account, and in either case (A) or (B) the Available Subordinated Amount
shall be reinstated by the amount of such payment or deposit.
(x) Excess Interest Collections. Any remaining Available
Certificateholder Interest Collections shall be treated as Excess Interest
Collections, and applied pursuant to Section 4.03(f) of the Agreement.
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If Available Certificateholder Interest Collections are not sufficient to
satisfy each of the applications described in clauses (i) through (ix) above on
any Transfer Date, then Excess Interest Collections from other Series allocable
to Series 2000-1 will be applied as Available Certificateholder Interest
Collections in the priority and the manner described in clauses (i) through (ix)
above. If Excess Interest Collections are less than the shortfalls for all
Series that provide for allocations of Excess Interest Collections, such Excess
Interest Collections shall be allocable to shortfalls for Series 2000- 1 and any
other Series that so provides pro rata based on the relative amounts of each
Series' shortfall.
SECTION 4.05 Application of Available Seller's Finance Charge Collections,
Spread Account and Liquidity Reserve Account to Deficiency Amount.
(a) On each Transfer Date, the Servicer shall determine the amount (the
"Deficiency Amount"), if any, by which the amount of the entire allocations
required on such Transfer Date by Sections 4.04(a)(i) through (vi) exceeds the
amount of Available Certificateholder Interest Collections for such Due Period
and Excess Interest Collections allocated to Series 2000-1 on such Transfer
Date, if any, for the related Due Period.
(b) If the Deficiency Amount for any Transfer Date is greater than
zero, the Master Trust Trustee, acting in accordance with instructions from the
Servicer, shall apply available funds from the following sources in the
following order of priority in the same manner as Available Certificateholder
Interest Collections, each of which applications shall reduce such Deficiency
Amount (all such available funds being the "Available Draw Funds" for such
Transfer Date):
(i) Available Seller's Finance Charge Collections;
(ii) funds on deposit in the Spread Account;
(iii) for any Transfer Date occurring during any Early Amortization
Period, funds on deposit in the Liquidity Reserve Account;
provided, however, that the amount applied pursuant to this Section 4.05(b)
shall not exceed the Draw Amount. The Available Subordinated Amount shall be
reduced by the aggregate amount of Available Draw Funds applied pursuant to this
Section 4.05(b).
(c) If all of the amounts applied pursuant to Section 4.05(a) and (b)
are insufficient to make the entire application described in Section
4.04(a)(iv), the Available Subordinated Amount shall be reduced (but not below
zero) by the amount of such deficiency and any remaining Investor Dealer Note
Losses shall be deemed to be reimbursed to the extent of such reduction.
SECTION 4.06 Certificateholder Charge-Offs. If, for any Transfer Date on
which the Available Subordinated Amount equals or is reduced to zero (after
giving effect to the allocations, distributions, withdrawals and deposits to be
made on such Transfer Date) and the Deficiency Amount for such Transfer Date (as
reduced by the applications required by Section 4.05 of this Series Supplement)
is greater than zero, the Invested Amount shall be reduced by the lesser of (i)
such remaining Deficiency Amount for such Transfer Date and (ii) the amount of
Investor Dealer Note Losses for the related Due Period remaining unreimbursed
after all applications of funds or reductions
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of the Available Subordinated Amount pursuant to Sections 4.04 and 4.05 (such
lesser amount being a "Certificateholder Charge-Off"). On any Transfer Date on
which Certificateholder Charge-Offs are greater than zero, such
Certificateholder Charge-Offs shall first reduce the Class B Invested Amount
(such amount being a "Class B Certificateholder Charge-Off") but not below zero;
and then reduce the Class A Invested Amount (such amount being a "Class A
Certificateholder Charge-Off") but not below zero.
SECTION 4.07 Application of Seller's Finance Charge Collections.
(a) Application of Available Seller's Finance Charge Collections. On
each Transfer Date, the Master Trust Trustee, acting in accordance with
instructions from the Servicer, shall withdraw and apply from the Collections
Account to the extent of Available Seller's Finance Charge Collections for the
related Due Period, the following amounts in the following order of priority:
(i) On each Transfer Date related to a Due Period for which a
Deficiency Amount exists, the amount required by Section 4.05(b)(i) shall
be applied as specified in Section 4.05(b).
(ii) On each Transfer Date related to a Due Period occurring during
an Early Amortization Period, the amount, if any, by which the Available
Subordinated Amount as of the end of such Transfer Date exceeds the amount
of funds on deposit in the Liquidity Reserve Account shall be deposited in
the Liquidity Reserve Account.
(iii) On each Transfer Date on which the full Spread Account Deposit
Amount was not deposited in the Spread Account pursuant to Section
4.04(a)(vii), an amount equal to the shortfall in such Spread Account
Deposit Amount shall be deposited in the Spread Account.
(iv) Any remaining Available Seller's Finance Charge Collections for
the related Due Period shall be allocated and paid to the Seller.
(b) Application of Series Allocable Finance Charge Collections to the
Seller. On each Transfer Date, the Master Trust Trustee, acting in accordance
with instructions from the Servicer, shall withdraw from the Collections Account
and allocate and pay to the Seller an amount equal to the product of (i) the
result of the Excess Seller's Percentage for such Due Period minus the Required
Excess Seller Interest Percentage and (ii) Series Allocable Finance Charge
Collections for such Due Period.
SECTION 4.08 Application of Series Allocable Principal Collections. On each
Business Day, the Master Trust Trustee, acting in accordance with instructions
from the Servicer, shall withdraw Series Allocable Principal Collections for
such Business Day from the Collections Account and apply such funds in the
following amounts:
(a) Investor Principal Collections During Revolving Period. During the
Revolving Period, an amount equal to Investor Principal Collections for such
Business Day shall be treated as
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Shared Principal Collections, and applied, pursuant to the written direction of
the Servicer, pursuant to Section 4.03(e) of the Agreement.
(b) Investor Principal Collections During Accumulation Period or Early
Amortization Period. During the Accumulation Period or any Early Amortization
Period, Investor Principal Collections for such Business Day shall be allocated
to the Series 2000-1 Certificateholders and deposited into the Series Principal
Account to the extent the Invested Amount as of the preceding Distribution Date
exceeds the amount of funds on deposit in the Series Principal Account on such
Business Day; provided, however, that for each Business Day of a Due Period
occurring during the Accumulation Period, the amount of Investor Principal
Collections deposited in the Series Principal Account on such Business Day, when
added to the amount of Investor Principal Collections previously deposited in
the Series Principal Account during such Due Period, shall not exceed the
Controlled Deposit Amount for such Due Period. Any Investor Principal
Collections remaining after the applications described in the preceding sentence
shall be treated as Shared Principal Collections, and applied, pursuant to the
written direction of the Servicer, pursuant to Section 4.03(e) of the Agreement.
(c) Seller's Principal Collections During the Revolving Period. During
the Revolving Period, all Seller's Principal Collections for such Business Day
shall be deemed to be Series 2000-1 Shared Seller Principal Collections and
shall be allocated as provided in Section 4.08(d)(iii).
(d) Seller's Principal Collections During Accumulation Period or Early
Amortization Period; Shared Seller Principal Collections.
(i) During the Accumulation Period, Available Seller's Principal
Collections for such Business Day shall be deemed to be "Remaining
Available Seller's Principal Collections," which shall be included in
Series 2000-1 Shared Seller Principal Collections and allocated as provided
in clause (iii) below. During the Accumulation Period, Excess Seller's
Principal Collections shall be included in Series 2000-1 Shared Seller
Principal Collections and allocated as provided in clause (iii) below.
(ii) During any Early Amortization Period Available Seller's
Principal Collections for such Business Day shall be deposited in the
Liquidity Reserve Account to the extent the Available Subordinated Amount
as of the end of the immediately preceding Transfer Date exceeds the amount
of funds on deposit in the Liquidity Reserve Account (including amounts
deposited pursuant to Section 4.07(a)(ii)). The amount required to be
deposited pursuant to the preceding sentence shall be reduced by the amount
of Available Seller's Finance Charge Collections deposited in the Liquidity
Reserve Account on such Business Day. Any remaining Available Seller's
Principal Collections for such Business Day shall be deemed to be
"Remaining Available Seller's Principal Collections." During any Early
Amortization Period, all Excess Seller's Principal Collections, all
Remaining Available Seller's Principal Collections and all shared seller
principal collections of any other Series that provides for shared seller
principal collections not allocated in respect of principal shortfalls
shall be allocated and paid to the Seller or deposited in the Excess
Funding Account to the extent necessary to maintain the Master Trust
Seller's Interest at an amount equal to (or, in the Seller's discretion,
greater than) the Minimum Master Trust Seller's Interest.
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(iii) During the Revolving Period or the Accumulation Period, Series
2000- 1 Shared Seller Principal Collections, if any, and shared seller
principal collections for any other Series that provides for shared seller
principal collections shall be determined on each business day and
allocated in the following priority: (i) to the 2000-1 Series to the extent
of any Series 2000-1 Accumulation Period Principal Shortfall and to any
other Series to the extent such Series provides for the use of shared
seller principal collections in respect of principal shortfalls, (ii) to
the Excess Funding Account to the extent necessary to maintain the Master
Trust Seller's Interest at an amount equal to (or, in the discretion of the
Seller, greater than) the Minimum Master Trust Seller's Interest, (iii) in
the discretion of the Seller, to make payments on the principal balance of
any variable funding certificates, and (iv) to the Seller or the holders of
the Seller's Certificates. If shared seller principal collections for all
Series, including Series 2000-1 Shared Seller Principal Collections, are
less than the shortfalls for which shared seller principal collections may
be used, including any Series 2000-1 Accumulation Period Principal
Shortfall, then such shared seller principal collections will be allocated
to all such shortfalls, including any Series 2000-1 Accumulation Period
Principal Shortfall, pro rata based on the relative amounts of each such
shortfall.
(iv) "Series 2000-1 Shared Seller Principal Collections" means on
each business day (i) during a Revolving Period, all Available Seller's
Principal Collections and all Excess Seller's Principal Collections and
(ii) during an Accumulation Period, all Remaining Available Seller's
Principal Collections and all Excess Seller's Principal Collections. There
shall be no Series 2000-1 Shared Seller Principal Collections during any
Early Amortization Period.
(e) If on any Distribution Date during an Early Amortization Period
after the application of all funds to be allocated or distributed on such date
the excess, if any, of (x) the Invested Amount over (y) the amount in the Series
Principal Account (the "Early Amortization Period Shortfall Amount") is less
than or equal to the aggregate amount of funds contained in the Liquidity
Reserve Account then funds shall be withdrawn in an amount equal to the Early
Amortization Period Shortfall Amount and shall be deposited in the Series
Principal Account.
SECTION 4.09 Shared Principal Collections.
(a) That portion of Shared Principal Collections for any Business Day
equal to the amount of Series 2000-1 Shared Principal Collections for such
Business Day will be allocated in the following priority: (i) to Series 2000-1
and applied in the same manner as Investor Principal Collections pursuant to
Section 4.08(b), (ii) deposited in the Excess Funding Account to the extent
necessary to maintain the Master Trust Seller's Interest at an amount equal to
(or, in the discretion of the Seller, greater than) the Minimum Master Trust
Seller's Interest, (iii) in the discretion of the Seller, paid on the principal
balance of any variable funding certificate or (iv) allocated to the Seller.
(b) "Series 2000-1 Shared Principal Collections," with respect to any
Business Day, shall mean an amount equal to the Series 2000-1 Principal
Shortfall for such Business Day; provided, however, that, if the aggregate
amount of Shared Principal Collections for all Series for such Business Day is
less than the aggregate amount of Principal Shortfalls for all Series for such
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Business Day, then Series 2000-1 Shared Principal Collections for such Business
Day shall equal the product of (x) Shared Principal Collections for all Series
for such Business Day and (y) a fraction, the numerator of which is the Series
2000-1 Principal Shortfall for such Business Day and denominator of which is the
aggregate amount of Principal Shortfalls for all Series for such Business Day.
SECTION 4.10 Distributions to Series 2000-1 Certificateholders. On each
Transfer Date, after all allocations to the Distribution Account and the Series
Principal Account for the related Transfer Date have been made, the Master Trust
Trustee, acting in accordance with instructions from the Servicer, shall
transfer to the Distribution Account the funds on deposit in the Series
Principal Account and on each Distribution Date shall make, without duplication,
the following distributions from the Distribution Account:
(a) Interest Distributions. On each Distribution Date (including the
Expected Principal Payment Date) first, Class A Monthly Interest will be
distributed to the Class A Certificateholders as accrued interest on the Class A
Certificates, and second, Class B Monthly Interest will be distributed to the
Class B Certificateholders as accrued interest on the Class B Certificates. To
the extent any interest is due but not distributed on any such Distribution
Date, such amount will be distributed on the following Distribution Date, along
with, to the extent permitted by law, interest at the applicable Certificate
Rate on such amount.
(b) Expected Principal Payment Date. On the Expected Principal Payment
Date, in addition to the amount described in (a) above, amounts on deposit in
the Series Principal Account will be distributed as principal (up to a maximum
of the Invested Amount on such Distribution Date) first, to the Class A
Certificateholders (up to a maximum of the Class A Invested Amount on such
Distribution Date), and second, to the Class B Certificateholders (up to a
maximum of the Class B Invested Amount on such Distribution Date).
(c) Early Amortization Period. On each Distribution Date related to a
Due Period occurring during an Early Amortization Period, in addition to the
amount described in (a) above, amounts on deposit in the Series Principal
Account will be distributed as principal first, to the Class A
Certificateholders (up to a maximum of the Class A Invested Amount on such
Distribution Date), and second, to the Class B Certificateholders (up to a
maximum of the Class B Invested Amount on such Distribution Date). Upon the
occurrence of an Early Amortization Event described in clause Section 6.01(b),
the distributions described in this Section 4.10(c) will begin on the first
Distribution Date occurring after the occurrence of such Early Amortization
Event.
SECTION 4.11 Accumulation Period Length; Accumulation Period Commencement
Date. On or prior to the Distribution Date which is ten months prior to the
Distribution Date which is the Expected Principal Payment Date, the Servicer
shall determine in its sole discretion the Accumulation Period Length and the
Accumulation Period Commencement Date and, promptly following such
determination, the Servicer shall notify the Master Trust Trustee and the Rating
Agencies in writing of such determination.
SECTION 4.12 Partial Month Due Period. The allocation and distribution
provisions in this Series Supplement are based upon the assumptions that each
Due Period will be a calendar month
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and that each Due Period will have a unique related Transfer Date and
Distribution Date. However, under certain circumstances (such as the occurrence
of an Early Amortization Event, the Revolving Period could end on a date other
than the last day of a calendar month (the period from the first day of such
month (the "Subject Month") to and including the date of such occurrence being
referred to herein as the "Revolving Due Period"), and an Early Amortization
Period could commence on a date other than the first day of a calendar month
(the period from such other date until the last day of the Subject Month being
the "Amortizing Due Period"). If such a circumstance occurs, then the Servicer,
the Seller and the Master Trust Trustee shall observe the following rules:
(i) the Transfer Date for both the Revolving Due Period and the
Amortizing Due Period shall be the date on which the Transfer Date would
have occurred if the Subject Month had been an ordinary Due Period;
(ii) the allocations and distributions of Finance Charge Collections
(and all items derived from Finance Charge Collections, such as Available
Certificateholder Interest Collections and Available Seller's Finance
Charge Collections) and Dealer Note Losses occurring during the Subject
Month shall be made as if the Subject Month were one Due Period, without
any distinction between the Revolving Due Period and the Amortizing Due
Period; and
(iii) two separate sets of allocations and distributions of
Principal Collections (and all items derived from Principal Collections,
such as Investor Principal Collections and Seller's Principal Collections)
shall be made on such Transfer Date, according to whether such Principal
Collections were received during the Revolving Due Period (in which case
allocations and distributions shall be made as provided in Sections 4.08(a)
and (c)) or the Amortizing Due Period (in which case allocations and
distributions shall be made as provided in Sections 4.08(b) and (d)).
SECTION 4.13 Additional Rights upon the Occurrence of Certain Events.
Notwithstanding the provisions of Section 9.02(a) of the Agreement, if any
insolvency event occurs with respect to the Seller, Navistar International
Corporation, International Truck and Engine Corporation or Navistar Financial
Corporation, on the day of such insolvency event, the Seller will (subject to
the actions of the Certificateholders) immediately cease to transfer Dealer
Notes to the Master Trust, and promptly give notice to the Master Trust Trustee
of such insolvency event. Under the terms of the Pooling and Servicing
Agreement, if an insolvency event occurs with respect to the Seller prior to the
date on which the Series 2000-1 Certificates issued by the Master Trust have
been paid in full, then within 15 days the Master Trust Trustee will publish a
notice of such insolvency event stating that the Master Trust Trustee intends to
sell, liquidate or otherwise dispose of the Dealer Notes in a commercially
reasonable manner and on commercially reasonable terms, unless within a
specified period of time Certificateholders representing more than 50% of the
aggregate series invested amount of the senior most outstanding Class of
Investor Certificates of each such Series and each person holding a Supplemental
Certificate, instruct the Master Trust Trustee not to sell, dispose of or
otherwise liquidate the Dealer Notes and to continue transferring Dealer Notes
as before such insolvency event.
ARTICLE V
DISTRIBUTIONS AND REPORTS
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TO SERIES 2000-1 CERTIFICATEHOLDERS
SECTION 5.01 Distributions.
(a) The Paying Agent shall distribute (in accordance with the Monthly
Servicer Certificate and Settlement Statement delivered by the Servicer to the
Master Trust Trustee and the Paying Agent pursuant to Section 3.04(d) of the
Agreement) to each Series 2000-1 Certificateholder of record on the preceding
Record Date (other than as provided in Section 12.02 of the Agreement respecting
a final distribution) on each Distribution Date such Certificateholder's pro
rata share (based on the aggregate fractional undivided interests represented by
the Series 2000-1 Certificates held by such Certificateholder) of the amounts on
deposit in the Series 2000-1 Accounts as is payable to the Series 2000-1
Certificateholders on such Distribution Date pursuant to Sections 4.10(a), (b)
and (c).
(b) Except as provided in Section 12.03 of the Agreement with respect
to a final distribution, distributions to Series 2000-1 Certificateholders
hereunder shall be made by check mailed to each Series 2000-1 Certificateholder
at such Certificateholder's address appearing in the Certificate Register
without presentation or surrender of any Series 2000-1 Certificate or the making
of any notation thereon; provided, however, that, with respect to Series 2000-1
Certificates registered in the name of a Common Depository, such distributions
shall be made to such Common Depository in immediately available funds.
SECTION 5.02 Monthly and Annual Certificateholders' Statement.
(a) Monthly Series 2000-1 Certificateholders' Statement. At least two
Business Days prior to each Distribution Date, the Servicer will provide to the
Master Trust Trustee and the Paying Agent, and on each Distribution Date, the
Paying Agent shall forward to each Series 2000-1 Certificateholder a Monthly
Servicer Certificate and Settlement Statement substantially in the form of
Exhibit B with such changes as the Servicer shall deem necessary or appropriate,
prepared by the Servicer and delivered to the Master Trust Trustee setting
forth, among other things, the following information (which, in the case of
(iii), (iv), (v), (viii), (ix) and (xi) below, will be stated on the basis of an
original principal amount of $1,000 per Series 2000-1 Certificate):
(i) the aggregate amount of Collections, including the aggregate
amount of Finance Charge Collections and the aggregate amount of Principal
Collections for the related Due Period;
(ii) the Series 2000-1 Allocation Percentage, the Floating
Allocation Percentage and the Principal Allocation Percentage (if
applicable) for the related Due Period;
(iii) the total amount, if any, to be distributed on each of the
Class A Certificates and the Class B Certificates on such Distribution
Date;
(iv) the amount, if any, of such distribution allocable to the
Invested Amount, the Class A Invested Amount and the Class B Invested
Amount;
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(v) the amount, if any, of such distribution allocable to interest
on the Class A Certificates and on the Class B Certificates;
(vi) Dealer Note Losses and Investor Dealer Note Losses for the
related Due Period;
(vii) the Draw Amount as of the related Transfer Date, if any;
(viii) the amount of Certificateholder Charge-Offs, Class A
Certificateholder Charge-Offs, Class B Certificateholder Charge-Offs and
the amount of reimbursement of each as of the related Transfer Date;
(ix) the amount of the Investor Servicing Fee to be paid on such
Distribution Date;
(x) the Controlled Deposit Amount for the related Due Period (if
applicable);
(xi) the Invested Amount, the Class A Invested Amount and the Class
B Invested Amount (after giving effect to all distributions that will occur
on such Distribution Date);
(xii) the aggregate amount of Dealer Notes and funds on deposit in
each of the Excess Funding Account, Series Principal Account and Spread
Account as of the end of the last day of the related Due Period (after
giving effect to payments and adjustments made pursuant to Article IV of
this Series Supplement and of the Agreement);
(xiii) the Available Subordinated Amount (after giving effect to
draws thereon) as of the end of the related Transfer Date;
(xiv) with respect to Eligible Investments in the Series Principal
Account, the Excess Funding Account and the Liquidity Reserve Account, as
of the last day of the related Due Period, the aggregate amount of funds
invested in Eligible Investments in each such Series Account, a brief
description of each such Eligible Investment and amount invested in each
such Eligible Investment, the rate of interest applicable to each such
Eligible Investment and the rating of each such Eligible Investment;
(xv) the Dealers with the five largest aggregate outstanding
principal amounts of Dealer Notes in the Master Trust as of the end of the
related Due Period;
(xvi) the aggregate outstanding principal amount of Dealer Notes
issued to finance each of OEM Vehicles and used vehicles as of the end of
the related Due Period;
(xvii) the percentages and all other information calculated pursuant
to Section 6.01 to determine whether an Early Amortization Event has
occurred;
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(xviii) the amount of Excess Interest Collections and Investor
Principal Collections treated as Shared Principal Collections, each for the
related Due Period, and the amount of such Excess Interest Collections and
Shared Principal Collections allocated to other Series; and
(xix) the amount of Remaining Available Seller's Principal
Collections, the amount of Excess Seller's Principal Collections and
Remaining Available Seller's Principal Collections treated as Series 2000-1
Shared Seller Principal Collections, the amount of Shared Seller Principal
Collections from other Series, and the amount of Shared Seller Principal
Collections allocated to Series 2000-1 and to other Series, each for the
related Due Period.
(b) A copy of the statement provided pursuant to subsection (a) will be
made available for inspection at the Corporate Trust Office.
(c) Annual Certificateholder's Tax Statement. On or about January 31 of
each calendar year, beginning with calendar year 2001, the Master Trust Trustee
shall furnish to the Servicer and Paying Agent a list of each Person who at any
time during the preceding calendar year was a Series 2000-1 Certificateholder
and received any payment thereon and the dates such Person held a Series 2000-1
Certificate, and the Paying Agent shall furnish to each such Series 2000-1
Certificateholder a statement prepared by the Paying Agent containing the
information prepared by the Master Trust Trustee which is required to be
contained in the statement to Series 2000-1 Certificateholders as set forth in
Sections 5.02(a)(iii)-(a)(v) above, aggregated for such calendar year or the
applicable portion thereof during which such Person was a Series 2000-1
Certificateholder, together with such other customary information as the Master
Trust Trustee or the Servicer deems necessary or desirable to enable the Series
2000-1 Certificateholders to prepare their tax returns, including information
(to be supplied by the Servicer to the Master Trust Trustee) regarding original
issue discount on the Series 2000-1 Certificates, if any. Such obligation of the
Paying Agent shall be deemed to have been satisfied to the extent that
substantially comparable information shall be provided by the Master Trust
Trustee pursuant to any requirements of the Internal Revenue Code as from time
to time in effect.
ARTICLE VI
EARLY AMORTIZATION EVENTS
SECTION 6.01 Additional Early Amortization Events. The occurrence of any of
the following events shall, immediately upon the occurrence thereof without
notice or other action on the part of the Master Trust Trustee or the Series
2000-1 Certificateholders, be deemed to be an Early Amortization Event solely
with respect to Series 2000-1:
(a) the Invested Amount is not reduced to zero by the Expected
Principal Payment Date;
(b) the United States government or any agency or instrumentality
thereof files a notice of a lien under Internal Revenue Code ss.6323 or any
similar statutory provision (including, but not limited to, ss.302(f) or ss.4068
of ERISA) on the assets of NFC or NFSC which is or may in
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the future be prior to the lien of the Master Trust Trustee or the assets of the
Master Trust (including, without limitation, proceeds of the Dealer Notes);
(c) failure on the part of the Seller (i) to make any payment,
distribution or deposit required under the Agreement within five business days
of the date required or (ii) to observe or perform in any material respect any
other material covenants or agreements of the Seller, which continues unremedied
for a period of 60 days after written notice of such failure shall have been
given to the Seller;
(d) any representation or warranty made by the Seller pursuant to the
Agreement or any information contained in the schedule of Dealer Notes delivered
thereunder or this Series Supplement shall prove to have been incorrect in any
material respect when made or when delivered, which representation, warranty or
schedule, or the circumstances or condition that caused such representation,
warranty or schedule to be incorrect, continues to be incorrect or uncured in
any material respect for a period of 60 days after written notice of such
incorrectness shall have been given to the Seller and as a result of which the
interests of the Series 2000-1 Certificateholders are materially and adversely
affected, except that an Early Amortization Event shall not be deemed to occur
if the Seller has repurchased the related Dealer Notes or all such Dealer Notes,
if applicable, during such period in accordance with the provisions of the
Agreement;
(e) the Seller shall become legally unable for any reason to transfer
Dealer Notes to the Master Trust in accordance with the provisions of the
Agreement;
(f) on any Transfer Date, the Available Subordinated Amount for such
Transfer Date will be reduced to an amount less than the Required Subordinated
Amount;
(g) any Servicer Termination Event shall occur (i) which would have a
material adverse effect on the Series 2000-1 Certificateholders and (ii) for
which the Servicer has received a notice of termination;
(h) the delivery by the Seller to the Master Trust Trustee of a notice
stating that the Seller will no longer continue to sell Dealer Notes to the
Master Trust commencing on the date specified in such notice;
(i) the Average Coverage Differential shall be equal to or less than
negative two percent (-2.00%) on each of three consecutive Determination Dates;
(j) at the end of any Due Period, the Master Trust Seller's Interest is
reduced to an amount less than the Master Trust Minimum Seller's Interest and
the Seller has failed to assign additional Dealer Notes to the Master Trust in
the amount of such deficiency within ten Business Days following the end of such
Due Period;
(k) on any Determination Date, the quotient of (i) the product of (a)
the sum of Dealer Note Collections for each of the related Due Period and the
two immediately preceding Due Periods and (b) four divided by (ii) the daily
average principal amount of Dealer Notes outstanding during such Due Periods
("Turnover") is less than 1.7;
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(l) on any Determination Date, the quotient of (i) the sum of Dealer
Note Losses for each of the related Due Period and the five immediately
preceding Due Periods and (ii) the sum of Principal Collections for each of the
related Due Period and the five immediately preceding Due Periods, is greater
than or equal to one percent (1.00%);
(m) any of the Seller, ITEC, NIC or NFC shall file a petition
commencing a voluntary case under any chapter of the federal bankruptcy laws; or
the Seller or NFC shall file a petition or answer or consent seeking
reorganization, arrangement, adjustment or composition under any other similar
applicable federal law, or shall consent to the filing of any such petition,
answer or consent; or the Seller, ITEC, NIC or NFC shall appoint, or consent to
the appointment of a custodian, receiver, liquidator, trustee, assignee,
sequestrator or other similar official in bankruptcy or insolvency of it or of
any substantial part of its property; or the Seller, ITEC, NIC or NFC shall make
an assignment for the benefit of creditors, or shall admit in writing its
inability to pay its debts generally as they become due;
(n) any order for relief against any of the Seller, ITEC, NIC or NFC
shall have been entered by a court having jurisdiction in the premises under any
chapter of the federal bankruptcy laws, and such order shall have continued
undischarged or unstayed for a period of 120 days; or a decree or order by a
court having jurisdiction in the premises shall have been entered approving as
properly filed a petition seeking reorganization, arrangement, adjustment, or
composition of the Seller, ITEC, NIC or NFC under any other similar applicable
federal law, and such decree or order shall have continued undischarged or
unstayed for a period of 120 days; or a decree or order of a court having
jurisdiction in the premises for the appointment of a custodian, receiver,
liquidator, trustee, assignee, sequestrator or other similar official in
bankruptcy or insolvency of the Seller, ITEC, NIC or NFC of any substantial part
of their property, or for the winding up or liquidation of their affairs, shall
have been entered, and such decree or order shall have remained in force
undischarged or unstayed for a period of 120 days;
(o) failure on the part of ITEC to make a deposit in the Interest
Deposit Account required by the terms of the Interest Deposit Agreement on or
before the date occurring five Business Days after the date such deposit is
required by the Interest Deposit Agreement to be made; and
(p) on any Distribution Date, as of the last day of the related Due
Period, the aggregate principal balance of Dealer Notes owned by the Master
Trust which were advanced against financed vehicles which are used vehicles
exceeds 25% of the aggregate principal balance of all Dealer Notes owned by the
Master Trust.
ARTICLE VII
OTHER SERIES PROVISIONS
SECTION 7.01 Conveyance of Dealer Notes. Upon the date on which each Series
is either no longer outstanding or the fully funded date has occurred with
respect thereto, the Master Trust Trustee shall sell, assign and convey to the
Seller or its designee, without recourse, representations or warranty, all
right, title and interest of the Master Trust in the Dealer Notes, whether then
existing or thereafter created, all security interests in the Financed Vehicles
with respect thereto, all monies
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due or to become due and all amounts received with respect thereto and all
proceeds thereof except for amounts on deposit in the Collections Account that
are allocable to Investor Certificates and amounts on deposit in any Series
Account. The Master Trust Trustee shall execute and deliver such instruments of
transfer and assignment, in each case without recourse, as shall be reasonably
requested by the Seller to vest in the Seller or its designee all right, title
and interest which the Master Trust had in all such property.
SECTION 7.02 Tax Treatment. The Seller has entered into the Agreement and
this Series Supplement and the Series 2000-1 Certificates have been issued with
the intention that the Series 2000-1 Certificates will qualify under applicable
tax law as indebtedness secured by the Master Trust assets attributable to the
Series 2000-1 Certificates. The Seller and each Series 2000-1 Certificateholder
and Certificate Owner, by the acceptance of its Series 2000-1 Certificate or
Book-Entry Certificate, as applicable, agrees to treat the Series 2000-1
Certificates as indebtedness secured by the Master Trust assets attributable to
the Series 2000-1 Certificates, for Federal income taxes, state and local income
and franchise taxes and any other taxes imposed on or measured by income in
whole or in part.
ARTICLE VIII
FINAL DISTRIBUTIONS
SECTION 8.01 Sale of Investors' Interest Pursuant to Section 2.07 of the
Agreement; Distributions Pursuant to Section 2.03 or 12.03 of the Agreement.
(a) The amount to be paid by the Seller to the Collections Account with
respect to Series 2000-1 in connection with a purchase of the
Certificateholders' Interest pursuant to Section 2.07 of the Agreement shall
equal the Reassignment Amount for the Distribution Date on which such purchase
occurs.
(b) With respect to the Reassignment Amount, if any, deposited into the
Collections Account pursuant to this Section 8.01 of this Series Supplement or
Section 2.07 of the Agreement or any proceeds deposited into the Collections
Account pursuant to Section 12.03(c) of the Agreement, the Master Trust Trustee
shall, not later than 12:00 noon, New York City time, on the Distribution Date
on which such amounts are deposited (or, if such date is not a Distribution
Date, on the immediately following Distribution Date) (in the priority set forth
below): (i) first, deposit the Invested Amount on such Distribution Date into
the Series Principal Account, (ii) second, deposit the amount of accrued and
unpaid interest on the unpaid balance of the Series 2000-1 Certificates in the
Distribution Account, and (iii) third, pay the remainder of any such
Reassignment Amounts to the Seller.
(c) Notwithstanding any other provision to the contrary in this Series
Supplement or the Agreement, the entire amount deposited in the Series Principal
Account on a Distribution Date pursuant to Section 8.01(b) and all other amounts
on deposit therein shall be distributed in full to the Series 2000-1
Certificateholders on such Distribution Date and any distribution made pursuant
to this paragraph (c) shall be deemed to be a final distribution pursuant to
Section 12.03 of the Agreement with respect to Series 2000-1.
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SECTION 8.02 Distribution of Proceeds of Sale, Disposition or Liquidation
of the Dealer Notes Pursuant to Section 9.02 of the Agreement.
(a) Not later than 12:00 noon, New York City time, on the Distribution
Date following the date on which the Insolvency Proceeds are deposited into the
Collections Account pursuant to Section 9.02(b) of the Agreement, the Master
Trust Trustee shall first (in each case, after giving effect to any deposits and
distributions otherwise to be made on such Distribution Date) deduct an amount
equal to the Invested Amount on such Distribution Date from the portion of the
Insolvency Proceeds allocated to Series Allocable Principal Collections and
deposit such amount in the Series Principal Account; provided that the amount of
such deposit shall not exceed the product of (x) the portion of the Insolvency
Proceeds allocated to Series Allocable Principal Collections and (y) 100% minus
the Excess Seller's Percentage with respect to the related Due Period. The
remainder of the portion of the Insolvency Proceeds allocated to Series
Allocable Principal Collections shall be allocated to the Master Trust Seller's
Interest and shall be distributed on such Distribution Date to the Seller.
(b) Not later than 12:00 noon, New York City time, on such Distribution
Date, the Master Trust Trustee shall (in each case, after giving effect to any
deposits and distributions otherwise to be made on such Distribution Date) (a)
first, deduct an amount equal to the sum of (i) Class A Monthly Interest for
such Distribution Date, (ii) any Class A Monthly Interest previously due but not
distributed on a prior Distribution Date and (iii) to the extent permitted by
law, interest at the Class A Certificate Rate on Class A Monthly Interest that
was due but not previously distributed to the Class A Certificateholders on a
prior Distribution Date, from the portion of the Insolvency Proceeds allocated
to Series Allocable Finance Charge Collections and deposit such amount in the
Distribution Account, and (b) second, deduct an amount equal to the sum of (i)
Class B Monthly Interest for such Distribution Date, (ii) any Class B Monthly
Interest previously due but not distributed on a prior Distribution Date and
(iii) to the extent permitted by law, interest at the Class B Certificate Rate
on Class B Monthly Interest that was due but not previously distributed to the
Class B Certificateholders on a prior Distribution Date, from the portion of the
Insolvency Proceeds allocated to Series Allocable Finance Charge Collections and
deposit such amount in the Distribution Account; provided that the sum of such
deposits shall not exceed the product of (x) the portion of the Insolvency
Proceeds allocated to Series Allocable Finance Charge Collections and (y) 100%
minus the Excess Seller's Percentage with respect to the related Due Period. The
remainder of the portion of the Insolvency Proceeds allocated to Series
Allocable Finance Charge Collections shall be allocated to the Master Trust
Seller's Interest and shall be distributed on such Distribution Date to the
Seller.
(c) Notwithstanding anything to the contrary in this Series Supplement
or the Agreement, the entire amount deposited in the Series Principal Account
and the Distribution Account pursuant to this Section 8.02 and all other amounts
on deposit therein shall be distributed in full to the Series 2000-1
Certificateholders on the Distribution Date on which funds are deposited
pursuant to this Section 8.02 (or, if not so deposited on a Distribution Date,
on the immediately following Distribution Date) and any distribution made
pursuant to this Section 8.02 shall be deemed to be a final distribution
pursuant to Section 12.03 of the Agreement with respect to Series 2000-1.
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ARTICLE IX
MISCELLANEOUS PROVISIONS
SECTION 9.01 Ratification of Agreement. As supplemented by this Series
Supplement, the Agreement is in all respects ratified and confirmed and the
Agreement as so supplemented by this Series Supplement shall be read, taken and
construed as one and the same instrument.
SECTION 9.02 Counterparts. This Series Supplement may be executed in two or
more counterparts (and by different parties on separate counterparts) each of
which shall be an original, but all of which together shall constitute one and
the same instrument.
SECTION 9.03 GOVERNING LAW. THIS SERIES SUPPLEMENT SHALL BE CONSTRUED, AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED, IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS,
WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, EXCEPT THAT THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE MASTER TRUST TRUSTEE SHALL BE DETERMINED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICT OF LAW PROVISIONS.
[END OF PAGE]
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Seller, the Servicer and the Master Trust Trustee
have caused this Series Supplement to be duly executed by their respective
officers as of the day and year first above written.
NAVISTAR FINANCIAL SECURITIES CORPORATION
as Seller
By: /s/ R. Xxxxx Xxxx
---------------------------------------
R. Xxxxx Xxxx
Vice President and Treasurer
NAVISTAR FINANCIAL CORPORATION
as Servicer
By: /s/ R. Xxxxx Xxxx
----------------------------------------
R. Xxxxx Xxxx
Vice President and Treasurer
THE BANK OF NEW YORK
as Master Trust Trustee
By: /s/ Xxxxx Xxxxxxx
----------------------------------------
Name: Xxxxx Xxxxxxx
Title: Assistant Treasurer
