EXHIBIT 10.3
CUSTODIAN AGREEMENT
BETWEEN
NAVISTAR FINANCIAL CORPORATION
CUSTODIAN
AND
NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION
SELLER
DATED AS OF NOVEMBER 6, 1996
THIS CUSTODIAN AGREEMENT, dated as of November 6,
1996 is made between Navistar Financial Corporation, a Delaware
corporation, as Custodian (the "CUSTODIAN"), and Navistar
Financial Retail Receivables Corporation, a Delaware corporation
(the "SELLER").
WHEREAS, simultaneously herewith Navistar Financial
Corporation (in its capacity as seller, "NFC") and the Seller
are entering into a Purchase Agreement of even date herewith
(the "PURCHASE AGREEMENT"), pursuant to which NFC shall sell,
transfer and assign to the Seller without recourse all of its
right, title and interest in and to the Receivables and certain
related rights and interests therein;
WHEREAS, the Purchase Agreement contemplates that the
Seller may enter into the Further Transfer and Servicing
Agreements with the Issuer, pursuant to which the Seller shall
sell, transfer and assign to the Issuer without recourse, all of
the Seller's right, title and interest in, to and under, among
other things, (a) the Receivables and (b) the custodian agreement
to be entered into simultaneously with the Further Transfer and
Servicing Agreements, pursuant to which the Seller shall
revocably appoint the Custodian as custodian of the Receivables
Files pertaining to the Receivables; and
WHEREAS, in connection with any such sale, transfer
and assignment, the Seller desires for the Custodian to act as
custodian of the Receivables for the benefit of the Issuer.
NOW, THEREFORE, in consideration of the mutual
agreements herein contained and of other good and valuable
consideration the receipt and adequacy of which are hereby
acknowledged, the parties agree as follows:
1. CERTAIN DEFINITIONS. Capitalized terms used
but not otherwise defined herein shall have the respective
meanings assigned them in Part I of APPENDIX A to the Pooling
and Servicing Agreement of even date herewith among the Issuer,
the Seller and Navistar Financial Corporation, as Servicer (as
it may be amended, supplemented or modified from time to time,
the "POOLING AND SERVICING AGREEMENT"). All references herein to
"the Agreement" or "this Agreement" are to this Custodian
Agreement as it may be amended, supplemented or modified from
time to time, the exhibits hereto and the capitalized terms used
herein which are defined in such APPENDIX A, and all references
herein to Sections and subsections are to Sections and
subsections of this Agreement unless otherwise specified. The
rules of construction set forth in Part II of such APPENDIX A
shall be applicable to this Agreement.
2. APPOINTMENT OF CUSTODIAN; ACKNOWLEDGEMENT OF
RECEIPT. Subject to the terms and conditions hereof, the Seller
hereby appoints the Custodian, and the Custodian hereby accepts
such appointment, to act as agent of the Seller as Custodian to
maintain custody of the Receivable Files pertaining to the
Receivables for which from time to time the Seller is the Holder
thereof. The Custodian hereby acknowledges that the Seller may
sell, transfer and assign all of its right, title and interest
under this Agreement to the Issuer pursuant to the Further
Transfer and Servicing Agreements. The Custodian hereby agrees,
in connection with any such sale, transfer and assignment, to
act as Custodian for the benefit of the Issuer with respect to
those Receivables of which from time to time the Issuer is the
Holder. In performing its duties hereunder, the Custodian
agrees to act with reasonable care, using that degree of skill
and attention that the Custodian exercises with respect to
receivable files relating to comparable medium and heavy duty
truck, bus and trailer receivables that the Custodian services
and holds for itself or others. The Custodian hereby
acknowledges receipt of the Receivable File for each Receivable
listed on the Schedule of Receivables.
3. MAINTENANCE AT OFFICE. The Custodian agrees to
maintain each Receivable File at its principal office at
Navistar Financial Corporation, 0000 Xxxx Xxxx Xxxx, Xxxxxxx
Xxxxxxx, Xxxxxxxx 00000, or at such other office of the
Custodian as shall from time to time be identified to the Holder
of the related Receivable upon 30 days' prior written notice.
4. DUTIES OF CUSTODIAN.
(a) SAFEKEEPING. The Custodian shall hold each
Receivable File described herein on behalf of the Holder of the
related Receivable for the use and benefit of such Holder and,
if applicable, Interested Parties and shall maintain such
accurate and complete accounts, records and computer systems
pertaining to each Receivable File described herein as shall
enable the Seller and the Issuer to comply with their respective
obligations under the Purchase Agreement and the Further
Transfer and Servicing Agreements. Each Receivable shall be
identified as such on the books and records of the Custodian to
the extent the Custodian reasonably determines to be necessary
to comply with the terms and conditions of the Purchase
Agreement and, if applicable, the Further Transfer and Servicing
Agreements. The Custodian shall conduct, or cause to be
conducted, periodic physical inspections of the Receivable Files
held by it under this Agreement, and of the related accounts,
records and computer systems, in such a manner as shall enable
the Issuer and the Custodian to verify the accuracy of the
Custodian's inventory and record keeping. The Custodian shall
promptly report to the Holder of a Receivable any failure on its
part to hold the related Receivable File described herein and
maintain its accounts, records and computer systems as herein
provided and promptly take appropriate action to remedy any such
failure.
(b) ACCESS TO RECORDS. Subject only to the
Custodian's security requirements applicable to its own
employees having access to similar records held by the
Custodian, the Custodian shall permit the Holder of a Receivable
or its duly authorized representatives, attorneys or auditors to
inspect the related Receivable File described herein and the
related accounts, records and computer systems maintained by the
Custodian pursuant hereto at such times as such Holder may
reasonably request.
(c) RELEASE OF DOCUMENTS. The Custodian shall
release any Receivable (and its related Receivable File) in the
Receivable Files described herein to the Seller, the Servicer or
the Issuer, as appropriate, under the circumstances provided in
the Purchase Agreement and the Further Transfer and Servicing
Agreements.
(d) ADMINISTRATION; REPORTS. In general, the
Custodian shall attend to all non-discretionary details in
connection with maintaining custody of the Receivable Files
described herein. In addition, the Custodian shall assist the
Issuer generally in the preparation of routine reports to the
holders of Securities, if any, or to regulatory bodies, to the
extent necessitated by the Custodian's custody of the Receivable
Files described herein.
5. INSTRUCTIONS; AUTHORITY TO ACT. The Custodian
shall be deemed to have received proper instructions from the
Issuer with respect to the Receivable Files described herein
upon its receipt of written instructions signed by an Authorized
Officer. A certified copy of a by-law or of a resolution of the
appropriate governing body of the Issuer (or, as appropriate,
the Owner Trustee on behalf of the Issuer) may be received and
accepted by the Custodian as conclusive evidence of the authority
of any such officer to act and may be considered as in full
force and effect until receipt of written notice to the
contrary. Such instructions may be general or specific in
terms.
6. INDEMNIFICATION BY THE CUSTODIAN. The
Custodian agrees to indemnify the Issuer and each Trustee with
respect to any Securities for any and all liabilities,
obligations, losses, damage, payments, costs or expenses of any
kind whatsoever that may be imposed on, incurred or asserted
against the Issuer or any such Trustee as the result of any act
or omission in any way relating to the maintenance and custody
by the Custodian of the Receivable Files described herein;
PROVIDED, HOWEVER, that the Custodian shall not be liable to the
Issuer or any such Trustee, respectively, for any portion of any
such amount resulting from the willful misfeasance, bad faith or
gross negligence of the Issuer or any such Trustee,
respectively.
7. ADVICE OF COUNSEL. The Custodian, the Seller
and, upon execution of the Further Transfer and Servicing
Agreements, the Issuer further agree that the Custodian shall be
entitled to rely and act upon advice of counsel with respect to
its performance hereunder and shall be without liability for any
action reasonably taken pursuant to such advice, provided that
such action is not in violation of applicable federal or state
law.
8. EFFECTIVE PERIOD, TERMINATION, AND AMENDMENT;
INTERPRETIVE AND ADDITIONAL PROVISIONS. This Agreement shall
become effective as of the date hereof, shall continue in full
force and effect until terminated as hereinafter provided, may
be amended at any time by mutual agreement of the parties hereto
and may be terminated by either party by written notice to the
other party, such termination to take effect no sooner than sixty
(60) days after the date of such notice. Notwithstanding the
foregoing, if Navistar Financial Corporation resigns as Servicer
under the Further Transfer and Servicing Agreements or if all of
the rights and obligations of the Servicer have been terminated
under the Further Transfer and Servicing Agreements, this
Agreement may be terminated by the Issuer or by any Persons to
whom the Issuer has assigned its rights hereunder. As soon as
practicable after the termination of this Agreement, the
Custodian shall deliver the Receivable Files described herein to
the Issuer or the Issuer's agent at such place or places as the
Issuer may reasonably designate.
9. GOVERNING LAW. All questions concerning the
construction, validity and interpretation of this Agreement
shall be governed by and construed and enforced in accordance
with the internal laws of the State of Illinois, without giving
effect to any choice of law or conflict provision or rule
(whether of the State of Illinois or any other jurisdiction) that
would cause the application of the laws of any jurisdiction
other than the State of Illinois.
10. NOTICES. All demands, notices and
communications upon or to the Custodian or the Seller under this
Agreement shall be delivered as specified in APPENDIX B to the
Pooling and Servicing Agreement.
11. BINDING EFFECT. This Agreement shall be
binding upon and shall inure to the benefit of the Seller, the
Issuer, the Custodian and their respective successors and
assigns, including the Issuer.
12. SEVERABILITY OF PROVISIONS. If any one or more
of the covenants, agreements, provisions or terms of this
Agreement shall be for any reason whatsoever held invalid, then
such covenants, agreements, provisions or terms shall be deemed
severable from the remaining covenants, agreements, provisions
or terms of this Agreement and shall in no way affect the
validity or enforceability of the other provisions of this
Agreement.
13. ASSIGNMENT. Notwithstanding anything to the
contrary contained in this Agreement, this Agreement may not be
assigned by the Custodian without the prior written consent of
the Seller or any Persons to whom the Seller has assigned its
rights hereunder, as applicable.
14. HEADINGS. The headings of the various Sections
herein are for convenience of reference only and shall not
define or limit any of the terms or provisions hereof.
15. COUNTERPARTS. This Agreement may be executed
by the parties in separate counterparts, each of which when so
executed and delivered shall be an original but all such
counterparts shall together constitute but one and the same
instrument.
16. NO THIRD-PARTY BENEFICIARIES. This Agreement
shall inure to the benefit of and be binding upon the parties
hereto, the Owners and their respective successors and permitted
assigns. Except as otherwise expressly provided in this
Agreement, no other Person shall have any right or obligation
hereunder.
17. MERGER AND INTEGRATION. Except as specifically
stated otherwise herein, this Agreement sets forth the entire
understanding of the parties relating to the subject matter
hereof, and all prior understandings, written or oral, are
superseded by this Agreement. This Agreement may not be
modified, amended, waived, or supplemented except as provided
herein.
* * * * *
IN WITNESS WHEREOF, each of the parties hereto has
caused this Agreement to be in its name and on its behalf by a
duly authorized officer as of the day and year first above
written.
NAVISTAR FINANCIAL RETAIL
RECEIVABLES CORPORATION
By:
Name: R. Xxxxx Xxxx
Title: Vice President
NAVISTAR FINANCIAL CORPORATION,
as Custodian
By:
Name: R. Xxxxx Xxxx
Title: Vice President
