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SALE AGREEMENT
between
NATIONAL FINANCIAL AUTO FUNDING TRUST II
and
NATIONAL FINANCIAL AUTO FUNDING TRUST
_____________________
Dated as of October 21, 1996
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SALE AGREEMENT
SALE AGREEMENT, dated as of October 21, 1996, by and between
NATIONAL FINANCIAL AUTO FUNDING TRUST, a Delaware business trust ("Funding Trust
I") and NATIONAL FINANCIAL AUTO FUNDING TRUST II, a Delaware business trust
("Funding Trust II").
W I T N E S S E T H:
In consideration of the mutual covenants herein contained, Funding
Trust I and Funding Trust II agree as follows:
ARTICLE I
DEFINITIONS
1.1 Incorporation of Definitions. Capitalized terms used but not
defined herein have the meanings ascribed to them in the Pooling and
Administration Agreement dated as of December 8, 1994 (the "Pooling and
Administration Agreement"), among Funding Trust II, as transferor, National Auto
Finance Company L.P. ("NAFCO"), as Administrator, and Bankers Trust Company, as
Trustee.
1.2 Other Definitions. When used in this Agreement, the following
words and phrases shall have the following meanings:
Cut-off Date: As defined in Section 2.1.
Closing Date: means November 13, 1996.
Outstanding Principal Balance: As of any date and with respect to
any Receivable, the outstanding principal balance of such Receivable as of such
date, which shall be computed by reducing the original principal balance of such
Receivable by the principal portion of each payment received and processed by
the Servicer on or before such date.
Purchase Price: As defined in Section 2.1.
Receivable Assets: The assets described in clauses (i) through
(vii), inclusive, of subsection 2.1 hereof.
Related Security: means, with respect to any Receivable, the
interest of the Seller in (i) the security interest in the Financed Vehicles
granted by the Obligors of the Receivables and any accessions thereto and (ii)
physical damage, credit life, credit disability or other insurance policies
covering Financed Vehicles or Obligors (including any blanket vendor's single
interest insurance policy).
Receivables Schedule: The schedule of Receivables attached as
Schedule 1 hereto, such schedule identifying each Receivable by name of the
Obligor and setting forth as to each Receivable its Outstanding Principal
Balance as of the Cut-off Date, loan number, interest rate, scheduled monthly
payment of principal and interest, final maturity date and original principal
amount.
ARTICLE II
PURCHASE AND SALE
2.1 Purchase. Subject to and on the terms and conditions set forth
herein, Funding Trust II hereby sells, transfers, conveys and assigns, without
representation, warranty or recourse, except as specifically set forth herein,
all of its right, title and interest in and to (i) the Receivables identified on
the Receivables Schedule attached hereto as Schedule I, (ii) all monies paid or
payable thereunder on or after October 21, 1996 (the "Cut-off Date"), (iii) the
Related Security with respect to each such Receivable, (iv) all proceeds of the
foregoing, including all Collections or Related Security with respect to such
Receivables, or other recoveries applied to repay or discharge any such
Receivable received on or after the Cut-off Date (including net proceeds of sale
or other disposition of repossessed Financed Vehicles that were the subject of
any such Receivable) or other collateral or property of any Obligor or any other
party directly or indirectly liable for payment of such Receivables, (v) the
Seller Transaction Documents and the Assignment Agreement, dated as of October
21, 1996 between Funding Trust II and Bankers Trust Company, as Trustee of the
National Financial Auto Receivables Master Trust (the "Assignment Agreement"),
(vi) all Records relating to any of the foregoing, (vii) any other Trust Assets
relating to the Receivables Assets and (viii) the proceeds of the foregoing.
Funding Trust I agrees to pay to Funding Trust II on the Closing Date as the
purchase price (the "Purchase Price") for the Receivable Assets sold hereunder
on such date an amount equal to 100% of the aggregate Outstanding Principal
Balance of the Receivables as of the Cut-off Date in immediately available funds
to an account at a bank designated by Funding Trust II to Funding Trust I.
2.2 Filings. (a) On or prior to the Closing Date, Funding Trust II
shall have filed in the office of the Secretary of State of Delaware and the
Office of the Secretary of State of Florida UCC financing statements,
appropriate under the Uniform Commercial Code in effect in Delaware and Florida
to reflect the transfer of the Receivables Assets from Funding Trust II to
Funding Trust I and to protect Funding Trust I's interest in the Receivables
Assets against all other Persons, naming Funding Trust II as debtor, Funding
Trust I as secured party and Xxxxxx Trust and Savings Bank ("Xxxxxx Trust") as
assignee. During the term of this Agreement, Funding Trust II shall not change
its name, identity or structure or relocate its chief executive office or
principal place of business without first giving 60 days prior written notice to
Funding Trust I and Financial Security Assurance Inc. (for so long as any policy
issued Financial Security
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Assurance Inc. is in effect with respect to any securities issued by Funding
Trust I or any trust of which Funding Trust I is depositor or transferor);
provided, however, that Funding Trust I has no right or power to prohibit a
change in Funding Trust II's name, identity or structure or, subject to the last
sentence of this paragraph, a relocation of, its chief executive office. If any
change in Funding Trust II's name, identity or structure or the relocation of
its chief executive office or principal place of business would make any
financing or continuation statement or notice of lien filed in connection with
this Agreement seriously misleading within the meaning of applicable provisions
of the UCC or any title statute, Funding Trust II, shall after the effective
date of such change, promptly file or cause to be filed such amendments as may
be required to preserve and protect Funding Trust I's interest in the
Receivables Assets.
(b) On or prior to the Closing Date, Funding Trust II shall deliver
to Funding Trust I or such other Person as Funding Trust I shall direct cash
equal to all payments received on such Receivables on or after the Cut-off Date
and on or before two Business days prior to the Closing Date. Within two
Business Days after the Closing Date, Funding Trust II shall deliver to Funding
Trust I or such other Person as Funding Trust I shall direct all other payments
received on such Receivables on or after the Cut-off Date and on or before the
Closing Date.
2.3 No Recourse. The sale and purchase of Receivables and the other
Receivables Assets under this Agreement shall be without recourse to Funding
Trust II.
2.4 True Sales. Funding Trust II and Funding Trust I intend that the
transactions contemplated hereby be true sales of the Receivables and other
Receivables Assets by Funding Trust II to Funding Trust I providing Funding
Trust I with the full benefits of ownership of the Receivables and other
Receivables Assets free and clear of any liens, and neither Funding Trust II nor
Funding Trust I intends the transactions contemplated hereby to be, or for any
purpose to be characterized as, a loan from Funding Trust I to Funding Trust II.
Funding Trust II shall reflect sales of the Receivables Assets hereunder on the
books and records maintained by Funding Trust II as sales of assets, and shall
treat such sales as sales for all purposes.
2.5 Receipt of Payments after Closing Date. Funding Trust I shall be
entitled to all payments received or receivable with respect to any Receivable
sold and conveyed by Funding Trust II to Funding Trust I hereunder that are
received on and after the Cut-off Date. If Funding Trust II receives any payment
on a Receivable belonging to Funding Trust I, Funding Trust II promptly shall
turn such payment over to Xxxxxx Trust, as trustee under the Pooling and
Servicing Agreement, dated as of October 21, 1996 (the "Pooling and Servicing
Agreement"), among Funding Trust I, NAFCO and Xxxxxx Trust.
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ARTICLE III
MISCELLANEOUS
3.1 Notices. All notices, demands and requests that may be given or
that are required to be given hereunder shall be sent by United States certified
mail, postage prepaid, return receipt requested, to the parties at their
respective addresses as follows:
If to Funding Trust II:
National Financial Auto Funding Trust II
c/o Chase Manhattan Bank USA, N.A., as Trustee
0000 X. Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Corporate Administration Trust Department
Telecopier No: (000) 000-0000
Confirmation: (000) 000-0000
If to Funding Trust I:
National Financial Auto Funding Trust I
c/o Chase Manhattan Bank USA, N.A., as Trustee
0000 X. Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attn: Corporate Administration Trust Department
Telecopier No: (000) 000-0000
Confirmation: (000) 000-0000
If to Financial Security Assurance Inc.:
Financial Security Assurance Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: NAFCO Auto Finance 1996-1 Trust, 6.33% Automobile
Receivables Backed Certificates
Attention: Surveillance Department
Telecopier No: (000) 000-0000
(000) 000-0000
Confirmation: (000) 000-0000
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If to Xxxxxx Trust:
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Indenture Trust Division
Telecopier No: (000) 000-0000
Confirmation: (000) 000-0000
3.2 Choice of Law. This Agreement shall be construed in accordance
with the laws of the State of New York and the obligations, rights and remedies
of the parties hereunder shall be determined in accordance with such laws.
3.3 Counterparts. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all of such counterparts shall together constitute but one and the same
instrument.
3.4 Assignment. This Agreement may not be assigned by Funding Trust
II or Funding Trust I except as contemplated by this Section; provided, however,
that simultaneously with the execution and delivery of this Agreement, Funding
Trust I shall assign all of its right, title and interest hereunder to Xxxxxx
Trust, as trustee under the Pooling and Servicing Agreement, and the
Certificateholders (as defined in the Pooling Agreement, the
"Certificateholders") and the Certificate Insurer (as defined in the Pooling
Agreement, the "Certificate Insurer") as provided in Section 2.01 of the Pooling
Agreement, to which Funding Trust II hereby expressly consents.
3.5 Third-Party Beneficiaries. This Agreement will inure to the
benefit of and be binding upon the parties hereto and Xxxxxx Trust for the
benefit of the Certificateholders and the Certificate Insurer, which shall be
considered to be third-party beneficiaries of this Agreement and shall be
entitled to rely upon and directly enforce the provisions of this Agreement.
Except as otherwise provided in this Agreement, no other Person will have any
right or obligation hereunder. The Certificate Insurer may disclaim any of its
rights and powers under this Agreement upon delivery of a written note to
Funding Trust II and Funding Trust I.
3.6 No Petition. Funding Trust II hereby agrees not to cause the
filing of a petition in bankruptcy against Funding Trust I until one year and
one day after the maturity of any securities issued pursuant to the Pooling and
Servicing Agreement.
3.7 Further Assurances. It is Funding Trust II's intention to convey
its entire rights, title and interest in the Receivables Assets or other assets
related thereto acquired from National Financial Auto Receivables Master Trust
pursuant to the Assignment Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first written above.
NATIONAL FINANCIAL AUTO FUNDING
TRUST II
By: CHASE MANHATTAN BANK USA, N.A.
not in its individual capacity but solely
as Owner Trustee of the National
Financial Auto Funding Trust II
By:____________________________________
Name:
Title:
NATIONAL FINANCIAL AUTO FUNDING
TRUST
By: CHASE MANHATTAN BANK USA, N.A.
not in its individual capacity but
solely as Owner Trustee of the National
Financial Auto Funding Trust
By:____________________________________
Name:
Title:
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