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Exhibit 1.2
Class B Note Underwriting Agreement
dated July 11, 2001
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CLASS B NOTE UNDERWRITING AGREEMENT
CATERPILLAR FINANCIAL ASSET TRUST 2001-A
CLASS B 5.72% ASSET BACKED NOTES
July 11, 2001
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
1. Introductory. Caterpillar Financial Funding Corporation, a
Nevada corporation (the "Seller"), proposes to cause Caterpillar Financial Asset
Trust 2001-A (the "Trust") to issue and sell $15,527,000, aggregate principal
amount of 5.72% Class B Asset Backed Notes (the "Class B Notes") to ▇▇▇▇▇▇▇,
Sachs & Co. (the "Underwriter"). The assets of the Trust will include, among
other things, a pool of fixed-rate retail installment sale contracts and finance
leases (the "Receivables") secured by new and used machinery manufactured
primarily by Caterpillar Inc. ("Caterpillar"), including rights to receive
certain payments with respect to such Receivables, and security interests in the
machinery financed by the Receivables (the "Financed Equipment"), and the
proceeds thereof. The Receivables will be sold to the Trust by the Seller. The
Receivables will be serviced for the Trust by Caterpillar Financial Services
Corporation, a Delaware corporation (the "Servicer" or "CFSC"). The Notes will
be issued pursuant to the Indenture to be dated as of July 1, 2001 (as amended
and supplemented from time to time, the "Indenture"), between the Trust and Bank
One, National Association, a national banking association (the "Indenture
Trustee").
Simultaneously with the issuance and sale of the Class B Notes as
contemplated herein, the Trust will issue $181,448,000 aggregate principal
amount of Class A-1 3.74% Asset Backed Notes (the "Class A-1 Notes"),
$134,000,000 aggregate principal amount of Class A-2 4.11% Asset Backed Notes
(the "Class A-2 Notes") and $277,687,000 aggregate principal amount of Class A-3
4.85% Asset Backed Notes (the "Class A-3 Notes," together with the Class A-1
Notes and the Class A-2 Notes, the "Class A Notes," and together with the Class
B Notes, the "Notes") and $12,422,797 aggregate principal amount of Asset Backed
Certificates (the "Certificates," together with the Notes sometimes referred to
collectively herein as the "Securities"), each such certificate representing a
fractional undivided interest in the Trust. The Class A Notes will be sold
pursuant to an underwriting agreement (the "Class A Note Underwriting
Agreement," together with this Underwriting Agreement, the "Underwriting
Agreements") among the Seller, CFSC and the underwriters named in Schedule I
thereto.
Capitalized terms used and not otherwise defined herein shall
have the meanings ascribed to them in the Sale and Servicing Agreement to be
dated as of July 1, 2001 (as amended and supplemented from time to time, the
"Sale and Servicing Agreement"), among the Trust, the Seller and the Servicer
or, if not defined therein, in the Indenture or the Trust Agreement to be
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dated as of July 1, 2001 (as amended and supplemented from time to time, the
"Trust Agreement"), between the Seller and Chase Manhattan Bank USA, National
Association, a national banking association as owner trustee under the Trust
Agreement (the "Owner Trustee").
2. Representations and Warranties of the Seller and CFSC. Each of
the Seller and CFSC, with respect to itself only, and not with respect to the
other, represents and warrants to and agrees with the Underwriter that:
(a) The Seller meets the requirements for use of Form S-3
under the Securities Act of 1933, as amended (the "Act"), and has filed with the
Securities and Exchange Commission (the "Commission") a registration statement
(Registration No. 333-58814) on such Form S-3, including a prospectus and a form
of prospectus supplement, for registration under the Act of the offering and
sale of the Notes. The Seller may have filed one or more amendments thereto,
each of which amendments has previously been furnished to the Underwriter. The
Seller will also file with the Commission a prospectus supplement in accordance
with Rule 424(b) under the Act. The Seller has included in the Registration
Statement, as amended at the Effective Date (as hereinafter defined), all
information required by the Act and the rules thereunder to be included in the
Prospectus (as hereinafter defined) with respect to the Notes and the offering
thereof. As filed, the registration statement as amended, the form of prospectus
supplement, and any prospectuses or prospectus supplements filed pursuant to
Rule 424(b) under the Act relating to the Notes shall, except to the extent that
the Underwriter shall agree in writing to a modification, be in all substantive
respects in the form furnished to the Underwriter prior to the Execution Time
(as hereinafter defined) or, to the extent not completed at the Execution Time,
shall contain only such specific additional information and other changes
(beyond that contained in the latest preliminary prospectus supplement which has
previously been furnished to the Underwriter) as the Seller has advised the
Underwriter, prior to the Execution Time, will be included or made therein.
For purposes of this Agreement, "Effective Time" means the date
and time as of which such registration statement, or the most recent
post-effective amendment thereto, if any, was declared effective by the
Commission, and "Effective Date" means the date of the Effective Time.
"Execution Time" shall mean the date and time that this Agreement is executed
and delivered by the parties hereto. Such registration statement, as amended at
the Effective Time, and including the exhibits thereto and any material
incorporated by reference therein (including any Computational Materials, ABS
Term Sheets, Structural Term Sheets and Collateral Term Sheets (as defined in
Section 12 of this Agreement) filed on Form 8-K), is hereinafter referred to as
the "Registration Statement," and any prospectus supplement (the "Prospectus
Supplement") relating to the Notes, as filed with the Commission pursuant to and
in accordance with Rule 424(b) under the Act is, together with the prospectus
filed as part of the Registration Statement (such prospectus, in the form it
appears in the Registration Statement or in the form most recently revised and
filed with the Commission pursuant to Rule 424(b) being hereinafter referred to
as the "Basic Prospectus"), hereinafter referred to as the "Prospectus".
"Preliminary Prospectus" means any preliminary prospectus to the Prospectus
which describes the Notes and the offering thereof and which is used prior to
the filing of the Prospectus. "Rule 424" refers to such rule under the Act. Any
reference herein to the Registration Statement, the Prospectus or any Prospectus
Supplement shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 which were filed under the
Securities
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Exchange Act of 1934, as amended (the "Exchange Act"), on or before the
Effective Date of the Registration Statement or the issue date of the Prospectus
or any Prospectus Supplement, as the case may be; and any reference herein to
the terms "amend," "amendment" or "supplement" with respect to the Registration
Statement, the Prospectus or any Prospectus Supplement shall be deemed to refer
to and include the filing of any document under the Exchange Act after the
Effective Date of the Registration Statement, or the issue date of the
Prospectus or any Prospectus Supplement, as the case may be, deemed to be
incorporated therein by reference.
(b) On the Effective Date and on the date of this Agreement,
the Registration Statement did or will, and, when the Prospectus was first filed
and on the Closing Date (as defined below), the Prospectus and any Prospectus
Supplement did or will comply in all material respects with the applicable
requirements of the Act, the Exchange Act and the Trust Indenture Act of 1939,
as amended (the "Trust Indenture Act"), and the respective rules and regulations
of the Commission thereunder (the "Rules and Regulations") and of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"). On the Effective
Date, the Registration Statement did not and will not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein not
misleading; and, on the Effective Date, the Prospectus, if not filed pursuant to
Rule 424(b), did not or will not, and on the date of any filing pursuant to Rule
424(b) and on the Closing Date, the Prospectus, together with any Prospectus
Supplement, did not or will not include any untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the Seller makes no representation or
warranty as to the information contained in or omitted from the Registration
Statement or the Prospectus in reliance upon and in conformity with information
furnished in writing to the Seller by the Underwriter specifically for use in
connection with preparation of the Registration Statement or the Prospectus.
(c) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, (i) there has not been
any material adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, business, management,
financial condition, stockholders' equity, results of operations, regulatory
status or business prospects of the Seller or CFSC, and (ii) neither the Seller
nor CFSC has entered into any transaction or agreement (whether or not in the
ordinary course of business) material to it that, in either case, would
reasonably be expected to materially adversely affect the interests of the
holders of the Notes, other than as set forth or contemplated in the Prospectus.
(d) The computer tape of the Receivables created as of July 1,
2001, and made available to the Underwriter by the Servicer, was complete and
accurate as of the date thereof and includes a description of the Receivables
that are described in Schedule A to the Sale and Servicing Agreement.
(e) Each of the Seller and CFSC is duly incorporated and is
validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation and is qualified to transact business in and is in
good standing under the laws of each state in which its activities require such
qualification, and has full power, authority and legal right to own its
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properties and conduct its business as such properties are presently owned and
such business is presently conducted.
(f) This Agreement has been duly authorized, executed and
delivered by each of the Seller and CFSC.
(g) On the date of this Agreement and on the Closing Date, the
representations and warranties of CFSC and the Seller in each of the Basic
Documents to which they are a party will be true and correct.
(h) CFSC's sale, transfer, assignment, set over and conveyance
of the Receivables to the Seller as of the Closing Date will vest in the Seller
all of CFSC's right, title and interest therein, subject to no prior lien,
mortgage, security interest, pledge, adverse claim, charge or other encumbrance.
(i) The Seller's sale, transfer, assignment, set over and
conveyance of the Receivables to the Trust as of the Closing Date will vest in
the Trust all of the Seller's right, title and interest therein, subject to no
prior lien, mortgage, security interest, pledge, adverse claim, charge or other
encumbrance.
(j) The Trust's grant of a security interest in the
Receivables to the Indenture Trustee pursuant to the Indenture will vest in the
Indenture Trustee, for the benefit of the Noteholders, a first priority
perfected security interest therein, subject to no prior lien, mortgage,
security interest, pledge, adverse claim, charge or other encumbrance.
3. Purchase, Sale, and Delivery of the Class B Notes. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Seller agrees to cause
the Trust to sell to the Underwriter, and the Underwriter agrees to purchase
from the Trust, at a purchase price of 99.590863% of the principal amount
thereof, $15,527,000 in principal amount of Class B Notes. Delivery of and
payment for the Class B Notes shall be made at the office of ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
& ▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ on July 25, 2001
(the "Closing Date"). Delivery of the Class B Notes shall be made against
payment of the purchase price in immediately available funds drawn to the order
of the Seller. The Class B Notes to be so delivered will be initially
represented by one or more Class B Notes registered in the name of "Cede & Co.,"
the nominee of The Depository Trust Company ("DTC"). The interests of beneficial
owners of the Class B Notes will be represented by book entries on the records
of DTC and participating members thereof. Definitive Class B Notes will be
available only under limited circumstances set forth in the Indenture.
4. Offering by Underwriter. It is understood that the Underwriter
proposes to offer the Class B Notes for sale to the public (which may include
selected dealers) as set forth in the Prospectus.
5. Covenants of the Seller. The Seller covenants and agrees with
the Underwriter that:
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(a) Immediately following the execution of this Agreement, the
Seller will prepare a Prospectus Supplement setting forth the amount of Notes
covered thereby and the terms thereof not otherwise specified in the Basic
Prospectus, the price at which such Notes are to be purchased by the
Underwriter, the initial public offering price, the selling concessions and
allowances, and such other information as the Seller deems appropriate and shall
furnish a copy to the Underwriter in accordance with Section 5(b) of this
Agreement. The Seller will transmit the Prospectus including such Prospectus
Supplement to the Commission pursuant to Rule 424(b) by a means reasonably
calculated to result in filing that complies with all applicable provisions of
Rule 424(b). The Seller will advise the Underwriter promptly of any such filing
pursuant to Rule 424(b).
(b) Prior to the termination of the offering of the Notes, the
Seller will not file any amendment of the Registration Statement or supplement
to the Prospectus unless the Seller has furnished the Underwriter with a copy
for its review prior to filing and will not file any such proposed amendment or
supplement to which the Underwriter reasonably objects. Subject to the foregoing
sentence, if filing of the Prospectus is otherwise required under Rule 424(b),
the Seller will file the Prospectus, properly completed, and any supplement
thereto, with the Commission pursuant to and in accordance with the applicable
paragraph of Rule 424(b) within the time period prescribed and will provide
evidence satisfactory to the Underwriter of such timely filing.
(c) The Seller will advise the Underwriter promptly of any
proposal to amend or supplement the Registration Statement as filed or the
Prospectus, and will not effect such amendment or supplement without the
Underwriter's consent, which consent will not unreasonably be withheld. The
Seller will also advise the Underwriter promptly of any request by the
Commission for any amendment of or supplement to the Registration Statement or
the Prospectus or for any additional information and the Seller will also advise
the Underwriter promptly of any amendment or supplement to the Registration
Statement or the Prospectus and of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
institution or threat of any proceeding for that purpose, and the Seller will
use its best efforts to prevent the issuance of any such stop order and to
obtain as soon as possible the lifting of any issued stop order.
(d) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then amended or supplemented would include an untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend the
Registration Statement or supplement the Prospectus to comply with the Act or
the Exchange Act or the respective Rules and Regulations thereunder, the Seller
promptly will notify the Underwriter and will prepare and file, or cause to be
prepared and filed, with the Commission, subject to the first sentence of
paragraph (b) of this Section 5, an amendment or supplement that will correct
such statement or omission, or effect such compliance. Any such filing shall not
operate as a waiver or limitation on any right of the Underwriter hereunder.
(e) As soon as practicable, but not later than fourteen months
after the original effective date of the Registration Statement, the Seller will
cause the Trust to make
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generally available to Noteholders an earnings statement of the Trust covering a
period of at least twelve months beginning after the Effective Date of the
Registration Statement that will satisfy the provisions of Section 11(a) of the
Act.
(f) The Seller will furnish to the Underwriter copies of the
Registration Statement (one of which will be signed and will include all
exhibits), each related preliminary prospectus or prospectus supplement, the
Prospectus and all amendments and supplements to such documents, in each case as
soon as available and in such quantities as the Underwriter requests.
(g) The Seller will assist the Underwriter in arranging for
the qualification of the Notes for sale and determination of their eligibility
for investment under the laws of such jurisdictions in the United States, or as
necessary to qualify for Euroclear Bank S.A./N.V. or Clearstream Banking,
societe anonyme, as the Underwriter designates and will continue to assist the
Underwriter in maintaining such qualifications in effect so long as required for
the distribution; provided, however, that neither the Seller nor CFSC shall be
required to qualify to do business in any jurisdiction where it is now not
qualified or to take any action which would subject it to general or unlimited
service of process in any jurisdiction in which it is now not subject to service
of process.
(h) For a period from the date of this Agreement until the
retirement of the Notes, or until such time as the Underwriter shall cease to
maintain a secondary market in the Notes, whichever occurs first, the Seller
will deliver to the Underwriter the annual statements of compliance and the
annual independent certified public accountants' reports furnished to the Owner
Trustee or the Indenture Trustee pursuant to the Sale and Servicing Agreement,
as soon as such statements and reports are furnished to the Owner Trustee or the
Indenture Trustee.
(i) So long as any of the Notes are outstanding, the Seller
will furnish to the Underwriter (i) as soon as practicable after the end of the
fiscal year all documents required to be distributed to Noteholders or filed
with the Commission pursuant to the Exchange Act or any order of the Commission
thereunder and (ii) from time to time, any other information concerning the
Seller filed with any government or regulatory authority which is otherwise
publicly available, as the Underwriter may reasonably request.
(j) On or before the Closing Date, the Seller shall cause the
computer records of the Seller and the Servicer relating to the Receivables to
be marked to show the Trust's absolute ownership of the Receivables, and from
and after the Closing Date neither the Seller nor the Servicer shall take any
action inconsistent with the Trust's ownership of such Receivables, other than
as permitted by the Sale and Servicing Agreement.
(k) To the extent, if any, that the rating provided with
respect to the Notes by the rating agency or agencies that initially rate the
Notes is conditional upon the furnishing of documents or the taking of any other
actions by the Seller, the Seller shall furnish such documents and take any such
other actions.
(l) For the period beginning on the date of this Agreement and
ending seven days after the Closing Date, unless waived by the Underwriter, none
of the Seller, CFSC
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or any trust originated, directly or indirectly, by the Seller or CFSC will
offer to sell or sell notes (other than the Notes) collateralized by, or
certificates (other than the Certificates) evidencing an ownership interest in,
receivables generated pursuant to fixed-rate retail installment sale contracts
and finance leases and secured by equipment similar to the Financed Equipment.
(m) The Seller and CFSC each will deliver to the Underwriter,
all opinions, certificates and other documents or information delivered to the
Owner Trustee and the Indenture Trustee at the time such opinions, certificates
and other documents or information are delivered to the Owner Trustee or the
Indenture Trustee pursuant to the Sale and Servicing Agreement and the Purchase
Agreement with respect to perfection and priority of CFSC's interest in the
Receivables.
6. Payment of Expenses. The Seller will pay all expenses incident
to the performance of its obligations under this Agreement, including (i) the
printing and filing of the Registration Statement as originally filed and of
each amendment thereto, (ii) the preparation, issuance and delivery of the Notes
to the Underwriter, (iii) the fees and disbursements of the Seller's counsel and
accountants, (iv) the qualification of the Notes under securities laws in
accordance with the provisions of Section 5(g) of this Agreement, including
filing fees and the fees and disbursements of counsel in connection therewith
and in connection with the preparation of any blue sky or legal investment
survey, (v) the printing and delivery to the Underwriter of copies of the
Registration Statement as originally filed and of each amendment thereto, of the
Preliminary Prospectus and of each amendment or supplement thereto, (vi) the
printing and delivery to the Underwriter of copies of any blue sky or legal
investment survey prepared in connection with the Notes, (vii) any fees charged
by rating agencies for the rating of the Notes, (viii) the fees and expenses, if
any, incurred with respect to any filing with the National Association of
Securities Dealers, Inc. and (ix) the fees and expenses of ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ LLP in its role as counsel to the Trust incurred as a result of
providing the opinions required by Section 7(f) hereof.
7. Conditions of the Obligations of the Underwriter. The
obligations of the Underwriter to purchase and pay for the Class B Notes will be
subject to the accuracy of the representations and warranties on the part of the
Seller herein, to the accuracy of the statements of officers of the Seller made
pursuant to the provisions hereof, to the performance by the Seller of its
obligations hereunder and to the following additional conditions precedent:
(a) The Registration Statement shall have become effective
prior to the Execution Time, and prior to the Closing Date, no stop order
suspending the effectiveness of the Registration Statement shall have been
issued and no proceedings for that purpose shall have been instituted or, to the
knowledge of the Seller or the Underwriter, shall be contemplated by the
Commission or by any authority administering any state securities or blue sky
law.
(b) The Prospectus and any supplements thereto shall have been
filed (if required) with the Commission in accordance with the Rules and
Regulations and Section 5(a) hereof.
(c) On or prior to the date of this Agreement and on or prior
to the Closing Date, the Underwriter shall have received a letter or letters,
dated as of the date of this
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Agreement and as of the Closing Date, respectively, of PricewaterhouseCoopers
LLP, independent public accountants, substantially in the form of the drafts to
which the Underwriter has previously agreed and otherwise in form and substance
satisfactory to the Underwriter and its counsel.
(d) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any development
involving a prospective change, in or affecting particularly the business or
properties of the Trust, the Seller or the Servicer which, in the judgment of
the Underwriter, materially impairs the investment quality of the Notes or makes
it impractical or inadvisable to market the Notes; (ii) any suspension or
limitation of trading in securities generally on the New York Stock Exchange, or
any setting of minimum prices for trading on such exchange; (iii) any suspension
of trading of any securities of Caterpillar or CFSC on any exchange or in the
over-the-counter market; (iv) any banking moratorium declared by Federal,
Delaware or New York authorities; or (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress, or any other substantial national or international calamity or
emergency if, in the judgment of the Underwriter, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it impractical or
inadvisable to proceed with completion of the sale of and payment for the Notes.
(e) The Underwriter shall have received opinions of ▇▇▇▇ ▇.
▇▇▇▇▇, General Counsel of CFSC, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP and ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, PLLC, counsel to CFSC, the Seller and the Trust and such
other counsel acceptable to the Underwriter, addressed to the Underwriter, the
Owner Trustee and the Indenture Trustee, dated the Closing Date and satisfactory
in form and substance to the Underwriter and its counsel, substantially to the
effect that:
(i) CFSC has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware with full corporate power and authority to own its
properties and conduct its business, as presently owned and conducted by
it, and to enter into and perform its obligations under the Underwriting
Agreements, the Administration Agreement, the Purchase Agreement, the
Sale and Servicing Agreement and the Custodial Agreement and had at all
times, and now has, the power, authority and legal right to acquire, own
and sell the Receivables.
(ii) The Seller has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the
State of Nevada with full corporate power and authority to own its
properties and conduct its business, as presently owned and conducted by
it, and to enter into and perform its obligations under the Underwriting
Agreements, the Purchase Agreement, the Trust Agreement, the Sale and
Servicing Agreement, the Administration Agreement and the Custodial
Agreement and had at all times, and now has, the power, authority and
legal right to acquire, own and sell the Receivables.
(iii) CFSC is duly qualified to do business and is in
good standing, and has obtained all necessary licenses and approvals in
each jurisdiction in which failure to qualify or to obtain such license
or approval would render any Receivable
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unenforceable by the Seller, the Owner Trustee or the Indenture Trustee.
(iv) The Seller is duly qualified to do business and is
in good standing, and has obtained all necessary licenses and approvals
in each jurisdiction in which failure to qualify or to obtain such
license or approval would have a material adverse effect on the
Receivables as a whole.
(v) The direction by the Seller to the Owner Trustee to
authenticate the Certificates has been duly authorized by the Seller
and, when the Certificates have been duly executed, authenticated and
delivered by the Owner Trustee in accordance with the Trust Agreement
and delivered to and paid for by the Seller, will be legally issued,
fully paid and nonassessable obligations of the Trust and will be
entitled to the benefits of the Trust Agreement.
(vi) The direction by CFSC to the Indenture Trustee to
authenticate the Notes has been duly authorized by CFSC, and, when the
Notes have been duly executed and delivered by the Owner Trustee on
behalf of the Trust, authenticated by the Indenture Trustee in
accordance with the Indenture and delivered and paid for pursuant to the
Underwriting Agreements, the Notes will be duly issued, will constitute
legal, valid and binding obligations of the Trust enforceable against
the Trust in accordance with their terms and will be entitled to the
benefits and security afforded by the Indenture, except (x) the
enforceability thereof may be subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights and (y) the remedy of specific
performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought.
(vii) Each of the Purchase Agreement, the Trust
Agreement, the Sale and Servicing Agreement, the Administration
Agreement and the Custodial Agreement has been duly authorized, executed
and delivered by the Seller, and is a legal, valid and binding
obligation of the Seller enforceable against the Seller in accordance
with its terms, except (x) the enforceability thereof may be subject to
bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights and (y) the
remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be
brought.
(viii) The Underwriting Agreements have been duly
authorized, executed and delivered by each of the Seller and CFSC.
(ix) Each of the Administration Agreement, the Purchase
Agreement, the Sale and Servicing Agreement and the Custodial Agreement
has been duly authorized, executed and delivered by CFSC and is a legal,
valid and binding obligation of CFSC enforceable against CFSC in
accordance with its terms, except (x) the enforceability thereof may be
subject to bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
and (y) the remedy of specific performance and injunctive and other
forms of equitable
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relief may be subject to equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought.
(x) Neither the sale, transfer, assignment, set over and
conveyance of the Receivables from CFSC to the Seller, nor the sale,
transfer, assignment, set over and conveyance of the Receivables from
the Seller to the Trust, nor the grant of a security interest in the
Trust Estate by the Trust to the Indenture Trustee, nor the assignment
by the Seller of its right, title and interest in the Purchase Agreement
to the Trust, nor the grant of the security interest in the Collateral
to the Indenture Trustee pursuant to the Indenture, nor the execution
and delivery of the Underwriting Agreements, the Purchase Agreement, the
Trust Agreement, the Sale and Servicing Agreement, the Administration
Agreement or the Custodial Agreement by the Seller, nor the execution of
the Underwriting Agreements, the Administration Agreement, the Purchase
Agreement, the Sale and Servicing Agreement or the Custodial Agreement
by CFSC, nor the consummation of any transactions contemplated in the
Underwriting Agreements, the Purchase Agreement, the Trust Agreement,
the Indenture, the Administration Agreement, the Sale and Servicing
Agreement or the Custodial Agreement (such agreements, excluding the
Underwriting Agreements, being for purposes of this clause (e) and
elsewhere herein, as applicable, collectively, the "Basic Documents"),
nor the fulfillment of the terms thereof by CFSC, the Seller or the
Trust, as the case may be, will (x) conflict with, or result in a
breach, violation or acceleration of, or constitute a default under, any
term or provision of the certificate of incorporation or bylaws of CFSC
or the Seller or, to the best of such counsel's knowledge after due
inquiry, of any indenture or other agreement or instrument to which CFSC
or the Seller is a party or by which either of them is bound, or (y)
result in a violation of or contravene the terms of any statute, order
or regulation applicable to CFSC or the Seller of any court, regulatory
body, administrative agency or governmental body having jurisdiction
over either of them.
(xi) There are no actions, proceedings or investigations
pending or, to the best of such counsel's knowledge, threatened before
any court, administrative agency, or other tribunal (1) asserting the
invalidity of the Trust or any of the Basic Documents, (2) seeking to
prevent the consummation of any of the transactions contemplated by any
of the Basic Documents or the execution and delivery thereof, or (3)
that could reasonably be expected to materially and adversely affect the
performance (A) by CFSC of its obligations under, or the validity or
enforceability of, the Underwriting Agreements, the Administration
Agreement, the Purchase Agreement, the Sale and Servicing Agreement or
the Custodial Agreement, (B) by the Seller of its obligations under, or
the validity or enforceability of, the Underwriting Agreements, the
Purchase Agreement, the Trust Agreement, the Sale and Servicing
Agreement or the Custodial Agreement, or (C) by the Servicer of its
obligations under, or the validity or enforceability of, the Sale and
Servicing Agreement.
(xii) To the best knowledge of such counsel, no default
exists and no event has occurred which, with notice, lapse of time or
both, would constitute a default in the due performance and observance
of any term, covenant or condition of any agreement to which CFSC or the
Seller is a party or by which either of them is bound, which default is
or would have a material adverse effect on the financial condition,
earnings, business
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or properties of CFSC and its subsidiaries, taken as a whole.
(xiii) The Assignment (as defined in the Purchase
Agreement) dated as of the Closing Date from CFSC to the Seller has been
duly authorized, executed and delivered by CFSC.
(xiv) Should CFSC become the debtor in a case under the
Bankruptcy Code, if the matter were properly briefed and presented to a
court, the court should hold that (1) the transfer of the Receivables by
CFSC to the Seller in the manner set forth in the Purchase Agreement
would constitute an absolute sale of the Receivables, rather than a
borrowing by CFSC secured by the Receivables, and thus (2) the Seller's
rights to the Receivables would not be impaired by the operation of
Section 362(a) of the Bankruptcy Code.
(xv) Should CFSC become the debtor in a case under the
Bankruptcy Code, and the Seller would not otherwise properly be a debtor
in a case under the Bankruptcy Code, and if the matter were properly
briefed and presented to a court exercising bankruptcy jurisdiction, the
court, exercising reasonable judgment after full consideration of all
relevant factors, should not order, over the objection of the
Certificateholders or the Noteholders, the substantive consolidation of
the assets and liabilities of the Seller with those of CFSC based on any
legal theories currently subscribed to by federal courts exercising
bankruptcy jurisdiction.
(xvi) Such counsel is familiar with the Servicer's
standard operating procedures relating to the Servicer's acquisition of
a perfected first priority security interest in the equipment financed
by the Servicer pursuant to equipment installment sale contracts in the
ordinary course of the Servicer's business. Assuming that the Servicer's
standard procedures have been followed with respect to the perfection of
security interests in the Financed Equipment (and such counsel has no
reason to believe that such procedures have not been followed), the
Servicer has acquired or will acquire a perfected first priority
security interest in the Financed Equipment.
(xvii) The Purchase Agreement grants to the Seller a
valid security interest in CFSC's rights in the Receivables and the
proceeds thereof. The Sale and Servicing Agreement grants to the Trust a
valid security interest in the Seller's rights in the Receivables and
the proceeds thereof. The Indenture grants to the Indenture Trustee a
valid security interest in the Trust's rights in the Receivables and the
proceeds thereof.
(xviii)The Receivables are chattel paper as defined in
the UCC.
(xix) Immediately prior to the sale of the Receivables
and the proceeds thereof to the Seller, CFSC had a first priority
perfected security interest in the Receivables and the proceeds thereof.
Immediately prior to the transfer of the Receivables and the proceeds
thereof to the Trust, the Seller had a first priority perfected security
interest in the Receivables and the proceeds thereof. Immediately prior
to the transfer of the Receivables and the proceeds thereof to the
Indenture Trustee, the Trust had a first priority perfected security
interest in the Receivables and the proceeds thereof.
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The Indenture Trustee has a first priority perfected security interest
in the Receivables and the proceeds thereof. The opinion covered by this
paragraph (xix) shall be subject to customary UCC exceptions and
qualifications.
(xx) The Sale and Servicing Agreement, the Trust
Agreement, the Indenture, the Administration Agreement and the Purchase
Agreement conform in all material respects with the description thereof
contained in the Prospectus and any supplement thereto.
(xxi) The statements in the Prospectus under the
headings "Risk Factors -- The notes may suffer losses if the interests
of other persons in the receivables are superior to the trust's
interest" and "Certain Legal Aspects of the Receivables" to the extent
they constitute matters of law or legal conclusions with respect
thereto, are correct in all material respects.
(xxii) The statements contained in the Prospectus and
any supplement thereto under the headings "Description of the Notes,"
"Description of the Certificates" and "Description of the Transfer and
Servicing Agreements," insofar as such statements constitute a summary
of the Notes, the Certificates, the Indenture, the Administration
Agreement, the Sale and Servicing Agreement, the Purchase Agreement and
the Trust Agreement, are a fair and accurate summary of the matters
referred to therein.
(xxiii) No consent, approval, authorization or order of,
or filing with, any court or governmental agency or body is required for
the consummation of the transactions contemplated in the Basic
Documents, except for such filings with respect to the transfer of the
Receivables to the Seller pursuant to the Purchase Agreement and the
transfer of the Receivables to the Trust pursuant to the Sale and
Servicing Agreement and as may be required under state securities or
Blue Sky laws of various jurisdictions.
(xxiv) All actions required to be taken and all filings
required to be made under the Act prior to the sale of the Notes have
been duly taken or made.
(xxv) The Trust Agreement is not required to be
qualified under the Trust Indenture Act and the Trust is not required to
be registered under the Investment Company Act of 1940, as amended (the
"Investment Company Act").
(xxvi) The Indenture has been duly qualified under the
Trust Indenture Act.
(xxvii) The Seller is not, and will not as a result of
the offer and sale of the Notes as contemplated in the Prospectus and
the Underwriting Agreements become, an "investment company" as defined
in the Investment Company Act or a company "controlled by" an
"investment company" within the meaning of the Investment Company Act.
(xxviii) To the best of such counsel's knowledge, there
are no legal or governmental proceedings pending or threatened which are
required to be disclosed in the
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Registration Statement, other than those disclosed therein.
(xxix) The Registration Statement has become effective
under the Act, any required filing of any Preliminary Prospectus and the
Prospectus and any supplements thereto pursuant to Rule 424(b) has been
or will be made in the manner and within the time period required by
Rule 424(b), and, to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or are
pending or contemplated under the Act, and the Registration Statement
and the Prospectus, and each amendment or supplement thereto, as of
their respective effective or issue dates, complied as to form in all
material respects with the requirements of the Act, the Exchange Act,
the Trust Indenture Act and the Rules and Regulations.
(xxx) Nothing has come to such counsel's attention that
would lead such counsel to believe that the Registration Statement or
the Prospectus or any amendment or supplement thereto as of the
respective dates thereof and as of the Closing Date (other than the
financial statements and other financial and statistical information
contained therein, as to which such counsel need not express any view)
contains an untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein not
misleading.
(xxxi) The Trust has been duly formed and is validly
existing as a statutory business trust and is in good standing under the
laws of the State of Delaware, with full power and authority to execute,
deliver and perform its obligations under the Sale and Servicing
Agreement, the Indenture, the Custodial Agreement, the Administration
Agreement, the Notes and the Certificates.
(xxxii) The Indenture, the Sale and Servicing Agreement,
the Custodial Agreement and the Administration Agreement have been duly
authorized and, when duly executed and delivered by the Owner Trustee on
behalf of the Trust, will constitute the legal, valid and binding
obligations of the Trust, enforceable against the Trust in accordance
with their terms, except (x) the enforceability thereof may be subject
to bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights and (y)
the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be
brought.
(xxxiii) The Servicer has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the
State of Delaware with full corporate power and authority to own its
properties and conduct its business, as presently conducted by it, and
to enter into and perform its obligations under the Sale and Servicing
Agreement, and had at all relevant times, and now has, the power,
authority and legal right to acquire, own, sell and service the
Receivables.
(xxxiv) The Servicer is duly qualified to do business
and is in good standing, and has obtained all necessary licenses and
approvals in each jurisdiction in which failure to qualify or to obtain
such license or approval would render any
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Receivable unenforceable by the Seller, the Owner Trustee or the
Indenture Trustee.
(xxxv) The Sale and Servicing Agreement has been duly
authorized, executed and delivered by the Servicer, and is the legal,
valid and binding obligation of the Servicer enforceable against the
Servicer in accordance with its terms, except (x) the enforceability
thereof may be subject to bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights and (y) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
(xxxvi) Neither the execution and delivery of the Sale
and Servicing Agreement by the Servicer, nor the consummation of any
transactions contemplated in the Underwriting Agreements or the Basic
Documents, nor the fulfillment of the terms thereof by the Servicer will
conflict with, or result in a breach, violation or acceleration of, or
constitute a default under, any term or provision of the certificate of
incorporation or bylaws of the Servicer or of any indenture or other
agreement or instrument to which the Servicer is a party or by which it
is bound, or result in a violation of or contravene the terms of any
statute, order or regulation applicable to the Servicer of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over it.
(xxxvii) To the best knowledge of such counsel, no
default exists and no event has occurred which, with notice, lapse of
time or both, would constitute a default in the due performance and
observance of any term, covenant or condition of any agreement to which
the Servicer is a party or by which it is bound, which default is or
would have a material adverse effect on the financial condition,
earnings, business or properties of the Servicer and its subsidiaries,
taken as a whole.
Such counsel shall also opine as to such other matters as the
Underwriter may reasonably request. The opinions set forth in clauses (xiv),
(xv) and (xix) of this Section 7(e) shall be given by ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇ LLP or such other outside counsel to CFSC, the Seller and the Trust as
may be acceptable to the Underwriter.
(f) The Underwriter shall have received an opinion addressed
to it of ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP in its capacity as Special Tax
Counsel for the Trust, dated the Closing Date, substantially to the effect that
the statements in the Prospectus under the headings "Summary of Terms of the
Notes -- Tax Status" (to the extent relating to Federal income tax consequences)
and "Federal Income Tax Consequences" accurately describe the material Federal
income tax consequences to holders of the Notes, and the statements in the
Prospectus under the heading "ERISA Considerations," to the extent that they
constitute statements of matters of law or legal conclusions with respect
thereto, have been prepared or reviewed by such counsel and accurately describe
the material consequences to holders of the Notes under ERISA. ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP, in its capacity as Special Counsel to the Trust,
shall have delivered an opinion with respect to the characterization of the
transfer of the Receivables.
(g) The Underwriter shall have received an opinion addressed
to it of
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, PLLC in its capacity as Special Tennessee Tax
Counsel for the Trust, dated the Closing Date, substantially to the effect that
the statements in the Prospectus under the heading "Summary of Terms of the
Notes -- Tax Status" (to the extent relating to Tennessee income tax
consequences) and in the Prospectus under the heading "Certain State Income Tax
Considerations" accurately describe the material income tax consequences in the
State of Tennessee to holders of the Notes.
(h) The Underwriter shall have received an opinion addressed
to it of ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ in its capacity as Special Nevada Tax Counsel
for the Trust, dated the Closing Date, substantially to the effect that the
Trust would not be subject to taxation in Nevada.
(i) The Underwriter shall have received an opinion addressed
to it of Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP in its capacity as Special
Counsel to the Underwriter, dated the Closing Date, with respect to the validity
of the Securities and such other related matters as the Underwriter shall
require and the Seller shall have furnished or caused to be furnished to such
counsel such documents as they may reasonably request for the purpose of
enabling them to pass upon such matters.
(j) The Underwriter shall have received an opinion addressed
to it, the Seller and the Servicer of The Law Department of the Indenture
Trustee, and such other counsel acceptable to the Underwriter and its counsel,
dated the Closing Date and satisfactory in form and substance to the Underwriter
and its counsel, substantially to the effect that:
(i) The Indenture Trustee is a national banking
association duly organized and validly existing under the Federal law of
the United States of America.
(ii) The Indenture Trustee has the full corporate trust
power to accept the office of trustee under the Indenture and to enter
into and perform its obligations under the Indenture, the Sale and
Servicing Agreement, the Custodial Agreement and the Administration
Agreement.
(iii) The execution and delivery of the Indenture, the
Custodial Agreement and the Administration Agreement and the
acknowledgment and acceptance of the Sale and Servicing Agreement and
the performance by the Indenture Trustee of its obligations under the
Indenture, the Custodial Agreement, the Sale and Servicing Agreement and
the Administration Agreement have been duly authorized by all necessary
corporate action of the Indenture Trustee and each has been duly
executed and delivered by the Indenture Trustee.
(iv) The Indenture, the Sale and Servicing Agreement,
the Custodial Agreement and the Administration Agreement constitute
valid and binding obligations of the Indenture Trustee enforceable
against the Indenture Trustee in accordance with their terms under the
laws of the State of New York and the Federal law of the United States
of America.
(v) The execution and delivery by the Indenture Trustee
of the
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Indenture, the Custodial Agreement and the Administration Agreement and
the acknowledgment and acceptance of the Sale and Servicing Agreement do
not require any consent, approval or authorization of, or any
registration or filing with, any New York or United States Federal
governmental authority, other than the filing of Form T-1 under the
Trust Indenture Act.
(vi) Each of the Notes has been duly authenticated by
the Indenture Trustee.
(vii) Neither the consummation by the Indenture Trustee
of the transactions contemplated in the Sale and Servicing Agreement,
the Indenture, the Custodial Agreement or the Administration Agreement,
nor the fulfillment of the terms thereof by the Indenture Trustee, will
conflict with, result in a breach or violation of, or constitute a
default under any law or the charter, bylaws or other organizational
documents of the Indenture Trustee or the terms of any indenture or
other agreement or instrument known to such counsel and to which the
Indenture Trustee is a party or is bound or any judgment, order or
decree known to such counsel to be applicable to the Indenture Trustee
of any court, regulatory body, administrative agency, governmental body
or arbitrator having jurisdiction over the Indenture Trustee.
(viii) To the best of such counsel's knowledge and
belief, there is no action, suit or proceeding pending or threatened
against the Indenture Trustee (as trustee under the Indenture or in its
individual capacity) before or by any governmental authority that if
adversely decided, would materially adversely affect the ability of the
Indenture Trustee to perform its obligations under the Indenture, the
Custodial Agreement, the Sale and Servicing Agreement or the
Administration Agreement.
(ix) The execution, delivery and performance by the
Indenture Trustee of the Sale and Servicing Agreement, the Indenture,
the Custodial Agreement and the Administration Agreement will not
subject any of the property or assets of the Trust or any portion
thereof, to any liens that are unrelated to the transactions
contemplated in such agreements.
(k) The Underwriter shall have received an opinion addressed
to it, the Seller and the Servicer of Pryor, Cashman, ▇▇▇▇▇▇▇ & ▇▇▇▇▇, counsel
to the Owner Trustee, and such other counsel acceptable to the Underwriter and
its counsel, dated the Closing Date and satisfactory in form and substance to
the Underwriter and its counsel, when taken together, substantially to the
effect that:
(i) The Owner Trustee has been duly incorporated and is
validly existing as a banking corporation in good standing under the
laws of the State of Delaware.
(ii) The Owner Trustee has full corporate trust power
and authority to enter into and perform its obligations under the Trust
Agreement and, on behalf of the Trust, under the Indenture, the
Custodial Agreement, the Sale and Servicing Agreement and the
Administration Agreement.
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(iii) The execution and delivery of the Trust Agreement
and, on behalf of the Trust, of the Indenture, the Custodial Agreement,
the Sale and Servicing Agreement, the Administration Agreement, the
Certificates and the Notes and the performance by the Owner Trustee of
its obligations under the Trust Agreement, the Indenture, the Custodial
Agreement, the Sale and Servicing Agreement and the Administration
Agreement have been duly authorized by all necessary corporate action of
the Owner Trustee and each has been duly executed and delivered by the
Owner Trustee.
(iv) The Trust Agreement, the Sale and Servicing
Agreement, the Indenture, the Custodial Agreement and the Administration
Agreement constitute valid and binding obligations of the Owner Trustee
enforceable against the Owner Trustee in accordance with their terms
under the laws of the State of New York and the State of Delaware and
the Federal law of the United States of America.
(v) The execution and delivery by the Owner Trustee of
the Trust Agreement and, on behalf of the Trust, of the Indenture, the
Sale and Servicing Agreement, the Custodial Agreement and the
Administration Agreement do not require any consent, approval or
authorization of, or any registration or filing with, any Delaware or
United States Federal governmental authority having jurisdiction over
the trust power of the Owner Trustee, other than those consents,
approvals or authorizations as have been obtained and the filing of the
Certificate of Trust with the Secretary of State of the State of
Delaware.
(vi) The Owner Trustee has duly executed, authenticated
and delivered the Certificates, and has duly executed and delivered the
Notes, issued on the Closing Date on behalf of the Trust.
(vii) The execution and delivery by the Owner Trustee of
the Trust Agreement and, on behalf of the Trust, the Sale and Servicing
Agreement, the Indenture, the Custodial Agreement and the Administration
Agreement and the performance by the Owner Trustee of its obligations
thereunder, do not conflict with, result in a breach or violation of or
constitute a default under, the articles of association or bylaws of the
Owner Trustee.
(l) The Underwriter shall have received certificates dated the
Closing Date of any two of the Chairman of the Board, the President, the
Executive Vice President, any Vice President, the Treasurer, any Assistant
Treasurer, the principal financial officer or the principal accounting officer
of each of the Seller and CFSC, in its individual capacity and as Servicer, in
which such officers shall state that, to the best of their knowledge after
reasonable investigation, (i) the representations and warranties of the Seller,
CFSC and/or the Servicer, as the case may be, contained in this Agreement, the
Trust Agreement, Purchase Agreement and the Sale and Servicing Agreement, as
applicable, are true and correct, that the Seller, CFSC and/or the Servicer, as
the case may be, has complied with all agreements and satisfied all conditions
on its part to be performed or satisfied under such agreements at or prior to
the Closing Date, that no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been instituted or are contemplated by the Commission and (ii) no material
adverse change in or affecting particularly the business or properties of the
Trust,
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the Seller, CFSC and/or the Servicer, as the case may be, has occurred.
(m) The Underwriter shall have received evidence satisfactory
to it that, on or before the Closing Date, the Custodian, on behalf of the
Seller, the Trust and the Indenture Trustee has taken possession of the
applicable Receivables reflecting the transfer of the interest of CFSC in such
Receivables and the proceeds thereof to the Seller, and the transfer of the
interest of the Seller in such Receivables and the proceeds thereof to the Trust
and the grant of the security interest by the Trust in such Receivables and the
proceeds thereof to the Indenture Trustee.
(n) The Class B Notes shall have been rated at least "A" by
Standard & Poor's Ratings Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc. and at least "A2" by ▇▇▇▇▇'▇ Investors Service, Inc.
(o) The issuance of the Notes and the Certificates shall not
have resulted in a reduction or withdrawal by any Rating Agency of the current
rating of any outstanding securities issued by the Seller or any of its
affiliates or by any trust established by the Seller or any of its affiliates.
(p) On the Closing Date, $181,448,000 aggregate principal
amount of Class A-1 3.74% Asset Backed Notes, $134,000,000 aggregate principal
amount of Class A-2 4.11% Asset Backed Notes and $277,687,000 aggregate
principal amount of Class A-3 4.85% Asset Backed Notes shall have been issued
and sold and $12,422,797 aggregate principal amount of the Certificates shall
have been issued and purchased by the Seller.
The Seller will provide or cause to be provided to the
Underwriter such conformed copies of such opinions, certificates, letters and
documents as it reasonably requests.
8. Indemnification and Contribution. (a) The Seller and CFSC will
jointly and severally, indemnify and hold harmless the Underwriter and each
person, if any, who controls the Underwriter within the meaning of Section 15 of
the Act against any losses, claims, damages, expenses or liabilities, joint or
several, to which the Underwriter or person may become subject, under the Act or
otherwise, insofar as such losses, claims, damages, expenses or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact contained in the Registration
Statement (including any Computational Materials, ABS Term Sheets, Structural
Term Sheets and Collateral Term Sheets (as defined in Section 13 of this
Agreement) approved for use by the Seller and CFSC), the Prospectus, or any
amendment or supplement thereto, any related preliminary prospectus, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse the Underwriter for any legal or
other expenses reasonably incurred by the Underwriter in connection with
investigating or defending any such loss, claim, damage, expense liability or
action; provided, however, that the Seller and CFSC will not be liable in any
such case to the extent that any such loss, claim, damage, expense or liability
arises out of or is based upon an untrue statement or alleged untrue statement
in or omission or alleged omission from any of such documents in reliance upon
and in conformity with written information furnished to the Seller by the
Underwriter specifically for use therein; and provided further, that the Seller
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and CFSC shall not be liable to the Underwriter or any person controlling the
Underwriter under the indemnity agreement in this subsection (a) with respect to
any of such documents to the extent that any such loss, claim, damage, expense
or liability of the Underwriter or such controlling person results from the fact
that the Underwriter sold Notes to a person to whom there was not sent or given,
at or prior to the written confirmation of such sale, a copy of the Prospectus
or of the Prospectus as then amended or supplemented (excluding documents
incorporated by reference), whichever is most recent, if the Seller has
previously furnished copies thereof to the Underwriter.
The indemnity agreement in this subsection (a) shall be in
addition to any liability which the Seller or CFSC may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
the Underwriter within the meaning of the Act.
(b) The Underwriter will indemnify and hold harmless the
Seller and CFSC against any losses, claims, damages, expenses or liabilities to
which the Seller and CFSC may become subject, under the Act or otherwise,
insofar as such losses, claims, damages, expenses or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Registration Statement,
the Prospectus or any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Seller or CFSC by the
Underwriter specifically for use therein, and will reimburse any legal or other
expenses reasonably incurred by the Seller or CFSC in connection with
investigating or defending any such action or claim.
The indemnity agreement in this subsection (b) shall be in
addition to any liability which the Underwriter may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
the Seller or CFSC within the meaning of the Act.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) of written notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against the
indemnifying party under subsection (a) or (b) above, notify the indemnifying
party of the commencement thereof, and in the event that such indemnified party
shall not so notify the indemnifying party within 30 days following receipt of
any such notice by such indemnified party, the indemnifying party shall have no
further liability under such subsection to such indemnified party unless the
indemnifying party shall have received other notice addressed and delivered in
the manner provided in Section 11 hereof of the commencement of such action; but
the omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than under such
subsection. In case any such action is brought against any indemnified party and
it notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party in its
reasonable judgment, and after notice from the indemnifying party to such
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indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under such
subsection for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation.
(d) If the indemnification provided for in this Section 8 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages, expenses
or liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, expenses or
liabilities (or actions in respect thereof) in such proportion as is appropriate
to reflect the relative benefits received by the Seller and CFSC on the one hand
and the Underwriter on the other from the offering of the Notes. If, however,
the allocation provided by the immediately preceding sentence is not permitted
by applicable law, then each indemnifying party shall contribute to such amount
paid or payable by such indemnified party in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault of the
Seller and CFSC on the one hand and the Underwriter on the other in connection
with the statements or omissions which resulted in such losses, claims, damages,
expenses or liabilities (or actions in respect thereof) as well as any other
relevant equitable considerations. The relative benefits received by the Seller
and CFSC on the one hand and the Underwriter on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Seller and CFSC bear to the total
underwriting discounts and commissions received by the Underwriter, in each case
as set forth in the table on the cover page of the Prospectus, as amended or
supplemented, with respect to the Notes. The relative fault shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Seller and CFSC on the one
hand or by the Underwriter on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission, including, with respect to the Underwriter, the
extent to which such losses, claims, damages, expenses or liabilities (or
actions in respect thereof) result from the fact that the Underwriter sold such
Notes to a person to whom there was not sent or given, at or prior to the
written confirmation of such sale, a copy of the Prospectus or the Prospectus as
then supplemented or amended (excluding documents incorporated by reference),
whichever is more recent, if the Seller has previously furnished copies thereof
to the Underwriter. The Seller, CFSC and the Underwriter agree that it would not
be just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
subsection (d). The amount paid by an indemnified party as a result of the
losses, claims, damages, expenses or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim. Notwithstanding the provisions
of this subsection (d), the Underwriter shall not be required to contribute any
amount in excess of the amount by which the total price at which the Notes
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which the Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation
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(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
9. No Bankruptcy Petition. The Underwriter and CFSC each
covenants and agrees that, prior to the date which is one year and one day after
the payment in full of all securities issued by the Seller or by a trust for
which the Seller was the depositor which securities were rated by any nationally
recognized statistical rating organization, it will not institute against, or
join any other person in instituting against, the Seller any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
proceedings under any Federal or state bankruptcy or similar law.
10. Survival of Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Seller or CFSC or any of their officers and the Underwriter set forth in or made
pursuant to this Agreement or contained in certificates of officers of the
Seller submitted pursuant hereto shall remain operative and in full force and
effect, regardless of (i) any termination of this Agreement, (ii) any
investigation or statement as to the results thereof made by or on behalf of the
Underwriter or of the Seller or any of their respective representatives,
officers or directors or any controlling person, and (iii) delivery of and
payment for the Class B Notes. If for any reason the purchase of the Class B
Notes by the Underwriter is not consummated, the Seller shall remain responsible
for the expenses to be paid or reimbursed by the Seller pursuant to Section 6 of
this Agreement and the respective obligations of the Seller and the Underwriter
pursuant to Section 8 of this Agreement shall remain in effect. If for any
reason the purchase of the Class B Notes by the Underwriter is not consummated
(other than because of a failure to satisfy the conditions set forth in items
(ii), (iv) or (v) of Section 7(d) of this Agreement), the Seller will reimburse
the Underwriter, upon demand, for all reasonable out-of-pocket expenses
(including fees and disbursements of counsel) reasonably incurred by it in
connection with the offering of the Class B Notes. Nothing contained in this
Section 10 shall limit the recourse of the Seller against the Underwriter.
11. Notices. All communications hereunder will be in writing and
if sent to the Underwriter, will be mailed, delivered or telegraphed and
confirmed to the Underwriter at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇; if sent to the Seller, will be mailed, delivered
or telegraphed, and confirmed to it at Caterpillar Financial Funding
Corporation, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: Secretary; if sent to CFSC, will be mailed, delivered or telegraphed,
and confirmed to it at Caterpillar Financial Services Corporation, ▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Secretary; provided,
however, that any notice to an Underwriter pursuant to Section 8 of this
Agreement will be mailed, delivered or telegraphed and confirmed to the
Underwriter. Any such notice will take effect at the time of receipt.
12. Computational Materials; Term Sheets. (a) Each Underwriter
represents and warrants to the Seller that (i) it has not and will not use any
information that constitutes "Computational Materials" as defined in the
no-action letter, dated May 20, 1994, issued by the Commission to ▇▇▇▇▇▇,
Peabody Acceptance Corporation I, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & Co. Incorporated and ▇▇▇▇▇▇
Structured Asset Corporation (as made generally applicable to other issuers and
underwriters by the Commission in the response to the request of the Public
Securities Association, dated May 24, 1994) (the "▇▇▇▇▇▇/PSA No-Action Letter"),
in connection with the
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offering of the Class B Notes and (ii) it has not and will not use any
information that constitutes "ABS Term Sheets," "Structural Term Sheets" or
"Collateral Term Sheets," each as defined in the no-action letter, dated
February 13, 1995, addressed by the Commission to the Public Securities
Association (the "PSA No-Action Letter," and together with the ▇▇▇▇▇▇/PSA
No-Action Letter, the "No Action Letters"), in connection with the offering of
the Class B Notes, in each case without the prior written approval of the Seller
and CFSC.
(b) The Seller represents and warrants that it has filed with
the Commission any Computational Materials, ABS Term Sheets, Structural Term
Sheets and Collateral Term Sheets approved by the Seller and CFSC on one or more
current reports on Form 8-K on or before the date indicated for filing pursuant
to the No-Action Letters.
13. Successors. This Agreement will inure to the benefit of and
be binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 8 of this
Agreement, and no other person will have any right or obligations hereunder. No
purchaser of Class B Notes from the Underwriter shall be deemed to be a
successor of the Underwriter merely because of such purchase.
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
15. Applicable Law. This Agreement will be governed by, and
construed in accordance with, the laws of the State of New York.
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If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicate hereof, whereupon
it will become a binding agreement among the Seller, CFSC and the Underwriter in
accordance with the terms of this Class B Note Underwriting Agreement.
Very truly yours,
CATERPILLAR FINANCIAL FUNDING
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Secretary
CATERPILLAR FINANCIAL SERVICES
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Secretary
The foregoing Class B Underwriting
Agreement is hereby confirmed and
accepted as of the date first written above.
▇▇▇▇▇▇▇, ▇▇▇▇▇ & CO.,
By: /s/ ▇▇▇▇▇▇▇, SACHS & CO.
----------------------------
(▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.)