===============================================================================
CNH EQUIPMENT TRUST 2001-A
SALE AND SERVICING AGREEMENT
among
CNH EQUIPMENT TRUST 2001-A,
as Issuer,
and
CNH CAPITAL RECEIVABLES INC.,
as Seller,
and
CASE CREDIT CORPORATION,
as Servicer.
Dated as of May 1, 2001
================================================================================
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS....................................................1
SECTION 1.1. Definitions...............................................1
SECTION 1.2. Other Definitional Provisions.............................1
ARTICLE II CONVEYANCE OF RECEIVABLES......................................2
SECTION 2.1. Conveyance of Initial Receivables.........................2
SECTION 2.2. Conveyance of Subsequent Receivables......................3
ARTICLE III THE RECEIVABLES................................................7
SECTION 3.1. Representations and Warranties of Seller..................7
SECTION 3.2. Repurchase upon Breach....................................8
SECTION 3.3. Custody of Receivable Files...............................9
SECTION 3.4. Duties of Servicer as Custodian...........................9
SECTION 3.5. Instructions; Authority To Act...........................10
SECTION 3.6. Custodian's Indemnification..............................10
SECTION 3.7. Effective Period and Termination.........................11
ARTICLE IV Administration and Servicing of Receivables...................11
SECTION 4.1. Duties of Servicer.......................................11
SECTION 4.2. Collection and Allocation of Receivable Payments.........12
SECTION 4.3. Realization upon Receivables.............................13
SECTION 4.4. Maintenance of Security Interests in Financed Equipment..13
SECTION 4.5. Covenants of Servicer....................................13
SECTION 4.6. Purchase of Receivables upon Breach......................13
SECTION 4.7. Servicing Fee............................................14
SECTION 4.8. Servicer's Certificate...................................14
SECTION 4.9. Annual Statement as to Compliance; Notice of Default.....14
SECTION 4.10. Annual Independent Certified Public Accountants' Report..15
SECTION 4.11. Access to Certain Documentation and Information Regarding
Receivables..............................................15
SECTION 4.12. Servicer Expenses........................................15
SECTION 4.13. Appointment of Subservicer...............................16
ARTICLE V Distributions: Spread Account; Statements to
Certificateholders and Noteholders.......................16
SECTION 5.1. Establishment of Trust Accounts..........................16
SECTION 5.2. Collections..............................................19
SECTION 5.3. Application of Collections...............................19
SECTION 5.4. Additional Deposits......................................19
SECTION 5.5. Distributions............................................20
SECTION 5.6. Spread Account...........................................21
SECTION 5.7. Pre-Funding Account......................................22
SECTION 5.8. Negative Carry Account...................................23
SECTION 5.9. Principal Supplement Account.............................23
SECTION 5.10. Statements to Certificateholders and Noteholders.........24
SECTION 5.11. Net Deposits.............................................26
ARTICLE VI The Seller...............................................26
SECTION 6.1. Representations of Seller................................26
SECTION 6.2. Corporate Existence......................................27
SECTION 6.3. Liability of Seller; Indemnities.........................28
SECTION 6.4. Merger or Consolidation of, or Assumption of the
Obligations of, Seller...................................29
SECTION 6.5. Limitation on Liability of Seller and Others.............30
SECTION 6.6. Seller May Own Certificates or Notes.....................30
ARTICLE VII The Servicer.............................................30
SECTION 7.1. Representations of Servicer..............................31
SECTION 7.2. Indemnities of Servicer..................................32
SECTION 7.3. Merger or Consolidation of, or Assumption of the
Obligations of, Servicer.................................34
SECTION 7.4. Limitation on Liability of Servicer and Others...........35
SECTION 7.5. Case Credit Not to Resign as Servicer....................35
SECTION 7.6. Servicer to Act as Administrator.........................36
ii
ARTICLE VIII Default..................................................36
SECTION 8.1. Servicer Default.........................................36
SECTION 8.2. Appointment of Successor Servicer........................37
SECTION 8.3. Notification to Noteholders and Certificateholders.......39
SECTION 8.4. Waiver of Past Defaults..................................39
ARTICLE IX Termination..............................................40
SECTION 9.1. Optional Purchase of All Receivables.....................40
ARTICLE X Miscellaneous Provisions.................................41
SECTION 10.1. Amendment................................................41
SECTION 10.2. Protection of Title to Trust.............................43
SECTION 10.3. Notices..................................................45
SECTION 10.4. Assignment...............................................46
SECTION 10.5. Limitations on Rights of Others..........................46
SECTION 10.6. Severability.............................................46
SECTION 10.7. Separate Counterparts....................................46
SECTION 10.8. Headings.................................................46
SECTION 10.9. Governing Law............................................46
SECTION 10.10. Assignment to Indenture Trustee..........................46
SECTION 10.11. Nonpetition Covenants....................................47
SECTION 10.12. Limitation of Liability of Trustee and
Indenture Trustee........................................47
SECTION 10.13. Conditions Precedent to Other Financing
Transactions.............................................48
iii
EXHIBITS
EXHIBIT A Form of Noteholder's Statement Pursuant to Section 5.10(a)
EXHIBIT B Form of Certificateholder's Statement Pursuant to Section 5.10(a)
EXHIBIT C Form of Servicer's Certificate
EXHIBIT D Form of Assignment
EXHIBIT E Form of Subsequent Transfer Assignment
EXHIBIT F Form of Accountants' Letter in Connection with Subsequent
Transfer Assignment
EXHIBIT G Form of Initial Interest Rate Swap Agreement
iv
TABLE OF CONTENTS
SALE AND SERVICING AGREEMENT (as amended or otherwise modified,
this "Agreement") dated as of May 1, 2001 among CNH EQUIPMENT TRUST 2001-A,
a Delaware business trust (the "Issuer"), CNH CAPITAL RECEIVABLES INC., a
Delaware corporation (the "Seller"), and CASE CREDIT CORPORATION, a
Delaware corporation (the "Servicer").
RECITALS
WHEREAS, the Issuer desires to purchase a portfolio of Contracts
purchased or originated by Case Credit Corporation ("Case Credit") or New
Holland Credit Company, LLC ("NH Credit"), in the ordinary course of
business and sold to the Seller on a monthly basis pursuant to the
Liquidity Receivables Purchase Agreements and/or the Purchase Agreements;
WHEREAS, the Seller is willing to sell such Contracts to the Issuer;
and
WHEREAS, Case Credit is willing to service such Contracts.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.1. Definitions. Capitalized terms used herein and not
otherwise defined herein are defined in Appendix A to the Indenture, dated
as of the date hereof, between CNH Equipment Trust 2001-A and Bank One,
National Association.
SECTION 1.2. Other Definitional Provisions. (a) All terms defined in
this Agreement shall have the defined meanings when used in any certificate or
other document made or delivered pursuant hereto unless otherwise defined
therein.
(b) As used in this Agreement and in any certificate or other document made
or delivered pursuant hereto, accounting terms not defined in this Agreement or
in any such certificate or other document, and accounting terms partly defined
in this Agreement or in any such certificate or other document to the extent not
defined, shall have the respective meanings given to them under generally
accepted accounting principles as in effect on the date hereof. To the extent
that the definitions of accounting terms in this Agreement or in any such
certificate or other document are inconsistent with the meanings of such terms
under generally accepted accounting principles, the definitions contained in
this Agreement or in any such certificate or other document shall control.
(c) The words "hereof", "herein", "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement; Section, Schedule and Exhibit
references contained in this Agreement are references to Sections, Schedules and
Exhibits in or to this Agreement unless otherwise specified; and the term
"including" shall mean "including, without limitation,".
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
ARTICLE II
Conveyance of Receivables
SECTION 2.1. Conveyance of Initial Receivables. In consideration
of the Issuer's delivery to or upon the order of the Seller on the Closing
Date of the net proceeds from the sale of the Notes and the Certificates
and the other amounts to be distributed from time to time to the Seller in
accordance with this Agreement, the Seller does hereby sell, transfer,
assign, set over and otherwise convey to the Issuer, without recourse
(subject to the obligations herein), all of its right, title and interest
in, to and under the following (collectively, the "Initial Assets"):
(a) the Initial Receivables, including all documents constituting chattel
paper included therewith, and all obligations of the Obligors thereunder,
including all moneys paid thereunder on or after the Initial Cutoff Date;
(b) the security interests in the Financed Equipment granted by Obligors
pursuant to the Initial Receivables and any other interest of the Seller in such
Financed Equipment;
(c) any proceeds with respect to the Initial Receivables from claims on
insurance policies covering Financed Equipment or Obligors;
(d) the Liquidity Receivables Purchase Agreements (only with respect to
Case Owned Contracts or NH Owned Contracts included in the Initial Receivables)
and the Purchase Agreements, including the right of the Seller to cause Case
Credit or NH Credit, as the case may be, to repurchase Initial Receivables from
the Seller under the circumstances described therein;
(e) any proceeds from recourse to Dealers with respect to the Initial
Receivables other than any interest in the Dealers' reserve accounts maintained
with Case Credit or with NH Credit;
(f) any Financed Equipment that shall have secured an Initial Receivable
and that shall have been acquired by or on behalf of the Trust;
(g) all funds on deposit from time to time in the Trust Accounts, including
the Spread Account Initial Deposit, any Principal Supplement Account Deposit,
the Negative Carry Account Initial Deposit and the Pre-Funded Amount, and in all
investments and proceeds thereof (including all income thereon); and
(h) any True Lease Equipment that is subject to any Initial Receivable; and
(i) the proceeds of any and all of the foregoing.
The above assignment shall be evidenced by a duly executed written
assignment in substantially the form of Exhibit D (the "Assignment"). The
Purchase Price for the Initial Receivables shall equal $565,086,041.92.
SECTION 2.2. Conveyance of Subsequent Receivables. (a) Subject to the
conditions set forth in clause (b) below, in consideration of the Trustee's
delivery on the related Subsequent Transfer Date to or upon the order of
the Seller of the amount described in Section 5.7(a) to be delivered to the
Seller, the Seller does hereby sell, transfer, assign, set over and
otherwise convey to the Issuer, without recourse (subject to the
obligations herein), all of its right, title and interest in, to and under
(collectively, the "Subsequent Assets"; and together with the Initial
Assets, the "CNHCR Assets"):
2
(i) the Subsequent Receivables listed on Schedule A to the
related Subsequent Transfer Assignment, including all documents
constituting chattel paper included therewith, and all obligations
of the Obligors thereunder, including all moneys paid thereunder
on or after the related Subsequent Cutoff Date;
(ii) the security interests in the Financed Equipment granted
by Obligors pursuant to such Subsequent Receivables and any other
interest of the Seller in such Financed Equipment;
(iii) any proceeds with respect to such Subsequent Receivables
from claims on insurance policies covering Financed Equipment or
Obligors;
(iv) the Liquidity Receivables Purchase Agreements (only with
respect to Subsequent Receivables purchased by the Seller pursuant to
those Agreements) and the Purchase Agreements, including the right
of the Seller to cause Case Credit or NH Credit, as the case may
be, to repurchase Subsequent Receivables from the Seller under the
circumstances described therein;
(v) any proceeds with respect to such Subsequent Receivables
from recourse to Dealers other than any interest in the Dealers'
reserve accounts maintained with Case Credit or with NH Credit;
(vi) any Financed Equipment that shall have secured any such
Subsequent Receivable and that shall have been acquired by or on
behalf of the Trust;
(vii) any True Lease Equipment that is subject to any
Subsequent Receivable; and
(viii) the proceeds of any and all of the foregoing.
(b) The Seller shall transfer to the Issuer the Subsequent Receivables
and the other property and rights related thereto described in clause (a) only
upon the satisfaction of each of the following conditions precedent on or
prior to the related Subsequent Transfer Date:
(i) the Seller shall have delivered to the Trustee and the
Indenture Trustee a duly executed written assignment in substantially
the form of Exhibit E (the "Subsequent Transfer Assignment"), which
shall include a Schedule A to the Subsequent Transfer Assignment
listing the Subsequent Receivables;
(ii) the Seller shall, to the extent required by Section
5.2, have deposited in the Collection Account all collections in
respect of the Subsequent Receivables;
(iii) as of such Subsequent Transfer Date: (A) the Seller was
not insolvent and will not become insolvent as a result of the
transfer of Subsequent Receivables on such Subsequent Transfer
Date, (B) the Seller did not intend to incur or believe that it
would incur debts that would be beyond the Seller's ability to pay
as such debts matured, (C) such transfer was not made with actual
intent to hinder, delay or defraud any Person and (D) the assets
of the Seller did not constitute unreasonably small capital to
carry out its business as conducted;
3
(iv) the applicable Spread Account Initial Deposit for such
Subsequent Transfer Date shall have been made;
(v) the applicable Principal Supplement Account Deposit, if
any, for such Subsequent Transfer Date shall have been made;
(vi) the Receivables in the Trust, including the Subsequent
Receivables to be conveyed to the Trust on such Subsequent Transfer
Date, shall meet the following criteria: (A) the weighted average
original term of the Receivables in the Trust will not be greater
than 55.0 months, and (B) not more than 50% of the aggregate
Contract Value of the Receivables in the Trust will represent
Contracts for the financing of construction equipment, (C) not
more than 5% of the aggregate Contract Value of the Receivables in
the Trust will represent Contracts for the financing of all-terrain
vehicles, snowmobiles or marine vessels collectively, and (D)
none of the Receivables in the Trust will represent Contracts
originated through Case Credit's Soris financing program;
(vii) the Funding Period shall not have terminated;
(viii) each of the representations and warranties made by the
Seller pursuant to Section 3.1 of this Agreement and by Case Credit and
NH Credit pursuant to Section 3.2(b) of the related Purchase
Agreement, in each case with respect to the Subsequent
Receivables, shall be true and correct as of such Subsequent
Transfer Date, and the Seller shall have performed all obligations
to be performed by it hereunder on or prior to such Subsequent
Transfer Date;
(ix) the Seller shall, at its own expense, on or prior to such
Subsequent Transfer Date, indicate in its computer files that the
Subsequent Receivables identified in the related Subsequent
Transfer Assignment have been sold to the Issuer pursuant to this
Agreement and the Subsequent Transfer Assignment;
(x) the Seller shall have taken any action required to maintain
the first priority perfected ownership interest of the Issuer in the
Trust Estate and the first perfected security interest of the
Indenture Trustee in the Collateral;
(xi) no selection procedures believed by the Seller to be
adverse to the interests of the Trust, the Noteholders or the
Certificateholders shall have been utilized in selecting the
Subsequent Receivables;
(xii) the addition of the Subsequent Receivables will
not result in a material adverse tax consequence to the Trust,
the Noteholders or the Certificateholders;
(xiii) the Seller shall have provided the Indenture Trustee,
the Trustee and the Rating Agencies a statement listing the aggregate
Contract Value of such Subsequent Receivables and any other information
reasonably requested by any of the foregoing with respect to such
Subsequent Receivables;
4
(xiv) [intentionally omitted]
(xv) the Seller shall have delivered to the Trustee and the
Indenture Trustee a letter of a firm of independent certified public
accountants confirming the satisfaction of the conditions set
forth in clause (vi) with respect to the Subsequent Receivables,
and covering substantially the same matters with respect to the
Subsequent Receivables as are set forth in Exhibit F hereto;
(xvi) the Seller shall have delivered to the Indenture Trustee
and the Trustee an Officers' Certificate confirming the satisfaction of
each condition specified in this clause (b) (substantially in the
form attached hereto as Annex A to the Subsequent Transfer
Assignment); and
(xvii) ▇▇▇▇▇'▇ shall have received written notification from
the Seller of the addition of all such Subsequent Receivables.
(c) The Seller covenants to transfer to the Issuer pursuant to clause
(a) Subsequent Receivables with an aggregate Contract Value equal to
$334,913,958.08 subject only to availability thereof.
ARTICLE III
The Receivables
SECTION 3.1. Representations and Warranties of Seller. The Seller
makes the following representations and warranties as to the Receivables on
which the Issuer is deemed to have relied in acquiring the Receivables.
Such representations and warranties speak as of the execution and delivery
of this Agreement and as of the Closing Date, in the case of the Initial
Receivables, and as of the applicable Subsequent Transfer Date, in the case
of the Subsequent Receivables, but shall survive the sale, transfer and
assignment of the Receivables to the Issuer and the pledge thereof to the
Indenture Trustee pursuant to the Indenture.
(a) Title. It is the intention of the Seller that the transfer and
assignment herein contemplated constitute a sale of the Receivables from
the Seller to the Issuer and that the beneficial interest in and title to
the Receivables not be part of the debtor's estate in the event of the
filing of a bankruptcy petition by or against the Seller under any
bankruptcy or similar law. No Receivable has been sold, transferred,
assigned or pledged by the Seller to any Person other than the Issuer.
Immediately prior to the transfer and assignment herein contemplated, the
Seller had good title to each Receivable, free and clear of all Liens and,
immediately upon the transfer thereof, the Issuer shall have good title to
each Receivable, free and clear of all Liens; and the transfer and
assignment of the Receivables to the Issuer has been perfected under the
UCC.
If (but only to the extent) that the transfer of the CNHCR Assets
hereunder is characterized by a court or other governmental authority as a
loan rather than a sale, the Seller shall be deemed hereunder to have
granted to the Issuer a security interest in all of Seller's right, title
and interest in and to the CNHCR Assets. Such security interest shall
secure all of Seller's obligations (monetary or otherwise) under this
Agreement and the other Basic Documents to which it is a party, whether now
or hereafter existing or arising, due or to become due, direct or indirect,
absolute or contingent. The Seller shall have, with respect to the property
described in Section 2.1 and Section 2.2, and in addition to all the other
rights and remedies available to Seller under this Agreement and applicable
law, all the rights and remedies of a secured party under any applicable
UCC, and this Agreement shall constitute a security agreement under
applicable law.
5
(b) All Filings Made. All filings (including UCC filings) necessary in
any jurisdiction to give the Issuer a first priority perfected ownership
interest in the Receivables, and to give the Indenture Trustee a first
priority perfected security interest therein, have been made.
SECTION 3.2. Repurchase upon Breach. (a) The Seller, the Servicer or
the Trustee, as the case may be, shall inform the other parties to this
Agreement and the Indenture Trustee promptly, in writing, upon the
discovery of any breach of the Seller's representations and warranties made
pursuant to Section 3.1 or Section 6.1, Case Credit's representations and
warranties made pursuant to Section 3.2(b) of the Case Liquidity
Receivables Purchase Agreement or NH Credit's representations and
warranties made pursuant to Section 3.2(b) of the NH Liquidity Receivables
Purchase Agreement, Case Credit's representations and warranties made
pursuant to Section 3.2(b) of the Case Purchase Agreement or NH Credit's
representations and warranties made pursuant to Section 3.2(b) of the NH
Purchase Agreement. Unless any such breach shall have been cured by the
last day of the second (or, if the Seller elects, the first) Collection
Period after such breach is discovered by the Trustee or in which the
Trustee receives written notice from the Seller or the Servicer of such
breach, the Seller shall be obligated, and, if necessary, the Seller or the
Trustee shall enforce the obligation of Case Credit under the Case
Liquidity Receivables Purchase Agreement, of NH Credit under the NH
Liquidity Receivables Purchase Agreement, of Case Credit under the Case
Purchase Agreement or of NH Credit under the NH Purchase Agreement, as
applicable, to repurchase any Receivable materially and adversely affected
by any such breach as of such last day. As consideration for the repurchase
of the Receivable, the Seller shall remit the Purchase Amount in the manner
specified in Section 5.4; provided, however, that the obligation of the
Seller to repurchase any Receivable arising solely as a result of a breach
of Case Credit's representations and warranties pursuant to Section 3.2(b)
of the Case Liquidity Receivables Purchase Agreement, of NH Credit's
representations and warranties pursuant to Section 3.2(b) of the NH
Liquidity Receivables Purchase Agreement, of Case Credit's representations
and warranties pursuant to Section 3.2(b) of the Case Purchase Agreement or
NH Credit's representations and warranties pursuant to Section 3.2(b) of
the NH Purchase Agreement is subject to the receipt by the Seller of the
Purchase Amount from Case Credit or NH Credit, as applicable. Subject to
the provisions of Section 6.3, the sole remedy of the Issuer, the Trustee,
the Indenture Trustee, the Noteholders or the Certificateholders with
respect to a breach of the representations and warranties pursuant to
Section 3.1 and the agreement contained in this Section shall be to require
the Seller to repurchase Receivables pursuant to this Section, subject to
the conditions contained herein, and to enforce Case Credit's or NH
Credit's obligation to the Seller to repurchase such Receivables pursuant
to the Case Liquidity Receivables Purchase Agreement, NH Liquidity
Receivables Purchase Agreement, the Case Purchase Agreement or the NH
Purchase Agreement, as applicable.
(b) With respect to all Receivables repurchased by the Seller pursuant
to this Agreement, the Issuer shall sell, transfer, assign, set over and
otherwise convey to the Seller, without recourse, representation or
warranty, all of the Issuer's right, title and interest in, to and under
such Receivables, and all security and documents relating thereto.
SECTION 3.3. Custody of Receivable Files. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Issuer
hereby revocably appoints the Servicer, and the Servicer hereby accepts
such appointment, to act for the benefit of the Issuer and the Indenture
Trustee as custodian of the following documents or instruments, which are
hereby constructively delivered to the Indenture Trustee, as pledgee of the
Issuer (or, in the case of the Subsequent Receivables, will as of the
applicable Subsequent Transfer Date be constructively delivered to the
Indenture Trustee, as pledgee of the Issuer) with respect to each
Receivable:
6
(a) the original fully executed copy of the Receivable;
(b) a record or facsimile of the original credit application
fully executed by the Obligor;
(c) the original certificate of title or file stamped copy of
the UCC financing statement or such other documents that
the Servicer shall keep on file, in accordance with its
customary procedures, evidencing the security interest
of Case Credit or, in the case of a NH Receivable, NH
Credit in the Financed Equipment; and (d) any and all
other documents that the Servicer or the Seller or, in
the case of NH Receivables, NH Credit shall keep on
file, in accordance with its customary procedures,
relating to a Receivable, an Obligor or any of the
Financed Equipment.
SECTION 3.4. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer shall hold the Receivable Files for the
benefit of the Issuer and the Indenture Trustee and maintain such accurate
and complete accounts, records and computer systems pertaining to each
Receivable File as shall enable the Issuer to comply with this Agreement.
In performing its duties as custodian, the Servicer shall act with
reasonable care, using that degree of skill and attention that the Servicer
exercises with respect to the receivable files relating to all comparable
equipment receivables that the Servicer services for itself or others. The
Servicer shall conduct, or cause to be conducted, periodic audits of the
Receivable Files and the related accounts, records and computer systems, in
such a manner as shall enable the Issuer or the Indenture Trustee to verify
the accuracy of the Servicer's record keeping. The Servicer shall promptly
report to the Issuer and the Indenture Trustee any failure on its part to
hold the Receivable Files and maintain its accounts, records and computer
systems as herein provided and promptly take appropriate action to remedy
any such failure. Nothing herein shall be deemed to require an initial
review or any periodic review by the Issuer, the Trustee or the Indenture
Trustee of the Receivable Files.
(b) Maintenance of and Access to Records. The Servicer shall maintain
each Receivable File at one of its offices or, in the case of a NH Receivable,
at one of NH Credit's offices; provided that at no time shall a Receivable
File be moved to an office or location outside the geographic boundaries of
the United States. The Servicer shall make available for inspection by the
Seller, the Issuer and the Indenture Trustee or their respective duly
authorized representatives, attorneys or auditors a list of locations of
the Receivable Files and the related accounts, records and computer systems
maintained by the Servicer at such times during normal business hours as
the Seller, the Issuer or the Indenture Trustee shall instruct.
SECTION 3.5. Instructions; Authority To Act. The Servicer shall be
deemed to have received proper instructions with respect to the Receivable
Files upon its receipt of written instructions signed by a Trust Officer of
the Indenture Trustee.
SECTION 3.6. Custodian's Indemnification. The Servicer as custodian
shall indemnify the Trust, the Trustee and the Indenture Trustee (and each
of their officers, directors, employees and agents) for any and all
liabilities, obligations, losses, compensatory damages, payments, costs or
expenses of any kind whatsoever that may be imposed on, incurred by or
asserted against the Trust, the Trustee or the Indenture Trustee (or any of
their officers, directors and agents) as the result of any improper act or
omission in any way relating to the maintenance and custody by the Servicer
as custodian of the Receivable Files; provided, however, that the Servicer
shall not be liable: (a) to the Trustee for any portion of any such amount
resulting from the willful misfeasance, bad faith or negligence of the
Trustee, and (b) to the Indenture Trustee for any portion of any such
amount resulting from the wilful misfeasance, bad faith or negligence of
the Indenture Trustee; and, provided further, that the Servicer shall only
be liable pursuant to this Section 3.6 for its acts or omissions committed
during the period it is serving as custodian hereunder. Indemnification
under this Section shall survive the resignation or removal of the Servicer
as custodian, the resignation or removal of the Indenture Trustee or the
termination of this Agreement.
7
SECTION 3.7. Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Initial Cutoff
Date and shall continue in full force and effect until terminated pursuant
to this Section. If any Servicer shall resign as Servicer in accordance
with this Agreement or if all of the rights and obligations of any Servicer
shall have been terminated under Section 8.1, the appointment of such
Servicer as custodian shall be terminated by: (a) the Indenture Trustee,
(b) the Noteholders of Notes evidencing not less than 25% of the Note
Balance, (c) with the consent of Noteholders of Notes evidencing not less
than 25% of the Note Balance, the Trustee or (d) Certificateholders
evidencing not less than 25% of the Certificate Balance, in the same manner
as the Indenture Trustee or such Holders may terminate the rights and
obligations of the Servicer under Section 8.1. The Indenture Trustee or,
with the consent of the Indenture Trustee, the Trustee may terminate the
Servicer's appointment as custodian, with cause, at any time upon written
notification to the Servicer, and without cause upon 30 days' prior written
notification to the Servicer. As soon as practicable after any termination
of such appointment, the Servicer shall deliver the Receivable Files to the
Indenture Trustee or the Indenture Trustee's agent at such place(s) as the
Indenture Trustee may reasonably designate.
ARTICLE IV
Administration and Servicing of Receivables
SECTION 4.1. Duties of Servicer. The Servicer, for the benefit of the
Issuer, and (to the extent provided herein) the Indenture Trustee shall
manage, service, administer and make collections on the Receivables with
reasonable care, using that degree of skill and attention that the Servicer
exercises with respect to all comparable equipment receivables that it
services for itself or others. The Servicer's duties shall include
collection and posting of all payments, responding to inquiries of Obligors
on such Receivables, investigating delinquencies, sending payment coupons
to Obligors, reporting tax information to Obligors, accounting for
collections and furnishing monthly and annual statements to the Trustee and
the Indenture Trustee with respect to distributions. Subject to Section
4.2, the Servicer shall follow its customary standards, policies and
procedures in performing its duties as Servicer. Notwithstanding anything
herein to the contrary, it is understood and agreed that, subject to
Section 4.2, in servicing the NH Receivables the Servicer shall follow NH
Credit's customary standards, policies and procedures in performing its
duties as Servicer with respect to the NH Receivables.
Without limiting the generality of the foregoing, the Servicer is
authorized and empowered to execute and deliver, on behalf of itself, the
Issuer, the Trustee, the Indenture Trustee, the Certificateholders, the
Noteholders or any of them, any and all instruments of satisfaction or
cancellation, or partial or full release or discharge, and all other
comparable instruments, with respect to such Receivables or the Financed
Equipment securing such Receivables. If the Servicer shall commence a legal
proceeding to enforce a Receivable, the Issuer shall thereupon be deemed to
have automatically assigned, solely for the purpose of collection, such
Receivable to the Servicer. If in any enforcement suit or legal proceeding
it shall be held that the Servicer may not enforce a Receivable on the
ground that it shall not be a real party in interest or a holder entitled
to enforce such Receivable, the Trustee shall, at the Servicer's expense
and direction, take steps to enforce such Receivable, including bringing
suit in its name or the name of the Trust, the Indenture Trustee, the
Certificateholders or the Noteholders. The Trustee or the Indenture Trustee
shall, upon the written request of the Servicer, furnish the Servicer with
any powers of attorney and other documents reasonably necessary or
appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
8
SECTION 4.2. Collection and Allocation of Receivable Payments. The
Servicer shall make reasonable efforts to collect all payments called for
under the Receivables as and when the same shall become due and shall
follow such collection procedures as it (or, with respect to a NH
Receivable, NH Credit) follows with respect to all comparable equipment
receivables that it services for itself or others. The Servicer shall
allocate collections between principal and interest in accordance with the
customary servicing procedures it follows with respect to all comparable
equipment receivables that it (or, with respect to a NH Receivable, NH
Credit) services for itself or others. The Servicer may grant extensions or
adjustments on a Receivable; provided, however, that if the Servicer
extends the date for final payment by the Obligor of any Receivable beyond
the Final Scheduled Maturity Date, it shall promptly purchase the
Receivable from the Issuer in accordance with Section 4.6. The Servicer
may, in its discretion, waive any late payment charge or any other fees
(other than extension fees or any other fees that represent interest
charges on deferred Scheduled Payments) that may be collected in the
ordinary course of servicing a Receivable. The Servicer shall not agree to
any decrease of the interest rate on any Receivable or reduce the aggregate
amount of the Scheduled Payments due on any Receivable.
SECTION 4.3. Realization upon Receivables. For the benefit of the
Issuer and the Indenture Trustee, the Servicer shall use reasonable
efforts, consistent with its customary servicing procedures, to repossess
or otherwise convert the ownership of the Financed Equipment securing any
Receivable as to which the Servicer shall have determined eventual payment
in full is unlikely. The Servicer shall follow such customary and usual
practices and procedures as it shall deem necessary or advisable in its
servicing of equipment receivables, which may include reasonable efforts to
realize upon any recourse to Dealers and selling the Financed Equipment at
public or private sale. The foregoing shall be subject to the provision
that, in any case in which the Financed Equipment shall have suffered
damage, the Servicer shall not expend funds in connection with the repair
or the repossession of such Financed Equipment unless it shall determine in
its discretion that such repair and/or repossession will increase the
Liquidation Proceeds by an amount greater than the amount of such expenses.
SECTION 4.4. Maintenance of Security Interests in Financed Equipment.
The Servicer shall, in accordance with its customary servicing procedures,
take such steps as are necessary to maintain perfection of the security
interest created by each Receivable in the related Financed Equipment. The
Servicer is hereby authorized to take such steps as are necessary to
re-perfect such security interest for the benefit of the Issuer and the
Indenture Trustee in the event of the relocation of any Financed Equipment,
any change to the UCC or for any other reason.
SECTION 4.5. Covenants of Servicer. The Servicer shall not release the
Financed Equipment securing any Receivable from the security interest
granted by such Receivable in whole or in part except in the event of
payment in full by the Obligor thereunder or repossession, nor shall the
Servicer impair the rights of the Issuer, the Indenture Trustee, the
Certificateholders or the Noteholders in such Receivables. The Servicer
shall, in accordance with its customary servicing procedures, require that
each Obligor shall have obtained physical damage insurance covering the
Financed Equipment as of the execution of the Receivable.
9
SECTION 4.6. Purchase of Receivables upon Breach. The Servicer or the
Trustee shall inform the other party, the Indenture Trustee, the Seller and
Case Credit promptly, in writing, upon the discovery of any breach pursuant
to Section 4.2, 4.4 or 4.5. Unless the breach shall have been cured by the
last day of the Collection Period in which such breach is discovered, the
Servicer shall purchase any Receivable materially and adversely affected by
such breach as of such last day. If the Servicer takes any action during
any Collection Period pursuant to Section 4.2 that impairs the rights of
the Issuer, the Indenture Trustee, the Certificateholders or the
Noteholders in any Receivable or as otherwise provided in Section 4.2, the
Servicer shall purchase such Receivable as of the last day of such
Collection Period. As consideration for the purchase of any such Receivable
pursuant to either of the two preceding sentences, the Servicer shall remit
the Purchase Amount in the manner specified in Section 5.4. Subject to
Section 7.2, the sole remedy of the Issuer, the Trustee, the Indenture
Trustee, the Certificateholders or the Noteholders with respect to a breach
pursuant to Section 4.2, 4.4 or 4.5 shall be to require the Servicer to
purchase Receivables pursuant to this Section. The Trustee shall have no
duty to conduct any affirmative investigation as to the occurrence of any
condition requiring the purchase of any Receivable pursuant to this
Section.
SECTION 4.7. Servicing Fee. The Servicing Fee for each Collection
Period shall be equal to 1/12th of 1.00% of the Pool Balance as of the first
day of such Collection Period.
SECTION 4.8. Servicer's Certificate. On each Determination Date the
Servicer shall deliver to the Trustee, the Indenture Trustee and the
Seller, with a copy to the Rating Agencies, a Servicer's Certificate
containing all information necessary to make the distributions pursuant to
Sections 5.5 and 5.6 and the deposits to the Collection Account pursuant to
Section 5.2 for the Collection Period preceding the date of such Servicer's
Certificate. Receivables to be repurchased by the Seller or purchased by
the Servicer shall be identified by the Servicer by account number with
respect to such Receivable (as specified in the schedule of Receivables
delivered on the Closing Date or attached to the applicable Subsequent
Transfer Assignment).
SECTION 4.9. Annual Statement as to Compliance; Notice of Default. (a)
The Servicer shall deliver to the Trustee and the Indenture Trustee, on or
before April 30th of each year, an Officers' Certificate, dated as of
December 31 of the preceding year, stating that: (i) a review of the
activities of the Servicer during the preceding 12-month period (or, in the
case of the first such certificate, from the Initial Cutoff Date to
December 31, 2001) and of its performance under this Agreement has been
made under such officers' supervision and (ii) to the best of such
officers' knowledge, based on such review, the Servicer has fulfilled all
its obligations under this Agreement throughout such year or, if there has
been a default in the fulfillment of any such obligation, specifying each
such default known to such officers and the nature and status thereof. The
Indenture Trustee shall send a copy of such Certificate and the report
referred to in Section 4.10 to the Rating Agencies. A copy of such
Certificate and report may be obtained by any Certificateholder or
Noteholder by a request in writing to the Trustee addressed to the
Corporate Trust Office. Upon the written request of the Trustee, the
Indenture Trustee will promptly furnish the Trustee a list of Noteholders
as of the date specified by the Trustee.
10
(b) The Servicer shall deliver to the Trustee, the Indenture Trustee
and the Rating Agencies, promptly after having obtained knowledge thereof, but
in no event later than five Business Days thereafter, written notice in an
Officers' Certificate of any event that, with the giving of notice or lapse
of time, or both, would become a Servicer Default under Section 8.1(a) or
(b).
SECTION 4.10. Annual Independent Certified Public Accountants' Report.
The Servicer shall cause a firm of independent certified public
accountants, which may also render other services to the Servicer, the
Seller or any other Affiliate of CNH Global, to deliver to the Trustee and
the Indenture Trustee on or before April 30 of each year a report,
addressed to the Board of Directors of the Servicer, the Trustee and the
Indenture Trustee, summarizing the results of certain procedures with
respect to certain documents and records relating to the servicing of the
Receivables during the preceding calendar year (or, in the case of the
first such report, during the period from the Initial Cutoff Date to
December 31, 2001). The procedures to be performed and reported upon by the
independent public accountants shall be those agreed to by the Servicer.
In the event that such firm requires the Indenture Trustee to
agree to the procedures performed by such firm, the Servicer shall direct
the Indenture Trustee in writing to so agree; it being understood and
agreed that the Indenture Trustee will deliver such letter of agreement in
conclusive reliance upon the direction of the Servicer and the Indenture
Trustee makes no independent inquiry or investigation as to, and shall have
no obligation or liability in respect of, the sufficiency, validity or
correctness of such procedures.
Such report will also indicate that the firm is independent of the
Servicer within the meaning of the Code of Professional Ethics of the
American Institute of Certified Public Accountants.
SECTION 4.11. Access to Certain Documentation and Information Regarding
Receivables. The Servicer shall provide to the Trustee and the Indenture
Trustee access to the Receivable Files in such cases where the Trustee or
the Indenture Trustee shall be required by applicable statutes or
regulations to review such documentation. Access shall be afforded without
charge, but only upon reasonable request and during the normal business
hours at the respective offices of the Servicer (or, in the case of the NH
Receivables, NH Credit). Nothing in this Section shall affect the
obligation of the Servicer to observe any applicable law prohibiting
disclosure of information regarding the Obligors, and the failure of the
Servicer to provide access to information as a result of such obligation
shall not constitute a breach of this Section.
SECTION 4.12. Servicer Expenses. The Servicer shall be required to pay
all expenses incurred by it in connection with its activities hereunder,
including fees and disbursements of independent accountants, taxes imposed
on the Servicer and expenses incurred in connection with distributions and
reports to Certificateholders and the Noteholders.
SECTION 4.13. Appointment of Subservicer. The Servicer may at any time
appoint a subservicer to perform all or any portion of its obligations as
Servicer hereunder; provided, however, that the Rating Agency Condition
shall have been satisfied in connection therewith (other than with respect
to the appointment of NH Credit, as subservicer, with respect to the NH
Receivables); and provided further, that the Servicer shall remain
obligated and be liable to the Issuer, the Trustee, the Indenture Trustee,
the Certificateholders and the Noteholders for the servicing and
administering of the Receivables in accordance with the provisions hereof
without diminution of such obligation and liability by virtue of the
appointment of such subservicer and to the same extent and under the same
terms and conditions as if the Servicer alone were servicing and
administering the Receivables. The fees and expenses of the subservicer
shall be as agreed between the Servicer and its subservicer from time to
time and none of the Issuer, the Trustee, the Indenture Trustee, the
Certificateholders or the Noteholders shall have any responsibility
therefor.
11
ARTICLE V
Distributions: Spread Account;
Statements to Certificateholders and Noteholders
SECTION 5.1. Establishment of Trust Accounts. (a) (i) The Servicer,
for the benefit of the Noteholders and the Certificateholders, shall
establish and maintain in the name of the Indenture Trustee an Eligible
Deposit Account (the "Collection Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Noteholders and the Certificateholders.
(ii) The Servicer, for the benefit of the Noteholders, shall
establish and maintain in the name of the Indenture Trustee an Eligible
Deposit Account (the "Note Distribution Account"), bearing a
designation clearly indicating that the funds deposited therein
are held for the benefit of the Noteholders.
(iii) The Servicer, for the benefit of the Noteholders, shall
establish and maintain in the name of the Indenture Trustee an Eligible
Deposit Account (the "Spread Account"), bearing a designation
clearly indicating that the funds deposited therein are held for
the benefit of the Noteholders.
(iv) The Servicer, for the benefit of the Noteholders and the
Certificateholders, shall establish and maintain in the name of
the Indenture Trustee an Eligible Deposit Account (the
"Pre-Funding Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Noteholders and the Certificateholders.
(v) The Servicer, for the benefit of the Noteholders and the
Certificateholders, shall establish and maintain in the name of
the Indenture Trustee an Eligible Deposit Account (the "Negative
Carry Account"), bearing a designation clearly indicating that the
funds deposited therein are held for the benefit of the
Noteholders and the Certificateholders.
(vi) The Servicer, for the benefit of the Noteholders and the
Certificateholders, shall establish and maintain in the name of
the Indenture Trustee an Eligible Deposit Account (the "Principal
Supplement Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Noteholders and the Certificateholders.
(b) Funds on deposit in the Collection Account, the Note Distribution
Account, the Spread Account, the Pre-Funding Account, the Negative Carry
Account and the Principal Supplement Account, (collectively, the "Trust
Accounts") shall be invested or reinvested by the Indenture Trustee in
Eligible Investments selected by and as directed in writing by the Servicer
(which written direction may be in the form of standing instructions);
provided, however, it is understood and agreed that the Indenture Trustee
shall not be liable for the selection of, or any loss arising from such
investment in, Eligible Investments. All such Eligible Investments shall be
held or controlled by the Indenture Trustee for the benefit of the
12
Noteholders and the Certificateholders or the Noteholders, as applicable
(and for the purposes of Articles 8 and 9 of the UCC, each Eligible
Investment is intended to constitute a Financial Asset, and each of the
Trust Accounts is intended to constitute a Securities Account); provided,
that on each Transfer Date, all Investment Earnings on funds on deposit
therein shall be deposited into the Collection Account and shall be deemed
to constitute a portion of the Total Distribution Amount. Other than as
permitted by the Rating Agencies, funds on deposit in the Trust Accounts
shall be invested in Eligible Investments that will mature so that such
funds will be available at the close of business on the Transfer Date
preceding the following Payment Date; provided, however, that funds on
deposit in Trust Accounts may be invested in Eligible Investments of the
entity serving as Indenture Trustee payable on demand or that mature so
that such funds will be available on the Payment Date. Funds deposited in a
Trust Account on the Transfer Date that precedes a Payment Date upon the
maturity or liquidation of any Eligible Investments are not required to be
invested overnight.
(c) (i) The Indenture Trustee shall possess or control all right,
title and interest in all funds on deposit from time to time in the Trust
Accounts and in all proceeds thereof (including all income thereon) and all such
funds, investments, proceeds and income shall be part of the Trust Estate.
The Trust Accounts shall be under the sole dominion and control of the
Indenture Trustee for the benefit of the Noteholders and the
Certificateholders or the Noteholders, as the case may be. If, at any time,
any of the Trust Accounts ceases to be an Eligible Deposit Account, the
Indenture Trustee (or the Servicer on its behalf) shall within 10 Business
Days (or such longer period, not to exceed 30 calendar days, as to which
each Rating Agency may consent) establish a new Trust Account as an
Eligible Deposit Account and shall transfer any cash and/or any investments
held in the no-longer Eligible Deposit Account to such new Trust Account.
(ii) With respect to the Trust Account Property, the Indenture
Trustee agrees, by its acceptance hereof, that:
(A) any Trust Account Property that is held in deposit
accounts shall be held solely in Eligible Deposit
Accounts, subject to the last sentence of Section
5.1(c)(i); and each such Eligible Deposit Account shall
be subject to the exclusive custody and control of the
Indenture Trustee, and the Indenture Trustee shall have
sole signature authority with respect thereto;
(B) any Trust Account Property that constitutes a
Certificated Security shall be delivered to the Indenture
Trustee in accordance with paragraph (i) of the
definition of "Delivery" and shall be held, pending
maturity or disposition, solely by the Indenture Trustee
or its agent;
(C) any such Trust Account Property that constitutes
an Uncertificated Security (including any investments in
money market mutual funds, but excluding any Federal Book
Entry Security) shall be delivered to the Indenture
Trustee in accordance with paragraph (ii) of the
definition of "Delivery" and shall be maintained, pending
maturity or disposition, through continued registration
of the Indenture Trustee's (or its custodian or
nominee's) ownership of such security; and
(D) with respect to any Trust Account Property that
constitutes a Federal Book Entry Security, the Indenture
Trustee shall maintain and obtain Control over such
property.
(iii) The Servicer shall have the power, revocable by
the Indenture Trustee or by the Trustee, with the consent of the
Indenture Trustee, to instruct the Indenture Trustee to make
withdrawals and payments from the Trust Accounts for the purpose
of permitting the Servicer or the Trustee to carry out its
respective duties hereunder or permitting the Indenture Trustee
to carry out its duties under the Indenture.
13
(d) All Trust Accounts will initially be established at the Indenture
Trustee.
SECTION 5.1.5. Interest Rate Swap Agreements. (a) The Issuer shall on or
prior to the Closing Date enter into the Interest Rate Swap Agreements with
the Counterparties for the benefit of the Noteholders and
Certificateholders, such that the aggregate notional amount under the
Interest Rate Swap Agreements shall, at any time, be equal to the
Outstanding Amount of the Class A-2 and Class A-3 Notes at such time. Net
Swap Receipts shall be deposited by the Indenture Trustee into the
Collection Account on the day received and shall constitute part of the
Total Distribution Amount. On any Payment Date when there shall be a Net
Swap Payment, the Indenture Trustee shall pay such Net Swap Payment from
the Total Distribution Amount.
(b) Each Interest Rate Swap Agreement shall be in substantially the same
form as the Interest Rate Swap Agreement attached hereto as Exhibit G.
(c) The Servicer, when required under any Interest Rate Swap Agreement,
shall cause the Issuer to enter into a replacement Interest Rate Swap
Agreement.
SECTION 5.2. Collections. The Servicer shall, and shall cause any
subservicer to, remit within two Business Days of receipt thereof to the
Collection Account all payments by or on behalf of the Obligors with
respect to the Receivables, and all Liquidation Proceeds, both as collected
during the Collection Period. Notwithstanding the foregoing, for so long
as: (i) Case Credit remains the Servicer, (ii) no Servicer Default shall
have occurred and be continuing and (iii) prior to ceasing daily
remittances, the Rating Agency Condition shall have been satisfied (and any
conditions or limitations imposed by the Rating Agencies in connection
therewith are complied with), the Servicer shall remit such collections
with respect to the related Collection Period to the Collection Account on
the Transfer Date immediately following the end of such Collection Period.
For purposes of this Article V, the phrase "payments by or on behalf of the
Obligors" shall mean payments made with respect to the Receivables by
Persons other than the Servicer or the Seller.
SECTION 5.3. Application of Collections. (a) With respect to each
Receivable, all collections for the Collection Period shall be applied to
the related Scheduled Payment.
(b) All Liquidation Proceeds shall be applied to the related Receivable.
SECTION 5.4. Additional Deposits. The Servicer and the Seller shall
deposit or cause to be deposited in the Collection Account the aggregate
Purchase Amount with respect to Purchased Receivables on the Transfer Date
related to the Collection Period on the last day of which the purchase
occurs, and the Servicer shall deposit therein all amounts to be paid under
Section 9.1 on the Transfer Date falling in the Collection Period referred
to in Section 9.1. The Servicer shall deposit the aggregate Purchase Amount
with respect to Purchased Receivables when such obligations are due, unless
the Servicer shall not be required to make daily deposits pursuant to
Section 5.2, in which case such deposits shall be made on the Transfer Date
following the related Collection Period.
SECTION 5.5. Distributions. (a) On each Determination Date, the
Servicer shall calculate all amounts required to determine the amounts to
be deposited in the Note Distribution Account, the Certificate Distribution
Account and the Spread Account.
14
(b) On each Payment Date, the Servicer shall instruct the Indenture
Trustee (based on the information contained in the Servicer's Certificate
delivered on the related Determination Date pursuant to Section 4.8) to make
from the Collection Account the following deposits and distributions for
receipt by the Servicer or deposit in the applicable Trust Account or
Certificate Distribution Account, as applicable, by 10:00 a.m. (New York time),
to the extent of the Total Distribution Amount, in the following order of
priority:
(i) to the Administrator, the Administration Fee and all
unpaid Administration Fees from prior Collection Periods;
(ii) to the Note Distribution Account, the Net Swap Payments
(including interest on any overdue Net Swap Payments), if any;
(iii) to the Note Distribution Account, the Class Interest
Amount for each Class of Class A Notes and the Swap Termination
Payments payable by the Issuer, if any;
(iv) to the Note Distribution Account, the Class Interest
Amount for the Class B Notes;
(v) to the Note Distribution Account, the Class Principal
Distributable Amount for each Class of Class A Notes;
(vi) to the Note Distribution Account, the Class B
Noteholders' Monthly Principal Distributable Amount;
(vii) to the Spread Account to the extent necessary so that
the balance on deposit therein will equal the Specified Spread Account
Balance;
(viii) to the Certificate Distribution Account, the
Certificateholders' Interest Distributable Amount;
(ix) to the Certificate Distribution Account, the
Certificateholders' Monthly Principal Distributable Amount;
(x) to the Servicer, the Servicing Fee and all unpaid
Servicing Fees from prior Collection Periods; provided that if Case
Credit or an Affiliate of Case Credit is not the Servicer, the amounts
described in this clause (ix) will be paid prior to any other
application of funds on deposit in the Collection Account; and
(xi) to the Seller, the remaining Total Distribution Amount;
(c) On the A-1 Note Final Scheduled Maturity Date, the Servicer shall
instruct the Indenture Trustee to deposit from the Collection Account into
the Note Distribution Account by 10:00 a.m. (New York time), to the extent
of available funds on such day, an amount equal to the sum of (i) the
aggregate accrued and unpaid interest on the Class A-1 Notes as of the A-1
Note Final Scheduled Maturity Date, and (ii) the amount necessary to reduce
the outstanding principal amount of the Class A-1 Notes to zero.
15
It is understood and agreed that, with respect to the amounts to
be distributed pursuant to this Section 5.5(c), the Servicer shall, to the
extent necessary (i) deposit into the Collection Account any amounts
received as payments by or on behalf of any Obligor (and not previously
deposited into the Collection Account) on or prior to the A-1 Note Final
Scheduled Maturity Date, (ii) make each calculation that would otherwise be
made on a Determination Date (with appropriate adjustments) in accordance
with Section 4.8 on the Business Day immediately proceeding the A-1 Note
Final Scheduled Maturity Date, (iii) on the Payment Date immediately
succeeding the A-1 Note Final Scheduled Maturity Date, make any adjustments
to the Class Principal Distributable Amount, the Class Interest Amount and
any other amount to be paid on such Payment Date, and (iv) make any other
calculation, adjustment or correction that may be required as a result of
any payment made on the A-1 Note Final Scheduled Maturity Date.
SECTION 5.6. Spread Account. (a) On the Closing Date and on each
Subsequent Transfer Date, the Seller shall deposit the applicable Spread
Account Initial Deposit into the Spread Account.
(b) If the amount on deposit in the Spread Account on any Payment Date
(after giving effect to all deposits or withdrawals therefrom on such
Payment Date) is greater than the Specified Spread Account Balance for such
Payment Date, the Servicer shall instruct the Indenture Trustee to
distribute the amount of the excess to the Seller (and its transferees and
assignees in accordance with their respective interests); provided, that
if, after giving effect to all payments made on the Notes on such Payment
Date, the sum of the Pool Balance and the Pre-Funded Amount as of the first
day of the Collection Period in which such Payment Date occurs is less than
the sum of the Note Balance and the Certificate Balance, such excess shall
not be distributed to the Seller (or such transferees or assignees) and
shall be retained in the Spread Account for application in accordance with
this Agreement. Amounts properly distributed pursuant to this Section
5.6(b) shall be deemed released from the Trust and the security interest
therein granted to the Indenture Trustee, and the Seller (and such
transferees and assignees) shall in no event thereafter be required to
refund any such distributed amounts.
(c) Following: (i) the payment in full of the aggregate Outstanding
Amount of the Notes and of all other amounts owing or to be distributed
hereunder or under the Indenture to the Noteholders, the Trustee and the
Indenture Trustee and (ii) the termination of the Trust, any amount remaining
on deposit in the Spread Account shall be distributed to the Seller or any
transferee or assignee pursuant to clause (g). The Seller (and such
transferees and assignees) shall in no event be required to refund any
amounts properly distributed pursuant to this Section 5.6(c).
(d) In the event that the sum of (x) the Noteholders' Distributable
Amount for a Payment Date, (y) the Net Swap Payments (including interest on any
overdue Net Swap Payments) for a Payment Date, if any, and (z) the Swap
Termination Payments payable by the Issuer, if any, exceeds the amount
deposited into the Note Distribution Account pursuant to Sections
5.5(b)(ii), (iii), (iv), (v) and (vi) on such Payment Date, the Servicer
shall instruct the Indenture Trustee on such Payment Date to withdraw from
the Spread Account on such Payment Date an amount equal to such excess, to
the extent of funds available therein, and deposit such amount into the
Note Distribution Account.
16
(e) The Seller may at any time, without consent of the Noteholders,
sell, transfer, convey or assign in any manner its rights to and interests in
distributions from the Spread Account, including interest and other
investment earnings thereon; provided, that the Rating Agency Condition is
satisfied.
SECTION 5.7. Pre-Funding Account. (a) On the Closing Date, the Trustee
will deposit, on behalf of the Seller, in the Pre-Funding Account
$334,913,958.08 from the net proceeds of the sale of the Notes and the
Certificates. On each Subsequent Transfer Date, the Servicer shall instruct
the Indenture Trustee to withdraw from the Pre-Funding Account an amount
equal to: (i) the aggregate Contract Value of the Subsequent Receivables
transferred to the Issuer on such Subsequent Transfer Date less the amounts
described in clause (ii) and clause (iii) below, and distribute such amount
to or upon the order of the Seller upon satisfaction of the conditions set
forth in Section 2.2(b) with respect to such transfer, (ii) the Spread
Account Initial Deposit for such Subsequent Transfer Date and, on behalf of
the Seller, deposit such amount in the Spread Account and (iii) the
Principal Supplement Account Deposit for such Subsequent Transfer Date,
and, on behalf of the Seller, deposit such amount in the Principal
Supplement Account.
(b) If: (i) the Pre-Funded Amount has not been reduced to zero on the
Payment Date on which the Funding Period ends (or, if the Funding Period
does not end on a Payment Date, on the first Payment Date following the end
of the Funding Period) or (ii) the Pre-Funded Amount has been reduced to
$100,000 or less on any Determination Date, in either case after giving
effect to any reductions in the Pre-Funded Amount on such date pursuant to
paragraph (a), the Servicer shall instruct the Indenture Trustee to
withdraw from the Pre-Funding Account, in the case of clause (i), on such
Payment Date or, in the case of clause (ii), on the Payment Date
immediately succeeding such Determination Date, the amount remaining at the
time in the Pre-Funding Account (such remaining amount being the "Remaining
Pre-Funded Amount") and deposit such amounts in the Collection Account, for
inclusion in the Total Distribution Amount for that Payment Date.
SECTION 5.8. Negative Carry Account. On the Closing Date, the Seller
shall deposit the Negative Carry Account Initial Deposit into the Negative
Carry Account. On each Payment Date, the Servicer will instruct the
Indenture Trustee to withdraw from the Negative Carry Account and deposit
into the Collection Account an amount equal to the Negative Carry Amount
for such Collection Period. If the amount on deposit in the Negative Carry
Account on any Payment Date (after giving effect to the withdrawal
therefrom of the Negative Carry Amount for such Payment Date) is greater
than the Required Negative Carry Account Balance, the excess will be
released to the Seller.
SECTION 5.9. Principal Supplement Account. On each Subsequent Transfer
Date the Servicer shall calculate the amount, if any, of the Principal
Supplement Account Deposit applicable to such Subsequent Transfer Date,
and, if such amount is positive, the Seller shall deposit such amount into
the Principal Supplement Account. In the event that the sum of (x) the
Noteholders' Distributable Amount for a Payment Date, (y) the Net Swap
Payments (including interest on any overdue Net Swap Payments) for a
Payment Date, if any, and (z) the Swap Termination Payments payable by the
Issuer, if any, exceeds the amount deposited into the Note Distribution
Account pursuant to Sections 5.5(b)(ii), (iii), (iv), (v) and (vi) on such
Payment Date and Section 5.6(d) on such Payment Date, the Servicer shall
instruct the Indenture Trustee on such Payment Date to withdraw from the
Principal Supplement Account on such Payment Date an amount equal to such
excess, to the extent of funds available therein, and deposit such amount
into the Note Distribution Account. In the event that the Class Principal
Distributable Amount for any Class of Notes for the applicable final
scheduled maturity date for such Class of Notes exceeds the remainder of
the Total Distribution Amount and the amounts available in the Spread
Account pursuant to Section 5.6(e) for that Payment Date after subtracting
the Class Principal Distributable Amount for each Class of Notes having
priority over such Class of Notes, the Servicer shall instruct the
Indenture Trustee on such Payment Date to withdraw from the Principal
17
Supplement Account on such Payment Date an amount equal to such excess, to
the extent of funds available therein, and deposit such amount into the
Note Distribution Account. Funds on deposit in the Principal Supplement
Account may be withdrawn and paid to the Seller on any day if each Rating
Agency has confirmed that such action will not result in a withdrawal or
downgrade of its rating of any Class of Notes.
SECTION 5.10. Statements to Certificateholders and Noteholders. (a) On
each Determination Date the Servicer shall provide to the Indenture Trustee
(with a copy to the Rating Agencies), for the Indenture Trustee to make
available to each Noteholder of record, and to the Trustee, for the Trustee
to forward to each Certificateholder of record, a statement substantially
in the form of Exhibits A and B, respectively, setting forth at least the
following information as to each Class of the Notes and the Certificates to
the extent applicable:
(i) the amount of such distribution allocable to principal of
each Class of Notes;
(ii) the amount of the distribution allocable to interest of
each Class of Notes;
(iii) the amount of the distribution allocable to principal
of the Certificates;
(iv) the amount of the distribution allocable to interest on
the Certificates;
(v) the Pool Balance as of the close of business on the last
day of the preceding Collection Period;
(vi) the aggregate Outstanding Amount and the Note Pool Factor
for each Class of Notes, and the Certificate Balance and the
Certificate Pool Factor as of such Payment Date, after giving effect
to payments allocated to principal reported under clauses (i) and
(iii) above;
(vii) the amount of the Servicing Fee paid to the Servicer
with respect to the preceding Collection Period;
(viii) the amount of the Administration Fee paid to the
Administrator in respect of the preceding Collection Period;
(ix) the amount of the aggregate Realized Losses, if any, for
such Collection Period;
(x) the aggregate Purchase Amounts for Receivables, if any,
that were repurchased or purchased in such Collection Period;
(xi) the balance of the Spread Account on such Payment Date,
after giving effect to changes therein on such Payment Date;
(xii) for Payment Dates during the Funding Period, the
remaining Pre-Funded Amount;
(xiii) for the final Payment Date with respect to the Funding
Period, the amount of any remaining Pre-Funded Amount that has not
been used to fund the purchase of Subsequent Receivables;
(xiv) the balance of the Principal Supplement Account on such
Payment Date, after giving effect to changes therein on such Payment
Date;
18
(xv) the balance of the Negative Carry Account on such
Payment Date, after giving effect to changes therein on such Payment
Date;
(xvi) the amount of Net Swap Payments or Net Swap Receipts for
such Payment Date, and
(xvii) the amount of Swap Termination Payments paid by the
Issuer on such Payment Date.
Each amount set forth pursuant to clauses (i), (ii), (iii), (iv), (vii) and
(viii) shall be expressed as a dollar amount per $1,000 of original
principal balance of a Certificate or Note, as applicable.
The Indenture Trustee will make the Statement to Noteholders
available each month to Noteholders and other parties to the Basic
Documents via the Indenture Trustee's internet website, which is presently
located at ▇▇▇.▇▇▇.▇▇▇▇▇▇▇.▇▇▇. Persons who are unable to use the above
website are entitled to have a paper copy mailed to them via first class
mail by calling the Indenture Trustee at (▇-▇▇▇) ▇▇▇-▇▇▇▇. The Indenture
Trustee shall have the right to change the way the Statement to Noteholders
is distributed in order to make such distribution more convenient and/or
more accessible to the above parties and to the Noteholders. The Indenture
Trustee shall provide timely and adequate notification to all above parties
and to the Noteholders regarding any such change.
SECTION 5.11. Net Deposits. As an administrative convenience, unless
the Servicer is required to remit collections daily, the Servicer will be
permitted to make the deposit of collections net of distributions, if any,
to be made to the Servicer with respect to the Collection Period. The
Servicer, however, will account to the Trustee, the Indenture Trustee, the
Noteholders and the Certificateholders as if all deposits, distributions
and transfers were made individually.
ARTICLE VI
The Seller
SECTION 6.1. Representations of Seller. The Seller makes the following
representations on which the Issuer is deemed to have relied in acquiring
the Receivables. The representations speak as of the execution and delivery
of this Agreement and shall survive the sale of the Receivables to the
Issuer and the pledge thereof to the Indenture Trustee pursuant to the
Indenture.
(a) Organization and Good Standing. The Seller is duly organized and
validly existing as a corporation in good standing under the laws of the State
of Delaware, with the corporate power and authority to own its properties and to
conduct its business as such properties are currently owned and such business is
presently conducted, and had at all relevant times, and has, the corporate
power, authority and legal right to acquire, own and sell the Receivables.
(b) Due Qualification. The Seller is duly qualified to do business as a
foreign corporation in good standing, and has obtained all necessary licenses
and approvals, in all jurisdictions in which the ownership or lease of property
or the conduct of its business shall require such qualifications.
19
(c) Power and Authority. The Seller has the power and authority to execute
and deliver this Agreement and to carry out its terms; the Seller has full power
and authority to sell and assign the property to be sold and assigned to and
deposited with the Issuer and has duly authorized such sale and assignment to
the Issuer by all necessary corporate action; and the execution, delivery and
performance of this Agreement have been, and the execution, delivery and
performance of each Subsequent Transfer Assignment have been or will be on or
before the related Subsequent Transfer Date, duly authorized by the Seller by
all necessary corporate action.
(d) Binding Obligation. This Agreement constitutes, and each Subsequent
Transfer Assignment when executed and delivered by the Seller will constitute, a
legal, valid and binding obligation of the Seller enforceable in accordance with
their terms.
(e) No Violation. The consummation of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof do not conflict with, result
in any breach of any of the terms and provisions of, or constitute (with or
without notice or lapse of time) a default under, the certificate of
incorporation or by-laws of the Seller, or any indenture, agreement or other
instrument to which the Seller is a party or by which it shall be bound; or
result in the creation or imposition of any Lien upon any of its properties
pursuant to the terms of any such indenture, agreement or other instrument
(other than the Basic Documents); or violate any law or, to the best of the
Seller's knowledge, any order, rule or regulation applicable to the Seller of
any court or of any Federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the Seller or its
properties.
(f) No Proceedings. There are no proceedings or investigations pending
or, to the Seller's best knowledge, threatened, before any court,
regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or its properties: (i)
asserting the invalidity of this Agreement, the Indenture or any of the
other Basic Documents, the Notes or the Certificates, (ii) seeking to
prevent the issuance of the Notes or the Certificates or the consummation
of any of the transactions contemplated by this Agreement, the Indenture or
any of the other Basic Documents, (iii) seeking any determination or ruling
that could reasonably be expected to materially and adversely affect the
performance by the Seller of its obligations under, or the validity or
enforceability of, this Agreement, the Indenture, any of the other Basic
Documents, the Notes or the Certificates or (iv) that might adversely
affect the Federal or state income tax attributes of the Notes or the
Certificates.
SECTION 6.2. Corporate Existence. (a) During the term of this
Agreement, the Seller will keep in full force and effect its existence,
rights and franchises as a corporation under the laws of the jurisdiction
of its incorporation and will obtain and preserve its qualification to do
business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Agreement, the
Basic Documents and each other instrument or agreement necessary or
appropriate to the proper administration of this Agreement and the
transactions contemplated hereby.
(b) During the term of this Agreement, the Seller shall observe the
applicable legal requirements for the recognition of the Seller as a legal
entity separate and apart from its Affiliates, including as follows:
20
(i) the Seller shall maintain corporate records and books
of account separate from those of its Affiliates;
(ii) except as otherwise provided in this Agreement and similar
arrangements relating to other securitizations, the Seller shall
not commingle its assets and funds with those of its Affiliates;
(iii) the Seller shall hold such appropriate meetings or obtain
such appropriate consents of its Board of Directors as are necessary
to authorize all the Seller's corporate actions required by law to be
authorized by the Board of Directors, shall keep minutes of such
meetings and of meetings of its stockholder(s) and observe all
other customary corporate formalities (and any successor Seller
not a corporation shall observe similar procedures in accordance
with its governing documents and applicable law);
(iv) the Seller shall at all times hold itself out to the
public under the Seller's own name as a legal entity separate and
distinct from its Affiliates; and
(v) all transactions and dealings between the Seller and
its Affiliates will be conducted on an arm's-length basis.
SECTION 6.3. Liability of Seller; Indemnities. The Seller shall be
liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Seller under this Agreement.
(a) The Seller shall indemnify, defend and hold harmless the Issuer,
the Trustee and the Indenture Trustee (and their officers, directors, employees
and agents) from and against any taxes that may at any time be asserted against
any of them with respect to the sale of the Receivables to the Issuer or the
issuance and original sale of the Certificates and the Notes, including any
sales, gross receipts, general corporation, tangible personal property,
privilege or license taxes (but, in the case of the Issuer, not including any
taxes asserted with respect to ownership of the Receivables or Federal or other
income taxes arising out of the transactions contemplated by this Agreement)
and costs and expenses in defending against the same.
(b) The Seller shall indemnify, defend and hold harmless the Issuer,
the Trustee and the Indenture Trustee (and their officers, directors,
employees and agents) from and against any loss, liability or expense
incurred by reason of the Seller's willful misfeasance, bad faith or
negligence in the performance of its duties under this Agreement, or by
reason of reckless disregard of its obligations and duties under this
Agreement.
Indemnification under this Section shall survive the resignation
or removal of the Trustee or the Indenture Trustee or the termination of
this Agreement and the Indenture and shall include reasonable fees and
expenses of counsel and expenses of litigation. If the Seller shall have
made any indemnity payments pursuant to this Section and the Person to or
on behalf of whom such payments are made thereafter shall collect any of
such amounts from others, such Person shall promptly repay such amounts to
the Seller, without interest.
21
SECTION 6.4. Merger or Consolidation of, or Assumption of the
Obligations of, Seller. Any Person: (a) into which the Seller may be merged
or consolidated, (b) that may result from any merger or consolidation to
which the Seller shall be a party or (c) that may succeed to the properties
and assets of the Seller substantially as a whole, which Person (in any of
the foregoing cases) executes an agreement of assumption to perform every
obligation of the Seller under this Agreement (or is deemed by law to have
assumed such obligations), shall be the successor to the Seller hereunder
without the execution or filing of any document or any further act by any
of the parties to this Agreement; provided, however, that: (i) immediately
after giving effect to such transaction, no representation or warranty made
pursuant to Section 3.1 shall have been breached and no Servicer Default,
and no event that, after notice or lapse of time, or both, would become a
Servicer Default shall have occurred and be continuing, (ii) the Seller
shall have delivered to the Trustee and the Indenture Trustee an Officers'
Certificate and an Opinion of Counsel each stating that such consolidation,
merger or succession and such agreement of assumption comply with this
Section and that all conditions precedent, if any, provided for in this
Agreement relating to such transaction have been complied with, (iii) the
Rating Agency Condition shall have been satisfied with respect to such
transaction and (iv) the Seller shall have delivered to the Trustee and the
Indenture Trustee an Opinion of Counsel either: (A) stating that, in the
opinion of such counsel, all financing statements, continuation statements
and amendments thereto have been executed and filed that are necessary
fully to preserve and protect the interest of the Trustee and Indenture
Trustee, respectively, in the Receivables and reciting the details of such
filings, or (B) stating that, in the opinion of such counsel, no such
action shall be necessary to preserve and protect such interests.
Notwithstanding anything herein to the contrary, the execution of the
foregoing agreement of assumption and compliance with clauses (i), (ii),
(iii) and (iv) shall be conditions to the consummation of the transactions
referred to in clauses (a), (b) or (c).
SECTION 6.5. Limitation on Liability of Seller and Others. The Seller
and any director, officer, employee or agent of the Seller may rely in good
faith on the advice of counsel or on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters
arising hereunder. The Seller shall not be under any obligation to appear
in, prosecute or defend any legal action that shall not be incidental to
its obligations under this Agreement, and that in its opinion may involve
it in any expense or liability.
SECTION 6.6. Seller May Own Certificates or Notes. The Seller and any
Affiliate thereof may in its individual or any other capacity become the
owner or pledgee of Certificates or the Notes with the same rights as it
would have if it were not the Seller or an Affiliate thereof, except as
expressly provided herein or in any other Basic Document.
Notwithstanding the foregoing, the Seller shall not sell the
Certificates except to an entity (a) that has provided an opinion of
counsel to the effect that such sale will not cause the Trust to be treated
as a "publicly traded partnership" under the Code and (b) that either (i)
is not an Affiliate of the Seller or (ii) is an Affiliate of the Seller
that (A) is a subsidiary of Case Credit or NH Credit, the Certificate of
Incorporation of which contains restrictions substantially similar to the
restrictions contained in the Certificate of Incorporation of the Seller
and (B) has provided an opinion of counsel regarding substantive
consolidation of such Affiliate with Case Credit or NH Credit in the event
of a bankruptcy filing by Case Credit or NH Credit, as applicable, which is
substantially similar to the opinion of counsel provided by Seller on the
Closing Date, and which may be subject to the same assumptions and
qualifications as that opinion.
22
ARTICLE VII
The Servicer
SECTION 7.1. Representations of Servicer. The Servicer makes the
following representations on which the Issuer is deemed to have relied in
acquiring the Receivables. The representations speak as of the execution
and delivery of the Agreement and as of the Closing Date, in the case of
the Initial Receivables, and as of the applicable Subsequent Transfer Date,
in the case of the Subsequent Receivables, and shall survive the sale of
the Receivables to the Issuer and the pledge thereof to the Indenture
Trustee pursuant to the Indenture.
(a) Organization and Good Standing. The Servicer is duly organized
and validly existing as a corporation in good standing under the laws of the
state of its incorporation, with the corporate power and authority to own
its properties and to conduct its business as such properties are currently
owned and such business is presently conducted, and had at all relevant
times, and has, the power, authority and legal right to acquire, own, sell
and service the Receivables and to hold the Receivable Files as custodian.
(b) Due Qualification. The Servicer is duly qualified to do business
as a foreign corporation in good standing, and has obtained all necessary
licenses and approvals, in all jurisdictions in which the ownership or
lease of property or the conduct of its business (including the servicing
of the Receivables as required by this Agreement) shall require such
qualifications.
(c) Power and Authority. The Servicer has the corporate power and
authority to execute and deliver this Agreement and to carry out
its terms; and the execution, delivery and performance of this
Agreement have been duly authorized by the Servicer by all
necessary corporate action.
(d) Binding Obligation. This Agreement constitutes a legal, valid and
binding obligation of the Servicer enforceable against the Servicer in
accordance with its terms.
(e) No Violation. The consummation of the transactions contemplated by
this Agreement and the fulfillment of the terms hereof shall not conflict
with, result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time) a default under, the
articles of incorporation or by-laws of the Servicer, or any indenture,
agreement or other instrument to which the Servicer is a party or by which
it shall be bound; or result in the creation or imposition of any Lien upon
any of its properties pursuant to the terms of any such indenture,
agreement or other instrument (other than this Agreement); or violate any
law or, to the best of the Servicer's knowledge, any order, rule or
regulation applicable to the Servicer of any court or of any Federal or
state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Servicer or its properties.
(f) No Proceedings. There are no proceedings or investigations
pending, or, to the Servicer's best knowledge, threatened, before any
court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Servicer or its properties:
(i) asserting the invalidity of this Agreement, the Indenture, any of the
other Basic Documents, the Notes or the Certificates, (ii) seeking to
prevent the issuance of the Notes or the Certificates or the consummation
of any of the transactions contemplated by this Agreement, the Indenture or
any of the other Basic Documents, (iii) seeking any determination or ruling
that could reasonably be expected to materially and adversely affect the
performance by the Servicer of its obligations under, or the validity or
enforceability of, this Agreement, the Indenture, any of the other Basic
Documents, the Notes or the Certificates or (iv) relating to the Servicer
and that might adversely affect the Federal or state income tax attributes
of the Notes or the Certificates.
23
(g) No Insolvent Obligors. As of the Initial Cutoff Date or, in the
case of the Subsequent Receivables, as of the related Subsequent Cutoff
Date, no Obligor is shown on the Receivable Files as the subject of a
bankruptcy proceeding.
SECTION 7.2. Indemnities of Servicer. The Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically
undertaken by the Servicer under this Agreement.
(a) The Servicer shall defend, indemnify and hold harmless the Issuer,
the Trustee, the Indenture Trustee, the Noteholders, the Certificateholders
and the Seller (and any of their officers, directors, employees and agents)
from and against any and all costs, expenses, losses, damages, claims and
liabilities, arising out of or resulting from:
(i) the use, ownership or operation by the Servicer or any
Affiliate thereof of any of the Financed Equipment;
(ii) any taxes that may at any time be asserted against
any such Person with respect to the transactions contemplated
herein, including any sales, gross receipts, general corporation,
tangible personal property, privilege or license taxes (but, in the
case of the Issuer, not including any taxes asserted with respect to,
and as of the date of, the sale of the Receivables to the Issuer or
the issuance and original sale of the Certificates, the Notes, or
asserted with respect to ownership of the Receivables, or Federal or
other income taxes arising out of distributions on the
Certificates or the Notes) and costs and expenses in defending
against the same;
(iii) the negligence, willful misfeasance or bad faith of the
Servicer in the performance of its duties under this Agreement or by
reason of reckless disregard of its obligations and duties under this
Agreement; and
(iv) the Seller's or the Issuer's violation of Federal or
State securities laws in connection with the offering or sale of the
Notes.
(b) The Servicer shall indemnify, defend and hold harmless the Trustee
and the Indenture Trustee (and their respective officers, directors,
employees and agents) from and against all costs, expenses, losses, claims,
damages and liabilities arising out of or incurred in connection with the
acceptance or performance of the trusts and duties herein and, in the case
of the Trustee, in the Trust Agreement contained, and, in the case of the
Indenture Trustee, in the Indenture contained, except to the extent that
such cost, expense, loss, claim, damage or liability:
(i) shall be due to the willful misfeasance, bad faith
or negligence (except for errors in judgment) of the Trustee or the
Indenture Trustee as applicable; or
(ii) shall arise from the breach by the Trustee of any of its
representations or warranties set forth in Section 7.3 of
the Trust Agreement.
(c) The Servicer shall pay any and all taxes levied or assessed
upon all or any part of the Trust Estate.
24
(d) The Servicer shall pay the Indenture Trustee and the Trustee from
time to time reasonable compensation for all services rendered by the Indenture
Trustee under the Indenture or by the Trustee under the Trust Agreement (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust).
(e) The Servicer shall, except as otherwise expressly provided in the
Indenture or the Trust Agreement, reimburse either the Indenture Trustee or
the Trustee, respectively, upon its request for all reasonable expenses,
disbursements and advances incurred or made in accordance with the
Indenture or the Trust Agreement, respectively, (including the reasonable
compensation, expenses and disbursements of its agents and either in-house
counsel or outside counsel, but not both), except any such expense,
disbursement or advance as may be attributable to the Indenture Trustee's
or the Trustee's, respectively negligence, bad faith or willful
misfeasance.
For purposes of this Section, in the event of the termination of
the rights and obligations of the Servicer pursuant to Section 8.1, or a
resignation by the Servicer pursuant to this Agreement, the Servicer shall
be deemed to be the Servicer pending appointment of a successor Servicer
pursuant to Section 8.2.
Indemnification under this Section shall survive the resignation
or removal of the Trustee or the Indenture Trustee or the termination of
this Agreement, the Trust Agreement and the Indenture and shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Servicer shall have made any indemnity payments pursuant to this Section
and the Person to or on behalf of whom such payments are made thereafter
collects any of such amounts from others, such Person shall promptly repay
such amounts to the Servicer, without interest.
SECTION 7.3. Merger or Consolidation of, or Assumption of the
Obligations of, Servicer. Any Person: (a) into which the Servicer may be
merged or consolidated, (b) that may result from any merger or
consolidation to which the Servicer shall be a party, or (c) that may
succeed to the properties and assets of the Servicer substantially as a
whole, which Person (in any of the foregoing circumstances) executes an
agreement of assumption to perform every obligation of the Servicer
hereunder (or is deemed by law to have assumed such obligations), shall be
the successor to the Servicer under this Agreement without further act on
the part of any of the parties to this Agreement; provided, however, that:
(i) immediately after giving effect to such transaction, no Servicer
Default, and no event that, after notice or lapse of time, or both, would
become a Servicer Default shall have occurred and be continuing, (ii) the
Servicer shall have delivered to the Trustee and Indenture Trustee an
Officers' Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption comply
with this Section and that all conditions precedent, if any, provided for
in this Agreement relating to such transaction have been complied with,
(iii) the Rating Agencies shall have received at least ten days' prior
written notice of such transaction and (iv) the Servicer shall have
delivered to the Trustee and the Indenture Trustee an Opinion of Counsel
either: (A) stating that, in the opinion of such counsel, all financing
statements, continuation statements and amendments thereto have been
executed and filed that are necessary fully to preserve and protect the
interest of the Trustee and the Indenture Trustee, respectively, in the
Receivables and reciting the details of such filings, or (B) stating that,
in the opinion of such counsel, no such action shall be necessary to
preserve and protect such interests. Notwithstanding anything herein to the
contrary, the execution of the foregoing agreement of assumption and
compliance with clauses (i), (ii), (iii) and (iv) shall be conditions to
the consummation of the transactions referred to in clauses (a), (b) or
(c).
25
SECTION 7.4. Limitation on Liability of Servicer and Others. Neither
the Servicer nor any of the directors, officers, employees or agents of the
Servicer shall be under any liability to the Issuer, the Noteholders or the
Certificateholders, except as provided under this Agreement, for any action
taken or for refraining from the taking of any action pursuant to this
Agreement or for errors in judgment; provided, however, that this provision
shall not protect the Servicer or any such Person against any liability
that would otherwise be imposed by reason of willful misfeasance, bad faith
or negligence in the performance of its duties or by reason of reckless
disregard of obligations and duties under this Agreement. The Servicer and
any director, officer, employee or agent of the Servicer may rely in good
faith on the advice of counsel or on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters
arising hereunder.
Except as provided in this Agreement, the Servicer shall not be
under any obligation to appear in, prosecute or defend any legal action
that shall not be incidental to its duties to service the Receivables in
accordance with this Agreement, and that in its opinion may involve it in
any expense or liability; provided, however, that the Servicer may
undertake any reasonable action that it may deem necessary or desirable in
respect of this Agreement, the Basic Documents and the rights and duties of
the parties to this Agreement, the other Basic Documents and the interests
of the Certificateholders under the Trust Agreement and the Noteholders
under the Indenture.
SECTION 7.5. Case Credit Not to Resign as Servicer. Subject to Section
7.3, Case Credit shall not resign from the obligations and duties imposed
on it as Servicer under this Agreement except upon determination that the
performance of its duties under this Agreement shall no longer be
permissible under applicable law and such impermissibility cannot be
reasonably and promptly cured. Notice of any such determination shall be
communicated to the Trustee and the Indenture Trustee at the earliest
practicable time (and, if such communication is not in writing, shall be
confirmed in writing at the earliest practicable time) and any such
determination shall be evidenced by an Opinion of Counsel to such effect
delivered to the Trustee and the Indenture Trustee concurrently with or
promptly after such notice. No such resignation shall become effective
until the Indenture Trustee or a successor Servicer shall have assumed the
responsibilities and obligations of Case Credit in accordance with Section
8.2.
SECTION 7.6. Servicer to Act as Administrator. In the event of the
resignation or removal of the Administrator and the failure of a successor
Administrator to have been appointed and to have accepted such appointment
as successor Administrator, the Servicer shall become the successor
Administrator and shall be bound by the terms of the Administration
Agreement.
ARTICLE VIII
Default
SECTION 8.1. Servicer Default. If any one of the following events
(a "Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to deliver to the Indenture Trustee
for deposit in any of the Trust Accounts or the Certificate Distribution
Account any required payment or to direct the Indenture Trustee or the
Trustee to make any required distributions therefrom, which failure
continues unremedied for three Business Days after written notice of such
failure is received by the Servicer from the Trustee or the Indenture
Trustee or after discovery of such failure by an officer of the Servicer;
26
(b) any failure by the Servicer or the Seller, as the case may be,
duly to observe or to perform in any material respect any other covenants
or agreements (other than as set forth in clause (a)) of the Servicer or
the Seller (as the case may be) set forth in this Agreement or any other
Basic Document, which failure shall: (i) materially and adversely affect
the rights of Certificateholders or Noteholders and (ii) continue
unremedied for a period of 60 days after the date on which written notice
of such failure, requiring the same to be remedied, shall have been given:
(A) to the Servicer or the Seller (as the case may be) by the Trustee or
the Indenture Trustee or (B) to the Servicer or the Seller (as the case may
be) and to the Trustee and the Indenture Trustee, by the Noteholders or
Certificateholders, as applicable, evidencing not less than 25% of the
Outstanding Amount of the Notes or 25% of the Certificate Balance; or
(c) an Insolvency Event occurs with respect to the Seller or the
Servicer;
then, and in each and every case, so long as the Servicer Default shall not
have been remedied, either the Indenture Trustee, or the Holders of Notes
evidencing not less than 25% of the Outstanding Amount of the Notes, by
notice then given in writing to the Servicer (and to the Indenture Trustee
and the Trustee if given by the Noteholders), may terminate all the rights
and obligations (other than the obligations set forth in Section 7.2) of
the Servicer under this Agreement. On or after the receipt by the Servicer
of such written notice, all authority and power of the Servicer under this
Agreement, whether with respect to the Notes, the Certificates, the
Receivables or otherwise, shall, without further action, pass to and be
vested in the Indenture Trustee or such successor Servicer as may be
appointed under Section 8.2; and, without limitation, the Indenture Trustee
and the Trustee are hereby authorized and empowered to execute and deliver,
on behalf of the predecessor Servicer, as attorney-in-fact or otherwise,
any and all documents and other instruments, and to do or accomplish all
other acts or things necessary or appropriate to effect the purposes of
such notice of termination, whether to complete the transfer and
endorsement of the Receivables and related documents, or otherwise. The
predecessor Servicer shall cooperate with the successor Servicer, the
Indenture Trustee and the Trustee in effecting the termination of the
responsibilities and rights of the predecessor Servicer under this
Agreement, including the transfer to the successor Servicer for
administration by it of: (i) all cash amounts that shall at the time be
held by the predecessor Servicer for deposit, or shall thereafter be
received by it with respect to a Receivable and (ii) all Receivable Files.
All reasonable costs and expenses (including attorneys' fees) incurred in
connection with such transfer, including the costs of transferring the
Receivable Files to the successor Servicer and amending this Agreement to
reflect its succession as Servicer, shall be paid by the predecessor
Servicer upon presentation of reasonable documentation of such costs and
expenses. Upon receipt of notice of the occurrence of a Servicer Default,
the Trustee shall give notice thereof to the Rating Agencies.
SECTION 8.2. ppointment of Successor Servicer. (a) Upon the
Servicer's receipt of notice of termination, pursuant to Section 8.1, or
the Servicer's resignation in accordance with this Agreement, the
predecessor Servicer shall continue to perform its functions as Servicer
under this Agreement, in the case of termination, only until the date
specified in such termination notice or, if no such date is specified in a
notice of termination, until receipt of such notice and, in the case of
resignation, until the earlier of: (x) the date 45 days from the delivery
to the Trustee and the Indenture Trustee of written notice of such
resignation (or written confirmation of such notice) in accordance with
this Agreement and (y) the date upon which the predecessor Servicer shall
become unable to act as Servicer, as specified in the notice of resignation
and accompanying Opinion of Counsel. In the event of the Servicer's
termination hereunder, the Issuer shall appoint a successor Servicer
acceptable to the Indenture Trustee, and the successor Servicer shall
accept its appointment by a written assumption in form acceptable to the
Indenture Trustee. In the event that a successor Servicer has not been
appointed at the time when the predecessor Servicer has ceased to act as
Servicer in accordance with this Section, the Indenture Trustee without
further action shall automatically be appointed the successor Servicer and
shall be entitled to the Servicing Fee. Notwithstanding the above, the
27
Indenture Trustee shall, if it shall be unable so to act, appoint or
petition a court of competent jurisdiction to appoint any established
institution, having a net worth of not less than $50,000,000 and whose
regular business shall include the servicing of receivables, as the
successor to the Servicer under this Agreement.
(b) Upon appointment, the successor Servicer (including the Indenture
Trustee acting as successor Servicer) shall be the successor in all
respects to the predecessor Servicer (except with respect to
responsibilities and obligations of the predecessor Servicer set forth in
Section 7.2) and shall be subject to all the responsibilities, duties and
liabilities arising thereafter relating thereto placed on the predecessor
Servicer and shall be entitled to the Servicing Fee and all the rights
granted to the predecessor Servicer by this Agreement. Neither the
Indenture Trustee nor any other successor Servicer shall be deemed to be in
default hereunder due to any act or omission of a predecessor Servicer,
including but not limited to failure of such predecessor Servicer to timely
deliver to the Indenture Trustee any required information pertaining to the
Receivables, any funds required to be deposited with the Indenture Trustee,
or any breach of duty of such predecessor Servicer to cooperate with a
transfer of servicing as required hereunder. Any successor Servicer shall
from time to time provide to Case Credit such information as Case Credit
shall request with respect to the Receivables and collections thereon.
(c) Subject to the last sentence of clause (a), the Servicer may not
resign unless it is prohibited from serving as such by law as evidenced by
an Opinion of Counsel to such effect delivered to the Indenture Trustee and
the Trustee.
SECTION 8.3. Notification to Noteholders and Certificateholders. Upon
any termination of, or appointment of a successor to, the Servicer pursuant
to this Article VIII, the Trustee shall give prompt written notice thereof
to the Certificateholders and the Indenture Trustee shall give prompt
written notice thereof to the Noteholders and the Rating Agencies.
SECTION 8.4. Waiver of Past Defaults. The Noteholders of Notes
evidencing not less than a majority of the Note Balance (or the Holders of
Certificates evidencing not less than a majority of the Certificate
Balance, in the case of any default that does not adversely affect the
Indenture Trustee or the Noteholders) may, on behalf of all the Noteholders
and Certificateholders, waive in writing any default by the Servicer in the
performance of its obligations hereunder and its consequences, except a
default in making any required deposits to or payments from any of the
Trust Accounts in accordance with this Agreement. Upon any such waiver of a
past default, such default shall cease to exist, and any Servicer Default
arising therefrom shall be deemed to have been remedied for every purpose
of this Agreement. No such waiver shall extend to any subsequent or other
default or impair any right consequent thereto.
ARTICLE IX
Termination
SECTION 9.1. Optional Purchase of All Receivables. (a) As of the first
day of any Collection Period immediately preceding a Payment Date as of
which the Pool Balance is 10% or less of the Initial Pool Balance, the
Servicer shall have the option to purchase all of the Trust Estate, other
than the Trust Accounts. To exercise such option, the Servicer shall
deposit, pursuant to Section 5.4, in the Collection Account an amount equal
to the aggregate Purchase Amount for the Receivables plus the appraised
value of any such other property held by the Trust, such value to be
determined by an appraiser mutually agreed upon by the Servicer, the
Trustee and the Indenture Trustee, and shall succeed to all interests in,
to and under the Trust Estate, other than the Trust Accounts.
29
(b) Upon any sale of the assets of the Trust, the Servicer shall
instruct the Indenture Trustee to deposit the proceeds from such sale after all
payments and reserves therefrom have been made (the "Sale Proceeds") in the
Collection Account. On the Payment Date on, or, if such proceeds are not so
deposited on a Payment Date, on the first Payment Date following the date
on which the Sale Proceeds are deposited in the Collection Account, the
Servicer shall instruct the Indenture Trustee to make the following
deposits (after the application on such Payment Date of the Total
Distribution Amount and funds on deposit in the Spread Account pursuant to
Sections 5.5 and 5.6) from the Sale Proceeds and any funds remaining on
deposit in the Spread Account (including the proceeds of any sale of
investments therein as described in the following sentence):
(i) first, to the Note Distribution Account, any portion of
the Class A Noteholders' Class Interest Amount and the Outstanding
Amount of the Class A Notes (after giving effect to the reduction
resulting from the deposits made in the Note Distribution Account on
such Payment Date and on prior Payment Dates) not otherwise deposited
into the Note Distribution Account on such Payment Date;
(ii) second, to the Note Distribution Account, any portion of
the Class B Noteholders' Class Interest Amount and the Outstanding
Amount of the Class B Notes (after giving effect to the reduction
resulting from the deposits made in the Note Distribution Account on
such Payment Date and on prior Payment Dates) not otherwise deposited
into the Note Distribution Account on such Payment Date;
(iii) third, to the Certificate Distribution Account, any
portion of the Certificateholders' Interest Distributable Amount not
otherwise deposited into the Certificate Distribution Account on such
Payment Date; and
(iv) fourth, to the Certificate Distribution Account, the
Certificate Balance (after giving effect to the reduction resulting
from the deposits made in the Certificate Distribution Account on such
Payment Date).
Any investments on deposit in the Spread Account that will not mature on or
before such Payment Date shall be sold by the Indenture Trustee at such
time as will result in the Indenture Trustee receiving the proceeds from
such sale not later than the Transfer Date preceding such Payment Date. Any
Sale Proceeds remaining after the deposits described above shall be paid to
the Seller.
(c) As described in Article IX of the Trust Agreement, notice of any
termination of the Trust shall be given by the Servicer to the Trustee and
the Indenture Trustee as soon as practicable after the Servicer has
received notice thereof.
(d) Following the satisfaction and discharge of the Indenture and the
payment in full of the principal of and interest on the Notes, the
Certificateholders will succeed to the rights of the Noteholders hereunder
and the Trustee will succeed to the rights of, and assume the obligations
of, the Indenture Trustee pursuant to this Agreement.
30
ARTICLE X
Miscellaneous Provisions
SECTION 10.1. Amendment. The Agreement may be amended from time to time
by a written amendment duly executed and delivered by the Seller, the
Servicer and the Issuer, with the written consent of the Indenture Trustee,
but without the consent of any of the Noteholders or the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions in this Agreement or for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions in this
Agreement or of modifying in any manner the rights of the Noteholders or
the Certificateholders; provided, however, that such action shall not, as
evidenced by an Opinion of Counsel delivered to the Trustee and the
Indenture Trustee, adversely affect in any material respect the interests
of any Noteholder or Certificateholder.
The Specified Spread Account Balance may be reduced or the
definition thereof otherwise modified without the consent of any of the
Noteholders or the Certificateholders if the Rating Agency Condition is
satisfied.
This Agreement may also be amended from time to time by the
Seller, the Servicer and the Issuer, with the written consent of the
Indenture Trustee, but without the consent of any of the Noteholders or the
Certificateholders, to: (x) replace the Spread Account with another form of
credit enhancement as long as such substitution will not result in a
reduction or withdrawal of the rating of any Class of the Notes or the
Certificates or (y) add credit enhancement for the benefit of any Class of
the Notes or the Certificates.
This Agreement may also be amended from time to time by the
Seller, the Servicer and the Issuer, with the written consent of (a) the
Indenture Trustee, (b) Noteholders holding Notes evidencing not less than a
majority of the Note Balance, and (c) the Holders of Certificates
evidencing not less than a majority of the Certificate Balance, for the
purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Noteholders or the Certificateholders; provided,
however, that no such amendment shall: (a) increase or reduce in any manner
the amount of, or accelerate or delay the timing of, collections of
payments on Receivables or distributions that shall be required to be made
for the benefit of the Noteholders or the Certificateholders or (b) reduce
the aforesaid percentage of the Notes and the Certificates that are
required to consent to any such amendment, without the consent of the
holders of all the outstanding Notes and Certificates.
Promptly after the execution of any such amendment or consent (or,
in the case of the Rating Agencies, 10 days prior thereto), the Trustee
shall furnish written notification of the substance of such amendment or
consent to each Certificateholder, the Indenture Trustee and each of the
Rating Agencies.
It shall not be necessary for the consent of Certificateholders or
the Noteholders pursuant to this Section to approve the particular form of
any proposed amendment or consent, but it shall be sufficient if such
consent shall approve the substance thereof.
Prior to the execution of any amendment to this Agreement, the
Trustee and the Indenture Trustee shall be entitled to receive and rely
upon: (i) an Opinion of Counsel stating that the execution of such
amendment is authorized or permitted by this Agreement and the other Basic
Documents and that all conditions precedent to such execution and delivery
by the Trustee and the Indenture Trustee have been satisfied and (ii) the
Opinion of Counsel referred to in Section 10.2(i)(1). The Trustee and the
Indenture Trustee may, but shall not be obligated to, enter into any such
amendment that affects the Trustee's or the Indenture Trustee's, as
applicable, own rights, duties or immunities under this Agreement or
otherwise.
31
SECTION 10.2. Protection of Title to Trust. (a) The Seller shall
execute and file such financing statements, and cause to be executed and
filed such continuation statements, all in such manner and in such places
as may be required by applicable law fully to preserve, maintain and
protect the right, title and interest of the Issuer and the interests of
the Indenture Trustee in the Receivables, the other property sold hereunder
and in the proceeds thereof. The Seller shall deliver (or cause to be
delivered) to the Trustee and the Indenture Trustee file-stamped copies of,
or filing receipts for, any document filed as provided above as soon as
available following such filing. It is understood and agreed, however, that
no filings will be made to perfect any security interest of the Issuer or
the Indenture Trustee in the Seller's interests in True Lease Equipment.
The Issuer and the Indenture Trustee shall cooperate fully with the Seller
in connection with the obligations set forth above and will execute any and
all documents reasonably required to fulfill the intent of this paragraph.
(b) Neither the Seller nor the Servicer shall change its name,
identity or corporate structure in any manner that would, could or might make
any financing statement or continuation statement filed in accordance with
paragraph (a) seriously misleading within the applicable provisions of the
UCC, unless it shall have given the Trustee and the Indenture Trustee at
least five days' prior written notice thereof and shall have promptly filed
appropriate amendments to all previously filed financing statements or
continuation statements.
(c) Each of the Seller and the Servicer shall have an obligation to
give the Trustee and the Indenture Trustee at least 60 days' prior written
notice of any relocation of its principal executive office if, as a result
of such relocation, the applicable provisions of the UCC would require the
filing of any amendment of any previously filed financing or continuation
statement or of any new financing statement and shall promptly file any
such amendment. The Servicer shall at all times maintain each office from
which it shall service Receivables, and its principal executive office,
within the United States of America.
(d) The Servicer shall maintain accounts and records as to each
Receivable accurately and in sufficient detail to permit: (i) the reader
thereof to know at any time the status of such Receivable, including payments
and recoveries made and payments owing (and the nature of each) and (ii)
reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Collection
Account in respect of such Receivable.
(e) The Servicer shall maintain its computer systems so that, from and
after the time of sale under this Agreement of the Receivables, the
Servicer's master computer records (including any backup archives) that
refer to a Receivable shall indicate clearly the interest of the Issuer and
the Indenture Trustee in such Receivable and that such Receivable is owned
by the Issuer and has been pledged to Bank One, as Indenture Trustee.
Indication of the Issuer's and the Indenture Trustee's interest in a
Receivable may be deleted from or modified on the Servicer's computer
systems when, and only when, the related Receivable shall have been paid in
full or repurchased.
(f) If at any time the Seller or the Servicer shall propose to sell,
grant a security interest in, or otherwise transfer any interest in equipment
receivables to any prospective purchaser, lender or other transferee, the
Servicer shall give to such prospective purchaser, lender or other
transferee computer tapes, records or printouts (including any restored
from backup archives) that, if they shall refer in any manner whatsoever to
any Receivable, shall indicate clearly that such Receivable has been sold
and is owned by the Issuer and has been pledged to the Indenture Trustee.
32
(g) The Servicer shall permit the Indenture Trustee and its agents at
any time during normal business hours to inspect, audit and make copies of and
abstracts from the Servicer's records regarding any Receivable.
(h) Upon request, the Servicer shall furnish to the Trustee or to the
Indenture Trustee, within five Business Days, a list of all Receivables (by
contract number and name of Obligor) then held as part of the Trust,
together with a reconciliation of such list to the Schedule of Receivables
and to each of the Servicer's Certificates furnished before such request
indicating removal of Receivables from the Trust.
(i) The Servicer shall deliver to the Trustee and the
Indenture Trustee:
(1) promptly after the execution and delivery of this Agreement
and of each amendment hereto, an Opinion of Counsel either: (A) stating
that, in the opinion of such counsel, all financing statements and
continuation statements have been executed and filed that are necessary
fully to preserve and protect the interest of the Trustee and the
Indenture Trustee in the Receivables, and reciting the details of such
filings or referring to prior Opinions of Counsel in which such details
are given, or (B) stating that, in the opinion of such counsel, no such
action shall be necessary to preserve and protect such interest; and
(2) within 90 days after the beginning of each calendar year
beginning with the first calendar year beginning more than three
months after the Initial Cutoff Date, an Opinion of Counsel, dated as
of a date during such 90-day period, either: (A) stating that, in the
opinion of such counsel, all financing statements and continuation
statements have been executed and filed that are necessary fully
to preserve and protect the interest of the Trustee and the
Indenture Trustee in the Receivables, and reciting the details of
such filings or referring to prior Opinions of Counsel in which
such details are given, or (B) stating that, in the opinion of
such counsel, no such action shall be necessary to preserve and
protect such interest.
Each Opinion of Counsel referred to in clause (1) or (2) shall
specify any action necessary (as of the date of such opinion) to be taken
in the following year to preserve and protect such interest.
(j) The Seller shall, to the extent required by applicable law, cause
the Certificates and the Notes to be registered with the Commission pursuant to
Section 12(b) or Section 12(g) of the Exchange Act within the time periods
specified in such sections.
SECTION 10.3. Notices. All demands, notices, directions, instructions
and communications upon or to the Seller, the Servicer, the Issuer, the
Trustee, the Indenture Trustee or the Rating Agencies under this Agreement
shall be in writing, personally delivered or mailed by certified mail,
return receipt requested, and shall be deemed to have been duly given upon
receipt: (a) in the case of the Seller, to CNH Capital Receivables Inc.,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention of:
Treasurer (telephone (▇▇▇) ▇▇▇-▇▇▇▇ and facsimile (▇▇▇) ▇▇▇-▇▇▇▇, (b) in
the case of the Servicer, to Case Credit Corporation, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Treasurer (telephone (▇▇▇) ▇▇▇-▇▇▇▇ and
facsimile (▇▇▇) ▇▇▇-▇▇▇▇), (c) in the case of the Issuer or the Trustee, at
33
its Corporate Trust Office, (d) in the case of the Indenture Trustee, at
its Corporate Trust Office, (e) in the case of Moody's, to ▇▇▇▇▇'▇
Investors Service, Inc., ABS Monitoring Department, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, and (f) in the case of Standard & Poor's, to Standard
& Poor's Ratings Services, a division of ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of Asset Backed
Surveillance Department; or, as to each of the foregoing, at such other
address as shall be designated by written notice to the other parties.
SECTION 10.4. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Sections 6.4 and 7.3 and as
provided in the provisions of this Agreement concerning the resignation of
the Servicer, this Agreement may not be assigned by the Seller or the
Servicer.
SECTION 10.5. Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Seller, the Servicer, the
Issuer, the Trustee, the Certificateholders, the Indenture Trustee and the
Noteholders, and nothing in this Agreement, whether express or implied,
shall be construed to give to any other Person any legal or equitable
right, remedy or claim in the Trust Estate or under or in respect of this
Agreement or any covenants, conditions or provisions contained herein.
SECTION 10.6. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other
jurisdiction.
SECTION 10.7. Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 10.8. Headings. The headings of the various Articles
and Sections herein are for convenience of reference only and shall not
define or limit any of the terms or provisions hereof.
SECTION 10.9. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
SECTION 10.10. Assignment to Indenture Trustee. The Seller hereby
acknowledges and consents to any mortgage, pledge, assignment and grant of
a security interest by the Issuer to the Indenture Trustee pursuant to the
Indenture for the benefit of the Noteholders of all right, title and
interest of the Issuer in, to and under the Receivables and/or the
assignment of any or all of the Issuer's rights and obligations hereunder
to the Indenture Trustee, and agrees that enforcement of a right or remedy
hereunder by the Indenture Trustee shall have the same force and effect as
if the right or remedy had been enforced or executed by the Issuer.
34
SECTION 10.11. Nonpetition Covenants. (a) Notwithstanding any prior
termination of this Agreement, the Servicer and the Seller shall not, prior
to the date that is one year and one day after the termination of this
Agreement, with respect to the Issuer, acquiesce, petition or otherwise
invoke or cause the Issuer to invoke the process of any court or
governmental authority for the purpose of commencing or sustaining a case
against the Issuer under any Federal or state bankruptcy, insolvency or
similar law or appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Issuer or any
substantial part of its property5, or ordering the winding up or liquidation
of the affairs of the Issuer. The foregoing shall not limit the right of
the Servicer and the Seller to file any claim in or otherwise take any
action with respect to any such insolvency proceeding that was instituted
against the Issuer by any Person other than the Servicer or the Seller.
(b) Notwithstanding any prior termination of this Agreement, the
Servicer shall not, prior to the date that is one year and one day after the
termination of this Agreement, with respect to the Seller, acquiesce,
petition or otherwise invoke or cause the Seller to invoke the process of
any court or governmental authority for the purpose of commencing or
sustaining a case against the Seller under any Federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Seller or
any substantial part of its property, or ordering the winding up or
liquidation of the affairs of the Seller. The foregoing shall not limit the
right of the Servicer to file any claim in or otherwise take any action
with respect to any such insolvency proceeding that was instituted against
the Seller by any Person other than the Servicer.
SECTION 10.12. Limitation of Liability of Trustee and Indenture Trustee.
(a) Notwithstanding anything contained herein to the contrary, this
Agreement has been countersigned by The Bank of New York, not in its
individual capacity but solely in its capacity as Trustee of the Issuer,
and in no event shall The Bank of New York, in its individual capacity or,
except as expressly provided in the Trust Agreement, any beneficial owner
of the Issuer have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in
any of the certificates, notices or agreements delivered pursuant hereto,
as to all of which recourse shall be had solely to the assets of the
Issuer.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been accepted by Bank One, National Association, not in its
individual capacity but solely as Indenture Trustee, and in no event shall
Bank One, National Association have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer
hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the
assets of the Issuer.
SECTION 10.13. Conditions Precedent to Other Financing Transactions.
The Seller shall not enter into any receivables sale or other financing
transaction unless either the appropriate documents relating thereto
contain provisions substantially to the effect set out in Sections 11.17
and 11.19 of the Indenture or such transaction otherwise shall have
satisfied the Rating Agency Condition.
(signature page follows)
35
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective officers as of the day and year
first above written.
CNH EQUIPMENT TRUST 2001-A
By: THE BANK OF NEW YORK,
not its individual capacity but solely
as Trustee of the Trust
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Assistant Treasurer
CNH CAPITAL RECEIVABLES INC.,
as Seller
By: /s/ ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
------------------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
Title: Assistant Treasurer
CASE CREDIT CORPORATION,
as Servicer
By: /s/ ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
------------------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇'▇▇▇▇▇
Title: Assistant Treasurer
Acknowledged and Accepted:
Bank One, National Association,
not in its individual capacity
but solely as Indenture Trustee
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
S-1
EXHIBIT A
Sale and Servicing Agreement
FORM OF NOTEHOLDER'S
STATEMENT PURSUANT TO SECTION 5.10(a)
-------------------------------------
Payment Date: ______________________
(i) Amount of principal being paid on Notes:
A-1 Notes: __________ ($_____ per $1,000 original principal amount)
A-2 Notes: __________ ($_____ per $1,000 original principal amount)
A-3 Notes: __________ ($_____ per $1,000 original principal amount)
A-4 Notes: __________ ($_____ per $1,000 original principal amount)
Class B Notes: _________ ($_____ per $1,000 original principal amount)
(ii) Amount of interest being paid on Notes:
A-1 Notes: __________ ($_____ per $1,000 original principal amount)
A-2 Notes: __________ ($_____ per $1,000 original principal amount)
A-3 Notes: _________ ($_____ per $1,000 original principal amount)
A-4 Notes: _________ ($_____ per $1,000 original principal amount)
Class B Notes: _______ ($_____ per $1,000 original principal amount)
(iii) Pool Balance at end of the preceding Collection Period: _____
(iv) After giving effect to distributions on this Payment Date:
(a) (1) Outstanding Amount of A-1 Notes: _______
(2) Outstanding Amount of A-2 Notes: _______
(3) Outstanding Amount of A-3 Notes: _______
(4) Outstanding Amount of A-4 Notes: _______
(5) Outstanding Amount of Class B Notes: _______
(6) A-1 Note Pool Factor: _____
(7) A-2 Note Pool Factor: _____
(8) A-3 Note Pool Factor: _____
(9) A-4 Note Pool Factor: _____
(10) Class B Note Pool Factor: _____
A-1
(b) (1) Certificate Balance: __________
(2) Certificate Pool Factor: __________
(v) Amount of Servicing Fee: ___ ($___ per $1,000 original principal amount)
(vi) Amount of Administration Fee: ____ ($____ per $1,000 original
principal amount)
(vii) Aggregate Amount of Realized Losses for the Collection Period: _________
(viii) Aggregate Purchase Amounts for the Collection Period: __________
(ix) Balance of Spread Account: __________
(x) Pre-funded Amount: __________
(xi) Balance of Principal Supplement Account:__________
(xii) Balance of Negative Carry Account: __________
(xiii) Amount of Net Swap Payments or Net Swap Receipts: __________
(xiv) Amount of Swap Termination Payments paid by the Issuer: __________
A-2
EXHIBIT B
to Sale and Servicing Agreement
FORM OF CERTIFICATEHOLDER'S
STATEMENT PURSUANT TO SECTION 5.10(a)
-------------------------------------
Payment Date: ______________________
(i) Amount of principal being paid or distributed:
(a) (1) A-1 Notes: __________
(2) A-2 Notes: __________
(3) A-3 Notes: __________
(4) A-4 Notes: __________
(5) Class B Notes: __________
(b) Certificates: _______ ($_____ per $1,000 original principal
amount)
(c) Total: __________
(ii) Amount of interest being paid or distributed:
(a) (1) A-1 Notes: __________
(2) A-2 Notes: __________
(3) A-3 Notes: __________
(4) A-4 Notes: __________
(5) Class B Notes: __________
(b) Certificates: ___________ ($_____ per $1,000 original
principal amount)
(c) Total: __________
(iii) Pool Balance at end of the preceding Collection Period: _____
(iv) After giving effect to distributions on this Payment Date:
(a) (1) Outstanding Amount of A-1 Notes: _______
(2) Outstanding Amount of A-2 Notes: _______
(3) Outstanding Amount of A-3 Notes: _______
(4) Outstanding Amount of A-4 Notes: _______
(5) Outstanding Amount of Class B Notes: _______
(6) A-1 Note Pool Factor: _____
(7) A-2 Note Pool Factor: _____
B-1
(8) A-3 Note Pool Factor: _____
(9) A-4 Note Pool Factor: _____
(10) Class B Note Pool Factor: _____
(b) (1) Certificate Balance: __________
(2) Certificate Pool Factor: __________
(v) Amount of Servicing Fee: ____ ($_____ per $1,000 original principal
amount)
(vi) Amount of Administration Fee: ____ ($____ per $1,000 original principal
amount)
(vii) Aggregate amount of Realized Losses for the Collection Period: ________
(viii) Aggregate Purchase Amounts for the Collection Period: __________
(ix) Balance of Spread Account: __________
(x) Pre-Funded Amount:__________
(xi) Balance of Negative Carry Account: __________
(xii) Amount of Net Swap Payments or Net Swap Receipts: __________
(xiii) Amount of Swap Termination Payments paid by the Issuer: __________
B-2
EXHIBIT C
to Sale and Servicing Agreement
FORM OF SERVICER'S CERTIFICATE
------------------------------
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration - Asset Backed Finance Unit
Bank One, National Association
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Global Corporate Trust Services
CNH Capital Receivables Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
▇▇▇▇▇'▇ Investors Service, Inc.
ABS Monitoring Department
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Standard & Poor's Ratings Services,
a division of ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Asset Backed Surveillance Department
C-1
Class A-1 Asset-Backed Notes
Class A-2 Asset-Backed Notes
Class A-3 Asset-Backed Notes
Class A-4 Asset-Backed Notes
Class B Asset-Backed Notes
Certificates
----------------------
Determination Date: - -
---- -- ---
DISTRIBUTIONS
-------------
(1) Total Distribution Amount $________
(2) Servicing Fee $________
(3) Administration Fee $________
(4) Net Swap Payments $________
(5) Swap Termination Payments payable by the Issuer $________
(6) Class A Noteholder's Class Interest Amount: $________
o Interest on Class N Notes ($_______________)
o Class A Noteholder's Class Interest Shortfall,
if any ($__________)
(7) Class B Noteholders' Class Interest Amount $________
o Interest on Class B Notes ($___________)
o Class B Noteholders' Class Interest
Shortfall ($_____________)
(8) Class Principal Distributable Amount $________
o Class A Noteholders' Monthly Principal Distributable Amount
o Class Principal Distributable Amount for each Class of Class
A Notes having priority of payment over such Class of Class
A Notes
o Outstanding principal amount of that Class
(9) Class A Noteholders' Monthly Principal Distributable
Amount $________
o Aggregate scheduled principal payments on the Receivables
received during the Collection Period ($____________)
o Outstanding principal balance of the Class A Notes and
Certificates ($________)
o Pool Balance ($_________)
C-2
o Amounts on deposit in the Pre-Funding Account ($__________)
o Outstanding amount of Class A Notes ($__________)
(10) A-1 Noteholders' Class Principal Distributable Amount $________
o Class A Noteholders' Monthly Principal Distributable
Amount ($________)
o A-1 Noteholders' outstanding principal amount ($__________)
(11) o A-2 Noteholders' Class Principal Distributable
Amount $________
o Class A Noteholders' Monthly Principal Distributable
Amount ($__________)
o A-1 Noteholders' Class Principal Distributable
Amount ($__________)
o A-2 Noteholders' Outstanding Amount ($__________)
(12) A-3 Noteholders' Class Principal Distributable Amount $________
o Class A Noteholders' Monthly Principal Distributable
Amount ($__________)
o A-1 Noteholders' Class Principal Distributable
Amount ($__________)
o A-2 Noteholders' Class Principal Distributable Amount
($__________)
o A-3 Noteholders' Outstanding Amount ($__________)
(13) A-4 Noteholders' Class Principal Distributable Amount $________
o Class A Noteholders' Monthly Principal Distributable Amount
($__________)
o A-1 Noteholders' Class Principal Distributable Amount
($__________)
o A-2 Noteholders' Class Principal Distributable Amount
($__________)
o A-3 Noteholders' Class Principal Distributable
Amount ($__________)
o A-4 Noteholders' Outstanding Amount ($__________)
(14) NOTEHOLDERS' DISTRIBUTABLE AMOUNT $________
(6)+(7)+(10)+(11)+(12)+(13)
C-3
(15) Certificateholders' Interest Distributable Amount $________
o Interest at the Pass-Through Rate on Certificate
Balance ($__________)
o Certificateholders' Interest Shortfall ($__________)
(16) Certificateholders' Monthly Principal Distributable $_______
Amount
o Outstanding principal balances of the Class A Notes
and the Class B Notes after giving effect to payments on
the Class A Notes and Class B Notes) and the Certificates
($__________)
o Pool Balance ($__________)
o Amounts on deposit in the Pre-Funding Account ($__________)
o Outstanding amount of Certificates ($__________)
(17) CERTIFICATEHOLDERS' DISTRIBUTABLE AMOUNT (15)+(16) $________
(18) Deposit to Note Distribution Account $________
o Excess, if any, of Total Distribution Amount (1),
less the Administration Fee (3), less the Servicing Fee
(2*)
o Withdrawal from Spread Account pursuant to Section 5.6(d)
(see (25) below)
o Withdrawal from Spread Account pursuant to
5.6(e) (see(26) below)
o Withdrawal from Principal Supplement
Accounts pursuant to Section 5.9
o But not greater than the
Noteholders' Distributable Amount (14)
(19) Deposit to Spread Account pursuant to
Section 5.5(b)(vi) $________
o Excess, if any, of Total Distribution Amount (1),
less the Administration Fee (3), less the Servicing Fee
(2*), less the Noteholders' Distributable Amount (14)
o But not greater than Item (23) below
(20) Deposit to Certificate Distribution Account $________
o Excess, if any, of Total Distribution Amount (1),
less the Administration Fee(3), less the Servicing Fee
(2*), less the Noteholders' Distributable Amount (14),
less the Deposit to Spread Account (19)
o But not greater than the Certificateholders' Distributable
Amount (17)
* The Servicing Fee (2) shall not be included if Case Credit or an
Affiliate of Case Credit is the Servicer.
C-4
SPREAD ACCOUNT
--------------
(21) Spread Account Balance as of Determination Date $________
(prior to any deposits or withdrawals)
(22) Specified Spread Account Balance (after all distributions and
adjustments) $________
(23) Limit on Deposit to the Spread Account $________
o________The excess, if any, of the Specified Spread Account
Balance (22) less the Spread Account Balance as of the
Determination Date (prior to any deposits or withdrawals)
(21)
(24) Withdrawal from Spread Account distributed to Seller $________
(as permitted in Sections 5.6(b) and (c)
of the Sale and Servicing Agreement)
o The excess, if any, of the Spread Account Balance as
of the Determination Date (prior to any deposits or
withdrawals) (21) less the Specified Spread Account
Balance (22)
o But zero, if (a) the sum of the Pool Balance (28) and the
Pre-Funded Amount as of the first day of the Collection
Period; is less than (b) the sum of the Note Balance and
the Certificate Balance
(25) Withdrawal from Spread Account pursuant to $________
Section 5.6(d) to be deposited in the Note
Distribution Account
o Excess, if any, of the sum of the Noteholders' Distributable
Amount (14), the Net Swap Payments (4) and the Swap Termination
Payments payable by the Issuer(5), less the Total Distribution
Amount (1), less the Administration Fee(3), less the
Servicing Fee (2*)
o But not Greater than the Spread Account Balance (21)
(26) Withdrawal from Spread Account pursuant to $________
Section 5.6(e) To be deposited in the Note Distribution Account
o Excess, if any, of Class Principal Distributable Amount for
any Class of Notes for the applicable final scheduled maturity
date for such Class of Notes, less the Total Distribution
Amount (1), less the Class Principal Distributable Amount for
each Class of Notes having priority over such Class of Notes
having priority over such Class of Notes
o But not Greater than the Spread Account Balance (21)
C-5
(27) Final Spread Account Balance (21) + (19) - (24) $________
- (25) - (26)
MISCELLANEOUS
-------------
(28) Pool Balance at the beginning of this Collection $________
Period
(29) After giving effect to all distributions on the Payment Date
during this Collection Period:
(a) Outstanding Amount of A-1 Notes $________
A-1 Note Pool Factor (__._______)
(b) Outstanding Amount of A-2 Notes $________
A-2 Note Pool Factor (__.______)
(c) Outstanding Amount of A-3 Notes $________
A-3 Note Pool Factor (__.______)
(d) Outstanding Amount of A-4 Notes $________
A-4 Note Pool Factor (__.______)
(e) Outstanding Amount of Class B Notes $________
Class B Note Pool Factor (___.______)
(f) Outstanding Amount of Certificates $________
Certificate Pool Factor (___._______)
(30) Aggregate Purchase Amounts for the preceding $________
Collection Period
C-6
EXHIBIT D
to Sale and Servicing Agreement
FORM OF ASSIGNMENT
------------------
For value received, in accordance with and subject to the Sale and
Servicing Agreement dated as of May 1, 2001 (the "Sale and Servicing
Agreement") among the undersigned, Case Credit Corporation ("Case Credit")
and CNH Equipment Trust 2001-A (the "Issuer"), the undersigned does hereby
sell, assign, transfer set over and otherwise convey unto the Issuer,
without recourse, all of its right, title and interest in, to and under:
(a) the Initial Receivables, including all documents constituting chattel
paper included therewith, and all obligations of the Obligors thereunder,
including all moneys paid thereunder on or after the Initial Cutoff Date,
(b) the security interests in the Financed Equipment granted by Obligors
pursuant to the Initial Receivables and any other interest of the
undersigned in such Financed Equipment, (c) any proceeds with respect to
the Initial Receivables from claims on insurance policies covering Financed
Equipment or Obligors, (d) the Liquidity Receivables Purchase Agreements
(only with respect to Case Owned Contracts or NH Owned Contracts included
in the Initial Receivables) and the Purchase Agreements, including the
right of the undersigned to cause Case Credit or NH Credit, as the case may
be, to repurchase Receivables from the undersigned under the circumstances
described therein, (e) any proceeds from recourse to Dealers with respect
to the Initial Receivables other than any interest in the Dealers' reserve
accounts maintained with Case Credit or with NH Credit, (f) any Financed
Equipment that shall have secured an Initial Receivable and that shall have
been acquired by or on behalf of the Trust, (g) all funds on deposit from
time to time in the Trust Accounts, including the Spread Account Initial
Deposit, any Principal Supplement Account Deposit, the Negative Carry
Account Initial Deposit and the Pre-Funded Amount, and in all investments
and proceeds thereof (including all income thereon), (h) any True Lease
Equipment that is subject to any Initial Receivable, and (i) the proceeds
of any and all of the foregoing. The foregoing sale does not constitute and
is not intended to result in any assumption by the Issuer of any obligation
of the undersigned to the Obligors, insurers or any other person in
connection with the Initial Receivables, Receivables Files, any insurance
policies or any agreement or instrument relating to any of them.
This Assignment is made pursuant to and upon the representations,
warranties and agreements on the part of the undersigned contained in the
Sale and Servicing Agreement and is to be governed in all respects by the
Sale and Servicing Agreement. Capitalized terms used herein and not
otherwise defined shall have the meanings assigned to them in the Sale and
Servicing Agreement.
D-1
IN WITNESS WHEREOF, the undersigned has caused this Assignment to
be duly executed as of May 1, 2001.
CNH CAPITAL RECEIVABLES INC.,
By: ----------------------------------------
Name: -----------------------------------
Title: ----------------------------------
D-2
EXHIBIT E
to Sale and Servicing Agreement
FORM OF SUBSEQUENT TRANSFER ASSIGNMENT
--------------------------------------
For value received, in accordance with and subject to the Sale and
Servicing Agreement dated as of May 1, 2001 (the "Sale and Servicing
Agreement") among CNH Equipment Trust 2001-A, a Delaware business trust
(the "Issuer"), CNH Capital Receivables Inc., a Delaware corporation (the
"Seller"), and Case Credit Corporation, a Delaware corporation ("Case
Credit"), the Seller does hereby sell, transfer, assign, set over and
otherwise convey to the Issuer, without recourse, all of its right, title
and interest in, to and under: (a) the Subsequent Receivables, with an
aggregate Contract Value equal to $________, listed on Schedule A hereto,
including all documents constituting chattel paper included therewith, and
all obligations of the Obligors thereunder including all moneys paid
thereunder on or after the Subsequent Cutoff Date, (b) the security
interests in the Financed Equipment granted by Obligors pursuant to such
Subsequent Receivables and any other interest of the Seller in such
Financed Equipment, (c) any proceeds with respect to such Subsequent
Receivables from claims on insurance policies covering Financed Equipment
or Obligors, (d) the Liquidity Receivables Purchase Agreements (only with
respect to Subsequent Receivables purchased by the Seller pursuant to those
Agreements) and the Purchase Agreements, including the right of the Seller
to cause Case Credit or NH Credit, as the case may be, to repurchase
Subsequent Receivables from the Seller under the circumstances described
therein, (e) any proceeds from recourse to Dealers with respect to such
Subsequent Receivables other than any interest in the Dealers' reserve
accounts maintained with Case Credit or NH Credit, (f) any Financed
Equipment that shall have secured any such Subsequent Receivables and that
shall have been acquired by or on behalf of the Trust, (g) any True Lease
Equipment that is subject to any Subsequent Receivable, and (h) the
proceeds of any and all of the foregoing. The foregoing sale does not
constitute and is not intended to result in any assumption by the Issuer of
any obligation of the Seller to the Obligors, insurers or any other person
in connection with such Subsequent Receivables, Receivable Files, any
insurance policies or any agreement or instrument relating to any of them.
This Subsequent Transfer Assignment is made pursuant to and upon
the representations, warranties and agreements on the part of the Seller
contained in the Sale and Servicing Agreement (including the Officers'
Certificate of the Seller accompanying this Agreement) and is to be
governed in all respects by the Sale and Servicing Agreement. Capitalized
terms used but not otherwise defined herein shall have the meanings
assigned to them in the Sale and Servicing Agreement.
E-1
IN WITNESS WHEREOF, the undersigned has caused this Subsequent
Transfer Assignment to be duly executed as of ___________________, _____.
CNH CAPITAL RECEIVABLES INC.,
By: ----------------------------------------
Name: -----------------------------------
Title: ----------------------------------
E-2
SCHEDULE A
to Subsequent Transfer Assignment
SCHEDULE OF SUBSEQUENT RECEIVABLES
----------------------------------
[Attached]
ANNEX A
to Subsequent Transfer Assignment
OFFICERS' CERTIFICATE
---------------------
We, the undersigned officers of CNH Capital Receivables Inc. (the
"Company"), do hereby certify, pursuant to Section 2.2(b)(xv) of the Sale
and Servicing Agreement dated as of May 1, 2001 among the Company, CNH
Equipment Trust 2001-A and Case Credit Corporation (the "Agreement"), that
(i) all of the conditions precedent to the transfer to the Issuer of the
Subsequent Receivables listed on Schedule A to the Subsequent Transfer
Assignment delivered herewith, and the other property and rights related to
such Subsequent Receivables as described in Section 2.2(a) of the
Agreement, have been satisfied on or prior to the related Subsequent
Transfer Date and (ii) each statement of fact set forth in any officers'
certificate executed by an officer of the Company in connection with an
Opinion of Counsel delivered on the Closing Date with respect to a transfer
of, or a security interest in, the Receivables shall be true and correct as
of the date hereof with respect to the Subsequent Receivables listed on the
aforementioned Schedule A.
Capitalized terms used but not defined herein shall have the
meanings assigned to such terms in the Agreement.
IN WITNESS WHEREOF, the undersigned have caused this certificate
to be duly executed this _____day of _____________, ______.
By: -----------------------------------------
Name:-----------------------------------
Title: ---------------------------------
By: ------------------------------------------
Name: ----------------------------------
Title: ----------------------------------
EXHIBIT F
to Sale and Servicing Agreement
FORM OF ACCOUNTANTS' LETTER IN CONNECTION
WITH THE SUBSEQUENT TRANSFER ASSIGNMENT PURSUANT TO
SECTION 2.2(b)(xiv) OF THE SALE AND SERVICING AGREEMENT
--------------------------------------------------------
[Letterhead of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇]
----------------, ------
CNH Capital Receivables Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
NH Equipment Trust 2001-A
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Chase Securities Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Bank One, National Association
▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇ ▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Ladies and Gentlemen:
This letter is issued at the request of CNH Capital Receivables Inc. (the
"Seller") with respect to the sale of certain retail receivables (the
"Subsequent Receivables") to the CNH Equipment Trust 2001-A (the "Trust")
pursuant to the Sale and Servicing Agreement dated as of May 1, 2001 (the
"Sale and Servicing Agreement") among the Trust, the Seller and Case Credit
Corporation (the "Servicer"). The sale of the Subsequent Receivables is
described in the prospectus dated May 7, 2001 and the prospectus supplement
dated May 9, 2001 (together, the "Prospectus"), which relates to the
offering by the Trust of 4.035% Class A-1 Asset Backed Notes, Floating Rate
Class A-2 Asset Backed Notes, Floating Rate Class A-3 Asset Backed Notes,
5.38% Class A-4 Asset Backed Notes and 5.73% Class B Asset Backed Notes
(collectively, the "Notes") and the 5.73% Asset Backed Certificates (the
"Certificates"). Capitalized terms used herein and not otherwise defined
have the meaning described in the Prospectus or the Sale and Servicing
Agreement, as applicable. In connection therewith, we performed or have
previously performed certain agreed upon procedures as specified in the
items below:
1. As previously communicated in our letter to the Seller, the Trust,
____________________, the Indenture Trustee and the Trustee dated
_________, _______ relating to the sale of certain retail
receivables (the "Initial Receivables") and the offering of the
Notes and the Certificates, we performed several procedures based
on a computer data file (the "Initial File") received from the
Servicer, including the following:
a. We read certain fields on the Initial File to determine
whether the data pertaining to the Initial Receivables
complied with the selection criteria as noted in our
previous letter.
b. Proved the arithmetic accuracy of the Aggregate Contract
Value and the related percentage of Initial Receivables
coded as representing construction and forestry equipment
and the Total Aggregate Contract Value of the Initial
Receivables as shown on Schedule B.
c. Proved the arithmetic accuracy of the Weighted Average Original
Term of the Initial Receivables as shown in Schedule B.
2. On ______________, _____, we obtained a computer data file (the
"Subsequent File") produced by and represented by the Servicer to
contain the list of the Subsequent Receivables. The Subsequent
File was received directly by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP from the
Servicer. By use of data retrieval software, we have performed the
following with respect to the information contained in the
Subsequent File:
a. We read certain fields on the Subsequent File to determine
whether the data relating to the Subsequent Receivables
complied with selection criteria 1, 2 and 4 as shown on
Schedule A. For purposes of selection criteria 3, as shown on
Schedule A, we read certain fields from the Initial File and
Subsequent File to aggregate the total Contract Value for each
account number for the purpose of determining the Contract
Value for each Obligor. The total Contract Value for each
account number was then compared to the aggregate Contract
Value to determine if the selection criteria was achieved.
b. Proved the arithmetic accuracy of the Aggregate Contract
Value and the related percentage of the Subsequent
Receivables coded as representing construction and
forestry equipment and the Total Aggregate Contract Value
of the Subsequent Receivables as shown on Schedule B.
c. Proved the arithmetic accuracy of the Weighted Average
Original Term of the Subsequent Receivables as shown in
Schedule B.
2
3. We proved the arithmetic accuracy of the columnar totals for
Aggregate Contract Value of construction and forestry equipment
and the Total Aggregate Contract Value as shown on Schedule B.
4. We proved the arithmetic accuracy of the percent of total column
as shown in 1 on Schedule B by dividing the amount in the Total
Aggregate Contract Value of construction and forestry equipment
column by the amount in the Total Aggregate Contract Value column.
We also proved the arithmetic accuracy of the Weighted Average
Original Term as shown in 2 on Schedule B by summing the products
of Total Aggregate Contract Value times Weighted Average Original
Term for the Initial Receivables and the Subsequent Receivables
and dividing the resulting sum by the columnar total of the Total
Aggregate Contract Value.
The foregoing procedures do not constitute an audit conducted in accordance
with generally accepted auditing standards, and, therefore, we are unable
to and do not express an opinion on any individual balances or summaries of
selected transactions specifically set forth in this letter. Also, these
procedures would not necessarily reveal matters of significance with
respect to the findings described herein. Accordingly, we make no
representations regarding the sufficiency of the foregoing procedures for
your purposes of for questions of legal interpretation. Had we performed
additional procedures, other matters might have come to our attention that
would have been reported to you. Further, we have addressed ourselves
solely to the foregoing data in the Sale and Servicing Agreement and the
Prospectus and make no representations regarding the adequacy of disclosure
regarding whether any material facts have been omitted.
This letter is solely for the information of the addressees and is not to
be used, circulated, quoted or otherwise referred to for any other purpose
including, but not limited to, the purchase or sale of Notes or
Certificates, nor is it to be referred to in any document. Furthermore, we
undertake no responsibility to update this letter for events and
circumstances occurring after the date of this letter.
Very truly yours,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP
3
SCHEDULE A
to Accountant's Letter
Selection Criteria Results
------------------ -------
1. No Subsequent Receivables was more than 90 days
past due as of the applicable Subsequent Cutoff Date.
2. Each Subsequent Receivable has an APR that is equal to or greater
than the sum of the weighted average of the Interest Rates for the
Class A Notes and the Class B Notes plus the Servicing Fee.
3. Each Subsequent Receivable has a Contract Value as of the
Subsequent Cutoff Date that (when combined with the Contract Value
of any other Receivables with the same or an affiliated Obligor)
does not exceed 1% of the aggregate Contract Value of all
Receivables.
4. Each Subsequent Receivable has a remaining term
to maturity (i.e., the period from but excluding
the applicable Subsequent Cutoff Date to and including the
Receivables' maturity date) of not more than
72 months.
4
SCHEDULE B
to Accountant's Letter
1. Percentage of principal balance of the Receivables that represents
construction and forestry
equipment:
Aggregate Construction and
Contract Value of Forestry
Construction and Total Aggregate Equipment
Forestry Equipment Contract Value Percent of Total
------------------ --------------- ----------------
Initial Receivables $ $ %
Subsequent Receivables $ $ %
Total Receivables $ $ %
2._______Weighted Average Original Term of the Receivables in the Trust.
Weighted
Total Aggregate Average Original
Contract Value Term
-------------- ------------------
Initial Receivables $_____ _____ months
Subsequent Receivables $_____ _____ months
Total Receivables $_____ _____ months
As noted above, the Weighted Average Original Term does not exceed 55.0
months as required by the Sale and Servicing Agreement.
5