[Execution Copy]
PURCHASE AGREEMENT
BETWEEN
NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION
AND
NAVISTAR FINANCIAL CORPORATION
DATED AS OF NOVEMBER 13, 1998
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS . . . . . . . . . . . . . . 1
SECTION 1.1. Definitions . . . . . . . . . . . . . . . . . . 1
ARTICLE II
PURCHASE AND SALE OF RECEIVABLES . . . . . . . . . 1
SECTION 2.1. Purchase and Sale of Receivables . . . . . . . . . 1
SECTION 2.2. Purchase Price . . . . . . . . . . . . . . . . . . 2
SECTION 2.3. The Closing . . . . . . . . . . . . . . . . . . . 2
ARTICLE III
REPRESENTATIONS AND WARRANTIES . . . . . . . . . 3
SECTION 3.1. Representations and Warranties as to
Receivables .. . . . . . . . . . . . . . . . . 3
SECTION 3.2. Additional Representations and Warranties of
NFC . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 3.3. Representations and Warranties of NFRRC . . . . . 8
ARTICLE IV
CONDITIONS . . . . . . . . . . . . . . 9
SECTION 4.1. Conditions to Obligation of NFRRC . . . . . . . . 9
SECTION 4.2. Conditions To Obligation of NFC . . . . . . . . 10
ARTICLE V
ADDITIONAL AGREEMENTS . . . . . . . . . . 11
SECTION 5.1. Conflicts With Program Documents . . . . . . . . 11
SECTION 5.2. Protection of Title . . . . . . . . . . . . . . 11
SECTION 5.3. Other Liens or Interests . . . . . . . . . . . . 12
SECTION 5.4. Repurchase Events . . . . . . . . . . . . . . . 12
SECTION 5.5. Indemnification . . . . . . . . . . . . . . . . 12
SECTION 5.6. Further Assignments . . . . . . . . . . . . . . 12
SECTION 5.7. Pre-Closing Collections . . . . . . . . . . . . 13
SECTION 5.8. Limitation on Transfer of NITC Purchase
Obligations . . . . . . . . . . . . . . . . . 13
SECTION 5.9. Sale Treatment . . . . . . . . . . . . . . . . . 13
ARTICLE VI
MISCELLANEOUS PROVISIONS . . . . . . . . . . 13
SECTION 6.1. Amendment . . . . . . . . . . . . . . . . . . . 13
SECTION 6.2. Survival . . . . . . . . . . . . . . . . . . . . 13
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SECTION 6.3. Notices . . . . . . . . . . . . . . . . . . . . 13
SECTION 6.4. Governing Law . . . . . . . . . . . . . . . . . 13
SECTION 6.5. Waivers . . . . . . . . . . . . . . . . . . . . 13
SECTION 6.6. Costs and Expenses . . . . . . . . . . . . . . . 14
SECTION 6.7. Confidential Information . . . . . . . . . . . . 14
SECTION 6.8. Headings . . . . . . . . . . . . . . . . . . . . 14
SECTION 6.9. Counterparts . . . . . . . . . . . . . . . . . . 14
SECTION 6.10. Severability of Provisions . . . . . . . . . . . 14
SECTION 6.11. Further Assurances . . . . . . . . . . . . . . . 14
SECTION 6.12. No Third-Party Beneficiaries . . . . . . . . . . 14
SECTION 6.13. Merger and Integration . . . . . . . . . . . . . 14
Exhibits
Exhibit A - Form of Assignment
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PURCHASE AGREEMENT, dated as of November 13, 1998, between
NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION, a Delaware
corporation ("NFRRC"), and NAVISTAR FINANCIAL CORPORATION, a Delaware
corporation ("NFC").
WHEREAS, NFRRC desires to purchase a portfolio of retail
instalment sale contracts for, and retail loans evidenced by notes and
secured by new and used medium and heavy duty trucks, buses and trailers
(collectively, the "Retail Notes"), together with related rights owned
by NFC;
WHEREAS, NFC is willing to sell such Retail Notes and the
related rights to NFRRC; and
WHEREAS, NFRRC has agreed to sell or otherwise transfer such
Retail Notes and related rights to Park Avenue Receivables Corporation,
a Delaware corporation (the "Purchaser"), pursuant to the Transfer and
Administration Agreement (as defined below).
NOW, THEREFORE, in consideration of the foregoing, the other
good and valuable consideration and the mutual terms and covenants
herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. Capitalized terms used but not
otherwise defined in this Agreement shall have the respective meanings
assigned them in the Transfer and Administration Agreement of even date
herewith by and among NFC, NFRRC, Park Avenue Receivables Corporation
and The Chase Manhattan Bank (the "Transfer and Administration
Agreement"), as it may be amended, supplemented or modified from time to
time. All references herein to "the Agreement" or "this Agreement" are
to this Purchase Agreement as it may be amended, supplemented or
modified from time to time, the exhibits hereto and the capitalized
terms used herein which are defined in the Transfer and Administration
Agreement, and all references herein to Articles, Sections and
subsections are to Articles, Sections or subsections of this Agreement
unless otherwise specified. The rules of construction set forth in
Article I of the Transfer and Administration Agreement shall be
applicable to this Agreement.
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ARTICLE II
PURCHASE AND SALE OF RECEIVABLES
SECTION 2.1. Purchase and Sale of Receivables. Subject to the
satisfaction of the conditions specified in Article IV, NFC agrees to
sell, transfer, assign and otherwise convey to NFRRC, without recourse,
pursuant to a written assignment substantially in the form of Exhibit A
(an "Assignment"), and NFRRC agrees to purchase on the Closing Date all
right, title and interest of NFC in, to and under:
(a) the Retail Notes, secured by one or more Financed Vehicles,
that are identified in a schedule to the Assignment delivered to NFRRC
on the Closing Date (the "Receivables") and Collections paid thereon
(including Liquidation Proceeds) and due thereunder on and after the
Cutoff Date;
(b) the security interests in the Financed Vehicles granted by
Obligors pursuant to the Receivables and, to the extent permitted by
law, any accessions thereto which are financed by NFC;
(c) the benefits of any lease assignments with respect to the
related Financed Vehicles;
(d) any proceeds from any Insurance Policies with respect to the
Receivables;
(e) any proceeds from Dealer Liability with respect to the
Receivables, proceeds from any NITC Purchase Obligations with respect to
the Receivables (subject to the limitations set forth in Section 5.8
hereof) and proceeds from any Guaranties of Receivables; and
(f) any Proceeds of the property described in clauses (a), (b) and
(c) above (the property described in clauses (b) through (f) hereof are
referred to as the "Related Security").
SECTION 2.2. Purchase Price. In consideration for the
purchase of the Receivables and the Related Security, NFRRC shall, on
the Closing Date, pay to NFC an amount equal to the Initial Aggregate
Receivables Balance (the "Purchase Price") and NFC shall execute and
deliver to NFRRC an Assignment with respect to the Receivables. On the
Closing Date, a portion of the Purchase Price payable on such date equal
to $525,754,105.00 shall be paid to NFC in immediately available funds,
and the balance of the Purchase Price shall be recorded as an advance
from NFC to NFRRC. Concurrent with the payment of the Purchase Price
by NFRRC, NFC shall make a capital contribution to NFRRC by paying to
NFRRC $400,000 in immediately available funds and by contributing to
NFRRC an interest rate cap agreement by NFC for the benefit of NFRRC.
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SECTION 2.3. The Closing. The sale and purchase of the
Receivables shall take place at such a place, on a date and at a time
mutually agreeable to NFC and NFRRC, and may occur simultaneously with
the closing of any related transactions contemplated by the Transfer and
Administration Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1. Representations and Warranties as to Receivables.
NFC makes the following representations and warranties as to the
Receivables on which NFRRC relies in accepting such Receivables. Such
representations and warranties speak as of the Closing Date, and as of
the related transfer of such Receivables under the Transfer and
Administration Agreement, and shall survive the sale, transfer and
assignment of the Receivables to NFRRC and the subsequent assignment and
transfer thereof pursuant to the Transfer and Administration Agreement
and the PARCO Asset Purchase Agreement:
(a) Characteristics of Receivables. Each Receivable:
(i) was originated by NFC to finance a retail purchase by a
retail customer or a refinancing of a Financed Vehicle or Financed
Vehicles by a retail customer and was fully and properly executed
by the parties thereto;
(ii) has created or shall create a valid, binding and
enforceable first priority security interest in favor of NFC in
each Financed Vehicle related thereto, which security interest will
be validly assigned by NFC to NFRRC and will be assignable by NFRRC
to a subsequent purchaser;
(iii) contains customary and enforceable provisions such as
to render the rights and remedies of the holder thereof adequate
for realization against the collateral of the benefits of the
security;
(iv) shall yield interest at the Annual Percentage Rate; and
(v) comes from one of the following categories, which differ
in their provisions for the payment of principal and interest:
Equal Payment Fully Amortizing Receivables, Equal Payment Skip
Receivables, Equal Payment Balloon Receivables, Level Principal
Fully Amortizing Receivables, Level Principal Skip Receivables,
Level Principal Balloon Receivables, or Other Receivables. "Equal
Payment Fully Amortizing Receivables" are Receivables that provide
for equal monthly payments that fully amortize the amount financed
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over its original term to maturity. "Equal Payment Skip
Receivables" are Receivables that provide for equal monthly
payments in eleven or fewer months of each twelve-month period that
fully amortize the amount financed over its original term to
maturity. "Equal Payment Balloon Receivables" are Receivables that
provide for equal monthly payments except that a larger payment
becomes due on the final maturity date for such Receivables.
"Level Principal Fully Amortizing Receivables" are Receivables that
provide for monthly payments consisting of level principal amounts
together with accrued and unpaid interest on the unpaid Receivable
Balances. "Level Principal Skip Receivables" are Receivables that
provide for monthly payments in eleven or fewer months of each
twelve-month period consisting of level principal amounts together
with accrued and unpaid interest on the unpaid Receivable Balances.
"Level Principal Balloon Receivables" are Receivables that provide
for monthly payments consisting of level principal amounts together
with accrued and unpaid interest on the unpaid Receivable Balances,
except that a larger principal payment becomes due on the final
maturity date for such Receivables. "Other Receivables" are
Receivables not described above, including Receivables that provide
for level monthly payments in eleven or fewer months of each
twelve-month period that amortize a portion of the amount financed
over its original term to maturity with a larger payment that
becomes due on the final maturity date for such Receivables.
(b) Schedule of Receivables. The information set forth in the
Schedule of Receivables is true and correct in all material respects;
(c) Compliance With Law. All requirements of applicable federal,
state and local laws, and regulations thereunder, including the Equal
Credit Opportunity Act, the Federal Reserve Board's Regulation "B", the
Soldiers' and Sailors' Civil Relief Act of 1940, and any applicable bulk
sales or bulk transfer law and other equal credit opportunity and
disclosure laws, in respect of any of the Receivables, have been
complied with in all material respects, and each such Receivable and the
sale of the Financed Vehicle or Financed Vehicles evidenced thereby
complied at the time it was originated or made and now complies in all
material respects with all legal requirements of the jurisdiction in
which it was originated or made;
(d) Binding Obligation. Each Receivable represents the genuine,
legal, valid and binding payment obligation in writing of the Obligor
thereon, enforceable against the Obligor by the holder thereof in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization or similar laws
affecting the enforcement of creditors' rights in general and by equity,
regardless of whether such enforceability is considered in a proceeding
in equity or at law;
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(e) Security Interest in Financed Vehicle. Immediately prior to
the sale, transfer and assignment thereof pursuant hereto, each
Receivable was secured by a validly perfected first priority security
interest in the related Financed Vehicle or, in the event any such
Receivable was secured by more than one Financed Vehicle, in each
related Financed Vehicle, each in favor of NFC as secured party, or all
necessary and appropriate action had been commenced that will result,
within 100 days following the Cutoff Date, in the valid perfection of a
first priority security interest in each related Financed Vehicle in
favor of NFC as secured party in each case (except for first priority
security interests which may exist in any accessions not financed by
NFC);
(f) Receivables In Force. No Receivable has been satisfied,
subordinated or rescinded, and no Financed Vehicle securing any
Receivable has been released from the Lien of the related Receivable in
whole or in part;
(g) No Waiver. Since the Cutoff Date, no provision of any
Receivable has been waived, altered or modified in any respect;
(h) No Amendments. Since the Cutoff Date, no Receivable has been
amended or otherwise modified such that the total number of the
Obligor's Scheduled Payments is increased or the Initial Receivable
Balance thereof is increased;
(i) No Defenses. No right of rescission, setoff, counterclaim or
defense has been asserted or threatened with respect to any Receivable;
(j) No Liens. There are, to NFC's knowledge, no Liens or claims
that have been filed for work, labor or materials affecting any Financed
Vehicle securing any Receivable that are or may be prior to, or equal or
coordinate with, the security interest in each Financed Vehicle granted
by the Receivable (except for Liens or claims which may exist in any
accessions to the Financed Vehicles not financed by NFC);
(k) No Default. There has been no default, breach, violation or
event permitting acceleration under the terms of any Receivable, and no
event has occurred and is continuing that with notice or the lapse of
time would constitute a default, breach, violation or event permitting
acceleration under the terms of any Receivable, and NFC has not waived
any of the foregoing, in each case except for payments on any
Receivables which are not more than 60 days past due (measured from the
date of any Scheduled Payment) as of the Cutoff Date;
(l) Insurance. Each Obligor on a Receivable is required to
maintain a physical damage insurance policy for each Financed Vehicle of
the type that NFC requires in accordance with its customary underwriting
standards for the purchase of medium and heavy duty truck, bus and
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trailer receivables, unless NFC has in accordance with its customary
procedures permitted an Obligor to self-insure such Financed Vehicle;
(m) Good Title. No Receivable has been sold, transferred,
assigned or pledged by NFC to any Person other than NFRRC; immediately
prior to the conveyance of any Receivables pursuant to this Agreement,
NFC had good and marketable title thereto, free of any Lien (except for
any Lien which may exist in accessions to the Financed Vehicles not
financed by NFC); and, upon execution and delivery of this Agreement and
the related Assignment by NFC, and satisfaction of the conditions set
forth in Section 4.2 hereof relating to such Receivables, NFRRC shall
have all of the right, title and interest of NFC in and to the
Receivables and the Related Security, free of any Lien (except for any
Lien which may exist in accessions to the Financed Vehicles not financed
by NFC);
(n) Lawful Assignment. No Receivable was originated in, or is
subject to the laws of, any jurisdiction the laws of which would make
unlawful the sale, transfer and assignment of such Receivable under this
Agreement or any of the other Program Documents to which NFC or NFRRC is
a party;
(o) All Filings Made. All filings necessary under the UCC in any
jurisdiction to give NFRRC a first priority perfected security or
ownership interest in the Receivables and the Related Security (to the
extent it constitutes Code Collateral) shall have been made, and the
Receivables constitute Code Collateral;
(p) One Original. There is only one original executed copy of
each Receivable;
(q) No Documents or Instruments. No Receivable, or constituent
part thereof, constitutes a "negotiable instrument" or "negotiable
document of title" (as such terms are used in the UCC);
(r) Maturity of Receivables. Each Receivable has an original term
to maturity of not less than 12 months and not greater than 84 months
and, as of the Cutoff Date, had a remaining term to maturity of not less
than 12 months and not greater than 73 months;
(s) Annual Percentage Rate. The Annual Percentage Rate of each
Receivable is not less than 6.22%;
(t) Scheduled Payments; Delinquency. As of the Cutoff Date, each
Receivable had a first scheduled payment that was due on or before
October 31, 1998; as of the Cutoff Date, no Receivable had a payment
that was more than 60 days past due; as of the Closing Date, no
Receivable had a final scheduled payment that is due later than October
31, 2004;
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(u) Vehicles. Each Financed Vehicle to which a Receivable relates
was a new or used medium or heavy duty truck, bus or trailer at the time
the related Obligor executed the Retail Note;
(v) Origin. Each Receivable was originated in the United States;
(w) Beginning Receivable Balance. The Initial Receivable Balance
of each Receivable shall be $1,000 or more;
(x) Concentration. The aggregate Initial Receivables Balance of
all Receivables from a single Obligor shall not be more than 2.00% of
the Initial Aggregate Receivables Balance;
(y) Selection Criteria. The Receivables were selected on a random
basis from all Retail Notes satisfying the selection criteria described
herein, and no selection procedures believed to be adverse to NFRRC or
to the Owners were utilized in selecting the Receivables from those
Retail Notes of NFC which meet the selection criteria under this
Agreement; and
(z) No Government Contracts. No Obligor under any of the
Receivables is a governmental authority of the United States or any
state or political subdivision thereof.
SECTION 3.2. Additional Representations and Warranties of NFC.
NFC hereby represents and warrants to NFRRC as of the date hereof and as
of the related closing under the Transfer and Administration Agreement
in its capacity as the seller of the Receivables hereunder, that:
(a) Organization and Good Standing. NFC has been duly organized
and is validly existing as a corporation in good standing under the laws
of the State of Delaware, with power and authority to own its properties
and to conduct its business as such properties are presently owned and
such business is presently conducted, and had at all relevant times, and
now has, power, authority and legal right to acquire and own the
Receivables;
(b) Due Qualification. NFC 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 requires or shall
require such qualification;
(c) Power and Authority. NFC has the power and authority to
execute and deliver this Agreement and to carry out its terms; NFC has
full power and authority to sell and assign the Receivables and the
Related Security to NFRRC, has duly authorized such sale and assignment
to NFRRC by all necessary corporate action; and the execution, delivery
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and performance of this Agreement have been duly authorized by NFC by
all necessary corporate action;
(d) Valid Sale; Binding Obligation. This Agreement, together with
the Assignment, when duly executed and delivered, shall (upon
satisfaction of the conditions set forth in Section 4.02(b) hereof)
constitute a valid sale, transfer and assignment of the Receivables and
Related Security, enforceable against creditors of and purchasers from
NFC; and this Agreement, together with the Assignment, when duly
executed and delivered, shall (upon satisfaction of the conditions set
forth in Section 4.2(b) hereof) constitute a legal, valid and binding
obligation of NFC enforceable against NFC in accordance with its
respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or other similar laws affecting
the enforcement of creditors' rights in general and by general
principles of equity, regardless of whether such enforceability is
considered in a proceeding in equity or at law;
(e) No Violation. The consummation of the transactions
contemplated by this Agreement and the Assignment, and the fulfillment
of the terms of this Agreement and the Assignment, 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 certificate of incorporation or by-laws of NFC, or any indenture,
agreement, mortgage, deed of trust or other instrument to which NFC is a
party or by which it is 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, mortgage, deed of trust or other instrument (other
than this Agreement, the Assignment or any other Program Documents), or
violate any law or, to NFC's knowledge, any order, rule or regulation
applicable to NFC of any court or of any federal or state regulatory
body, administrative agency or other governmental instrumentality having
jurisdiction over NFC or any of its properties;
(f) No Proceedings. There are no proceedings or, to NFC's
knowledge, investigations pending or, to NFC's knowledge, threatened,
before any court, regulatory body, administrative agency or other
tribunal or governmental instrumentality having jurisdiction over NFC or
its properties (i) asserting the invalidity of this Agreement or the
Assignment, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or the Assignment, or (iii)
seeking any determination or ruling that might materially and adversely
affect the performance by NFC of its obligations under, or the validity
or enforceability of, this Agreement or the Assignment; and
(g) No Consent. No permit, consent, approval or authorization of,
or declaration to or filing with, any governmental authority is required
in connection with the execution, delivery and performance by NFC of
this Agreement or the Assignment or the consummation by NFC of the
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transactions contemplated hereby or thereby except as expressly
contemplated herein or therein.
SECTION 3.3. Representations and Warranties of NFRRC. NFRRC
hereby represents and warrants to NFC as of the date hereof:
(a) Organization and Good Standing. NFRRC has been duly organized
and is validly existing as a corporation in good standing under the laws
of the State of Delaware, with power and authority to own its properties
and to conduct its business as such properties are presently owned and
such business is presently conducted, and had at all relevant times, and
now has, power, authority and legal right to acquire and own the
Receivables;
(b) Due Qualification. NFRRC 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 requires such
qualification;
(c) Power and Authority. NFRRC has the 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 NFRRC by all necessary corporate action;
(d) No Violation. The consummation by NFRRC of the transactions
contemplated by this Agreement and the fulfillment of the terms of this
Agreement 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 certificate of incorporation or by-laws of
NFRRC, or any indenture, agreement, mortgage, deed of trust or other
instrument to which NFRRC is a party or by which it is 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, the Assignment or any other
Program Document), or violate any law or, to NFRRC's knowledge, any
order, rule or regulation applicable to NFRRC of any court or of any
federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over NFRRC or any of
its properties;
(e) No Proceedings. There are no proceedings or, to NFRRC's
knowledge, investigations pending or, to NFRRC's knowledge, threatened,
before any court, regulatory body, administrative agency or other
tribunal or governmental instrumentality having jurisdiction over NFRRC
or its properties (i) asserting the invalidity of this Agreement or the
Assignment, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or (iii) seeking any
determination or ruling that might materially and adversely affect the
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performance by NFRRC of its obligations under, or the validity or
enforceability of, this Agreement or the Assignment;
(f) Binding Obligation. This Agreement shall constitute a legal,
valid and binding obligation of NFRRC enforceable against NFRRC in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, or other similar laws
affecting the enforcement of creditors' rights in general and by general
principles of equity, regardless of whether such enforceability is
considered in a proceeding in equity or at law; and
(g) No Consent. No permit, consent, approval or authorization of,
or declaration to or filing with, any governmental authority is required
in connection with the execution, delivery and performance by NFRRC of
this Agreement, or the consummation by NFRRC of the transactions
contemplated hereby except as expressly contemplated herein.
ARTICLE IV
CONDITIONS
SECTION 4.1. Conditions to Obligation of NFRRC. The obligation
of NFRRC to purchase the Receivables and the Related Security hereunder
is subject to the satisfaction of the following conditions:
(a) Representations and Warranties True. The representations and
warranties of NFC in Section 3.1 regarding the Receivables and the
Related Security, and the representations and warranties of NFC in
Section 3.2, shall be true and correct on the Closing Date, and NFC
shall have performed all obligations to be performed by it hereunder on
or prior to the Closing Date.
(b) No Repurchase Event. No Repurchase Event (as defined in
Section 5.4 below) shall have occurred on or prior to the Closing Date
with respect to any of the Receivables.
(c) Computer Files Marked. NFC shall, at its own expense, on or
prior to the Closing Date, (i) indicate in its computer files created in
connection with the Receivables that the Receivables have been sold to
NFRRC pursuant to this Agreement and the related Assignment and (ii)
deliver to NFRRC the Schedule of Receivables certified by an officer of
NFC to be true, correct and complete.
(d) Documents to be Delivered By NFC.
(i) The Assignment. On the Closing Date, NFC shall execute
and deliver to NFRRC the Assignment of the Receivables and the
Related Security.
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(ii) Evidence of UCC Filing. On or prior to the Closing Date,
NFC shall record and file, at its own expense, a UCC-1 financing
statement in each jurisdiction in which required by applicable law,
executed by NFC as seller or debtor, naming NFRRC as purchaser or
secured party, naming the Receivables and Related Security as
collateral, meeting the requirements of the laws of each such
jurisdiction and in such manner as is necessary to perfect under
the UCC the sale, transfer, assignment and conveyance of the
Receivables and the Related Security (to the extent it constitutes
Code Collateral) to NFRRC. NFC shall deliver a file-stamped copy,
or other evidence satisfactory to NFRRC of such filing, to NFRRC on
or prior to the Closing Date.
(iii) Other Documents. On the Closing Date, NFC shall
provide such other documents as NFRRC may reasonably request.
(e) Other Transactions. The related transactions contemplated by
the Transfer and Administration Agreement shall be consummated on or
prior to the Closing Date (and all conditions precedent thereto shall be
satisfied) to the extent that such transactions are intended to be
substantially contemporaneous with the transactions hereunder.
SECTION 4.2. Conditions To Obligation of NFC. The obligation of
NFC to sell the Receivables to NFRRC hereunder on the Closing Date is
subject to the satisfaction of the following conditions:
(a) Representations and Warranties True. The representations and
warranties of NFRRC hereunder shall be true and correct as of the
Closing Date, and NFRRC shall have performed all obligations to be
performed by it hereunder on or prior to the Closing Date.
(b) Purchase Price. On the Closing Date, NFRRC shall pay to NFC
the Purchase Price, payable on such date as provided in Section 2.2 of
this Agreement.
ARTICLE V
ADDITIONAL AGREEMENTS
NFC agrees with NFRRC as follows:
SECTION 5.1. Conflicts With Program Documents. To the extent
that any provision of Sections 5.2 through 5.4 of this Agreement
conflicts with any provision of the other Program Documents to which NFC
or NFRRC is a party, such other Program Documents shall govern.
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SECTION 5.2. Protection of Title.
(a) Filings. NFC shall execute and file such financing statements
and cause to be executed and filed such continuation and other
statements, all in such manner and in such places as may be required by
law fully to preserve, maintain and protect the interest of NFRRC under
this Agreement in the Receivables and the Related Security and in the
proceeds thereof. NFC shall deliver (or cause to be delivered) to NFRRC
file-stamped copies of, or filing receipts for, any document filed as
provided above, as soon as available following such filing.
(b) Name Change. NFC shall not change its name, identity or
corporate structure in any manner that would, could or might make any
financing statement or continuation statement filed by NFC in accordance
with Section 5.2(a) seriously misleading within the meaning of Section
9-402(7) of the UCC, unless it shall have given NFRRC at least 60 days
prior written notice thereof and shall file such financing statements or
amendments as may be necessary to continue the perfection of NFRRC's
security interest in the Receivables and the Related Security.
(c) Executive Office; Maintenance of Offices. NFC shall give
NFRRC 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. NFC shall at all times maintain each
office from which it services Receivables and its principal executive
office within the United States of America.
SECTION 5.3. Other Liens or Interests. Except for the
conveyances hereunder and as contemplated by the Transfer and
Administration Agreement and the other Program Documents, NFC shall not
sell, pledge, assign or transfer the Receivables and the Related
Security to any other Person, or grant, create, incur, assume or suffer
to exist any Lien (except any Lien which may exist in accessions to the
Financed Vehicles not financed by NFC) on any interest therein, and NFC
shall defend the right, title and interest of NFRRC in, to and under the
Receivables and Related Security against all claims of third parties
claiming through or under NFC.
SECTION 5.4. Repurchase Events. By its execution of the Program
Documents to which it is a party, NFC shall be deemed to acknowledge the
assignment by NFRRC of such of its right, title and interest in, to and
under this Agreement to the Owners as shall be provided in the Program
Documents. NFC hereby covenants and agrees with NFRRC for the benefit
of NFRRC and the Owners, that in the event of a breach of any of NFC's
representations and warranties contained in Section 3.01 hereof with
respect to any Receivable (a "Repurchase Event") as of the second
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Accounting Date following NFC's discovery or its receipt of notice of
breach (or, at NFC's election, the first Accounting Date following such
discovery), unless such breach shall have been cured in all material
respects, NFC will repurchase such Receivable from the Owners on the
related Distribution Date for an amount equal to the Warranty Payment,
without further notice from NFRRC hereunder. Upon the occurrence of a
Repurchase Event with respect to a Receivable owned by NFRRC, NFC agrees
to repurchase such Receivable from NFRRC for an amount and upon the same
terms as NFC would be obligated to repurchase such Receivable from the
Owners if such Receivable was owned by the Owners, and upon payment of
such amount, NFC shall have such rights with respect to such Receivable
as if NFC had purchased such Receivable from the Owners. It is
understood and agreed that the obligation of NFC to repurchase any
Receivable as to which a breach has occurred and is continuing shall, if
such obligation is fulfilled, except for Section 5.5, constitute the
sole remedy against NFC for such breach available to NFRRC or any Owner.
SECTION 5.5. Indemnification. NFC shall indemnify NFRRC for any
liability as a result of the failure of a Receivable to be originated in
compliance with all requirements of law and for any breach of any of its
representations and warranties contained herein. This indemnity
obligation shall be in addition to any obligation that NFC may otherwise
have.
SECTION 5.6. Further Assignments. NFC acknowledges that NFRRC
shall, pursuant to the Transfer and Administration Agreement, sell
Receivables to the Purchaser and assign its rights hereunder to the
Purchaser, subject to the terms and conditions of the Transfer and
Administration Agreement, and that the Purchaser may in turn further
pledge, assign or transfer its rights in the Receivables and this
Agreement pursuant to the PARCO Asset Purchase Agreement. NFC further
acknowledges that NFRRC may assign its rights under the Custodian
Agreement to the Purchaser.
SECTION 5.7. Pre-Closing Collections. Within two Business Days
after the Closing Date, NFC shall transfer to the account or accounts
designated by NFRRC (or by the Funding Agent, on behalf of the
Purchaser, under the Transfer and Administration Agreement) all
Collections (from whatever source) on or with respect to the Receivables
and the Related Security.
SECTION 5.8. Limitation on Transfer of NITC Purchase Obligations.
NFRRC acknowledges and agrees that the rights pursuant to the NITC
Purchase Obligations are personal to NFC, and only the proceeds of such
rights have been assigned to NFRRC. NFRRC is not and is not intended to
be a third-party beneficiary of such rights and, accordingly, such
rights will not be exercisable by, enforceable by or for the benefit of,
or preserved for the benefit of, NFRRC.
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SECTION 5.9. Sale Treatment. NFC intends to treat the transfer
and assignment described herein as a sale for accounting and tax
purposes.
ARTICLE VI
MISCELLANEOUS PROVISIONS
SECTION 6.1. Amendment. This Agreement may be amended from time
to time (subject to any expressly applicable amendment provision of the
Transfer and Administration Agreement) by a written amendment duly
executed and delivered by NFC and NFRRC; provided that NFC and NFRRC
shall have received the prior written consent of the Funding Agent.
SECTION 6.2. Survival. The representations, warranties and
covenants of NFC set forth in Article III and Article V of this
Agreement shall remain in full force and effect and shall survive the
Closing Date, the closing under the Transfer and Administration
Agreement and any transfer of the Receivables and the Related Security
pursuant to the PARCO Asset Purchase Agreement.
SECTION 6.3. Notices. All demands, notices and communications
under this Agreement shall be delivered as specified in the Transfer and
Administration Agreement.
SECTION 6.4. Governing Law. All questions concerning
construction, validity and interpretation of this Agreement and the
Assignment shall be governed by and construed and enforced in accordance
with the internal laws of the State of Illinois, without giving effect
to any choice of law or conflict provision or rule (whether of the State
of Illinois or any other jurisdiction) that would cause the application
of laws of any jurisdiction other than the State of Illinois.
SECTION 6.5. Waivers. No failure or delay on the part of NFRRC
in exercising any power, right or remedy under this Agreement or the
Assignment shall operate as a waiver thereof, nor shall any single or
partial exercise of any such power, right or remedy preclude any other
or further exercise thereof or the exercise of any other power, right or
remedy.
SECTION 6.6. Costs and Expenses. NFC agrees to pay all
reasonable out-of-pocket costs and expenses of NFRRC, including fees and
expenses of counsel, in connection with the perfection as against third
parties of NFRRC's right, title and interest in, to and under the
Receivables and the enforcement of any obligation of NFC hereunder.
SECTION 6.7. Confidential Information. NFRRC agrees that it
shall neither use nor disclose to any person the names and addresses of
the Obligors, except in connection with the enforcement of NFRRC's
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rights hereunder, under the Receivables, under the Program Documents or
as required by law.
SECTION 6.8. Headings. The various headings in this Agreement
are for purposes of reference only and shall not affect the meaning or
interpretation of any provision of this Agreement.
SECTION 6.9. Counterparts. This Agreement may be executed in two
or more counterparts, and by different parties on separate counterparts,
each of which shall be an original, but all of which together shall
constitute one and the same instrument.
SECTION 6.10. Severability of Provisions. If any one or more of
the covenants, agreements, provisions or terms of this Agreement shall
for any reason whatsoever be held invalid, then such covenants,
agreements, provisions or terms shall be deemed enforceable to the
fullest extent permitted, and if not so permitted, shall be deemed
severable from the remaining covenants, agreements, provisions or terms
of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or rights of
any Owner.
SECTION 6.11. Further Assurances. NFC and NFRRC agree to do and
perform, from time to time, any and all acts and to execute any and all
further instruments required or reasonably requested by the other more
fully to effect the purposes of this Agreement, including the execution
of any financing statements or continuation statements relating to the
Receivables for filing under the provisions of the UCC of any applicable
jurisdiction.
SECTION 6.12. No Third-Party Beneficiaries. This Agreement shall
inure to the benefit of and be binding upon the parties hereto, the
Owners and their respective successors and permitted assigns. Except as
otherwise expressly provided in this Agreement, no other Person shall
have any right or obligation hereunder.
SECTION 6.13. Merger and Integration. Except as specifically
stated otherwise herein, this Agreement sets forth the entire
understanding of the parties relating to the subject matter hereof, and
all prior understandings, written or oral, are superseded by this
Agreement. This Agreement may not be modified, amended, waived, or
supplemented except as provided herein.
* * * * *
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IN WITNESS WHEREOF, the parties hereby have caused this
Agreement to be executed by their respective officers thereunto duly
authorized as of the date and year first above written.
NAVISTAR FINANCIAL CORPORATION
By:___________________________________________
R. ▇▇▇▇▇ ▇▇▇▇, Vice President and Treasurer
NAVISTAR FINANCIAL RETAIL RECEIVABLES
CORPORATION
By:_____________________________________________
R. ▇▇▇▇▇ ▇▇▇▇, Vice President and Treasurer
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EXHIBIT A
FORM OF ASSIGNMENT
For value received, in accordance with the Purchase Agreement,
dated as of November 13, 1998 (the "Purchase Agreement"), between
Navistar Financial Corporation, a Delaware corporation ("NFC"), and
Navistar Financial Retail Receivables Corporation a Delaware corporation
("NFRRC"), NFC does hereby sell, assign, transfer and otherwise convey
unto NFRRC, without recourse, all right, title and interest of NFC in,
to and under (i) the Receivables listed on Schedule I hereto, (having an
Initial Aggregate Receivables Balance of $545,048,813.47) (the
"Receivables") and all monies paid thereon (including Liquidation
Proceeds) and due thereunder on and after October 1, 1998 (the "Cutoff
Date"); (ii) the security interests in the Financed Vehicles granted by
Obligors pursuant to the Receivables and, to the extent permitted by
law, any accessions thereto which are financed by NFC; (iii) the
benefits of any lease assignments with respect to the Financed Vehicles;
(iv) any proceeds from any Insurance Policies with respect to the
Receivables; (v) any proceeds from Dealer Liability with respect to the
Receivables, proceeds from any NITC Purchase Obligations with respect to
the Receivables (subject to the limitations set forth in Section 5.8 of
the Purchase Agreement) and proceeds from any Guaranties of Receivables;
and (vi) any proceeds of the property described in clauses (i), (ii) and
(iii) above.
The foregoing sale does not constitute and is not intended to
result in any assumption by NFRRC of any obligation of the undersigned
to the Obligors, Dealers, insurers or any other Person in connection
with the Receivables, the agreements with Dealers, 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 Purchase Agreement and is to be governed by
the Purchase Agreement.
Capitalized terms used herein and not otherwise defined shall
have the meaning assigned to them in the Purchase Agreement.
* * * * *
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IN WITNESS WHEREOF, the undersigned has caused this Assignment
to be duly executed as of November 13, 1998.
NAVISTAR FINANCIAL CORPORATION
By: _________________________________
Name:
Title:
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