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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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F O R M 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 1, 1998
CIT RV Trust 1998-A
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(Exact name of registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation)
333-36061 Applied for
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Commission File Number) (IRS Employer Identification No.)
c/o Bankers Trust (Delaware)
as Owner Trustee
1011 Centre Road, Suite 200
Wilmington, Delaware 19805-1266
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(Address of principal executive offices and zip code)
(302) 636-3305
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Registrants' telephone number, including area code:
N/A
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(Former name or former address, if changed since last report)
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Item 7. Financial Statements and Exhibits.
---------------------------------
(c) Exhibits.
The following are filed herewith. The exhibit numbers correspond with
Item 601(b) of Regulation S-K.
Exhibit No. Description
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99.1 Computational Materials
SIGNATURE
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CIT RV TRUST 1998-A
By: BANKERS TRUST (DELAWARE)
as Owner Trustee
By: /s/ M. Lisa Wilkins
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Name: M. Lisa Wilkins
Title: Assistant Secretary
Dated: June 4, 1998
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EXHIBIT 99.1
Computational Materials
CIT RV Trust 1998-A
$400,000,000 (Approximate)
THE CIT GROUP SECURITIZATION CORPORATION II
SELLER
THE CIT GROUP/SALES FINANCING, INC.
SERVICER
$111,000,000 (Approximate) Class A-1__% Asset-Backed Notes
$94,000,000 (Approximate) Class A-2 __% Asset-Backed Notes
$54,000,000 (Approximate) Class A-3 __% Asset-Backed Notes
$80,000,000 (Approximate) Class A-4 __% Asset-Backed Notes
$37,000,000 (Approximate) Class A-5 __% Asset-Backed Notes
$18,000,000 (Approximate) Class B __% Asset-Backed Notes
$6,000,000 (Approximate) __% Asset-Backed Certificates
COMPUTATIONAL MATERIALS
Neither the Issuer of the Notes and Certificates nor any of its affiliates make
any representation as to the accuracy or completeness of the information herein.
The information herein is preliminary, and will be superseded by the applicable
prospectus supplement and by any other information subsequently filed with the
Securities and Exchange Commission. The information addresses only certain
aspects of the applicable security's characteristics and thus does not provide a
complete assessment. As such, the information may not reflect the impact of all
structural characteristics of the security. The assumptions underlying the
information, including structure and collateral, may be modified from time to
time to reflect changed circumstances. The attached term sheet is not intended
to be a prospectus and any investment decision with respect to the Notes and
Certificates should be made by you based solely upon all of the information
contained in the final prospectus. Under no circumstances shall the information
presented constitute an offer to sell or the solicitation of an offer to buy nor
shall there be any sale of the securities in any jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction. The securities may
not be sold nor may an offer to buy be accepted prior to the delivery of a final
prospectus relating to the securities. All information described herein is
preliminary, limited in nature and subject to completion or amendment. No
representation is made that the above referenced securities will actually
perform as described in any scenario presented. A final prospectus and
prospectus supplement may be obtained by contacting the Salomon Smith Barney
Syndicate Desk at (212) 783-3727.
The information contained in the attached materials is referred to as
the "Information."
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The attached Term Sheet has been prepared by The CIT Group
Securitization Corporation II (the "Seller"). Neither Salomon Smith Barney nor
any of its affiliates makes any representation as to the accuracy or
completeness of the Information herein. The Information contained herein is
preliminary and will be superseded by the applicable prospectus supplement and
by any other information subsequently filed with the Securities and Exchange
Commission.
The Information contained herein will be superseded by the
description of the collateral pool contained in the prospectus supplement
relating to the securities.
The Information addresses only certain aspect of the applicable
security's characteristics and thus does not provide a complete assessment. As
such, the Information may not reflect the impact of all structural
characteristics of the security. The assumptions underlying the Information,
including structure and collateral, may be modified from time to time to reflect
changed circumstances.
Although a registration statement (including the prospectus)
relating to the securities discussed in this communication has been filed with
the Securities and Exchange Commission and is effective, the final prospectus
supplement relating to the securities discussed in this communication has not
been filed with the Securities and Exchange Commission. This communication shall
not constitute an offer to sell or the solicitation of an offer to buy nor shall
there be any offer or sale of the securities discussed in this communication in
any state in which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws or any such state.
Prospective purchasers are referred to the final prospectus and prospectus
supplement relating to the securities discussed in this communication for
definitive information on any matter discussed in this communication. Any
investment decision should be based only on the data in the prospectus and the
prospectus supplement ("Offering Documents") and the then current version of the
Information. Offering Documents contain data that is current as of their
publication dates and after publication may no longer be complete or current. A
final prospectus and prospectus supplement may be obtained by contacting the
Salomon Smith Barney Syndicate Desk at (212) 783-3727.
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CIT RV TRUST 1998-A
SUBJECT TO REVISION
TERM SHEET DATED JUNE 1, 1998
Issuer..............................CIT RV Trust 1998-A (the "Trust" or the
"Issuer"), a Delaware business trust to be
formed by the Seller and the Owner Trustee
pursuant to the Trust Agreement, to be dated
as of June 1, 1998 (the "Trust Agreement").
Seller..............................The CIT Group Securitization Corporation II
(the "Company"),a wholly-owned, limited
purpose subsidiary of The CIT Group, Inc.
("CIT"). Neither CIT nor any of its
affiliates, including the Company and The
CIT Group/Sales Financing, Inc. ("CITSF"),
has guaranteed, insured or is otherwise
obligated with respect to the Securities.
Servicer............................The CIT Group/Sales Financing, Inc. (in such
capacity referred to herein as the
"Servicer"), a wholly-owned subsidiary of
CIT. The Servicer will be responsible for
managing, administering, servicing and
making collections on the Contracts held by
the Trust.
Underwriters........................Salomon Smith Barney (Lead), Chase
Securities Inc., Credit Suisse First Boston
The Notes...........................Class A-1 % Asset-Backed Notes (the "Class
A-1 Notes"), in the aggregate initial
principal amount of $111,000,000;
Class A-2 % Asset-Backed Notes (the "Class
A-2 Notes"), in the aggregate initial
principal amount of $94,000,000;
Class A-3 % Asset-Backed Notes (the "Class
A-3 Notes"), in the aggregate initial
principal amount of $54,000,000;
Class A-4 % Asset-Backed Notes (the "Class
A-4 Notes"), in the aggregate initial
principal amount of $80,000,000;
Class A-5 % Asset-Backed Notes (the "Class
A-5 Notes" and, together with the Class A-1
Notes, the Class A-2 Notes, the Class A-3
Notes and the Class A-4 Notes, the "Class A
Notes") in the aggregate initial principal
amount of $37,000,000;
Class B % Asset-Backed Notes (the "Class B
Notes" and, together with the Class A Notes,
the "Notes" and, together with the
Certificates, the "Securities") in the
aggregate initial principal amount of
$18,000,000.
Payments in respect of the Class B Notes
will be subordinated to payments on the
Class A Notes.
The Certificates....................The CIT RV Trust 1998-A % Asset-Backed
Certificates (the "Certificates") in the
aggregate initial principal amount of
$6,000,000 will represent fractional
undivided interests in the Trust.
The Contracts.......................The statistical information presented in
this Term Sheet concerning the portion of
the Contract Pool which has been identified
as of the date
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hereof (the "Statistical Calculation Pool")
does not reflect all of the Contracts which
will be included on the Closing Date in the
final Contract Pool. The Statistical
Calculation Pool reflects only those
Contracts owned by the Seller or its
affiliates as of April 30, 1998 (the
"Statistical Cut-off Date") which are
expected to be included in the Contract Pool
as of the Closing Date. The statistical
information presented herein is based on the
number and the principal balances of such
Contracts as of the Statistical Cut-off
Date. The aggregate principal balance of the
Statistical Calculation Pool is
$333,856,652. The Seller expects that the
actual Contract Pool as of the Closing Date
will consist of approximately $400,000,000
principal balance of Contracts. The
additional Contracts to be included in the
final Contract Pool will consist of
Contracts originated or to be acquired by
the Seller or its affiliates prior to the
Closing Date. In addition, certain of the
Contracts included in the Statistical
Calculation Pool may be repaid, in whole or
in part, prior to the Closing Date, or may
not satisfy the criteria for transfer to the
Trust on the Closing Date. As a result of
the foregoing, the characteristics of the
Contracts in the Contract Pool may vary from
the characteristics of the Contracts in the
Statistical Calculation Pool as presented in
this Term Sheet.
Distribution........................Dates Payments of interest and principal on
the Securities will be made on the fifteenth
day of each month or, if any such day is not
a Business Day, on the next succeeding
Business Day (each, a "Distribution Date"),
commencing July 15, 1998.
To the extent not previously paid in full
prior to such time, the outstanding face
amount of the Certificates will be payable
on the Distribution Date occurring in
November 2018 (the "Certificate Final
Scheduled Distribution Date") and the
outstanding principal amount of the Class
A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes, the Class A-4 Notes, the Class
A-5 Notes and the Class B Notes will be
payable on the Distribution Date occurring
in January 2004, May 2007, May 2009, March
2012, December 2013 and April 2017,
respectively (the "Class A-1 Note Final
Scheduled Distribution Date," the "Class A-2
Note Final Scheduled Distribution Date," the
"Class A-3 Note Final Scheduled Distribution
Date," the "Class A-4 Note Final Scheduled
Distribution Date," the "Class A-5 Note
Final Scheduled Distribution Date," and the
"Class B Note Final Scheduled Distribution
Date," respectively).
A "Business Day" is any day other than a
Saturday, Sunday or any day on which banking
institutions or trust companies in the
states of New York, Delaware, Maryland or
Oklahoma are authorized by law, regulation
or executive order to be closed.
Due Period..........................With respect to any Distribution Date, the
"Due Period" is the period during which
principal, interest and other amounts will
be collected on the Contracts for
application towards the payment of principal
and interest to the Securityholders and the
payment of fees on such Distribution Date.
The "Due Period" will be the calendar month
immediately preceding the Distribution Date.
The first Due Period will commence on and
include June 1, 1998 and will end on and
include June 30, 1998.
Interest Accrual Period.............Interest on the outstanding principal amount
of the Notes and Certificates will accrue at
the applicable Interest Rate or Pass-Through
Rate for any Distribution Date from and
including the preceding
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Distribution Date (or the Closing Date in
the case of the first Distribution Date) to
but excluding such Distribution Date (each,
an "Interest Accrual Period ").
Interest will be paid to the Noteholders and
Certificateholders of record on the related
Record Date, on each Distribution Date, to
the extent of available funds therefor, in
an amount equal to the sum of (A) the
product of (x) the applicable Interest Rate
or Pass-Through Rate, as applicable, (y) the
outstanding principal balance of the class
of Notes or Certificate Balance, as
applicable, immediately preceding such
Distribution Date and (z) a fraction, the
numerator of which is one and the
denominator of which is twelve (or, in the
case of the first Distribution Date, the
numerator of which is the actual number of
days elapsed (based on a 360-day year
consisting of twelve 30-day months) from and
including the Closing Date to but excluding
such Distribution Date and the denominator
of which is 360), and (B) any applicable
Interest Carryover Shortfall.
Terms of the Notes
A. Interest Rate...............The Notes will have fixed interest rates
(each, an "Interest Rate").
B. Interest....................On each Distribution Date, the Indenture
Trustee will distribute to the Noteholders
of each class accrued interest at the
applicable Interest Rate on the outstanding
principal amount of such class to the extent
of the Available Amount remaining after
payment of the Servicer Payment. To the
extent the remaining Available Amount on a
Distribution Date is insufficient to pay
Noteholders the entire amount of interest
due on such Distribution Date, such
shortfall will be funded from the Reserve
Account, subject to the Available Reserve
Amount, under the circumstances described
herein. Interest on the Notes will be
calculated on the basis of a 360-day year
consisting of twelve 30-day months. Interest
on the Notes of any class for any
Distribution Date due but not paid on such
Distribution Date will be due on the next
Distribution Date in addition to an amount
equal to interest on such amount at the
applicable Interest Rate (to the extent
lawful).
The "Available Amount" on any Distribution
Date is equal to the excess of (A) the sum
of (i) all amounts on deposit in the
Collection Account attributable to
collections or deposits made in respect of
the Contracts (including any Late Fees), in
the related Due Period and (ii) the Purchase
Price for any Contract repurchased by CITSF
as a result of breaches of certain
representations and warranties or purchased
by the Servicer as a result of breaches of
certain covenants and any Monthly Advances
made by the Servicer, if such Purchase Price
or Monthly Advance is paid on the Deposit
Date immediately preceding such Distribution
Date, over (B) the sum of the following
amounts (to the extent that the Servicer has
not already withheld such amounts from
collections on the Contracts): (i) any
repossession profits on Liquidated
Contracts, Liquidation Expenses incurred and
taxes and insurance advanced by the Servicer
in respect of Financed Vehicles that are
reimbursable to the Servicer under the Sale
and Servicing Agreement, (ii) any amounts
incorrectly deposited in the Collection
Account, (iii) net investment earnings on
the funds in the Collection Account and (iv)
any other amounts permitted to be withdrawn
from the Collection Account by the Servicer
(or to be retained by the Servicer from
collections on the Contracts) pursuant to
the Sale and Servicing Agreement.
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The "Servicer Payment" is equal on each
Distribution Date to the sum of the
reimbursement then due to the Servicer for
outstanding Monthly Advances and the
Servicing Fee (including any unpaid
Servicing Fees for past Distribution Dates);
provided, however, that if CITSF or one of
its affiliates is the Servicer, the
Servicing Fee (including any unpaid
Servicing Fees for past Distribution Dates)
shall not be included in the Servicer
Payment but instead shall be payable to the
Servicer on each Distribution Date only from
the Available Amount, if any, remaining
after the principal and interest payable on
the Securities on such Distribution Date
have been paid.
Interest payments to all classes of Class A
Noteholders will have the same priority.
Under certain circumstances, the amount
available for interest payments could be
less than the amount of interest payable on
the Class A Notes on any Distribution Date,
in which case each class of Class A
Noteholders will receive their ratable share
(based upon the aggregate amount of interest
due to such class of Class A Noteholders) of
the aggregate amount available to be
distributed in respect of interest on the
Class A Notes.
Interest on the Class B Notes will not be
paid on any Distribution Date until interest
on the Class A Notes for such Distribution
Date has been paid in full. In addition,
notwithstanding the foregoing, if an Event
of Default has occurred and the Notes have
been accelerated, payments of interest on
and principal of the Class B Notes will not
be paid until the Class A Notes have been
paid in full.
C. Principal...................Principal on the Notes will be payable on
each Distribution Date in an amount equal to
the Principal Distribution Amount, to the
extent of the Available Amount remaining
after payment of the Servicer Payment and
interest due on the Notes on such
Distribution Date. To the extent the
remaining Available Amount on a Distribution
Date is insufficient to fund the entire
Principal Distribution Amount due on such
Distribution Date, such shortfall will be
funded from the Reserve Account, subject to
the Available Reserve Amount remaining after
any withdrawals from the Reserve Account to
make payments of interest due on the Notes
on such Distribution Date, under the
circumstances described herein.
The Principal Distribution Amount will
generally consist of all payments of
principal made on each Contract during the
related Due Period and the unpaid principal
balance of each Contract that became a
Repurchased Contract or Liquidated Contract
during the related Due Period.
No principal payments will be made (i) on
the Class A-2 Notes until the Class A-1
Notes have been paid in full, (ii) on the
Class A-3 Notes until the Class A-2 Notes
have been paid in full, (iii) on the Class
A-4 Notes until the Class A-3 Notes have
been paid in full, or (iv) on the Class A-5
Notes until the Class A-4 Notes have been
paid in full. No principal payments will be
made on the Class B Notes until the Class A
Notes have been paid in full.
Notwithstanding the foregoing, if an Event
of Default has occurred and the Notes have
been accelerated, principal payments will be
made on each class of Class A Notes pro rata
on the basis of their respective unpaid
principal amounts.
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The outstanding principal amount of the
Class A-1 Notes, to the extent not
previously paid, will be payable on the
Class A-1 Note Final Scheduled Distribution
Date; the outstanding principal amount of
the Class A-2 Notes, to the extent not
previously paid, will be payable on the
Class A-2 Note Final Scheduled Distribution
Date; the outstanding principal amount of
the Class A-3 Notes, to the extent, not
previously paid, will be payable on the
Class A-3 Note Final Scheduled Distribution
Date; the outstanding principal amount of
the Class A-4 Notes, to the extent not
previously paid, will be payable on the
Class A-4 Note Final Scheduled Distribution
Date; the outstanding principal amount of
the Class A-5 Notes, to the extent not
previously paid, will be payable on the
Class A-5 Note Final Scheduled Distribution
Date; and the outstanding principal amount
of the Class B Notes, to the extent not
previously paid, will be payable on the
Class B Note Final Scheduled Distribution
Date.
D. Redemption..................In the event of an Optional Purchase or
Auction Sale the outstanding Notes will be
redeemed, at a redemption price equal to the
unpaid principal amount of the Notes plus
accrued and unpaid interest thereon at the
applicable Interest Rates.
E. Limited Rights..............If an Event of Default occurs under the
Indenture, the Class B Noteholders will not
have any right to direct or to consent to
any remedies therefor by the Indenture
Trustee, including acceleration of the Notes
or the sale of Contracts, until the Class A
Notes have been paid in full. If an Event of
Termination occurs, the Class B Noteholders
will not have any right to direct or consent
to removal of the Servicer or to waive any
Event of Termination until the Class A Notes
have been paid in full.
Terms of the Certificates
A. Pass-Through Rate...........The Certificates will bear interest at the
rate of % per annum (the "Pass-Through
Rate").
B. Interest....................On each Distribution Date, the Owner Trustee
will distribute pro rata to
Certificateholders accrued interest at the
Pass-Through Rate on the outstanding
Certificate Balance to the extent of the
Available Amount remaining after payment of
the Servicer Payment and interest and
principal due on the Notes on such
Distribution Date. To the extent the
remaining Available Amount on a Distribution
Date is insufficient to pay
Certificateholders the entire amount of
interest due on such Distribution Date, such
shortfall will be funded from the Reserve
Account, subject to the Available Reserve
Amount remaining after any withdrawals from
the Reserve Account to make payments of
interest and principal due on the Notes on
such Distribution Date, under the
circumstances described herein. Interest on
the Certificates for any Distribution Date
due but not paid on such Distribution Date
will be due on the next Distribution Date in
addition to an amount equal to interest on
such amount at the Pass-Through Rate (to the
extent lawful). Interest on the Certificates
will be calculated on the basis of a 360-day
year consisting of twelve 30-day months.
The "Certificate Balance" means the Original
Certificate Balance reduced by all
distributions allocable to principal
actually made to Certificateholders.
The rights of Certificateholders to receive
distributions of interest will
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be subordinated to the rights of Noteholders
to receive distributions of interest and
principal, as described herein. If an Event
of Default has occurred and the Notes have
been accelerated, Certificateholders will
not be entitled to receive any distributions
until the Notes have been paid in full.
C. Principal...................On each Distribution Date prior to the
Distribution Date on which the Notes have
been paid in full (the "Certificate Cross-
Over Date "), the Certificateholders will
not be entitled to any payments of
principal.
On each Distribution Date on or after the
Certificate Cross-Over Date, principal on
the Certificates will be payable, subject to
the remaining Available Amount and the
remaining Available Reserve Amount, in an
amount equal to the Principal Distribution
Amount (less the portion of the Principal
Distribution Amount required on such
Distribution Date to pay the Notes in full)
with respect to such Distribution Date. Such
principal payments will be funded to the
extent of the Available Amount remaining
after payment of the Servicer Payment,
payment of interest and principal in respect
of the Notes on the Certificate Cross-Over
Date, and payment of interest due on the
Certificates on such Distribution Date. To
the extent the remaining Available Amount on
a Distribution Date is insufficient to fund
the entire Principal Distribution Amount due
on such Distribution Date, such shortfall
will be funded from the Reserve Account,
subject to the Available Reserve Amount
remaining after any withdrawals from the
Reserve Account to make payments of interest
and principal due on the Notes and interest
due on the Certificates on such Distribution
Date, under the circumstances described
herein. The rights of Certificateholders to
receive distributions of principal
(following the payment of interest on the
Certificates) will be subordinated to the
rights of Noteholders to receive
distributions of interest and principal.
D. Redemption..................In the event of an Optional Purchase or
Auction Sale, the Certificates will be
redeemed at a redemption price equal to the
Certificate Balance plus accrued and unpaid
interest thereon at the Pass-Through Rate.
E. Limited Rights..............If an Event of Default occurs under the
Indenture, the Certificateholders will not
have any right to direct or to consent to
any remedies therefor exercisable by the
Indenture Trustee, including the sale of the
Contracts, until the Notes have been paid in
full, and if an Event of Termination occurs,
the Certificateholders will not have any
right to direct or consent to removal of the
Servicer or to waive such Event of
Termination until the Notes have been paid
in full.
Subordination.......................To the extent described herein, the rights
of the Certificateholders to receive
distributions with respect to the Contracts
will be subordinated to the rights of the
Noteholders, and the rights of the Class B
Noteholders to receive distributions with
respect to the Contracts will be
subordinated to the rights of the Class A
Noteholders. This subordination is intended
to enhance the likelihood of timely receipt
by the Class A Noteholders (and to a lesser
extent the Class B Noteholders) of the full
amount of interest and principal required to
be paid to them, and to afford the Class A
Noteholders (and to a lesser extent the
Class B Noteholders) limited protection
against losses in respect of the Contracts.
No distribution will be made to the
Certificateholders on any Distribution Date
in respect of (i) interest until the full
amount of
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interest and principal on the Notes payable
on such Distribution Date has been
distributed to the Noteholders, and (ii)
principal until the Notes have been paid in
full.
No distribution will be made to the Class B
Noteholders on any Distribution Date in
respect of (i) interest until the full
amount of interest on the Class A Notes
payable on such Distribution Date has been
distributed to the Class A Noteholders, and
(ii) principal until the Class A Notes have
been paid in full.
Reserve Account.....................On the Closing Date, an account (the
"Reserve Account") will be established
pursuant to the Sale and Servicing
Agreement. The Indenture Trustee will have
the right to withdraw (or cause to be
withdrawn) payments from the Reserve Account
under certain circumstances specified below.
The Reserve Account will be funded on the
Closing Date in an amount equal to 2.25% of
the Pool Balance as of the Cut-off Date (the
"Initial Reserve Amount") from the proceeds
of a loan (the "Loan") to be made by one or
more affiliates of the Company. With respect
to any Distribution Date, the amount
available to be withdrawn from the Reserve
Account (the "Available Reserve Amount")
will equal the lesser of (i) the Specified
Reserve Amount and (ii) the amount on
deposit in the Reserve Account, exclusive of
interest and earnings thereon and any net
investment gains and before giving effect to
any deposit to be made to the Reserve
Account on such Distribution Date. If the
Available Amount on any Distribution Date is
insufficient (after paying the Servicer
Payment) to pay the interest and principal
required to be distributed on the Securities
on such Distribution Date, the Indenture
Trustee will withdraw (or cause to be
withdrawn) from the Reserve Account an
amount equal to the lesser of the amount of
such deficiency or the Available Reserve
Amount. The Reserve Account will be
available to provide a source of funds to
make payments of principal or interest on
the Notes and the Certificates in the same
order of priority specified for
distributions of the Available Amount. If
the Available Reserve Amount is zero,
holders of the Securities will bear the risk
of loss resulting from default by Obligors
and will have to look primarily to the value
of the related Financed Vehicles for
recovery of the outstanding principal and
unpaid interest on the defaulted Contracts.
On each Distribution Date, the Servicer will
deposit Excess Collections, if any, into the
Reserve Account in an amount sufficient to
increase the amount on deposit in the
Reserve Account to the Specified Reserve
Amount for the next Distribution Date.
Excess Collections, if any, not so required
to be deposited in the Reserve Account will
be paid to one or more affiliates of the
Company that provided the Loan or to the
Affiliated Owner. "Excess Collections" for
any Distribution Date will equal the amounts
collected or deposited in respect of the
Contracts in the related Due Period and
which remain in the Collection Account on
such Distribution Date after taking into
account distributions to be made on the
Securities and payments and reimbursements
to be made to the Servicer on such
Distribution Date. The "Specified Reserve
Amount" with respect to any Distribution
Date means 2.25% of the Pool Balance as of
the first day of the related Due Period, but
in no event less than 1.175% of the Pool
Balance as of the Cut-off Date. If, with
respect to any Distribution Date, (a) the
average of the principal balance of
Contracts 60 days or more delinquent
(including Contracts relating to Financed
Vehicles that have been repossessed) as a
percentage of the Pool Balance for the three
preceding Due Periods exceeds the Maximum
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Average Delinquency Rate for such
Distribution Date or (b) the Cumulative Net
Loss Rate for such Distribution Date exceeds
the Maximum Net Loss Rate for such
Distribution Date, then the Specified
Reserve Amount with respect to such
Distribution Date shall be 4.25% of the Pool
Balance as of the first day of the related
Due Period, but in no event less than 1.175%
of the Pool Balance as of the Cut-off Date.
The Specified Reserve Amount shall never be
greater than the sum of the aggregate
principal amount of the Notes and the
outstanding Certificate Balance. The
Specified Reserve Amount may be reduced from
time to time to amounts less than the
Specified Reserve Amount as described herein
if the Rating Agencies shall have given
prior written notice to the Seller, the
Servicer and the Issuer that such reduction
will not result in a downgrade or withdrawal
of the then current rating of the Notes or
the Certificates. In several circumstances
the Servicer must determine on a
Distribution Date the Specified Reserve
Amount for the next Distribution Date; in
order to make the calculations required, the
Servicer will use the data for the three Due
Periods preceding the Due Period related to
such next Distribution Date.
"Cumulative Net Loss Rate" means, with
respect to any Distribution Date, the
fraction, expressed as a percentage, the
numerator of which is equal to the aggregate
Net Liquidation Losses for each Distribution
Date since the Cut-off Date and the
denominator of which is equal to the Pool
Balance as of the Cut-off Date.
"Net Liquidation Losses" means, with respect
to any Distribution Date, the amount, if
any, by which (a) the principal balance of
all Contracts which became Liquidated
Contracts during the related Due Period
exceeds (b) the Net Liquidation Proceeds
received during such Due Period in respect
of all Liquidated Contracts.
-10-
<PAGE>
The "Maximum Average Delinquency Rate" for any Distribution Date
is as set forth below:
Maximum Average
Distribution Date Delinquency Rate
----------------- ----------------
July 1998 - June 1999 1.25%
July 1999 - June 2000 2.00%
July 2000 - June 2001 2.50%
July 2001 and thereafter 3.00%
The "Maximum Net Loss Rate" for any Distribution Date is as set
forth below:
Maximum Net
Distribution Date Loss Rate
----------------- ---------
July 1998 - June 1999 0.32%
July 1999 - September 1999 0.56%
October 1999 - December 1999 0.80%
January 2000 - March 2000 1.05%
April 2000 - June 2000 1.30%
July 2000 - September 2000 1.60%
October 2000 - December 2000 1.90%
January 2001 - March 2001 2.20%
April 2001 - June 2001 2.50%
July 2001 - September 2001 2.70%
October 2001 - December 2001 2.90%
January 2002 - March 2002 3.20%
April 2002 - June 2002 3.40%
July 2002 - September 2002 3.50%
October 2002 - December 2002 3.70%
January 2003 - March 2003 3.80%
April 2003 - June 2003 4.00%
July 2003 - September 2003 4.10%
October 2003 - December 2003 4.20%
January 2004 - March 2004 4.30%
April 2004 and thereafter 4.40%
If, on any Distribution Date, the Available
Reserve Amount (after taking into account
any deposits to and withdrawals from the
Reserve Account pursuant to the Sale and
Servicing Agreement on such Distribution
Date) exceeds the Specified Reserve Amount
for the next Distribution Date, such excess
(the "Reserve Account Surplus") will be
withdrawn from the Reserve Account and paid
to one or more affiliates of the Company
which provided the Loan or to the Affiliated
Owner.
In the event that funds are withdrawn from
the Reserve Account to make payments on the
Securities or the Specified Reserve Amount
is increased, the sole source of funding of
the Reserve Account after the Closing Date
will be Excess Collections. Neither the
Seller, the Servicer nor any affiliate will
be obligated to deposit any of their own
funds into the Reserve Account in the event
that Excess Collections are not sufficient
to replenish the Reserve Account.
Ratings.............................The Class A Notes will be rated "AAA" by
Standard & Poor's Ratings Service, a
division of The McGraw-Hill Companies, Inc.
("S&P") and "Aaa" by Moody's Investors
Service, Inc. ("Moody's") (each, a "Rating
Agency"). The Class B Notes will be rated at
least "A" by S&P and "A2" by Moody's. The
Certificates will be rated at least "BBB" by
S&P and "Baa3" by Moody's.
-11-
<PAGE>
STATISTICAL CALCULATION POOL
Certain information with respect to the Contracts expected to be
included in the Contract Pool is set forth below. Unless otherwise noted, the
statistical information presented herein concerning the Contract Pool is based
on the $333,856,652 aggregate principal balance of Contracts included in such
pool as of April 30, 1998 (the "Statistical Cut-off Date") and does not include
data with respect to approximately $70,000,000 aggregate principal balance of
Contracts expected to be included in the Contract Pool by the Closing Date. The
statistical distribution of characteristics as of the Closing Date for the full
Contract Pool will vary from the statistical distribution of the characteristics
of the Contract Pool as of the Statistical Cut-off Date (such pool, the
"Statistical Calculation Pool") as presented herein. Prior to the Closing Date,
Contracts may be removed from the Contract Pool and other Contracts may be
substituted therefor. In addition, certain of the Contracts included in the
Statistical Calculation Pool may be repaid, in whole or in part, prior to the
Closing Date or may not satisfy the criteria for transfer to the Trust on the
Closing Date.
CHARACTERISTICS OF CONTRACTS
The Statistical Calculation Pool consists of contracts having an
aggregate unpaid principal balance (the "Pool Balance") as of the Statistical
Cut-off Date of $333,856,652. For the purposes of the discussion of the
characteristics of the Contracts on the Statistical Cut-off Date contained
herein, the principal balance of each Contract is the unpaid principal balance
as of the Statistical Cut-off Date.
The Contracts were selected from CITSF's portfolio of recreation vehicle
retail installment sale contracts and direct loans based on several criteria,
including the following: (i) each Contract was originated in the United States
of America; (ii) each Contract has a Contract Rate equal to or greater than
7.50%; (iii) each Contract provides for level monthly payments which include
interest at the related Contract Rate and, if paid in accordance with its
schedule, fully amortizes the amount financed over an original term of no
greater than 243 months; (iv) as of the Statistical Cut-off Date the most recent
scheduled payment of principal and interest, if any, on each Contract was made
by or on behalf of the related Obligor or was not delinquent more than 29 days;
(v) no Financed Vehicle has been repossessed without reinstatement as of the
Statistical Cut-off Date; (vi) as of the Statistical Cut-off Date no Obligor on
any Contract was the subject of a bankruptcy proceeding and (vii) as of the
Statistical Cut-off Date each Contract has a remaining principal balance of not
less than $1,000 and not more than $600,000. The Financed Vehicles consist of
motor homes, travel trailers and other types of recreation vehicles.
Approximately 76.97%, 12.74%, 8.80% and 1.49% of the Pool Balance as of
the Statistical Cut-off Date represented Contracts secured by motor homes, fifth
wheels, travel trailers and other types of recreation vehicles, respectively.
Approximately 63.14% of the Contracts, by Pool Balance as of the Statistical
Cut-off Date, represented financing of recreation vehicles which were new and
approximately 36.86% represented financing of recreation vehicles which were
used at the time the related Contracts were originated. As of the Statistical
Cut-off Date, the average outstanding principal balance of the Contracts secured
by motor homes, fifth wheels, travel trailers and other types of recreation
vehicles was $54,259, $23,954, $13,533 and $10,031, respectively.
The Obligors under the Contracts have mailing addresses in 49 states and
Washington D.C. As of the Statistical Cut-off Date, approximately 15.65% of the
Contracts, based upon Pool Balance as of the Statistical Cut-off Date, had
Obligors with mailing addresses in the State of Texas, approximately 13.35% had
Obligors with mailing addresses in the State of California, approximately 8.44%
had Obligors with mailing addresses in the State of Florida and approximately
5.83% had Obligors with mailing addresses in the State of Washington. Each other
state accounts for less than 5.00% of the Contracts based upon Pool Balance as
of the Statistical Cut-off Date.
As of the Statistical Cut-off Date, all Contracts have an interest rate
specified in such Contract (the "Contract Rate") of at least 7.50%. As of the
Statistical Cut-off Date, the Contracts have remaining maturities of at least 7
months but not more than 240 months, original maturities of at least 12 months
but not more than 241 months, and a weighted average remaining term to stated
maturity of 170.65 months. The weighted average original term to maturity of the
Contracts was 173.49 months. As of the Statistical Cut-off Date, the weighted
average Contract Rate of the Contracts was 9.66%. The final scheduled payment
dates on the Contracts range from November 1998 to May 2018. The average
remaining principal balance per Contract, as of the Statistical Cut-off Date,
was $36,376 and the outstanding principal balances of the Contracts, as of the
Statistical Cut-off Date, ranged from $1,014 to $583,395.
-12-
<PAGE>
The Contracts to be included in the final Contract Pool but which are
not included in the Statistical Calculation Pool will have a Contract Rate of at
least 7.5%, remaining maturities of at least 6 months but not more than 240
months and original maturities of at least 12 months but not more than 243
months. The outstanding principal balances of such Contracts will range from
$1,000 to $600,000.
The final Contract Pool is expected to have a weighted average remaining
term to stated maturity of at least 163 months but not more than 176 months, a
weighted average original term to maturity of at least 167 months but not more
than 180 months, and a weighted average Contract Rate of at least 9.5% but no
more than 9.75%.
-13-
<PAGE>
Set forth below is a description of certain characteristics of the Contracts
as of the Statistical Cut-off Date.
<TABLE>
<CAPTION>
GEOGRAPHICAL DISTRIBUTION OF CONTRACTS (1)
% OF STATISTICAL % OF STATISTICAL CALCULATION
NUMBER OF CALCULATION AGGREGATE PRINCIPAL POOL BY PRINCIPAL
CONTRACTS AS OF POOL BY NUMBER BALANCE OUTSTANDING BALANCE OUTSTANDING
STATISTICAL OF CONTRACTS AS OF AS OF STATISTICAL AS OF STATISTICAL
CUT-OFF DATE STATISTICAL CUT-OFF DATE CUT-OFF DATE CUT-OFF DATE
---------------- ------------------------ -------------------- ----------------------
STATE DATE
- ----- ----
<S> <C> <C> <C> <C>
Alabama.................... 136 1.48% $ 6,804,166 2.04%
Alaska..................... 23 0.25 1,382,957 0.41
Arizona.................... 461 5.02 15,988,315 4.79
Arkansas................... 240 2.61 5,641,835 1.69
California................. 1,268 13.82 44,553,599 13.35
Colorado................... 253 2.76 10,161,028 3.04
Connecticut................ 95 1.04 3,052,055 0.91
Delaware................... 9 0.10 304,476 0.09
District of Columbia....... 1 0.01 66,942 0.02
Florida.................... 662 7.21 28,164,231 8.44
Georgia.................... 232 2.53 7,832,943 2.35
Idaho...................... 71 0.77 3,036,443 0.91
Illinois................... 204 2.22 7,487,020 2.24
Indiana.................... 101 1.10 3,562,482 1.07
Iowa....................... 37 0.40 1,389,464 0.42
Kansas..................... 178 1.94 5,070,727 1.52
Kentucky................... 31 0.34 783,642 0.23
Louisiana.................. 99 1.08 3,771,153 1.13
Maine...................... 26 0.28 939,484 0.28
Maryland................... 105 1.14 2,730,023 0.82
Massachusetts.............. 203 2.21 5,750,292 1.72
Michigan................... 94 1.02 4,931,238 1.48
Minnesota.................. 74 0.81 3,597,515 1.08
Mississippi................ 44 0.48 1,237,223 0.37
Missouri................... 405 4.41 10,465,659 3.13
Montana.................... 25 0.27 1,299,884 0.39
Nebraska................... 27 0.29 1,063,853 0.32
Nevada..................... 170 1.85 5,560,142 1.67
New Hampshire.............. 51 0.56 1,731,938 0.52
New Jersey................. 80 0.87 2,986,447 0.89
New Mexico................. 88 0.96 3,696,526 1.11
New York................... 198 2.16 6,875,532 2.06
North Carolina............. 160 1.74 6,134,908 1.84
North Dakota............... 1 0.01 17,459 0.01
Ohio....................... 93 1.01 5,766,449 1.73
Oklahoma................... 462 5.03 11,644,890 3.49
Oregon..................... 316 3.44 16,607,260 4.97
Pennsylvania............... 94 1.02 4,092,482 1.23
Rhode Island............... 50 0.54 1,062,465 0.32
South Carolina............. 61 0.66 1,892,353 0.57
South Dakota............... 14 0.15 517,541 0.16
Tennessee.................. 104 1.13 4,051,246 1.21
Texas...................... 1,484 16.17 52,243,276 15.65
Utah....................... 38 0.41 1,734,449 0.52
Vermont.................... 15 0.16 394,197 0.12
Virginia................... 47 0.51 2,225,843 0.67
Washington................. 451 4.91 19,474,853 5.83
West Virginia.............. 21 0.23 819,387 0.25
Wisconsin.................. 59 0.64 2,390,324 0.72
Wyoming.................... 17 0.19 868,036 0.26
------- ------- ------------- -------
Total...................... 9,178 100.00%(2) $ 333,856,652 100.00%(2)
======= ======= ============= =======
</TABLE>
- ---------------
(1) In most cases, based on the mailing addresses of the Obligors as of the
Statistical Cut-off Date.
(2) May not equal 100% due to rounding.
-14-
<PAGE>
<TABLE>
<CAPTION>
RANGE OF CONTRACT RATES
%OF STATISTICAL
% OF STATISTICAL CALCULATION
NUMBER OF CALCULATION AGGREGATE PRINCIPAL POOL BY PRINCIPAL
RANGE OF CONTRACTS AS OF POOL BY NUMBER BALANCE OUTSTANDING BALANCE OUTSTANDING
CONTRACTS RATES STATISTICAL CUT-OFF OF CONTRACTS AS OF AS OF STATISTICAL AS OF STATISTICAL
--------------- DATE STATISTICAL CUT-OFF DATE CUT-OFF DATE CUT-OFF DATE
------------------ ------------------------ -------------------- ----------------------
<S> <C> <C> <C> <C>
7.50%--7.99%...................... 125 1.36% $ 14,072,660 4.22%
8.00%--8.99%...................... 1,667 18.16 126,900,106 38.01
9.00%--9.99%...................... 2,375 25.88 99,110,683 29.69
10.00%--10.99%.................... 1,910 20.81 47,761,252 14.31
11.00%--11.99%.................... 1,277 13.91 23,399,425 7.01
12.00%--12.99%.................... 865 9.42 12,351,432 3.70
13.00%--13.99%.................... 537 5.85 6,865,737 2.06
14.00%--14.99%.................... 267 2.91 2,312,927 0.69
15.00%--15.99%.................... 85 0.93 597,525 0.18
16.00%--16.99%.................... 50 0.54 343,026 0.10
17.00%--21.50%.................... 20 0.22 141,879 0.04
----- ------- ----------- ------
Total............................. 9,178 100.00%(1) 333,856,652 100.00%(1)
===== ======= =========== =======
</TABLE>
(1) May not equal 100% due to rounding.
<TABLE>
<CAPTION>
RANGE OF REMAINING MATURITIES
%OF STATISTICAL
% OF STATISTICAL CALCULATION
NUMBER OF CALCULATION AGGREGATE PRINCIPAL POOL BY PRINCIPAL
RANGE OF REMAINING CONTRACTS AS OF POOL BY NUMBER BALANCE OUTSTANDING BALANCE OUTSTANDING
MATURITY IN MONTHS STATISTICAL CUT-OFF OF CONTRACTS AS OF AS OF STATISTICAL AS OF STATISTICAL CUT-OFF
------------------ DATE STATISTICAL CUT-OFF DATE CUT-OFF DATE DATE
------------------ ------------------------ -------------------- ----------------------
<S> <C> <C> <C> <C>
7--49............................. 463 5.04% $ 2,506,935 0.75%
50--59............................ 345 3.76 3,339,506 1.00
60--69............................ 161 1.75 1,663,969 0.50
70--79............................ 220 2.40 2,399,202 0.72
80--89............................ 503 5.48 5,265,260 1.58
90--99............................ 338 3.68 4,101,392 1.23
100--109.......................... 46 0.50 671,133 0.20
110--119.......................... 1,267 13.80 23,252,319 6.96
120--129.......................... 339 3.69 6,097,339 1.83
130--139.......................... 405 4.41 9,296,818 2.78
140--149.......................... 1,465 15.96 31,219,179 9.35
150--159.......................... 21 0.23 1,214,789 0.36
160--169.......................... 57 0.62 3,120,942 0.93
170--179.......................... 2,661 28.99 156,872,793 46.99
180--189.......................... 493 5.37 30,267,254 9.07
190--199.......................... 3 0.03 229,315 0.07
200--209.......................... 4 0.04 339,787 0.10
210--219.......................... 1 0.01 163,892 0.05
220--229.......................... 3 0.03 437,449 0.13
230--239.......................... 331 3.61 44,351,583 13.28
240.............................. 52 0.57 7,045,796 2.11
------- ------- ------------- ------
Total............................ 9,178 100.00%(1) $ 333,856,652 100.00%(1)
===== ======== ============= =======
</TABLE>
(1) May not equal 100% due to rounding.
-15-
<PAGE>
THE CIT GROUP/SALES FINANCING, INC., SERVICER
GENERAL
As of March 31, 1998, CITSF serviced for itself and others approximately 291,500
contracts (consisting primarily of recreation vehicle, home equity, recreational
boat and manufactured housing contracts), representing an outstanding balance of
approximately $8.1 billion. Of this portfolio, approximately 101,100 contracts
(representing approximately $2.4 billion outstanding balance) consisted of
recreation vehicle retail installment sale contracts and direct loans. CITSF
entered into an agreement in 1996 to service additional manufactured housing
contracts for an unaffiliated third party, which increased substantially the
total number of contracts serviced by CITSF.
SERVICING
The following table shows the composition of CITSF's servicing portfolio,
including recreation vehicle retail installment sale contracts and direct loans
serviced by CITSF on the dates indicated:
THE CIT GROUP/SALES FINANCING, INC.
CONTRACTS BEING SERVICED BY PRODUCT LINE
<TABLE>
<CAPTION>
AT DECEMBER 31,
---------------------------------------------------------
1993 1994 1995
-------------------- ------------------ ----------------
(NUMBER) (DOLLARS) (NUMBER) (DOLLARS) (NUMBER) (DOLLARS)
-------- --------- -------- --------- -------- ---------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
RV--Owned.............. 43,530 $ 961,915 39,454 $ 847,142 29,984 $ 662,468
RV--Bulk Purchases..... 3,331 60,487 3,522 50,882 2,648 36,058
RV--Servicing(1)....... 0 0 4,827 118,267 19,494 445,716
Total RV............... 46,861 1,022,402 47,803 1,016,291 52,126 1,144,242
Total MH............... 47,898 809,670 39,599 878,152 69,277 1,368,513
Total RB............... 6,048 156,861
Home Equity............ 3,545 131,322 13,545 570,772 27,122 1,039,044
Other(2)............... 1,572 41,944 1,310 74,823 148 2,142
-------- ---------- ---------- ---------- ---------- ----------
Total Contracts
Serviced............... 99,876 $2,005,338 102,257 $2,540,038 154,721 $3,710,802
======== ========== ========== ========== ========== ==========
<CAPTION>
AT DECEMBER 31,
---------------------------------------------------------
1993 1994 AT MARCH 31, 1998
------------------- ------------------- ------------------
(NUMBER) (DOLLARS) (NUMBER) (DOLLARS) (NUMBER) (DOLLARS)
-------- --------- -------- --------- -------- ---------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
RV--Owned.............. 22,161 $ 477,355 19,548 $ 416,091 23,649 $ 571,813
RV--Bulk Purchases..... 2,770 32,704 3,499 82,794 9,240 72,417
RV--Servicing(1)....... 32,606 746,810 71,610 1,909,994 68,176 1,772,447
Total RV............... 57,537 1,256,869 94,657 2,408,879 101,065 2,416,677
Total MH............... 95,999 1,748,363 89,265 1,836,458 87,075 1,851,311
Total RB............... 13,281 328,110 35,677 948,884 37,830 1,013,516
Home Equity............ 52,617 2,005,498 57,284 2,446,170 58,076 2,704,465
Other(2)............... 149 3,093 5,134 121,553 7,261 153,858
-------- ---------- ---------- ---------- ---------- ----------
Total Contracts
Serviced............... 219,583 $5,341,933 282,017 $7,761,944 291,307 $8,139,827
======== ========== ========== ========== ========== ==========
</TABLE>
- -------------------
MH = Manufactured Housing
RV = Recreation Vehicle
RB = Recreational Boat
(1) Includes contracts sold by CITSF in previous securitizations which CITSF is
servicing. The 1997 and 1998 amounts also include a third party servicing
arrangement entered into in 1997.
(2) Includes inventory financing receivables. 1993 and 1994 amounts include
Recreational Boat receivables of $38.9 million and $71.6 million,
respectively.
-16-
<PAGE>
DELINQUENCY AND LOAN LOSS EXPERIENCE
The following table sets forth the delinquency experience for the five
years ended December 31, 1997 and the three months ended March 31, 1997 and 1998
of the portfolio of recreation vehicle retail installment sale contracts and
direct loans originated and serviced by CITSF, excluding contracts acquired by
CITSF through portfolio purchases and contracts in repossession. Delinquency and
loan loss experience for the serviced portfolio was obtained from the monthly
servicer reports for prior securitization trusts.
DELINQUENCY EXPERIENCE
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------
1993 1994(3) 1995(3) 1996(3) 1997(3)
--------- ----------- --------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Number of Contracts........ 43,530 44,281 49,478 54,767 64,584
Principal Balance of
Contracts $961,915 $965,409 $1,108,184 $1,224,165 $1,512,624
Serviced.................
Principal Balance of
Delinquent
Contracts(1):
30-59 Days................. $ 6,478 $ 4,986 $ 9,218 $ 14,904 $ 25,873
60-89 Days................. 2,211 1,959 3,071 4,342 9,357
90 Days or More............ 3,383 2,785 4,456 6,205 16,314
--------- --------- ---------- ---------- ----------
Total Principal Balance of
Delinquent Contracts..... $12,072 $ 9,730 $ 16,745 $ 25,451 $ 51,544
========= ========= ========== ========== ==========
Delinquencies as a Percent of
Principal Balances(2).... 1.26% 1.01% 1.51% 2.08% 3.41%
- --------------------------------------------------------------------------------------------
<CAPTION>
THREE MONTHS THREE MONTHS
ENDED ENDED
MARCH 31, MARCH 31,
1997(3) 1998(3)
------------ ------------
Number of Contracts......... 57,292 66,669
Principal Balance of Contracts
Serviced.................. $1,262,645 $1,594,135
Principal Balance of Delinquent
Contracts(1):
30-59 Days.................. $ 14,306 $ 17,411
60-89 Days.................. 5,202 7,680
90 Days or More............. 6,150 15,094
---------- ----------
Total Principal Balance of
Delinquent Contracts...... $ 25,658 $ 40,185
========= ==========
Delinquencies as a Percent
of Principal Balances(2).. 2.03% 2.52%
</TABLE>
- -----------------------------------------------------
(1) The period of delinquency is based on the number of days payments are
contractually past due (assuming 30-day months). Consequently, a contract
due on the first day of a month is not 30 days delinquent until the first
day of the next month. A Contract is deemed delinquent only if payments
exceeding $65 are contractually past due 30 days or more.
(2) Based on dollar percent delinquent calculated by dividing Total Principal
Balance of Delinquent Contracts by Principal Balance of Contracts Serviced.
(3) Includes recreation vehicle retail installment contracts and direct loans
sold by CITSF in previous securitizations which CITSF is servicing.
-17-
<PAGE>
The following table sets forth the loan loss experience for the five years ended
December 31, 1997 and the three months ended March 31, 1997 and 1998, of the
portfolio of recreation vehicle retail installment sale contracts and direct
loans originated and serviced by CITSF, excluding contracts acquired by CITSF
through portfolio purchases. "Net Losses" are equal to the aggregate balance of
all contracts which are determined to be uncollectible in the period less any
recoveries and liquidation proceeds on contracts charged-off in the period or
any prior periods. Net Losses include outside collection, repossession and
liquidation expenses.
LOAN LOSS/LIQUIDATION EXPERIENCE
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
-------------------------------------------------------
1993 1994(4) 1995(4) 1996(4) 1997(4)
-------- -------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
Number of 43,530 44,281 49,478 54,767 64,584
Contracts(1)...
Principal Balance
of Contracts
Serviced(1).... $ 961,915 $965,409 $1,108,184 $1,224,165 $1,512,624
========= ======== ========== ========== ==========
Net Losses:
Dollars(2)........ $ 3,917 $ 4,887 $ 4,762 $ 9,875 $ 13,773
Percentage(3)..... 0.41% 0.51% 0.43% 0.81% 0.91%
<CAPTION>
THREE MONTHS THREE MONTHS
------------ ------------
ENDED ENDED
----- -----
MARCH 31, MARCH 31,
--------- --------
1997(4) 1998(4)
------------ ------------
Number of 57,292 66,669
Contracts(1)...
Principal Balance
of Contracts $ 1,262,645 $ 1,594,135
========== ==========
Serviced(1)....
Net Losses:
Dollars(2)........ $ 3,847 $ 4,656
Percentage(3)..... 1.22%(5) 1.17%(5)
</TABLE>
(1) As of period end and excludes contracts in repossession.
(2) The calculation of net loss includes outside collection,
repossession and liquidation expenses.
(3) As a percentage of the principal balance of contracts as of
period end.
(4) Includes recreation vehicle retail installment sale contracts and direct
loans sold by CITSF in previous securitizations which CITSF is
servicing.
(5) Annualized. Annualized number may not be reflective of full year
results.
-18-
<PAGE>
The data presented in the preceding tables is for illustrative purposes
only. Such data relates to the performance of CITSF's entire portfolio of
recreation vehicle retail installment sale contracts and direct loans originated
and serviced by CITSF and is not historical data regarding the Contracts alone,
since the Contracts constitute only a portion of CITSF's portfolio.
Additionally, the loss and delinquency experience presented in the preceding
tables with respect to recreation vehicle retail installment sale contracts and
direct loans securitized by CITSF prior to May 1996 is calculated using the
method required by the related transaction documents which differs from the
method used by CITSF to calculate losses and delinquencies on the remainder of
its owned or subsequently securitized contracts. The securitizations prior to
May 1996 require a contract to be reflected as a loss in the month it becomes
120 days delinquent, unless it is in repossession. The data presented in the
preceding tables reflect this calculation method for these securitizations. The
loss data presented in the preceding tables with respect to CITSF's remaining
owned or previously securitized contracts reflects CITSF's general practice of
recording a loss when all amounts CITSF expects to recover either by sale or
disposition of the related financed vehicle or otherwise have been received. As
a result, the data in the preceding tables with respect to contracts securitized
prior to May 1996 reflects higher losses and lower delinquencies than would have
been reported had these contracts not been securitized.
In August 1994, CITSF adopted a risk-adjusted pricing policy and changed
its credit criteria and underwriting guidelines. In connection with this change,
CITSF reduced the minimum credit score for approval of a new credit in order to
extend credit to less creditworthy borrowers than under the credit criteria
previously in effect. CITSF believes that these changes have resulted in
increased delinquencies and losses. The seasoning of contracts originated using
the revised 1994 underwriting guidelines and the continued runoff of contracts
originated prior to August 1994 are reflected in the increased delinquencies and
loan losses during 1996, 1997 and the first quarter of 1998. In addition, the
delinquency and loss performance of the CITSF portfolio has been and will
continue to be influenced by overall economic and other trends including the
propensity of consumers to fail to make timely payments on consumer credit
obligations and their willingness to seek bankruptcy protection. All of the
Contracts were originated under the credit criteria adopted by CITSF in August
1994. Accordingly, the data presented in the preceding tables should not
necessarily be considered as a basis for assessing the likelihood, amount or
severity of delinquencies or losses on the Contracts and no assurance can be
given that the delinquency and loan loss experience presented in the preceding
tables will be indicative of the experience on the Contracts.
In August 1997 CITSF entered into an agreement to provide servicing for
approximately 42,000 additional recreation vehicle and recreational boat
consumer contracts for another financial institution, which CITSF is also
servicing at its Asset Service Center. The addition of these contracts to its
servicing portfolio required CITSF to increase staffing levels at the Asset
Service Center to support these contracts. The integration of these accounts was
a contributing factor to the increase in delinquencies experienced during the
fourth quarter of 1997.
WEIGHTED AVERAGE LIFE OF THE SECURITIES
The tables captioned "Balance Decline Table" (the "ABS Table") have been
prepared on the basis of certain characteristics of the Contracts. The ABS Table
was prepared assuming that (i) the Contracts prepay in full at the specified
constant percentage of ABS monthly, with no defaults, losses or repurchases,
(ii) each scheduled monthly payment on the Contracts is made on the last day of
each month and each Contract accrues to 30 days each month, (iii) payments on
the Notes and distributions on the Certificates are made on each Distribution
Date (and each such date is assumed to be the fifteenth day of each applicable
month), (iv) the Closing Date occurs on June 15, 1998 and (v) CITSF exercises
its Optional Purchase. The ABS Table indicates the projected weighted average
life of each class of the Notes and the Certificates and sets forth the percent
of the initial principal amount of each class of the Notes and the percent of
the Original Certificate Balance that is projected to be outstanding after each
of the Distribution Dates shown at various constant ABS percentages.
The ABS Table also assumes that the Contracts have been aggregated into
four hypothetical pools with all of the Contracts within each such pool having
the following characteristics and that the level scheduled monthly payment for
each of the pools (which is based on its aggregate principal balance, weighted
average APR, weighted average original term to maturity and weighted average
remaining term to maturity as of the Cut-off Date) will be such that each pool
will be fully amortized by the end of its remaining term to maturity.
-19-
<PAGE>
<TABLE>
<CAPTION>
WEIGHTED AVERAGE WEIGHTED AVERAGE
AGGREGATE WEIGHTED ORIGINAL TERM REMAINING TERM WEIGHTED AVERAGE
PRINCIPAL AVERAGE TO MATURITY TO MATURITY SEASONING
BALANCE CONTRACT RATE (MONTHS) (MONTHS) (MONTHS)
-------- ------------- ------ ------- -------
<S> <C> <C> <C> <C> <C>
Pool 1.......... $ 58,411,099 11.15% 102 99 3
Pool 2.......... $ 48,648,341 10.59% 144 141 3
Pool 3.......... $229,736,699 9.33% 180 177 3
Pool 4.......... $ 63,203,862 8.79% 239 237 2
</TABLE>
The actual characteristics and performance of the Contracts will
differ from the assumptions used in constructing the ABS Table. The assumptions
used are hypothetical and have been provided only to give a general sense of how
the principal cash flows might behave under varying prepayment scenarios. For
example, it is very unlikely that the Contracts will prepay at a constant level
of ABS until maturity or that all of the Contracts will prepay at the same level
of ABS. Moreover, the diverse terms of Contracts within each of the hypothetical
pools could produce slower or faster principal distributions than indicated in
the ABS Table at the various constant percentages of ABS specified, even if the
original and remaining terms to maturity of the Contracts are as assumed. Any
difference between such assumptions and actual characteristics and performance
of the Contracts or actual prepayment experience will affect the percentages of
initial balances outstanding over time and weighted average lives of the Notes
and the Certificates.
THE ABS TABLE HAS BEEN PREPARED BASED ON THE ASSUMPTIONS
DESCRIBED ABOVE (INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND
PERFORMANCE OF THE CONTRACTS WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS
AND PERFORMANCE THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
Balance Decline Tables
CIT RV Trust 1998-A
June 1, 1998
<TABLE>
<CAPTION>
CLASS A-1
NOTES
DISTRIBUTION DATE 0.0% 0.5% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%
- ----------------- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Initial Percentage 100% 100% 100% 100% 100% 100% 100% 100%
6/15/99 86% 65% 43% 34% 25% 16% 7% 0%
6/15/00 70% 30% 0% 0% 0% 0% 0% 0%
6/15/01 53% 0% 0% 0% 0% 0% 0% 0%
6/15/02 34% 0% 0% 0% 0% 0% 0% 0%
6/15/03 13% 0% 0% 0% 0% 0% 0% 0%
6/15/04 0% 0% 0% 0% 0% 0% 0% 0%
6/15/05 0% 0% 0% 0% 0% 0% 0% 0%
6/15/06 0% 0% 0% 0% 0% 0% 0% 0%
6/15/07 0% 0% 0% 0% 0% 0% 0% 0%
6/15/08 0% 0% 0% 0% 0% 0% 0% 0%
6/15/09 0% 0% 0% 0% 0% 0% 0% 0%
6/15/10 0% 0% 0% 0% 0% 0% 0% 0%
6/15/11 0% 0% 0% 0% 0% 0% 0% 0%
6/15/12 0% 0% 0% 0% 0% 0% 0% 0%
6/15/13 0% 0% 0% 0% 0% 0% 0% 0%
Weighted Average Life (years) 3.09 1.47 0.92 0.80 0.71 0.64 0.58 0.53
</TABLE>
-20-
<PAGE>
<TABLE>
<CAPTION>
CLASS A-2
NOTES
DISTRIBUTION DATE 0.0% 0.5% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%
- ----------------- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Initial Percentage 100% 100% 100% 100% 100% 100% 100% 100%
6/15/99 100% 100% 100% 100% 100% 100% 100% 97%
6/15/00 100% 100% 87% 67% 46% 26% 5% 0%
6/15/01 100% 95% 26% 0% 0% 0% 0% 0%
6/15/02 100% 56% 0% 0% 0% 0% 0% 0%
6/15/03 100% 17% 0% 0% 0% 0% 0% 0%
6/15/04 88% 0% 0% 0% 0% 0% 0% 0%
6/15/05 58% 0% 0% 0% 0% 0% 0% 0%
6/15/06 24% 0% 0% 0% 0% 0% 0% 0%
6/15/07 0% 0% 0% 0% 0% 0% 0% 0%
6/15/08 0% 0% 0% 0% 0% 0% 0% 0%
6/15/09 0% 0% 0% 0% 0% 0% 0% 0%
6/15/10 0% 0% 0% 0% 0% 0% 0% 0%
6/15/11 0% 0% 0% 0% 0% 0% 0% 0%
6/15/12 0% 0% 0% 0% 0% 0% 0% 0%
6/15/13 0% 0% 0% 0% 0% 0% 0% 0%
Weighted Average Life (years) 7.26 4.20 2.64 2.28 2.00 1.78 1.60 1.45
<CAPTION>
CLASS A-3
NOTES
DISTRIBUTION DATE 0.0% 0.5% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%
- ----------------- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Initial Percentage 100% 100% 100% 100% 100% 100% 100% 100%
6/15/99 100% 100% 100% 100% 100% 100% 100% 100%
6/15/00 100% 100% 100% 100% 100% 100% 100% 73%
6/15/01 100% 100% 100% 95% 45% 0% 0% 0%
6/15/02 100% 100% 45% 0% 0% 0% 0% 0%
6/15/03 100% 100% 0% 0% 0% 0% 0% 0%
6/15/04 100% 66% 0% 0% 0% 0% 0% 0%
6/15/05 100% 4% 0% 0% 0% 0% 0% 0%
6/15/06 100% 0% 0% 0% 0% 0% 0% 0%
6/15/07 94% 0% 0% 0% 0% 0% 0% 0%
6/15/08 45% 0% 0% 0% 0% 0% 0% 0%
6/15/09 0% 0% 0% 0% 0% 0% 0% 0%
6/15/10 0% 0% 0% 0% 0% 0% 0% 0%
6/15/11 0% 0% 0% 0% 0% 0% 0% 0%
6/15/12 0% 0% 0% 0% 0% 0% 0% 0%
6/15/13 0% 0% 0% 0% 0% 0% 0% 0%
Weighted Average Life (years) 9.94 6.29 4.00 3.44 3.01 2.67 2.39 2.16
</TABLE>
-21-
<PAGE>
<TABLE>
<CAPTION>
CLASS A-4
NOTES
DISTRIBUTION DATE 0.0% 0.5% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%
- ----------------- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Initial Percentage 100% 100% 100% 100% 100% 100% 100% 100%
6/15/99 100% 100% 100% 100% 100% 100% 100% 100%
6/15/00 100% 100% 100% 100% 100% 100% 100% 100%
6/15/01 100% 100% 100% 100% 100% 96% 62% 27%
6/15/02 100% 100% 100% 89% 46% 4% 0% 0%
6/15/03 100% 100% 69% 20% 0% 0% 0% 0%
6/15/04 100% 100% 14% 0% 0% 0% 0% 0%
6/15/05 100% 100% 0% 0% 0% 0% 0% 0%
6/15/06 100% 64% 0% 0% 0% 0% 0% 0%
6/15/07 100% 32% 0% 0% 0% 0% 0% 0%
6/15/08 100% 5% 0% 0% 0% 0% 0% 0%
6/15/09 95% 0% 0% 0% 0% 0% 0% 0%
6/15/10 58% 0% 0% 0% 0% 0% 0% 0%
6/15/11 24% 0% 0% 0% 0% 0% 0% 0%
6/15/12 0% 0% 0% 0% 0% 0% 0% 0%
6/15/13 0% 0% 0% 0% 0% 0% 0% 0%
Weighted Average Life (years) 12.29 8.53 5.39 4.61 4.00 3.53 3.16 2.85
<CAPTION>
CLASS A-5
NOTES
DISTRIBUTION DATE 0.0% 0.5% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%
- ----------------- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Initial Percentage 100% 100% 100% 100% 100% 100% 100% 100%
6/15/99 100% 100% 100% 100% 100% 100% 100% 100%
6/15/00 100% 100% 100% 100% 100% 100% 100% 100%
6/15/01 100% 100% 100% 100% 100% 100% 100% 100%
6/15/02 100% 100% 100% 100% 100% 100% 0% 0%
6/15/03 100% 100% 100% 100% 0% 0% 0% 0%
6/15/04 100% 100% 100% 0% 0% 0% 0% 0%
6/15/05 100% 100% 0% 0% 0% 0% 0% 0%
6/15/06 100% 100% 0% 0% 0% 0% 0% 0%
6/15/07 100% 100% 0% 0% 0% 0% 0% 0%
6/15/08 100% 100% 0% 0% 0% 0% 0% 0%
6/15/09 100% 58% 0% 0% 0% 0% 0% 0%
6/15/10 100% 0% 0% 0% 0% 0% 0% 0%
6/15/11 100% 0% 0% 0% 0% 0% 0% 0%
6/15/12 73% 0% 0% 0% 0% 0% 0% 0%
6/15/13 0% 0% 0% 0% 0% 0% 0% 0%
Weighted Average Life (years) 14.21 11.01 6.69 5.69 4.90 4.31 3.83 3.44
</TABLE>
-22-
<PAGE>
<TABLE>
<CAPTION>
CLASS B NOTES
DISTRIBUTION DATE 0.0% 0.5% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%
- ----------------- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Initial Percentage 100% 100% 100% 100% 100% 100% 100% 100%
6/15/99 100% 100% 100% 100% 100% 100% 100% 100%
6/15/00 100% 100% 100% 100% 100% 100% 100% 100%
6/15/01 100% 100% 100% 100% 100% 100% 100% 100%
6/15/02 100% 100% 100% 100% 100% 100% 0% 0%
6/15/03 100% 100% 100% 100% 0% 0% 0% 0%
6/15/04 100% 100% 100% 0% 0% 0% 0% 0%
6/15/05 100% 100% 0% 0% 0% 0% 0% 0%
6/15/06 100% 100% 0% 0% 0% 0% 0% 0%
6/15/07 100% 100% 0% 0% 0% 0% 0% 0%
6/15/08 100% 100% 0% 0% 0% 0% 0% 0%
6/15/09 100% 100% 0% 0% 0% 0% 0% 0%
6/15/10 100% 0% 0% 0% 0% 0% 0% 0%
6/15/11 100% 0% 0% 0% 0% 0% 0% 0%
6/15/12 100% 0% 0% 0% 0% 0% 0% 0%
6/15/13 0% 0% 0% 0% 0% 0% 0% 0%
Weighted Average Life (years) 14.42 11.33 6.83 5.83 5.00 4.42 3.92 3.50
<CAPTION>
CERTIFICATES
DISTRIBUTION DATE 0.0% 0.5% 1.0% 1.2% 1.4% 1.6% 1.8% 2.0%
- ----------------- ---- ---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Initial Percentage 100% 100% 100% 100% 100% 100% 100% 100%
6/15/99 100% 100% 100% 100% 100% 100% 100% 100%
6/15/00 100% 100% 100% 100% 100% 100% 100% 100%
6/15/01 100% 100% 100% 100% 100% 100% 100% 100%
6/15/02 100% 100% 100% 100% 100% 100% 0% 0%
6/15/03 100% 100% 100% 100% 0% 0% 0% 0%
6/15/04 100% 100% 100% 0% 0% 0% 0% 0%
6/15/05 100% 100% 0% 0% 0% 0% 0% 0%
6/15/06 100% 100% 0% 0% 0% 0% 0% 0%
6/15/07 100% 100% 0% 0% 0% 0% 0% 0%
6/15/08 100% 100% 0% 0% 0% 0% 0% 0%
6/15/09 100% 100% 0% 0% 0% 0% 0% 0%
6/15/10 100% 0% 0% 0% 0% 0% 0% 0%
6/15/11 100% 0% 0% 0% 0% 0% 0% 0%
6/15/12 100% 0% 0% 0% 0% 0% 0% 0%
6/15/13 0% 0% 0% 0% 0% 0% 0% 0%
Weighted Average Life (years) 14.42 11.33 6.83 5.83 5.00 4.42 3.92 3.50
</TABLE>
-23-
