<PAGE>
As filed with the Securities and Exchange Commission on September 17, 1997
Registration No. 333-32263/-01/-02
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------
Amendment No. 1 to
FORM S-3
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
--------------
CHASE MANHATTAN RV OWNER TRUST 1997-A
(Issuer of Securities)
CHASE MANHATTAN BANK THE CHASE MANHATTAN BANK
USA, NATIONAL ASSOCIATION
(Depositors of the Trust described herein)
(Exact name as specified in registrants' charter)
United States New York
(States or other jurisdictions of incorporation)
22-2382028 13-4994650
(I.R.S. employer identification numbers)
802 Delaware Avenue 270 Park Avenue
Wilmington, Delaware 19801 New York, New York 10017
(302) 575-5000 (212) 270-6000
(Address, including zip code, and
telephone number, including area code, of
registrant's Principal Executive Office)
ANDREW T. SEMMELMAN ANTHONY J. HORAN
Secretary Secretary
Chase Manhattan Bank USA, National Association The Chase Manhattan Bank
802 Delaware Avenue 270 Park Avenue
Wilmington, Delaware 19801 New York, New York 10017
(302) 575-5033 (212) 270-7122
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
<TABLE>
<CAPTION>
Copies to:
MARTIN R. JOYCE LAURA PALMA WILLIAM A. GRAY
<S> <C> <C>
The Chase Manhattan Bank Simpson Thacher & Bartlett Orrick, Herrington & Sutcliffe LLP
270 Park Avenue 425 Lexington Avenue 666 Fifth Avenue
New York, New York 10017 New York, New York 10017 New York, New York 10103
</TABLE>
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement. If any of
the securities being registered on this Form are to be offered pursuant to
dividend or interest reinvestment plans, please check the following box. |_|
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |_|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act Registration Statement number of the earlier
effective Registration Statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
Registration Statement number of the earlier effective Registration Statement
for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
CALCULATION OF REGISTRATION FEE
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====================================================================================================================================
Proposed Maximum Proposed Maximum Amount of
Title of Securities to be Amount to be Aggregate Price Aggregate Registration
Registered(1) Registered Per Unit(2) Offering Price(2) Fee(2)
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Asset-Backed Securities $897,395,285.54 100% $897,395,285.54 $271,938
====================================================================================================================================
</TABLE>
(1) The Securities are also being registered for the purpose of market making.
(2) Estimated solely for the purpose of calculating the registration fee.
(3) Of which 271,634 is paid herewith, and $304 has been previously paid.
The Registrants hereby amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrants
shall file a further amendment that specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, or until the Registration Statement shall thereafter
become effective in accordance on such date as the Commission, acting pursuant
to said Section 8(a), may determine.
================================================================================
RV
<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED SEPTEMBER 17, 1997
PROSPECTUS
$897,395,285.54
CHASE MANHATTAN RV OWNER TRUST 1997-A
$852,500,000.00 ASSET BACKED NOTES
$ 44,895,285.54 ASSET BACKED CERTIFICATES
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
THE CHASE MANHATTAN BANK
SELLERS
THE CIT GROUP/SALES FINANCING, INC.
SERVICER
Chase Manhattan RV Owner Trust 1997-A (the 'TRUST' or the 'ISSUER'), created
pursuant to an Amended and Restated Trust Agreement, to be dated as of September
1, 1997, among Chase Manhattan Bank USA, National Association, a national
banking association
(continued on following page)
THE NOTES REPRESENT OBLIGATIONS OF, AND THE CERTIFICATES REPRESENT BENEFICIAL
INTERESTS IN, THE TRUST ONLY AND DO NOT REPRESENT OBLIGATIONS OF OR INTERESTS IN
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION, THE CHASE MANHATTAN BANK, THE
CIT GROUP/SALES FINANCING, INC. OR ANY OF THEIR RESPECTIVE AFFILIATES. NONE OF
THE NOTES OR CERTIFICATES IS A DEPOSIT AND NONE OF THE NOTES OR CERTIFICATES IS
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE 'FDIC'). THE
RECEIVABLES ARE NOT INSURED OR GUARANTEED BY THE FDIC OR ANY OTHER GOVERNMENTAL
AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
PROSPECTIVE INVESTORS SHOULD CONSIDER, AMONG OTHER THINGS, THE INFORMATION SET
FORTH UNDER THE HEADING 'RISK FACTORS' COMMENCING ON PAGE 12 HEREIN.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AGGREGATE UNDERWRITING
PRINCIPAL INTEREST FINAL SCHEDULED PRICE TO DISCOUNT AND PROCEEDS TO
AMOUNT RATE(1) DISTRIBUTION DATE PUBLIC(2) COMMISSION SELLERS(3)
--------------- -------- ------------------- ---------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C>
CLASS A-1 NOTES $ 59,500,000.00 % OCTOBER 15, 1998 % % %
CLASS A-2 NOTES $119,000,000.00 % AUGUST 15, 2000 % % %
CLASS A-3 NOTES $113,000,000.00 % FEBRUARY 15, 2002 % % %
CLASS A-4 NOTES $ 73,000,000.00 % DECEMBER 16, 2002 % % %
CLASS A-5 NOTES $132,000,000.00 % NOVEMBER 15, 2004 % % %
CLASS A-6 NOTES $ 88,000,000.00 % DECEMBER 15, 2005 % % %
CLASS A-7 NOTES $ 57,000,000.00 % OCTOBER 16, 2006 % % %
CLASS A-8 NOTES $ 85,000,000.00 % DECEMBER 17, 2007 % % %
CLASS A-9 NOTES $ 61,000,000.00 % DECEMBER 15, 2008 % % %
CLASS A-10 NOTES $ 65,000,000.00 % MARCH 15, 2010 % % %
CERTIFICATES $ 44,895,285.54 % AUGUST 15, 2017 % % %
TOTAL $897,395,285.54 $ $ $
</TABLE>
(1) Certificate Rate, in the case of the Certificates.
(2) Plus accrued interest, if any, from the Closing Date.
(3) Before deduction of expenses estimated at $852,000.
- --------------------------------------------------------------------------------
This Prospectus may be used by Chase Securities Inc., an affiliate of each of
the Sellers and a subsidiary of The Chase Manhattan Corporation (the
'CORPORATION'), in connection with offers and sales related to market-making
transactions in the Securities. Chase Securities Inc. may act as principal or
agent in such transactions. Such sales will be made at prices related to
prevailing market prices at the time of sale.
The Securities are being offered by the Underwriters, subject to prior sale,
when, as and if issued to and accepted by the Underwriters, subject to approval
of certain legal matters by counsel for the Underwriters. The Underwriters
reserve the right to reject orders in whole or in part. It is expected that the
Notes and the Certificates will be delivered in book-entry form, on or about
September , 1997 (the 'CLOSING DATE') through the facilities of, in the case
of the Notes, The Depository Trust Company ('DTC'), Cedel Bank, societe anonyme
('CEDEL') or the Euroclear System ('EUROCLEAR') and, in the case of the
Certificates, DTC, in each case against payment therefor in immediately
available funds.
Underwriters of the Notes
CHASE SECURITIES INC.
BEAR, STEARNS & CO. INC.
MERRILL LYNCH & CO.
SALOMON BROTHERS INC
Underwriter of the Certificates
CHASE SECURITIES INC.
THE DATE OF THIS PROSPECTUS IS SEPTEMBER , 1997.
<PAGE>
(continued from preceding page)
('CHASE USA'), The Chase Manhattan Bank, a New York banking corporation
('CHASE,' and together with Chase USA, the 'SELLERS'), and Wilmington Trust
Company, as Owner Trustee ('OWNER TRUSTEE'), will issue $59,500,000 aggregate
principal amount of Class A-1 % Asset Backed Notes (the 'CLASS A-1 NOTES'),
$119,000,000 aggregate principal amount of Class A-2 % Asset Backed Notes
(the 'CLASS A-2 NOTES'), $113,000,000 aggregate principal amount of Class A-3
% Asset Backed Notes (the 'CLASS A-3 NOTES'), $73,000,000 aggregate
principal amount of Class A-4 % Asset Backed Notes (the 'CLASS A-4 NOTES'),
$132,000,000 aggregate principal amount of Class A-5 % Asset Backed Notes
(the 'CLASS A-5 NOTES'), $88,000,000 aggregate principal amount of Class A-6
% Asset Backed Notes (the 'CLASS A-6 NOTES'), $57,000,000 aggregate
principal amount of Class A-7 % Asset Backed Notes (the 'CLASS A-7 NOTES'),
$85,000,000 aggregate principal amount of Class A-8 % Asset Backed Notes
(the 'CLASS A-8 NOTES'), $61,000,000 aggregate principal amount of Class A-9
% Asset Backed Notes (the 'CLASS A-9 NOTES') and $65,000,000 aggregate
principal amount of Class A-10 % Asset Backed Notes (the 'CLASS A-10 NOTES'
and, together with the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class
A-4 Notes, Class A-5 Notes, Class A-6 Notes, Class A-7 Notes, Class A-8 Notes
and Class A-9 Notes, the 'NOTES') pursuant to an indenture (as amended and
supplemented from time to time, the 'INDENTURE') to be dated as of September 1,
1997, between the Trust and Norwest Bank Minnesota, National Association, as
indenture trustee (the 'INDENTURE TRUSTEE'). The Trust will also issue
$44,895,285.54 aggregate principal amount of % Asset Backed Certificates
(the 'CERTIFICATES' and, together with the Notes, the 'SECURITIES'). The assets
of the Trust will consist of a pool of retail installment sales contracts and
purchase money notes and other notes secured by new and used recreational
vehicles, certain monies received or due thereunder on and after September 1,
1997 (the 'CUTOFF DATE'), security interests in the recreational vehicles
financed thereby, amounts on deposit in the Collection Account, the Note
Distribution Account, the Certificate Distribution Account, the Paid-Ahead
Account and the Reserve Account and proceeds from claims and other rights to
payment on certain insurance policies, all as more fully described herein. The
Notes will be secured by the assets of the Trust pursuant to the Indenture.
Interest on each class of Notes will accrue at the applicable fixed per
annum interest rate specified above. Interest on the Notes will generally be
payable on the 15th day of each month (each, a 'DISTRIBUTION DATE'), commencing
October 15, 1997. Principal of the Notes will be payable on each Distribution
Date to the extent described herein, except that no principal will be paid on
any class of Notes until all the Notes with preceding class designations have
been paid in full.
The Certificates will represent fractional undivided interests in the
assets of the Trust. Interest, to the extent of the Certificate Rate, will be
generally distributed to the Certificateholders (as defined herein) on each
Distribution Date. Principal, to the extent described herein, will be
distributed to the Certificateholders on each Distribution Date commencing with
the Distribution Date on which the Notes have been paid in full. Distributions
of interest on and principal of the Certificates will be subordinated in
priority to payments due on the Notes to the extent described herein.
Each class of Notes will be payable in full on the Final Scheduled
Distribution Date with respect to such class specified above. The final
scheduled Distribution Date with respect to the Certificates will be the August
2017 Distribution Date. Investors should be aware that payment in full of a
class of Notes or the Certificates could occur earlier than such dates as
described herein. In addition, the Certificates will be subject to prepayment in
whole, but not in part, on any Distribution Date on which The CIT Group/Sales
Financing, Inc. ('CITSF'), in its capacity as servicer (in such capacity, the
'SERVICER'), exercises its option to purchase the Receivables. The Servicer may
purchase all the Receivables on any Distribution Date following the last day of
a Collection Period on which the Pool Balance (as defined herein) shall have
declined to 5% or less of the Cutoff Date Pool Balance (as defined herein).
The Securities initially will be represented by Notes and Certificates
registered in the name of Cede & Co. ('CEDE'), the nominee of DTC. The interests
of beneficial owners of the Securities will be
ii
<PAGE>
represented by book entries on the records of DTC and participating members
thereof (the 'PARTICIPANTS'). Definitive Notes or Definitive Certificates (each
as defined herein) will be available only under the limited circumstances
described herein.
There currently is no secondary market for the Securities and there is no
assurance that one will develop. The Underwriters expect, but are not obligated,
to make a market in the Securities, and there is no assurance that any such
market will develop or continue.
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE SECURITIES,
INCLUDING OVER-ALLOTMENT TRANSACTIONS, STABILIZING TRANSACTIONS, SYNDICATE
COVERING TRANSACTIONS AND PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES,
SEE 'UNDERWRITING' HEREIN.
Upon receipt of a request by an investor, or his or her representative,
within the period during which there is a prospectus delivery obligation, the
Underwriters will transmit or cause to be transmitted promptly, without charge
and in addition to any such delivery requirements, a paper copy of this
Prospectus or this Prospectus encoded in an electronic format.
AVAILABLE INFORMATION
The Sellers have filed with the Securities and Exchange Commission (the
'COMMISSION') a Registration Statement (together with all amendments and
exhibits thereto, referred to herein as the 'REGISTRATION STATEMENT') under the
Securities Act of 1933, as amended (the 'SECURITIES ACT'), with respect to the
Securities offered pursuant to this Prospectus. For further information,
reference is made
to the Registration Statement and any reports and other documents incorporated
herein by reference as described below under 'Incorporation of Certain Documents
by Reference,' which may be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549; and at the Commission's regional offices at Northwestern Atrium
Center, 500 West Madison Street, 14th Floor, Chicago, Illinois 60661 and Seven
World Trade Center, New York, New York 10048. Copies of the Registration
Statement may be obtained from the Public Reference Section of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. The Chase
Manhattan Bank, on behalf of the Trust, will agree to file or cause to be filed
with the Commission such periodic reports as are required under the Securities
Exchange Act of 1934, as amended (the 'EXCHANGE ACT'), and the rules and
regulations of the Commission thereunder. In addition, the Commission maintains
a public access site on the Internet through the World Wide Web, at which site
reports, information statements and other information, including all electronic
filings, regarding the Sellers may be viewed. The Internet address of such World
Wide Web site is http://www.sec.gov.
REPORTS TO SECURITYHOLDERS
Unless and until Definitive Securities (as defined herein) are issued,
unaudited monthly reports and annual reports containing information concerning
the Trust and prepared by the Servicer will be sent on behalf of the Trust only
to Cede, as the nominee of DTC and the registered holder of the Securities. See
'Certain Information Regarding the Securities--Book-Entry Registration,'
'--Definitive Securities' and '--Reports to Securityholders.' Such reports will
not constitute financial statements prepared in accordance with United States
generally accepted accounting principles or that have been examined and reported
upon by, with an opinion expressed by, an independent public or certified public
accountant. None of the Sellers or the Servicer intends to send any of its
financial reports to Securityholders or to the owners of beneficial interests in
the Securities.
iii
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
All documents filed on behalf of the Trust with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, subsequent to the date of
this Prospectus and prior to the termination of the offering of the Securities,
shall be deemed to be incorporated by reference herein and to be part hereof.
Any statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any subsequently filed document that also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
The Servicer will provide without charge to each person to whom a copy of
this Prospectus is delivered, on the written or oral request of any such person,
a copy of any or all of the documents incorporated herein by reference, except
the exhibits to such documents (unless such exhibits are specifically
incorporated by reference in such documents). Requests for such copies should be
directed to the Servicer, Attention: Securitization Department. Telephone
requests for such copies should be directed to the Servicer at (201) 740-5408.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain of the matters discussed under the captions 'The Receivables
Pool--Delinquencies and Net Losses' and 'Weighted Average Life of the
Securities--ABS Tables' may constitute forward-looking statements within the
meaning of Section 7A of the Securities Act, and as such may involve known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Receivables to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements.
iv
<PAGE>
SUMMARY OF TERMS
This Summary of Terms is qualified in its entirety by reference to the
detailed information appearing elsewhere herein. Certain capitalized terms used
in this Summary are defined elsewhere herein on the pages indicated in the
'Index of Terms.'
<TABLE>
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Issuer.................................... Chase Manhattan RV Owner Trust 1997-A (the 'TRUST' or the 'ISSUER'),
a Delaware business trust created pursuant to an amended and restated
trust agreement (as amended and supplemented, the 'TRUST AGREEMENT'),
to be dated as of September 1, 1997, among the Sellers and the Owner
Trustee.
Sellers................................... Chase USA and Chase (also referred to herein together as the
'SELLERS' or the 'BANKS'). None of the Sellers or any of their
affiliates has guaranteed, insured or is otherwise obligated with
respect to the Securities. See 'Risk Factors--Limited Assets;
Subordination.'
Servicer.................................. The CIT Group/Sales Financing, Inc., a Delaware corporation ('CITSF,'
or in such capacity, the 'SERVICER'), a wholly-owned subsidiary of
The CIT Group Holdings, Inc., a Delaware corporation ('CIT'). The
Servicer will be responsible for managing, administering, servicing
and making collections on the Receivables and serving as an
administrator of the Trust. Neither CITSF nor any of its affiliates
has guaranteed, insured or is otherwise obligated with respect to the
Securities. CIT is partially owned by the Corporation, the parent of
each of the Sellers. See 'The CIT Group/Sales Financing, Inc.,
Servicer' herein.
Chase RV Finance.......................... Prior to the Servicing Transfer, Chase and Chase USA, each a
wholly-owned subsidiary of the Corporation, together with several of
their affiliates, were engaged in the recreational vehicle financing
and recreational vehicle loan servicing business. As used herein, the
term 'CHASE RV FINANCE' refers to such business of the Sellers, their
respective predecessors and their affiliates, and such term does not
include what was the recreational vehicle financing and recreational
vehicle loan servicing business of The Chase Manhattan Bank, National
Association ('CHASE N.A.') or any of its affiliates prior to the
Chase/Chemical Merger. Prior to the Servicing Transfer, the servicing
of Recreational Vehicle Loans by Chase RV Finance was performed by
Chase Financial Management Corporation ('CFMC'), an Ohio corporation
headquartered in Cleveland, Ohio and a subsidiary of Chase USA.
On June 3, 1997, the right to service or subservice the Recreational
Vehicle Loans and certain other loans then serviced by CFMC was sold
to CITSF (such transaction, the 'SERVICING TRANSFER'). CITSF began
servicing such Recreational Vehicle Loans and other loans on August
18, 1997. In connection with the Servicing Transfer, CITSF agreed to
serve as Servicer under the Sale and Servicing Agreement. Following
the Servicing Transfer, none of the Sellers and their affiliates
(other than CIT and its affiliates) is financing or
</TABLE>
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<TABLE>
<S> <C>
servicing Recreational Vehicle Loans. The documents effecting the
Servicing Transfer are referred to herein as the 'SERVICING TRANSFER
AGREEMENTS.'
Indenture Trustee......................... Norwest Bank Minnesota, National Association, a national banking
association, as Indenture Trustee under the Indenture. The Indenture
Trustee's Corporate Trust Office is located at Norwest Center, Sixth
Street and Marquette Avenue, Minneapolis, Minnesota 55479-0070,
telephone (612) 667-8058. The Banks, the Servicer and their
respective affiliates may have normal banking relationships with the
Indenture Trustee and its affiliates.
Owner Trustee............................. Wilmington Trust Company, a Delaware banking corporation, as trustee
under the Trust Agreement (the 'OWNER TRUSTEE'). The Owner Trustee's
Corporate Trust Office is located at Rodney Square North, 1100 North
Market Street, Wilmington, Delaware 19890-0001, telephone (302)
651-1000. The Banks, the Servicer and their respective affiliates may
have normal banking relationships with the Owner Trustee and its
affiliates.
The Notes................................. Class A-1 % Asset Backed Notes in the aggregate principal amount
of $59,500,000.00.
Class A-2 % Asset Backed Notes in the aggregate principal amount
of $119,000,000.00.
Class A-3 % Asset Backed Notes in the aggregate principal amount
of $113,000,000.00.
Class A-4 % Asset Backed Notes in the aggregate principal amount
of $73,000,000.00.
Class A-5 % Asset Backed Notes in the aggregate principal amount
of $132,000,000.00.
Class A-6 % Asset Backed Notes in the aggregate principal amount
of $88,000,000.00.
Class A-7 % Asset Backed Notes in the aggregate principal amount
of $57,000,000.00.
Class A-8 % Asset Backed Notes in the aggregate principal amount
of $85,000,000.00.
Class A-9 % Asset Backed Notes in the aggregate principal amount
of $61,000,000.00.
Class A-10 % Asset Backed Notes in the aggregate principal amount
of $65,000,000.00.
The Notes will be issued by the Trust pursuant to an Indenture to be
dated as of September 1, 1997 (the 'INDENTURE'), between the Trust
and the Indenture Trustee. The Notes will be secured by the assets of
the Trust.
The Notes will be available for purchase in book-entry form only in
minimum denominations of $1,000 and integral multiples thereof. The
Noteholders will not be entitled to receive Definitive Notes, except
in the limited circumstances described herein. Noteholders may elect
to hold their Notes through DTC (in the United States) or Cedel or
Euroclear (in
</TABLE>
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<PAGE>
<TABLE>
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Europe). All references herein to Noteholders shall reflect the
rights of Noteholders, as such rights may be exercised through DTC
and its Participants (including Cedel and Euroclear), except as
otherwise specified herein. See 'Description of the Notes--General'
and 'Certain Information Regarding the Securities--Book-Entry
Registration' herein.
The Certificates.......................... % Asset Backed Certificates with an initial Certificate Balance of
$44,895,285.54. The Certificates will represent fractional undivided
interests in the assets of the Trust (subject to the rights of the
Noteholders as described herein) and will be issued pursuant to the
Trust Agreement.
The Certificates will be available for purchase in minimum
denominations of $1,000 and integral multiples thereof. The
Certificateholders will not be entitled to receive Definitive
Certificates, except in the limited circumstances described herein.
All references herein to Certificateholders shall reflect the rights
of Certificateholders, as such rights may be exercised through DTC
and its Participants, except as otherwise specified herein. See
'Description of the Certificates--General' and 'Certain Information
Regarding the Securities--Book-Entry Registration' herein.
No beneficial interest in a Certificate may be held directly or
indirectly by a Foreign Investor. Each purchaser of Certificates and
its assignees will be deemed to represent (i) that the beneficial
owners of such Certificates are not Foreign Investors, and (ii) that
it is not a Plan and that no Plan Assets of any Plan were used to
acquire the Certificates.
The rights of Certificateholders to receive distributions with
respect to the Certificates will be subordinated to the rights of the
Noteholders to receive interest on and principal of the Notes in the
manner described herein.
The Trust................................. The Trust is a business trust created under the laws of Delaware
pursuant to the Trust Agreement. The activities of the Trust are
limited by the terms of the Trust Agreement to acquiring, owning and
managing the Receivables, issuing and making payments on the
Securities and other activities related thereto. The assets of the
Trust will include (i) the Receivables, including (A) with respect to
Simple Interest Receivables, certain monies received thereunder on or
after the Cutoff Date, and (B) with respect to Precomputed
Receivables, certain monies due thereunder on or after the Cutoff
Date, (ii) such amounts as from time to time may be held in one or
more Trust Accounts established and maintained pursuant to the Sale
and Servicing Agreement, as described herein, (iii) security
interests in the Financed Vehicles, (iv) proceeds from the exercise
of any Seller's recourse rights against Dealers, (v) proceeds from
claims and other rights to payment on certain insurance policies, and
(vi) any and all proceeds of the foregoing.
The Receivables........................... The Receivables are retail installment sales contracts and purchase
money notes and other notes secured by new and
</TABLE>
3
<PAGE>
<TABLE>
<S> <C>
used recreational vehicles (the 'FINANCED VEHICLES'). On the Closing
Date, the Sellers will transfer the Receivables to the Trust in
exchange for the Securities pursuant to a Sale and Servicing
Agreement to be dated as of September 1, 1997 (as amended and
supplemented from time to time, the 'SALE AND SERVICING AGREEMENT'),
among the Trust, the Sellers and the Servicer. Chase will transfer
Receivables to the Trust having an aggregate Principal Balance of
$782,259,686.73 as of the Cutoff Date, and Chase USA will transfer
Receivables to the Trust having an aggregate Principal Balance of
$115,135,598.81 as of the Cutoff Date. See 'Description of the
Transfer and Servicing Agreements' herein.
The Receivables consist of all of the Recreational Vehicle Loans
owned by the Sellers which met the criteria stated herein as of the
Cutoff Date. No Receivable has a scheduled maturity that, after
giving prospective effect to any permitted extensions or deferrals,
would be later than July 31, 2017 (the 'FINAL SCHEDULED MATURITY
DATE'). As of the Cutoff Date, the weighted average remaining
maturity of the Receivables was approximately 130.42 months and the
weighted average original maturity of the Receivables was
approximately 169.06 months.
The aggregate Principal Balance of the Receivables as of the Cutoff
Date (the 'CUTOFF DATE POOL BALANCE') was $897,395,285.54, and the
aggregate Principal Balance of the Receivables as of each of their
respective origination dates (the 'ORIGINAL POOL BALANCE') was
$1,112,869,763.05.
The 'POOL BALANCE' as of any date will equal the aggregate Principal
Balance of the Receivables as of the close of business on such date.
Terms of the Notes........................ The principal terms of the Notes are described below:
Distribution Dates. Payments of interest on and principal of the
Notes will be made on the 15th day of each month or, if any such day
is not a Business Day, on the next succeeding Business Day,
commencing October 15, 1997. Payments will be made to holders of
record of the Notes (the 'NOTEHOLDERS') as of the day immediately
preceding such Distribution Date or, if Definitive Notes are issued,
as of the last day of the preceding calendar month (each, a 'RECORD
DATE'). A 'BUSINESS DAY' is a day on which banks located in New York,
New York, Oklahoma City, Oklahoma, Wilmington, Delaware, and
Minneapolis, Minnesota are open for the purpose of conducting a
commercial banking business.
Interest Rates. Each class of Notes will bear interest at the fixed
rate per annum specified for such class on the cover page hereof. The
interest rate for each class of Notes is referred to herein as an
'INTEREST RATE.'
Interest. Interest on the outstanding principal amount of each class
of Notes will accrue at the applicable Interest Rate from and
including the Closing Date (in the case of the first
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Distribution Date) or from and including the most recent Distribution
Date on which interest has been paid to but excluding the following
Distribution Date (each, an 'INTEREST ACCRUAL PERIOD'). On each
Distribution Date, the Indenture Trustee will distribute pro rata to
the Noteholders of each class accrued interest at the applicable
Interest Rate on the outstanding principal balance generally to the
extent of the Available Amount after the Servicer has been paid the
Servicer Payment. See 'Description of the Transfer and Servicing
Agreements--Distributions' herein. Interest on the the Class A-1
Notes will be calculated on the basis of a 360-day year based on the
actual number of days elapsed during the related Interest Accrual
Period, and interest on the other classes of 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). See
'Description of the Notes--Payments of Interest' and 'Description of
the Transfer and Servicing Agreements-- Distributions' herein.
Principal. Principal of the Notes will be payable on each
Distribution Date in an amount equal to the Noteholders' Principal
Distributable Amount for such Distribution Date, to the extent of the
Available Amount remaining after the Servicer has been paid the
Servicer Payment, the Noteholders' Interest Distributable Amount has
been deposited into the Note Distribution Account and the
Certificateholders' Interest Distributable Amount has been deposited
into the Certificate Distribution Account. The Noteholders' Principal
Distributable Amount for a Distribution Date will equal 100% of the
Principal Distributable Amount for such Distribution Date until the
Notes have been paid in full and will be calculated by the Servicer
in the manner described under 'Description of the Transfer and
Servicing Agreements--Distributions.'
No principal payments will be made on any class of Notes until all
Notes with preceding class designations have been paid in full. For
example, no principal payments will be made on the Class A-2 Notes
until the Class A-1 Notes have been paid in full, and no principal
payments will be made on the Class A-3 Notes until the Class A-2
Notes have been paid in full.
No principal will be distributed to the Certificateholders until the
Notes have been paid in full.
The outstanding principal amount of each class of Notes, to the
extent not previously paid, will be payable on the Distribution Date
specified for such class on the cover page hereof (each, a 'NOTE
FINAL SCHEDULED DISTRIBUTION DATE') from funds available therefor as
described herein.
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Terms of the Certificates................. The principal terms of the Certificates are described below:
Distribution Dates. Distributions with respect to the Certificates
will be made on each Distribution Date, commencing October 15, 1997.
Distributions will be made to holders of record of the Certificates
(the 'CERTIFICATEHOLDERS' and, together with the Noteholders, the
'SECURITYHOLDERS') as of the related Record Date.
Certificate Rate. % per annum (the 'CERTIFICATE RATE').
Interest. Interest in respect of a Distribution Date will accrue
during the related Interest Accrual Period. On each Distribution
Date, the Owner Trustee will distribute pro rata to
Certificateholders accrued interest at the Certificate Rate on the
outstanding Certificate Balance generally to the extent of the
Available Amount remaining after the Servicer has been paid the
Servicer Payment and the Noteholders' Interest Distributable Amount
has been deposited into the Note Distribution Account. Interest will
be calculated on the basis of a 360-day year consisting of twelve
30-day months. Distributions of interest on the Certificates are
subordinated to payment of interest on the Notes. If an Event of
Default occurs and the Notes are accelerated, Certificateholders will
not be entitled to receive any distributions of interest or principal
until the Notes have been paid in full. See 'Description of the
Notes--the Indenture' 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 Certificate Rate (to the extent
lawful).
Principal. No distributions of principal of the Certificates will be
made until the Notes have been paid in full. On each Distribution
Date commencing on the Distribution Date on which the Notes are paid
in full, principal of the Certificates will be payable in an amount
generally equal to the Certificateholders' Principal Distributable
Amount for such Distribution Date, to the extent of the Available
Amount remaining after the Servicer has been paid the Servicer
Payment, interest and principal have been paid in respect of the
Notes and interest has been paid in respect of the Certificates. The
Certificateholders' Principal Distributable Amount for each
Distribution Date generally will equal 100% of the Principal
Distributable Amount (after payment of any outstanding Notes in full)
and will be calculated by the Servicer in the manner described under
'Description of the Transfer and Servicing Agreements--Distributions'
herein.
The outstanding principal amount, if any, of the Certificates is
expected to be paid in full on the August 2017 Distribution Date (the
'CERTIFICATE FINAL SCHEDULED DISTRIBUTION DATE').
Optional Prepayment. After the Notes have been paid in full, the
Certificates will be prepaid on any Distribution Date on which the
Servicer exercises its option to purchase the Receivables, and the
Certificates will be retired. Such
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prepayment may occur on any Distribution Date following the last day
of any Collection Period as of which the Pool Balance declines to 5%
or less of the Cutoff Date Pool Balance. See 'Description of the
Certificates--Optional Prepayment' herein.
Limited Rights. If an Event of Default occurs under the Indenture,
except as described herein, 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 Receivables, until
the Notes have been paid in full, and if an Event of Servicing
Termination occurs, the Certificateholders will not have any right to
direct or consent to removal of the Servicer or the waiver of such
Event of Servicing Termination until the Notes have been paid in
full. See 'Risk Factors--Rights of Noteholders and
Certificateholders' and 'Description of the Transfer and Servicing
Agreements--Rights Upon Event of Servicing Termination' and '--Waiver
of Past Defaults' herein.
Reserve Account........................... The Sellers will establish a reserve account (the 'RESERVE ACCOUNT')
in the name of the Indenture Trustee on behalf of the Noteholders and
the Certificateholders to be pledged by the Trust to the Indenture
Trustee as collateral for the Notes. The Reserve Account will be
funded with an initial deposit by the Sellers of cash or certain
investments having a value of $13,460,929.28 (1.5% of the Cutoff Date
Pool Balance) (the 'RESERVE ACCOUNT INITIAL DEPOSIT'). In addition,
on each Distribution Date, any remaining Available Amount with
respect to the preceding calendar month (the 'COLLECTION PERIOD' with
respect to such Distribution Date) after payment of the Servicing
Payment to the Servicer and deposits into the Note Distribution
Account and the Certificate Distribution Account have been made will
be deposited into the Reserve Account. On each Distribution Date, any
amounts on deposit in the Reserve Account in excess of the Specified
Reserve Account Balance will be distributed to the Sellers in
accordance with the Sale and Servicing Agreement.
On or prior to each Deposit Date, the Owner Trustee will withdraw
funds from the Reserve Account, to the extent of the funds therein,
to the extent (x) the amounts required to be distributed to the
Servicer, the Noteholders and the Certificateholders on the related
Distribution Date exceeds (y) the Available Amount for such
Distribution Date. Amounts so withdrawn will be deposited into the
Collection Account. If the amount in the Reserve Account is reduced
to zero and, in the case of the Noteholders, to the extent the
subordination of amounts distributable to Certificateholders is
insufficient, Noteholders and Certificateholders will bear the credit
and other risks associated with ownership of the Receivables,
including the risk that the Trust may not have a perfected security
interest in the Financed Vehicles. See 'Description of the Transfer
and Servicing Agreements--Subordination of the
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Certificates; Reserve Account' and 'Certain Legal Aspects of the
Receivables' herein.
Specified Reserve Account
Balance................................. On any Distribution Date, the specified reserve account balance (the
'SPECIFIED RESERVE ACCOUNT BALANCE') will equal 2.00% (3.00% under
certain circumstances described herein) of the Pool Balance as of the
related Settlement Date, but in no event will be less than the lesser
of (i) $8,973,952.86 (1.00% of the Cutoff Date Pool Balance) and (ii)
such Pool Balance. The Specified Reserve Account Balance with respect
to any Distribution Date may be reduced to a lesser amount as
determined by the Sellers, provided that such reduction does not
adversely affect the rating by a Rating Agency of any class of Notes
or the Certificates.
Monthly Advances.......................... With respect to each Receivable as to which there has been a Payment
Shortfall during the related Collection Period (other than a Payment
Shortfall arising from a Receivable which has been prepaid in full or
which has been subject to a Relief Act Reduction during the related
Collection Period), on each Deposit Date the Servicer will be
obligated to advance funds in the amount of such Payment Shortfall
(each, a 'MONTHLY ADVANCE'), but only to the extent that the
Servicer, in its good faith judgment, expects to recover such Monthly
Advance from subsequent payments on such Receivable made by or on
behalf of the obligor thereunder (the 'OBLIGOR') (but only to the
extent of expected interest collections in the case of a Simple
Interest Receivable) or from Net Liquidation Proceeds or insurance
proceeds with respect to such Receivable. The Servicer shall be
reimbursed for any Monthly Advance from subsequent collections with
respect to such Receivable. If the Servicer determines in its good
faith judgment that an unreimbursed Monthly Advance will not
ultimately be recoverable from subsequent collections or that the
related Receivable will be sold pursuant to the Sale and Servicing
Agreement, the Servicer shall be reimbursed for such Monthly Advance
from collections on all Receivables in accordance with the priority
of distributions described herein. In determining whether a Monthly
Advance is or will be nonrecoverable, the Servicer need not take into
account any amounts it might receive in a deficiency judgment against
an Obligor. The Servicer will not make a Monthly Advance in respect
of (i) the principal component of any scheduled payment on a Simple
Interest Receivable or (ii) a Payment Shortfall arising from a
Receivable which has been prepaid in full or which has been subject
to a Relief Act Reduction during the related Collection Period. See
'Description of the Transfer and Servicing Agreements--Monthly
Advances' herein.
'PAYMENT SHORTFALL' means (i) with respect to any Simple Interest
Receivable and any Collection Period, the excess of (A) the product
of (1) one-twelfth of the Contract Rate of such Receivable and (2)
the outstanding principal amount of such Receivable as of the related
Settlement Date (or, in the case
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of the first Collection Period, as of the Cutoff Date) over (B) the
amount of interest, if any, collected on such Receivable during the
related Collection Period and (ii) with respect to any Precomputed
Receivable and any Collection Period, the excess of (A) the scheduled
payment due on such Precomputed Receivable during the related
Collection Period over (B) the amount with respect to such payment
collected on such Receivable (including any amounts allocated from
the Paid-Ahead Account with respect to such Collection Period).
Collection Account; Priority of
Payments................................ The Servicer will be required to remit collections (including Net
Liquidation Proceeds) received with respect to the Receivables during
the related Collection Period and any other amounts constituting the
Available Amount to an account in the name of the Indenture Trustee
(the 'COLLECTION ACCOUNT') on each Deposit Date, net of any amounts
due or distributable to the Sellers and the Servicer to the extent
described in 'Description of the Transfer and Servicing
Agreement--Net Deposits' herein (except upon the occurrence of
certain conditions described in 'Description of the Transfer and
Servicing Agreement--Collections' herein). Pursuant to the Sale and
Servicing Agreement, the Servicer will have the revocable power to
instruct the Indenture Trustee or the Paying Agent to withdraw the
Available Amount on deposit in the Collection Account and to apply
such funds on each Distribution Date to the following (in the
priority indicated): (i) the Servicer Payment (if not deducted from
the Servicer's remittance as described herein), (ii) the Noteholders'
Interest Distributable Amount into the Note Distribution Account,
(iii) the Certificateholder's Interest Distributable Amount into the
Certificate Distribution Account (except as described below), (iv)
the Noteholders' Principal Distributable Amount into the Note
Distribution Account and (v) the Certificateholders' Principal
Distributable Amount into the Certificate Distribution Account.
Notwithstanding the foregoing, if an Event of Default occurs and the
maturity of the Notes is accelerated, the Certificateholders will not
be entitled to receive any distributions in respect of the
Certificates until the Notes have been paid in full.
Paid-Ahead Amounts........................ Payments by or on behalf of Obligors on Precomputed Receivables which
do not constitute scheduled payments or full prepayments ('PAID-AHEAD
AMOUNTS') will be retained by the Servicer, will not be deposited
into the Paid-Ahead Account at any time and will not be deposited
into the Collection Account until such time as the paid-ahead payment
falls due (except upon the occurrence of certain events described in
'Description of the Transfer and Servicing Agreement--Collections'
herein). As of the Cutoff Date, the Servicer held $561,500.57 of
Paid-Ahead Amounts on the
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Receivables. See 'Description of the Transfer and Servicing
Agreements--Paid-Ahead Precomputed Receivables' herein.
Servicer Payment.......................... The Servicer will be entitled to receive a servicing fee, payable on
each Distribution Date (the 'SERVICING FEE'), in an amount equal to
the sum of (i) one-twelfth of the product of 0.50% (the 'SERVICING
FEE RATE') and the Pool Balance as of the close of business on the
last day of the second preceding Collection Period (the 'SETTLEMENT
DATE') and (ii) any Administrative Fees paid by the Obligors during
the related Collection Period. The 'SERVICER PAYMENT' with respect to
any Distribution Date will be equal to the sum of the reimbursement
then due to the Servicer for outstanding Monthly Advances and the
Servicing Fee for such Distribution Date (including any unpaid
Servicing Fees for past Distribution Dates). See 'Description of the
Transfer and Servicing Agreements--Servicing Compensation' and '--Net
Deposits' herein.
Administration Agreements................. Each of CITSF and Chase, in its capacity as an administrator of the
Trust (each, an 'ADMINISTRATOR'), will enter into an agreement (each,
an 'ADMINISTRATION AGREEMENT') with the Trust and the Indenture
Trustee. Pursuant to each Administration Agreement, each
Administrator will agree to provide certain notices and to perform
certain other administrative functions required of the Trust pursuant
to the Transfer and Servicing Agreements and specified in such
Administration Agreement as being the responsibility of such
Administrator. See 'Description of the Transfer and Servicing
Agreements--Administration Agreements' herein.
Certain Federal Income Tax
Considerations.......................... Upon issuance of the Securities, Simpson Thacher & Bartlett, special
United States federal income tax counsel to the Sellers, will deliver
its opinion generally to the effect that under current law the Notes
will be characterized as debt, and the Trust will not be
characterized as an association (or a publicly traded partnership)
taxable as a corporation. Each Noteholder, by the acceptance of a
Note, will agree to treat the Notes as indebtedness, and each
Certificateholder, by the acceptance of a Certificate, will agree to
treat the Trust as a partnership in which the Certificateholders are
partners for all United States federal, state and local tax purposes.
Alternative characterizations of the Trust and the Certificates are
possible, but would not result in materially adverse tax consequences
to Certificateholders. See 'Certain Federal Income Tax Consequences'
herein.
Legal Investment.......................... The Class A-1 Notes will be eligible securities for purchase by money
market funds under paragraph (a)(9) of Rule 2a-7 under the Investment
Company Act of 1940, as amended.
ERISA Considerations...................... Subject to the considerations described herein under 'ERISA
Considerations,' the Notes are eligible for purchase with Plan Assets
of any Plan. A fiduciary or other person contemplating purchasing the
Notes on behalf of or with Plan Assets of any
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Plan should carefully review with its legal advisors whether the
purchase or holding of the Notes could give rise to a transaction
prohibited or not otherwise permissible under ERISA or Section 4975
of the Code.
The Certificates may not be acquired by or on behalf of a Plan or
with Plan Assets. By its acceptance of a Certificate, each
Certificateholder will be deemed to have represented and warranted
that it is not subject to the foregoing limitations. The restrictions
contained in the foregoing representation and warranty shall not
apply to the acquisition or holding of Certificates with assets of
the general account of an insurance company to the extent that the
acquisition or holding, respectively, of such Certificates (i) is and
will be permissible under Section 401(c) of ERISA and final
regulations thereunder or another exemption under ERISA and (ii) does
not and will not result in the contemplated operations of the Trust
being treated as non-exempt prohibited transactions. Persons
contemplating acquiring the Certificates should consult their counsel
to determine whether they are purchasing on behalf of, or with Plan
Assets of, any Plan. See 'ERISA Considerations' herein for additional
information, including special considerations for purchasers using
assets of an insurance company general account.
Ratings of the Notes...................... It is a condition to the issuance of the Securities that (i) the
Class A-1 Notes be rated in the highest short-term rating category
and (ii) the Notes of each other class be rated in the highest
long-term rating category, in each case by Moody's Investors Service,
a division of Dun & Bradstreet ('MOODY'S'), Standard & Poor's Ratings
Services, a division of the McGraw-Hill Companies ('STANDARD &
POOR'S') and Duff & Phelps Credit Rating Company ('DUFF & PHELPS,'
and together with Moody's and Standard & Poor's, the 'RATING
AGENCIES'). There can be no assurance that any rating will not be
lowered or withdrawn by the related Rating Agency if, in its
judgment, circumstances in the future so warrant. See 'Risk
Factors--Ratings of the Securities' herein.
Rating of the Certificates................ It is a condition to the issuance of the Securities that the
Certificates be rated at least in the 'A' category, or its
equivalent, by at least one Rating Agency. There can be no assurance
that any rating will not be lowered or withdrawn by the related
Rating Agency if, in its judgment, circumstances in the future so
warrant. See 'Risk Factors--Ratings of the Securities' herein.
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RISK FACTORS
Investors should consider, among other things, the following risk factors
in connection with any purchase of the Securities.
LIMITED LIQUIDITY
There is currently no secondary market for the Securities offered hereby.
The Underwriters currently intend to make a market in the Securities, but are
not under any obligation to do so. There can be no assurance that a secondary
market will develop or, if a secondary market does develop, that it will provide
the Securityholders with liquidity of investment or that it will continue for
the life of the Securities.
TRUST'S RELATIONSHIP TO THE SELLERS AND THE SERVICER
The Notes represent obligations of, and the Certificates represent
beneficial interests in, the Trust only and do not represent obligations of, or
interests in, either Seller, the Servicer or any of their respective Affiliates.
None of the Sellers or the Servicer is generally obligated to make any payments
in respect of the Securities or the Receivables. See 'Description of the
Transfer and Servicing Agreements--Sale and Assignment of Receivables' herein.
SERVICING
In connection with the Servicing Transfer, the right to service or
subservice the Receivables and all other Recreational Vehicle Loans then
serviced by CFMC was sold to CITSF. CITSF began servicing the Receivables on
August 18, 1997. The Sellers and their affiliates (other than CIT and its
affiliates) are no longer financing or servicing Recreational Vehicle Loans.
Although steps were taken and will continue to be taken to ensure an orderly and
efficient transfer of the servicing of the Receivables to CITSF, the Sellers
anticipate a temporary increase in the number of delinquent Receivables during
the first few months following such transfer.
The Sale and Servicing Agreement provides that if, at the end of any
calendar year or, in the case of 1997, the last four months of 1997, Aggregate
Losses on the Receivables exceed 0.80% of the average of the month-end principal
balances of the Receivables for each month in such calendar year or, in the case
of 1997, partial calendar year, the Servicer may be replaced at the direction of
the Sellers as described herein. There can be no assurance that the replacement
of CITSF as Servicer would not adversely affect the performance of the
Receivables or result in delays in payments on the Securities. See 'Description
of the Transfer and Servicing Agreements--Certain Matters Regarding the
Servicer' herein.
The Servicing Transfer Agreements set forth certain requirements and
restrictions with respect to CITSF's activities as Servicer, including a
restriction on CITSF's ability to make any changes to the servicing policies and
procedures applicable to the Receivables that would have a material effect on
the collectibility of the Receivables without CFMC's consent. These requirements
and restrictions could result in the Servicer's servicing the Receivables from
time to time in accordance with policies and procedures which are materially
different than those it follows with respect to its own serviced portfolio of
recreational vehicle loans at such time. There can be no assurance that such
requirements and restrictions will not adversely affect the performance of the
Receivables. See 'Description of the Transfer and Servicing
Agreements--Servicing and Insurance Procedures' herein.
LIMITED ASSETS; SUBORDINATION
The Trust will not have, nor is it permitted or expected to have, any
significant assets or sources of funds other than the Receivables and the
amounts on deposit in the Reserve Account. Noteholders and Certificateholders
generally must rely for repayment upon payments on the Receivables and, if and
to the extent available on each Distribution Date to cover shortfalls in
distributions of interest and principal on the Notes and the Certificates,
amounts on deposit in the Reserve Account. However, funds deposited in the
Reserve Account are limited in amount, and the amount required to be maintained
on deposit therein will be reduced as the Pool Balance declines. If the amount
on deposit in the Reserve Account is exhausted, and, in the case of the
Noteholders, to the extent the
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subordination of amounts distributable to Certificateholders is insufficient,
the Trust will depend solely on current distributions on the Receivables to make
payments on the Notes and the Certificates. The Securities will not be insured
or guaranteed by the Sellers, the Servicer, the Owner Trustee, the Indenture
Trustee or any affiliate thereof.
Distributions of principal of the Certificates will be subordinated in
priority of payment to payments of interest and principal due on the Notes. The
Certificateholders will not receive any distributions of interest with respect
to an Interest Accrual Period until the full amount of interest due on the Notes
with respect to such Interest Accrual Period has been deposited in the Note
Distribution Account, and if an Event of Default occurs and the Notes are
accelerated, the Certificateholders will not receive any distributions of
interest with respect to an Interest Accrual Period until the Notes are paid in
full. The Certificateholders will not receive any distributions of principal
until the Distribution Date on which the Notes are paid in full. See
'Description of the Transfer and Servicing Agreements--Distributions' herein.
RATINGS OF THE SECURITIES
It is a condition to the issuance of the Securities that (i) the Class A-1
Notes be rated in the highest short-term rating category by each Rating Agency,
(ii) the Notes of each other class be rated in the highest long-term rating
category by each Rating Agency and (iii) the Certificates be rated at least in
the 'A' category, or its equivalent, by at least one Rating Agency. A rating is
not a recommendation to purchase, hold or sell the Securities, inasmuch as such
rating does not comment as to market price or suitability for a particular
investor. The ratings of the Securities address the likelihood of the timely
payment of interest on and ultimate payment of principal of the Securities
pursuant to their terms. There can be no assurance that a rating will remain for
any given period of time or that a rating will not be lowered or withdrawn
entirely by the related Rating Agency if in its judgment circumstances in the
future so warrant.
CERTAIN LEGAL ASPECTS
Security Interest in Financed Vehicles. Perfection of security interests
in the Financed Vehicles and enforcement of rights to realize upon the value of
the Financed Vehicles as collateral for the Receivables are subject to a number
of state laws, including the Uniform Commercial Code as adopted in each state
and certificate of title statutes. In connection with the sale of the
Receivables to the Trust, each Seller will assign its security interest in each
individual Financed Vehicle to the Trust. However, due to administrative burden
and expense, none of the Sellers, the Servicer or the Owner Trustee will amend
the certificates of title or UCC-1 financing statements, if any, with respect to
the Financed Vehicles to identify the Trust or the Indenture Trustee as the new
secured party. In addition, the certificates of title and the UCC-1 financing
statements with respect to the Financed Vehicles relating to those Receivables
not originated by either Seller have not been and will not be amended to reflect
any interim transfers of ownership of the security interests in such Financed
Vehicles. See 'The Receivables Pool--Chase RV Finance' herein. In a majority of
states, the assignment of a Receivable together with the related security
interest is an effective conveyance of such security interest without amendment
of any lien noted on the related certificate of title or of any UCC-1 financing
statements, and the new owner of the Receivable succeeds to the original secured
party's rights in the related Financed Vehicle as against creditors of the
Obligor. In certain states, in the absence of such amendment and delivery or
execution and filing of transfer instruments with the appropriate governmental
authorities to reflect the successive assignments of the security interest in
such Financed Vehicle, the related Seller (if not secured party of record), the
Trust and/or the Indenture Trustee may not have a perfected security interest in
such Financed Vehicle.
Each Seller will be obligated to repurchase any Receivable sold by it to
the Trust as to which such Seller has represented that the originator of such
Receivable has a first perfected security interest in the Financed Vehicle
securing such Receivable, if a breach of such representation shall materially
adversely affect the interest of the Securityholders in such Receivable and if a
breach of such representation shall not have been cured. If the Trust does not
have a perfected security interest in a Financed Vehicle, the only recourse of
the Trust with respect to third parties would be against the
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related Obligor on an unsecured basis or (if the related originator did not have
a perfected security interest in such Financed Vehicle) against the related
Seller pursuant to its repurchase obligation.
If the Trust does not have a perfected security interest in a Financed
Vehicle, its ability to realize on such Financed Vehicle in the event of a
default may be adversely affected. To the extent the security interest is
perfected, the Trust will have a prior claim over subsequent purchasers of such
Financed Vehicle and holders of subsequently perfected security interests in
such Financed Vehicle. However, under the laws of many states, certain
possessory liens for repairs and storage, as well as certain rights in favor of
federal and state governmental authorities arising from the use of a motor
vehicle in connection with illegal activities, may take priority even over a
perfected security interest. Certain federal tax liens may have priority over
the lien of a secured party. In addition, through fraud or negligence, the Trust
could lose its security interest or the priority of its security interest in a
Financed Vehicle. None of the Sellers or the Servicer will have an obligation to
repurchase a Receivable as to which any of the aforementioned occurrences result
in the Trust's losing the priority of its security interest or its security
interest in such Financed Vehicle after the date such security interest was
conveyed to the Trust (other than through fraud or negligence of a Seller or the
Servicer). See 'Certain Legal Aspects of the Receivables--Security Interests in
the Financed Vehicles' herein.
Transfer of Receivables to the Trust. Each of the Sellers intends that the
transfer of the Receivables by it to the Trust under the Sale and Servicing
Agreement constitute a sale. In the event that either Seller were to become
insolvent, the Federal Deposit Insurance Act ('FDIA'), as amended by the
Financial Institutions Reform, Recovery and Enforcement Act of 1989 ('FIRREA'),
sets forth certain powers that the FDIC may exercise if it were appointed
receiver of such Seller. To the extent that a Seller has granted a security
interest in the Receivables transferred by it to the Trust and that interest was
validly perfected before such Seller's insolvency and was not taken in
contemplation of insolvency or with the intent to hinder, delay or defraud such
Seller or its creditors, that security interest would not be subject to
avoidance by the FDIC as receiver of such Seller. Positions taken by the FDIC
staff prior to the passage of FIRREA do not suggest that the FDIC, if appointed
receiver of either Seller, would interfere with the timely transfer to the Trust
of payments collected on the Receivables. If, however, the FDIC were to assert a
contrary position, or were to require the Owner Trustee to establish its rights
to those payments by submitting to and completing the administrative claims
procedure established under the FDIA, or the conservator or receiver were to
request a stay of proceedings with respect to such Seller as provided under the
FDIA, delays in payments on the Securities and possible reductions in the amount
of those payments could occur.
GEOGRAPHIC CONCENTRATION OF RECEIVABLES
Based on the Cutoff Date Pool Balance, 28.97%, 9.29% and 6.34% of the
Receivables had Obligors (in the case of Receivables originated without the
involvement of Dealers) or were originated by Dealers (in the case of
Receivables originated with the involvement of Dealers) with mailing addresses
in California, Texas and Florida, respectively. Because of the relative lack of
geographic diversity, losses on the Receivables may be more sensitive to the
economies of such states than would be the case if there were more geographic
diversification. An economic downturn in California, Texas or Florida may have
an adverse effect on the ability of Obligors in such states to meet their
payment obligations under the Receivables.
MATURITY AND PREPAYMENT CONSIDERATIONS
The weighted average life of the Notes and the Certificates will generally
be influenced by the rate at which the principal balances of the Receivables are
paid, which payment may be in the form of scheduled amortization or prepayments.
The Receivables are prepayable by the Obligors at any time. Prepayments may also
result from Receivables becoming Liquidated Receivables. Any reinvestment risks
resulting from a faster or slower incidence of prepayment of the Receivables
will be borne entirely by the Securityholders. See also 'Description of the
Transfer and Servicing Agreements--Termination' regarding the Servicer's option
to purchase the Receivables.
In addition, the Servicer may, on a case-by-case basis, permit extensions
with respect to the Due Dates of payments on Receivables in accordance with the
Servicing Transfer Agreements and the
14
<PAGE>
Sale and Servicing Agreement. See 'Description of the Transfer and Servicing
Agreements--Servicing and Insurance Procedures' herein. Any such deferrals or
extensions may increase the weighted average life of the Securities. However,
the Servicer will not be permitted to grant any such deferral or extension if as
a result the final scheduled payment on a Receivable would fall after the Final
Scheduled Maturity Date unless the Servicer purchases the affected Receivable.
RISK OF COMMINGLING
Under the Sale and Servicing Agreement, for so long as CITSF is the
Servicer and CITSF satisfies certain requirements for making deposits less than
daily, the Servicer will not be required to deposit payments on and proceeds of
the Receivables collected during each Collection Period into the Collection
Account until the related Deposit Date and will not be required to deposit
Paid-Ahead Amounts into the Paid-Ahead Account or the Collection Account until
such time as the paid-ahead payment falls due. Pending deposit into the
Collection Account, as provided in the Servicing Transfer Agreements,
collections will be transferred by the Servicer to CFMC and held by CFMC until
the Business Day prior to the Deposit Date. The Servicer is required to make
deposits into the Collection Account on the Deposit Date regardless of whether
CFMC returns such funds to the Servicer. If the Servicer were unable to remit
such funds (if, for example, CFMC fails to return such funds to the Servicer
prior to the Deposit Date and the Servicer does not otherwise have funds
available), the Securityholders might incur a loss. The Sellers or the Servicer
may, in order to satisfy the requirements for making deposits less frequently
than daily, obtain a letter of credit or other security for the benefit of the
Trust to secure timely remittances of collections on the Receivables and payment
of the aggregate Repurchase Amount with respect to Receivables repurchased by a
Seller or purchased by the Servicer. See 'Description of the Transfer and
Servicing Agreements--Collections' herein.
INSURANCE
Each Receivable requires the Obligor to obtain fire, theft and collision
insurance or comprehensive and collision insurance with respect to the related
Financed Vehicle. Since Obligors may choose their own insurers to provide the
required coverage, the specific terms and conditions of their policies vary.
Prior to August 18, 1997, in the event an obligor under a Recreational Vehicle
Loan did not maintain the required insurance coverage with respect to the
related financed vehicle and the outstanding balance and months remaining to
maturity on such Recreational Vehicle Loan were greater than $5,000 and 15
months, respectively, CFMC purchased a collateral protection insurance policy on
behalf of such obligor. Although insurance will continue to be required pursuant
to the terms of the Receivables, none of the Sellers or CITSF as Servicer will
be obligated to purchase collateral protection insurance on behalf of any
Obligor, verify if any insurance required under a Receivable is being maintained
by any Obligor or be obligated to pursue any remedies under any Receivable or
applicable law as a result of any failure of an Obligor to maintain any such
insurance. See 'Description of Transfer and Servicing Agreements--Servicing and
Insurance Procedures' herein. As a result of this change in policy, the number
of Financed Vehicles that are not covered by collateral protection insurance may
be greater than that reflected in the historical performance of the Chase RV
Finance Portfolio. The term 'CHASE RV FINANCE PORTFOLIO' refers to the portfolio
of Recreational Vehicle Loans owned and/or serviced by Chase RV Finance prior to
the Servicing Transfer (including the Recreational Vehicle Loans sold pursuant
to prior securitizations which CFMC continued to service prior to the Servicing
Transfer).
RIGHTS OF NOTEHOLDERS AND CERTIFICATEHOLDERS
In general, the Certificateholders may direct the Owner Trustee in the
administration of the Trust. However, because the Trust will pledge the Trust
property to the Indenture Trustee to secure the payment of the Notes, including
in such pledge the rights of the Trust under the Sale and Servicing Agreement,
the Indenture Trustee and not the Certificateholders will have the power to
direct the Owner Trustee to take certain actions in connection with the
administration of the Trust property until the Notes have been paid in full and
the lien of the Indenture has been released. In addition, the Certificateholders
will not be allowed to direct the Owner Trustee to take any action that
conflicts with the provisions of the Sale and Servicing Agreement. The Indenture
will specifically prohibit the Owner
15
<PAGE>
Trustee from taking any action that would impair the Indenture Trustee's
security interest in the Trust property and will require the Owner Trustee to
obtain the consent of the Indenture Trustee or Noteholders representing not less
than a majority of the aggregate principal amount of the Notes then outstanding
before modifying, amending, supplementing, waiving or terminating any provision
of the Sale and Servicing Agreement. Therefore, except as described herein,
until the Notes have been paid in full, the ability to direct the Trust with
respect to certain actions permitted to be taken under the Sale and Servicing
Agreement rests with the Indenture Trustee and the Noteholders.
If an Event of Default under the Indenture occurs and the Notes are
accelerated, the Indenture Trustee will have the right or be required in certain
circumstances to exercise remedies as a secured party, including selling the
Receivables, to pay the principal of, and accrued interest on, the Notes. Upon
the occurrence of an Event of Default, except as described herein, the
Certificateholders will not have any right to direct or to consent to any
actions by the Indenture Trustee until the Noteholders have been paid in full.
There is no assurance that the proceeds of any sale of the Receivables would be
equal to or greater than the aggregate outstanding principal amount of the Notes
and the Certificate Balance plus, in each case, accrued interest thereon.
Because neither interest nor principal is distributed to the Certificateholders
following an Event of Default and acceleration of the Notes until the Notes have
been paid in full, the interests of the Noteholders and the Certificateholders
may conflict, and the exercise by the Indenture Trustee of its right to sell the
Receivables or exercise other remedies may cause the Certificateholders to
suffer a loss of all or part of their investment. See 'Description of the
Notes--The Indenture--Events of Default; Rights upon Event of Default' herein.
In the event that an Event of Servicing Termination occurs, the Indenture
Trustee or Noteholders evidencing not less than a majority of the aggregate
principal amount of the Notes then outstanding, as described under 'Description
of the Transfer and Servicing Agreements--Rights upon an Event of Servicing
Termination' herein, may remove the Servicer without the consent of the Owner
Trustee or any of the Certificateholders. None of the Certificateholders will
have the ability, with certain specified exceptions, to waive defaults by the
Servicer, including defaults that could materially adversely affect the
Certificateholders. See 'Description of the Transfer and Servicing
Agreements--Waiver of Past Defaults' herein.
THE TRUST
GENERAL
The Issuer, Chase Manhattan RV Owner Trust 1997-A, is a business trust
created for the transaction described herein under the laws of the State of
Delaware pursuant to a Certificate of Trust filed with the Secretary of State of
the State of Delaware on July 17, 1997 and the Trust Agreement. The activities
of the Trust are limited by the terms of the Trust Agreement to (i) acquiring,
holding and managing the Receivables and the other assets of the Trust and
proceeds thereof, (ii) issuing the Notes and the Certificates to finance such
assets, (iii) making payments on the Notes and the Certificates issued by it and
(iv) engaging in other activities that are necessary, suitable or convenient to
accomplish the foregoing or are incidental thereto or connected therewith. The
Trust will not acquire any contracts or assets other than the Trust property
described below and will not have any need for additional capital resources. As
the Trust does not have any operating history and will not engage in any
activity other than acquiring and holding the Receivables, issuing the Notes and
Certificates and making distributions thereon, there has not been included
herein any historical or pro forma financial statements or ratio of earnings to
fixed charges with respect to the Trust. Inasmuch as the Trust has no operating
history, it is not possible to predict the operating performance of the Trust
while the Notes and Certificates are outstanding. While management of each of
the Sellers believes that the loss and delinquency experience contained herein
for recent periods are representative of past performance of Recreational
Vehicle Loans in the Chase RV Finance Portfolio, there is no assurance that such
performance is indicative of the future performance of the Receivables, since
future performance may be impacted by, among other things, general economic
conditions and economic conditions in the geographical areas in which the
Obligors reside including, for example, unemployment rates, the servicing by
CITSF of the Receivables and the lack of force-placed insurance on uninsured
Financed Vehicles.
16
<PAGE>
The Certificate Balance represents the equity in the Trust. The Notes and
the Certificates will be transferred to the Sellers by the Trust in exchange for
the Receivables pursuant to the Sale and Servicing Agreement.
The Trust property will include a pool (the 'RECEIVABLES POOL') comprised
of retail installment sales contracts and purchase money notes and other notes
secured by Financed Vehicles ('RECREATIONAL VEHICLE LOANS') and, except as
described herein, (i) with respect to Simple Interest Receivables, all monies
received thereunder on and after the Cutoff Date and (ii) with respect to
Precomputed Receivables, all monies due thereunder on or after the Cutoff Date
(including any outstanding Paid-Ahead Amounts) (collectively, the
'RECEIVABLES'). The Trust property will also include: (i) such amounts as from
time to time may be held in one or more Trust Accounts established and
maintained pursuant to the Sale and Servicing Agreement, as described herein;
(ii) security interests in the Financed Vehicles; (iii) proceeds from the
exercise of the Sellers' recourse rights against Dealers (as described herein
under 'The Receivables Pools--Origination of Recreational Vehicle Loans'); and
(iv) proceeds from claims and other rights to payment on theft and physical
damage, credit life and credit disability insurance policies covering the
Financed Vehicles or the Obligors, as the case may be, to the extent that such
insurance policies relate to the Receivables. The Sale and Servicing Agreement
sets forth criteria that must be satisfied by each Receivable. See 'Description
of the Transfer and Servicing Agreements--Sale and Assignment of Receivables'
herein. Each Receivable will be identified in one of the schedules appearing as
exhibits to the Sale and Servicing Agreement. The Trust property will not
include any Administrative Fees incurred by the Obligors prior to August 18,
1997, any forced-placed insurance premiums that are not included in the
Principal Balances of the related Receivables ('EXCLUDED FORCED-PLACED INSURANCE
PREMIUMS') or any scheduled payments due on the Precomputed Receivables prior to
the Cutoff Date ('EXCLUDED PRECOMPUTED AMOUNTS').
If the protection provided to the Noteholders by the subordination of
amounts distributable on the Certificates and the protection provided to the
Securityholders by the Reserve Account is insufficient, the Trust will look only
to the Obligors on the Receivables and the proceeds from the repossession and
sale of Financed Vehicles that secure Liquidated Receivables to make payments on
the Notes and distributions on the Certificates. In such event, certain factors,
such as the Trust's not having a first priority perfected security interest in
some of the Financed Vehicles, may affect the Trust's ability to realize on the
collateral securing the Receivables, and thus may reduce the proceeds to be
distributed to Securityholders with respect to the Securities. See 'Description
of the Transfer and Servicing Agreements--Distributions,' '--Subordination of
the Certificates; Reserve Account' and 'Certain Legal Aspects of the
Receivables' herein.
The Trust's principal offices are in Delaware at the address listed below
under '--The Owner Trustee.'
CAPITALIZATION OF THE TRUST
The following table illustrates the capitalization of the Trust as of the
Cutoff Date, as if the issuance and sale of the Notes and the Certificates had
taken place on such date:
<TABLE>
<S> <C>
Notes................................................ $852,500,000.00
Certificates......................................... 44,895,285.54
---------------
Total........................................... $897,395,285.54
---------------
---------------
</TABLE>
THE OWNER TRUSTEE
Wilmington Trust Company is the Owner Trustee under the Trust Agreement.
Wilmington Trust Company is a Delaware banking corporation and its principal
offices are located at Rodney Square North, 1100 North Market Street,
Wilmington, Delaware 19890-0001. Each Seller, the Servicer and their respective
affiliates may maintain normal commercial banking relations with the Owner
Trustee and its affiliates.
17
<PAGE>
THE RECEIVABLES POOL
GENERAL
The Receivables held by the Trust will consist of all of the Recreational
Vehicle Loans owned by the Sellers meeting several criteria as of the Cutoff
Date, including the criteria stated below. Each Receivable:
(i) is not secured by a Financed Vehicle in repossession status;
(ii) has not been identified on the computer files of the Servicer as
relating to an Obligor who has filed for bankruptcy;
(iii) is not delinquent for 60 or more days; and
(iv) was not originated by Chase N.A. or any of its affiliates prior
to the Chase/Chemical Merger.
Approximately 93.94% of the Cutoff Date Pool Balance were Simple Interest
Receivables and approximately 6.06% of the Cutoff Date Pool Balance were
Precomputed Receivables. Approximately 68.83% of the Cutoff Date Pool Balance
related to New Financed Vehicles and approximately 31.17% of the Cutoff Date
Pool Balance related to Used Financed Vehicles. As used herein, a 'NEW FINANCED
VEHICLE' means a Financed Vehicle the model year of which was the year of
origination of the related Receivable or a later year, and a 'USED FINANCED
VEHICLE' means a Financed Vehicle the model year of which was earlier than the
year of origination of the related Receivable. There can be no assurance that
these definitions accurately identify all Financed Vehicles which were new or
used at the time the related Receivables were originated.
Approximately 28.97%, 9.29% and 6.34% of the Cutoff Date Pool Balance were
Receivables whose Obligors (in the case of Receivables originated without the
involvement of Dealers) or whose Dealers (in the case of Receivables originated
with the involvement of Dealers) had mailing addresses in the States of
California, Texas and Florida, respectively. Approximately 1.38% of the Cutoff
Date Pool Balance were Receivables delinquent between 30 and 59 days as of the
Cutoff Date.
All statistical information with respect to the Receivables set forth in
the following tables is given as of the Cutoff Date.
18
<PAGE>
COMPOSITION OF THE RECEIVABLES
<TABLE>
<CAPTION>
WEIGHTED AVERAGE AVERAGE
CONTRACT RATE CUTOFF DATE CUTOFF DATE ORIGINAL AVERAGE ORIGINAL NUMBER OF
(RANGE) POOL BALANCE PRINCIPAL BALANCE POOL BALANCE PRINCIPAL BALANCE RECEIVABLES
- ----------------------- --------------- ----------------- ----------------- ----------------- -----------
<S> <C> <C> <C> <C> <C>
9.31% $897,395,285.54 $ 31,555.09 $1,112,869,763.05 $ 39,131.82 28,439
(6.5% to 17.9%)
<CAPTION>
WEIGHTED WEIGHTED
AVERAGE AVERAGE
WEIGHTED AVERAGE ORIGINAL TERM REMAINING TERM
CONTRACT RATE (RANGE (RANGE
(RANGE) IN MONTHS) IN MONTHS)
- ----------------------- ------------- --------------
<S> <C> <C>
9.31% 169.06 130.42
(6.5% to 17.9%) (24-240) (1-236)
</TABLE>
DISTRIBUTION BY CONTRACT RATE
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE PERCENTAGE OF
NUMBER OF TOTAL NUMBER OF PRINCIPAL CUTOFF DATE
CONTRACT RATE RANGE RECEIVABLES RECEIVABLES BALANCE POOL BALANCE
- ----------------------------------- ----------- --------------- --------------- -------------
<S> <C> <C> <C> <C>
6.50 to 6.99%.................... 8 0.03% $ 447,481.78 0.05%
7.00 to 7.49%.................... 70 0.25 3,192,322.96 0.36
7.50 to 7.99%.................... 1,300 4.57 68,067,612.34 7.59
8.00 to 8.49%.................... 2,241 7.88 106,496,499.35 11.87
8.50 to 8.99%.................... 5,920 20.82 267,794,077.88 29.84
9.00 to 9.49%.................... 3,017 10.61 112,037,921.88 12.48
9.50 to 9.99%.................... 5,327 18.73 160,868,907.73 17.93
10.00 to 10.49%.................... 1,895 6.66 42,456,733.32 4.73
10.50 to 10.99%.................... 3,329 11.71 60,671,378.73 6.76
11.00 to 11.49%.................... 1,360 4.78 22,357,502.27 2.49
11.50 to 11.99%.................... 1,847 6.49 27,966,257.95 3.12
12.00 to 12.49%.................... 764 2.69 10,744,573.14 1.20
12.50 to 12.99%.................... 906 3.19 10,477,316.42 1.17
13.00 to 13.49%.................... 247 0.87 2,403,433.69 0.27
13.50 to 13.99%.................... 149 0.52 1,117,928.40 0.12
14.00 to 14.49%.................... 34 0.12 213,708.28 0.02
14.50 to 14.99%.................... 15 0.05 51,560.84 0.01
15.00 to 17.99%.................... 10 0.04 30,068.58 0.00
----------- --------------- --------------- -------------
Total(1)...................... 28,439 100.00% $897,395,285.54 100.00%
----------- --------------- --------------- -------------
----------- --------------- --------------- -------------
</TABLE>
- ------------------
(1) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
19
<PAGE>
GEOGRAPHIC DISTRIBUTION(1)
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE PERCENTAGE OF
NUMBER OF TOTAL NUMBER OF PRINCIPAL CUTOFF DATE
STATE RECEIVABLES RECEIVABLES BALANCE POOL BALANCE
- --------------------------------------------- ----------- --------------- --------------- -------------
<S> <C> <C> <C> <C>
Alabama...................................... 753 2.65% $ 25,688,375.97 2.86%
Alaska....................................... 156 0.55 5,657,193.93 0.63
Arizona...................................... 1,216 4.28 41,359,690.98 4.61
Arkansas..................................... 345 1.21 10,536,753.51 1.17
California................................... 8,479 29.81 259,953,002.48 28.97
Colorado..................................... 689 2.42 22,193,686.34 2.47
Connecticut.................................. 151 0.53 4,837,491.16 0.54
Delaware..................................... 50 0.18 1,254,632.19 0.14
District of Columbia......................... 3 0.01 30,279.55 0.00
Florida...................................... 1,538 5.41 56,934,480.60 6.34
Georgia...................................... 700 2.46 22,901,206.55 2.55
Hawaii....................................... 8 0.03 323,532.61 0.04
Idaho........................................ 79 0.28 3,171,744.81 0.35
Illinois..................................... 484 1.70 16,005,537.87 1.78
Indiana...................................... 105 0.37 4,157,275.70 0.46
Iowa......................................... 292 1.03 9,429,436.46 1.05
Kansas....................................... 147 0.52 4,323,992.50 0.48
Kentucky..................................... 74 0.26 2,165,596.59 0.24
Louisiana.................................... 392 1.38 10,684,332.36 1.19
Maine........................................ 87 0.31 2,640,244.19 0.29
Maryland..................................... 331 1.16 9,476,322.49 1.06
Massachusetts................................ 460 1.62 9,375,603.92 1.04
Michigan..................................... 190 0.67 9,509,775.55 1.06
Minnesota.................................... 314 1.10 10,882,370.82 1.21
Mississippi.................................. 288 1.01 9,772,000.45 1.09
Missouri..................................... 272 0.96 7,617,233.51 0.85
Montana...................................... 66 0.23 2,770,942.46 0.31
North Carolina............................... 1,090 3.83 23,117,366.45 2.58
North Dakota................................. 15 0.05 751,044.08 0.08
Nebraska..................................... 74 0.26 2,453,041.38 0.27
Nevada....................................... 363 1.28 12,287,433.06 1.37
New Hampshire................................ 195 0.69 4,311,822.56 0.48
New Jersey................................... 649 2.28 15,722,671.26 1.75
New Mexico................................... 470 1.65 11,103,826.03 1.24
New York..................................... 969 3.41 23,086,984.70 2.57
Ohio......................................... 286 1.01 13,938,264.69 1.55
Oklahoma..................................... 264 0.93 7,848,589.18 0.87
Oregon....................................... 663 2.33 33,434,224.86 3.73
Pennsylvania................................. 720 2.53 19,492,902.63 2.17
Rhode Island................................. 87 0.31 2,451,104.55 0.27
South Carolina............................... 355 1.25 8,859,341.87 0.99
South Dakota................................. 32 0.11 1,643,951.75 0.18
Tennessee.................................... 373 1.31 13,382,652.31 1.49
Texas........................................ 2,513 8.84 83,378,387.08 9.29
Utah......................................... 135 0.47 6,389,751.83 0.71
Vermont...................................... 42 0.15 897,694.82 0.10
Virginia..................................... 534 1.88 13,693,298.68 1.53
Washington................................... 316 1.11 15,119,060.88 1.68
West Virginia................................ 200 0.70 4,470,769.95 0.50
Wisconsin.................................... 364 1.28 13,694,332.51 1.53
Wyoming...................................... 42 0.15 1,703,447.53 0.19
Other........................................ 19 0.07 510,585.35 0.06
----------- ------- --------------- -------------
Total(2)................................. 28,439 100.00% $897,395,285.54 100.00%
----------- ------- --------------- -------------
----------- ------- --------------- -------------
</TABLE>
- ------------------
(1) Based on the mailing address of the related Obligor (in the case of
Receivables originated without involvement of Dealers) or the Dealer who
originated the Receivable (in the case of Receivables originated with
involvement of Dealers).
(2) Dollar amounts and percentages may not add to the total or to 100.00,
respectively, due to rounding.
20
<PAGE>
DISTRIBUTION BY ORIGINAL TERM(1)
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE PERCENTAGE OF
NUMBER OF TOTAL NUMBER OF PRINCIPAL CUTOFF DATE
ORIGINAL TERM RANGE (MONTHS) RECEIVABLES RECEIVABLES BALANCE POOL BALANCE
- ------------------------------------------- ----------- --------------- --------------- -------------
<S> <C> <C> <C> <C>
13 to 24................................. 3 0.01% $ 39,590.39 0.00%
25 to 36................................. 50 0.18 277,437.99 0.03
37 to 48................................. 151 0.53 705,822.66 0.08
49 to 60................................. 702 2.47 3,963,573.60 0.44
61 to 72................................. 316 1.11 2,097,852.85 0.23
73 to 84................................. 1,111 3.91 9,148,282.39 1.02
85 to 96................................. 1,072 3.77 9,601,599.52 1.07
97 to 108................................. 246 0.87 2,568,114.30 0.29
109 to 120................................. 5,515 19.39 72,229,615.93 8.05
121 to 132................................. 82 0.29 2,328,856.36 0.26
133 to 144................................. 3,400 11.96 66,967,702.21 7.46
145 to 156................................. 115 0.40 4,130,069.13 0.46
157 to 168................................. 149 0.52 7,835,553.43 0.87
169 to 180................................. 15,490 54.47 713,028,405.02 79.46
181 to 240................................. 37 0.13 2,472,809.76 0.28
----------- --------------- --------------- -------------
Total(2).............................. 28,439 100.00% $897,395,285.54 100.00%
----------- --------------- --------------- -------------
----------- --------------- --------------- -------------
</TABLE>
- ------------------
(1) 'Original Term' with respect to any Receivable is such Receivable's original
term as of its date of origination.
(2) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
DISTRIBUTION BY REMAINING TERM(1)
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE PERCENTAGE OF
NUMBER OF TOTAL NUMBER OF PRINCIPAL CUTOFF DATE
REMAINING TERM RANGE (MONTHS) RECEIVABLES RECEIVABLES BALANCE POOL BALANCE
- ------------------------------------------- ----------- --------------- --------------- -------------
<S> <C> <C> <C> <C>
0 to 12................................. 796 2.80% $ 1,715,703.65 0.19%
13 to 24................................. 1,092 3.84 5,553,392.15 0.62
25 to 36................................. 1,206 4.24 8,791,129.27 0.98
37 to 48................................. 1,594 5.60 14,797,254.03 1.65
49 to 60................................. 1,523 5.36 17,270,947.69 1.92
61 to 72................................. 1,979 6.96 29,882,124.88 3.33
73 to 84................................. 2,071 7.28 37,985,631.54 4.23
85 to 96................................. 1,664 5.85 36,432,874.64 4.06
97 to 108................................. 2,021 7.11 51,925,787.89 5.79
109 to 120................................. 2,210 7.77 69,089,482.09 7.70
121 to 132................................. 3,090 10.87 116,650,700.00 13.00
133 to 144................................. 3,257 11.45 144,937,513.58 16.15
145 to 156................................. 2,168 7.62 115,926,733.42 12.92
157 to 168................................. 2,511 8.83 160,776,188.46 17.92
169 to 180................................. 1,248 4.39 84,648,225.66 9.43
181 to 240................................. 9 0.03 1,011,596.59 0.11
----------- --------------- --------------- -------------
Total(2).............................. 28,439 100.00% $897,395,285.54 100.00%
----------- --------------- --------------- -------------
----------- --------------- --------------- -------------
</TABLE>
- ------------------
(1) The 'Remaining Term' with respect to any Receivable is such Receivable's
remaining term as of the Cutoff Date.
(2) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
21
<PAGE>
DISTRIBUTION BY ORIGINAL PRINCIPAL BALANCE(1)
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE PERCENTAGE OF
ORIGINAL RECEIVABLE PRINCIPAL NUMBER OF TOTAL NUMBER OF PRINCIPAL CUTOFF DATE
BALANCE RANGE (MONTHS) RECEIVABLES RECEIVABLES BALANCE POOL BALANCE
- ------------------------------------------- ----------- --------------- --------------- -------------
<S> <C> <C> <C> <C>
$ 1 to less than $ 10,000............ 1,343 4.72% $ 5,100,459.54 0.57%
$ 10,000 to less than $ 20,000............. 5,937 20.88 52,161,956.57 5.81
$ 20,000 to less than $ 30,000............. 5,055 17.77 91,085,959.86 10.15
$ 30,000 to less than $ 40,000............. 6,043 21.25 163,321,577.86 18.20
$ 40,000 to less than $ 50,000............. 4,162 14.63 150,261,521.36 16.74
$ 50,000 to less than $ 60,000............. 2,415 8.49 110,793,835.92 12.35
$ 60,000 to less than $ 70,000............. 1,103 3.88 61,357,361.39 6.84
$ 70,000 to less than $ 80,000............. 564 1.98 37,190,075.76 4.14
$ 80,000 to less than $ 90,000............. 296 1.04 21,960,033.88 2.45
$ 90,000 to less than $100,000............. 209 0.73 17,534,262.91 1.95
$100,000 to less than $120,000............. 436 1.53 42,366,885.99 4.72
$120,000 to less than $140,000............. 287 1.01 33,334,412.70 3.71
$140,000 to less than $160,000............. 191 0.67 25,636,089.03 2.86
$160,000 to less than $180,000............. 106 0.37 16,122,980.24 1.80
$180,000 to less than $200,000............. 84 0.30 14,103,150.70 1.57
$200,000 to less than $220,000............. 51 0.18 9,601,259.97 1.07
$220,000 to less than $240,000............. 28 0.10 5,714,829.00 0.64
$240,000 to less than $260,000............. 27 0.09 6,071,227.96 0.68
$260,000 to less than $280,000............. 20 0.07 4,838,726.60 0.54
$280,000 to less than $300,000............. 13 0.05 3,414,130.32 0.38
$300,000 to less than $340,000............. 20 0.07 5,685,005.07 0.63
$340,000 to less than $380,000............. 11 0.04 3,339,909.89 0.37
$380,000 to less than $420,000............. 13 0.05 4,726,219.79 0.53
$420,000 to less than $460,000............. 7 0.02 2,880,609.91 0.32
$460,000 to less than $500,000............. 8 0.03 3,531,136.31 0.39
$500,000 to less than $550,000............. 6 0.02 2,932,838.93 0.33
$550,000 to less than $720,000............. 4 0.01 2,328,828.08 0.26
----------- --------------- --------------- -------------
Total(2):............................. 28,439 100.00% $897,395,285.54 100.00%
----------- --------------- --------------- -------------
----------- --------------- --------------- -------------
</TABLE>
- ------------------
(1) The 'Original Principal Balance' with respect to any Receivable is its
Principal Balance as of its date of origination.
(2) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
22
<PAGE>
DISTRIBUTION BY CUTOFF DATE PRINCIPAL BALANCE
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE PERCENTAGE OF
CUTOFF DATE PRINCIPAL NUMBER OF TOTAL NUMBER OF PRINCIPAL CUTOFF DATE
BALANCE RANGE (MONTHS) RECEIVABLES RECEIVABLES BALANCE POOL BALANCE
- ------------------------------------------- ----------- --------------- --------------- -------------
<S> <C> <C> <C> <C>
$ 1 to less than $ 10,000............ 6,030 21.20% $ 35,918,815.31 4.00%
$ 10,000 to less than $ 20,000............. 5,081 17.87 74,981,566.37 8.36
$ 20,000 to less than $ 30,000............. 5,801 20.40 145,639,257.21 16.23
$ 30,000 to less than $ 40,000............. 4,837 17.01 167,214,912.04 18.63
$ 40,000 to less than $ 50,000............. 2,744 9.65 121,761,551.53 13.57
$ 50,000 to less than $ 60,000............. 1,346 4.73 73,293,720.77 8.17
$ 60,000 to less than $ 70,000............. 706 2.48 45,522,275.55 5.07
$ 70,000 to less than $ 80,000............. 390 1.37 29,014,173.27 3.23
$ 80,000 to less than $ 90,000............. 240 0.84 20,359,202.57 2.27
$ 90,000 to less than $100,000............. 240 0.84 22,854,061.55 2.55
$100,000 to less than $120,000............. 351 1.23 38,353,783.10 4.27
$120,000 to less than $140,000............. 219 0.77 28,148,290.15 3.14
$140,000 to less than $160,000............. 144 0.51 21,393,023.84 2.38
$160,000 to less than $180,000............. 88 0.31 14,903,905.62 1.66
$180,000 to less than $200,000............. 70 0.25 13,253,759.06 1.48
$200,000 to less than $220,000............. 28 0.10 5,857,830.37 0.65
$220,000 to less than $240,000............. 32 0.11 7,359,911.49 0.82
$240,000 to less than $260,000............. 14 0.05 3,469,547.15 0.39
$260,000 to less than $280,000............. 13 0.05 3,474,292.05 0.39
$280,000 to less than $300,000............. 13 0.05 3,748,191.56 0.42
$300,000 to less than $350,000............. 17 0.06 5,428,593.48 0.60
$350,000 to less than $400,000............. 11 0.04 4,144,243.21 0.46
$400,000 to less than $450,000............. 11 0.04 4,655,740.98 0.52
$450,000 to less than $500,000............. 8 0.03 3,802,357.19 0.42
$500,000 to less than $700,000............. 5 0.02 2,842,280.12 0.32
----------- --------------- --------------- -------------
Total(1)................................... 28,439 100.00% $897,395,285.54 100.00%
----------- --------------- --------------- -------------
----------- --------------- --------------- -------------
</TABLE>
- ------------------------
(1) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
DISTRIBUTION BY AGE
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE PERCENTAGE OF
NUMBER OF TOTAL NUMBER OF PRINCIPAL CUTOFF DATE
MONTHS SINCE ORIGINATION RECEIVABLES RECEIVABLES BALANCE POOL BALANCE
- ------------------------------------------- ----------- --------------- --------------- -------------
<S> <C> <C> <C> <C>
0 to 12................................. 1,862 6.55% $110,593,892.72 12.32%
13 to 24................................. 3,814 13.41 192,523,190.10 21.45
25 to 36................................. 3,818 13.43 138,377,249.18 15.42
37 to 48................................. 5,831 20.50 176,615,245.43 19.68
49 to 60................................. 5,180 18.21 132,992,086.15 14.82
61 to 72................................. 3,224 11.34 69,271,518.94 7.72
73 to 84................................. 2,036 7.16 34,629,731.97 3.86
85 to 96................................. 1,090 3.83 19,147,124.16 2.13
97 to 108................................. 785 2.76 13,932,945.31 1.55
109 to 120................................. 509 1.79 7,085,243.85 0.79
121 to 132................................. 188 0.66 1,824,681.44 0.20
133 to 144................................. 102 0.36 402,376.29 0.04
----------- --------------- --------------- -------------
Total(1)................................... 28,439 100.00% $897,395,285.54 100.00%
----------- --------------- --------------- -------------
----------- --------------- --------------- -------------
</TABLE>
- ------------------------
(1) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
23
<PAGE>
DISTRIBUTION BY YEAR OF ORIGINATION
<TABLE>
<CAPTION>
PERCENTAGE OF AGGREGATE PERCENTAGE OF
NUMBER OF TOTAL NUMBER OF PRINCIPAL CUTOFF DATE
ORIGINATION YEAR RECEIVABLES RECEIVABLES BALANCE POOL BALANCE
- ------------------------------------------- ----------- --------------- --------------- -------------
<S> <C> <C> <C> <C>
1985....................................... 29 0.10% $ 34,259.82 0.00%
1986....................................... 102 0.36 524,176.69 0.06
1987....................................... 224 0.79 2,307,400.62 0.26
1988....................................... 628 2.21 10,069,915.66 1.12
1989....................................... 966 3.40 17,912,839.96 2.00
1990....................................... 1,124 3.95 18,881,004.08 2.10
1991....................................... 2,063 7.25 36,724,886.67 4.09
1992....................................... 3,692 12.98 84,208,157.91 9.38
1993....................................... 5,805 20.41 152,747,850.82 17.02
1994....................................... 6,100 21.45 198,672,997.10 22.14
1995....................................... 3,174 11.16 125,126,369.96 13.94
1996....................................... 3,408 11.98 184,604,602.48 20.57
1997....................................... 1,124 3.95 65,580,823.77 7.31
----------- --------------- --------------- -------------
Total(1).............................. 28,439 100.0% $897,395,285.54 100.00%
----------- --------------- --------------- -------------
----------- --------------- --------------- -------------
</TABLE>
- ------------------
(1) Dollar amounts and percentages may not add to the total or to 100.00%,
respectively, due to rounding.
DELINQUENCIES AND NET LOSSES
The following tables set forth information with respect to delinquencies,
loan losses and recoveries for the Chase RV Finance Portfolio as of the dates
indicated and for each of the one-year periods ended December 31, 1996, 1995,
1994 and 1993 and for each of the six-month periods ended June 30, 1997 and June
30, 1996. The data presented in the following tables are for illustrative
purposes only.
Higher delinquencies since December 31, 1995 reflect in large part a
modification of CFMC's servicing system in 1995 which resulted in the
classification for the first time of Recreational Vehicle Loans as delinquent if
force-placed and other insurance premiums with respect to such loans were
unpaid. Higher net charge-offs for the six-month period ended June 30, 1997 and
the one-year period ended December 31, 1996 reflect, in addition to economic
conditions affecting consumer debt generally, a combination of regular aging of
the Chase RV Finance Portfolio as a whole (as Recreational Vehicle Loans
originated in 1991 and 1992 (13.48% of the Cutoff Date Pool Balance consisted of
Receivables originated in 1991 and 1992) reached the point in their terms when
they are most likely to be charged-off) and a decline in the growth rate of the
Chase RV Finance Portfolio, and the implementation of a new policy in July 1996
of using the discounted market value of financed vehicles, rather than the
market value thereof, in calculating gross charge-offs upon repossession. These
factors magnified net charge-offs as a percent of Period End Outstanding Amount
and Average Outstanding Principal Amount for those periods.
Although steps were taken and will continue to be taken to ensure an
orderly and efficient transfer of the servicing of the Receivables to CITSF in
accordance with the Servicing Transfer, the Sellers anticipate a temporary
increase in the number of delinquent Receivables during the first few months
following such transfer.
The delinquency and loan loss data presented in the following tables
include data with respect to Recreational Vehicle Loans serviced by CFMC and for
which, if necessary, force-placed insurance had been obtained. Since CITSF will
not be obtaining force-placed insurance on the Financed Vehicles, charge-offs on
the Receivables in future periods may be greater than those experienced by the
Chase RV Finance Portfolio and reflected in the tables below.
There can be no assurance that the loss and delinquency experience of the
Receivables will be comparable to that of the Chase RV Finance Portfolio,
particularly since the performance of the
24
<PAGE>
Receivables will reflect to a large extent CITSF's loss and delinquency policies
which are different from those of Chase RV Finance. See 'The CIT Group/Sales
Financing, Inc., Servicer--CITSF's Servicing Procedures.' In addition, under
certain circumstances, CITSF may be replaced as Servicer. See 'The CIT
Group/Sales Financing, Inc., Servicer.' Accordingly, the information presented
in the tables below should not be considered as a basis for assessing the
likelihood, amount or severity of delinquency or losses on the Receivables in
the future, and no assurances can be given that the delinquency and loss
experience presented in the tables below will be indicative of such experience
of the Receivables.
25
<PAGE>
DELINQUENCY EXPERIENCE
<TABLE>
<CAPTION>
AS OF JUNE 30, AS OF DECEMBER 31,
----------------------------------------------- -------------------------------------------------
1997 1996 1996 1995
----------------------------------------------- -------------------------------------------------
NUMBER NUMBER NUMBER NUMBER
DOLLARS OF DOLLARS OF DOLLARS OF DOLLARS OF
(000'S) LOANS (000'S) LOANS (000'S) LOANS (000'S) LOANS
----------------------------------------------- -------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Outstanding Principal
Amount(1) $995,273,000 31,607 $1,169,362,240 38,107 $1,083,830,797 35,022 $1,166,137,723 39,869
Delinquencies ($)(2)(3)
30-59 Days $ 10,835,275 458 $ 8,474,722 372 $ 11,904,202 463 $ 11,301,829 473
60-89 Days 3,962,124 159 3,436,054 131 3,548,806 150 2,630,595 110
90 Days or More 4,028,022 153 3,876,189 121 4,403,793 178 3,116,651 127
----------------------------------------------- -------------------------------------------------
TOTAL Delinquencies $ 18,825,421 770 $ 15,786,965 624 $ 19,856,801 791 $ 17,049,075 710
Repossession Inventory (4) 3,650,381 96 4,580,430 115 4,614,120 117 4,423,004 127
----------------------------------------------- -------------------------------------------------
TOTAL Delinquencies and
Repossession Inventory $ 22,475,802 866 $ 20,367,395 739 $ 24,470,921 908 $ 21,472,079 837
----------------------------------------------- -------------------------------------------------
----------------------------------------------- -------------------------------------------------
Delinquencies (%)(2)(3)(5)
30-59 Days 1.09% 1.45% 0.72% 0.98% 1.10% 1.32% 0.97% 1.19%
60-89 Days 0.40% 0.50% 0.29% 0.34% 0.33% 0.43% 0.23% 0.28%
90 Days or More 0.40% 0.48% 0.33% 0.32% 0.41% 0.51% 0.27% 0.32%
----------------------------------------------- -------------------------------------------------
TOTAL Delinquencies (6) 1.89% 2.44% 1.35% 1.64% 1.83% 2.26% 1.46% 1.78%
Repossession Inventory (4) 0.37% 0.30% 0.39% 0.30% 0.43% 0.33% 0.38% 0.32%
----------------------------------------------- -------------------------------------------------
TOTAL Delinquencies
and Repossession
Inventory (4)(6) 2.26% 2.74% 1.74% 1.94% 2.26% 2.59% 1.84% 2.10%
----------------------------------------------- -------------------------------------------------
----------------------------------------------- -------------------------------------------------
<CAPTION>
1994 1993
------------------------ -----------------------
NUMBER NUMBER
DOLLARS OF DOLLARS OF
(000'S) LOANS (000'S) LOANS
------------------------ -----------------------
<S> <C> <C> <C> <C>
Outstanding Principal
Amount(1) $1,198,121,000 43,064 $1,073,005,000 N/A
Delinquencies ($)(2)(3)
30-59 Days $ 6,745,000 324 $ 6,014,000 N/A
60-89 Days 1,734,000 79 1,532,000 N/A
90 Days or More 2,694,000 99 2,563,000 N/A
------------------------ ---------------------
TOTAL Delinquencies $ 11,173,000 502 $ 10,109,000 N/A
Repossession Inventory (4) 3,369,368 110 N/A N/A
------------------------ ---------------------
TOTAL Delinquencies and
Repossession Inventory $ 14,542,368 612 $ 10,109,000 N/A
====================== ======================
Delinquencies (%)(2)(3)(5)
30-59 Days 0.56% 0.75% 0.56% N/A
60-89 Days 0.14% 0.18% 0.14% N/A
90 Days or More 0.22% 0.23% 0.24% N/A
------------------------ ---------------------
TOTAL Delinquencies (6) 0.93% 1.17% 0.94% N/A
Repossession Inventory (4) 0.28% 0.26% 0.00% N/A
------------------------ ---------------------
TOTAL Delinquencies
and Repossession
Inventory (4)(6) 1.21% 1.42% 0.94% N/A
====================== ======================
</TABLE>
*N/A: Data is not available.
(1) Outstanding Principal Amount is (i) the sum of all amounts scheduled to be
paid under precomputed Recreational Vehicle Loans, less the unearned finance
charges on such Recreational Vehicle Loans, plus (ii) the sum of the unpaid
principal balances on simple interest Recreational Vehicle Loans (in each
case, excluding Recreational Vehicle Loans in repossession).
(2) The period of delinquency is calculated on a 'Fed' basis, which means that
delinquencies are not reported until the month-end following 30 days after a
payment is contractually due.
(3) Delinquencies include principal amounts only.
(4) Amounts shown in repossession inventory represent the principal balances of
Recreational Vehicle Loans whose related financed vehicles have been
repossessed but have not been sold.
(5) Historically, Delinquencies as a percent of the Outstanding Principal Amount
as of year-end have been higher than those at the end of any prior quarter
during the related year principally due to year-end seasonal factors.
(6) Percentages representing components of TOTAL Delinquencies and TOTAL
Delinquencies and Repossession Inventory may not add to the totals thereof
due to rounding.
26
<PAGE>
LOAN LOSS EXPERIENCE
<TABLE>
<CAPTION>
SIX MONTHS ENDED
--------------------------------
JUNE 30, JUNE 30,
1997 1996
-------------- --------------
<S> <C> <C>
Number of Loans Outstanding (1) 31,607 38,107
Portfolio Growth Rate (2) (16.34%) 0.55%
Period End Outstanding Principal
Amount (3) $ 995,273,000 $1,169,362,240
Average Outstanding Principal
Amount (4) $1,039,988,907 $1,173,454,293
Number of Repossessions 242 251
Number of Repossessions as a % of
Period End Number of Loans
Outstanding (2) 1.53% 1.32%
Gross Charge-Offs (5) $ 5,303,825 $ 3,361,880
Gross Charge-Offs as a % of Period
End Outstanding Principal
Amount (2) 1.07% 0.57%
Gross Charge-Offs as a % of Average
Outstanding Principal Amount (2) 1.02% 0.57%
Recoveries (6) $ (524,631) $ (679,137)
Net Charge-Offs $ 4,779,194 $ 2,682,743
Net Charge-Offs as a % of Period
End Outstanding Principal Amount
(2) 0.96% 0.46%
Net Charge-Offs as a % of Average
Outstanding Principal Amount (2) 0.92% 0.46%
- -----------------------------------
<CAPTION>
YEAR ENDED
----------------------------------------------------------------------
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1996 1995 1994 1993
----------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Number of Loans Outstanding (1) 35,022 39,869 43,064 N/A
Portfolio Growth Rate (2) (7.06%) (2.67%) 11.66% N/A
Period End Outstanding Principal
Amount (3) $ 1,083,830,797 $1,166,137,723 $1,198,121,000 $1,073,005,000
Average Outstanding Principal
Amount (4) $ 1,144,889,929 $1,182,268,169 $1,131,883,417 $1,029,450,333
Number of Repossessions 493 432 411 N/A
Number of Repossessions as a % of
Period End Number of Loans
Outstanding (2) 1.41% 1.08% 0.95% N/A
Gross Charge-Offs (5) $ 8,610,134 $ 6,582,583 $ 5,311,171 $ 6,374,846
Gross Charge-Offs as a % of Period
End Outstanding Principal
Amount (2) 0.79% 0.56% 0.44% 0.59%
Gross Charge-Offs as a % of Average
Outstanding Principal Amount (2) 0.75% 0.56% 0.47% 0.62%
Recoveries (6) $ (1,778,925) $ (627,547) $ (1,035,982) $ (882,166)
Net Charge-Offs $ 6,831,209 $ 5,955,036 $ 4,275,189 $ 5,492,680
Net Charge-Offs as a % of Period
End Outstanding Principal Amount
(2) 0.63% 0.51% 0.36% 0.51%
Net Charge-Offs as a % of Average
Outstanding Principal Amount (2) 0.60% 0.50% 0.38% 0.53%
- -----------------------------------
</TABLE>
*N/A: Data is not available.
(1) Number of loans at period end.
(2) Percentages for the six-month periods ending June 30, 1996 and June 30, 1997
are annualized.
(3) 'Outstanding Principal Amount' is (i) the sum of all amounts scheduled to be
paid under precomputed Recreational Vehicle Loans, less the unearned finance
charges on such Recreational Vehicle Loans, plus (ii) the sum of the unpaid
principal balances on simple interest Recreational Vehicle Loans (in each
case, excluding Recreational Vehicle Loans in repossession).
(4) Averages were computed by taking a simple average of month-end Outstanding
Principal Amounts for each period presented.
(5) Amount charged-off includes amounts charged to losses at the time of
repossession of the related financed vehicle or when the Recreational
Vehicle Loan is otherwise deemed to be uncollectible, plus or minus any
subsequent loss or gain recognized at the time of disposition of the related
financed vehicle. Such amounts exclude related repossession and other
liquidation expenses and amounts subsequently recovered from the obligor.
(6) Recoveries represent any deficiency amounts recovered from the obligor,
including proceeds realized in connection with accounts previously
charged-off without repossessing the related financed vehicle.
27
<PAGE>
THE FINANCED VEHICLES
The Financed Vehicles consist of motor homes, travel trailers and other
types of recreational vehicles. Motor homes are recreational camping and travel
vehicles built on or as an integral part of a self-propelled motor vehicle
chassis. A motor home may provide kitchen, sleeping, and bathroom facilities, is
equipped with the ability to store and carry fresh water and sewage, and falls
within one of the following types:
Motor Home (Class A): The living unit is entirely constructed on a
bare, specially designed motor vehicle chassis.
Van Campers (Class B): A panel-type truck to which the manufacturer
adds any two of the following conveniences: sleeping, kitchen, and toilet
facilities. The manufacturer typically also adds 110-volt hookup, fresh
water storage, city water hookup, and top extension to provide more
headroom.
Mini Motor Home or Compact Motor Home (Class C): This unit is built on
an automotive manufactured cab and chassis or van frame with an attached
cab section. The manufacturer completes the body section containing the
living area and attaches it to the cab section.
Travel trailers are trailers designed to be towed by a motorized vehicle
(automobile, van, or pickup truck) and are of such size and weight as not to
require a special highway permit. A travel trailer is designed to provide
temporary living quarters for recreational, camping, or travel use, does not
require permanent on-site hookup, and falls within one of the following types:
Conventional Travel Trailer: This unit ranges typically from 12 feet
to 35 feet in length and is towed by means of a bumper or frame hitch
attached to the towing vehicle.
Park Trailer: These are designed for seasonal or temporary living.
When set up, the unit may be connected to utilities necessary for operation
of installed fixtures and appliances. The unit is built on a single chassis
mounted on wheels. Park trailers are not more than 12 feet in overall body
width when in the traveling mode.
Fifth-Wheel Travel Trailer: This unit can be equipped the same as the
conventional travel trailer, but is constructed with a raised forward
section that allows a bi-level floor plan and is designed to be towed by a
vehicle equipped with a device known as a fifth-wheel hitch.
PAYMENTS ON RECREATIONAL VEHICLE LOANS
'SIMPLE INTEREST RECEIVABLES' provide for the allocation of payments made
thereunder to principal and interest in accordance with the 'simple interest'
method. As payments are received under a Simple Interest Receivable, the finance
charges accrued to date are paid first, the unpaid amount financed (to the
extent of the remaining monthly scheduled payment) is paid second and the
remaining payment is applied to the unpaid late charges. Accordingly, if an
Obligor pays the fixed monthly installment in advance of the date on which a
payment is due (the 'DUE DATE'), the portion of the payment allocable to finance
charges for the period since the preceding payment will be less than it would be
if the payment were made on the Due Date, and the portion of the payment
allocable to reduce the amount financed will be correspondingly greater.
Conversely, if the Obligor pays the fixed monthly installment after its Due
Date, the portion of the payment allocable to finance charges for the period
since the last payment will be greater than it would be if the payment were made
on the Due Date, and the portion of the payment allocable to reduce the amount
financed will be correspondingly smaller. When necessary, an adjustment is made
at the maturity of the loan to the scheduled final payment to reflect the larger
or smaller, as the case may be, allocations of payments to the amount financed
under a Simple Interest Receivable as a result of early or late payments, as the
case may be. See 'Weighted Average Life of the Securities--Paid-Ahead Simple
Interest Receivables.'
'PRECOMPUTED RECEIVABLES' consist of Actuarial Receivables and Rule of 78's
Receivables. 'ACTUARIAL RECEIVABLES' provide for amortization of the loan over a
series of fixed level payment monthly installments. Each monthly installment,
including the monthly installment representing the final
28
<PAGE>
payment on the Receivable, consists of an amount of interest equal to 1/12th of
the related Contract Rate multiplied by the unpaid principal balance of the
Receivable, and an amount of principal equal to the remainder of the monthly
payment. 'RULE OF 78'S RECEIVABLES' provide for the payment by the related
Obligor of a specified total amount of payments, payable in equal monthly
installments on each Due Date, which total represents the principal amount
financed and add-on interest in an amount calculated based on the Contract Rate
for the term of the Receivable. The rate at which such amount of add-on interest
is earned and, correspondingly, the amount of each fixed monthly payment
allocated to reduction of the outstanding principal are calculated in accordance
with the 'RULE OF 78'S'. Substantially all of the Precomputed Receivables are
Actuarial Receivables.
If a Simple Interest Receivable is prepaid, rather than receive a rebate,
the Obligor is required to pay interest only to the date of prepayment. If an
Actuarial Receivable is prepaid in full, with minor variations based upon state
law, the Actuarial Receivable requires that the rebate be calculated on the
basis of a constant interest rate. For purposes of making the calculations
required by the Sale and Servicing Agreement, the Servicer will calculate the
amount of interest paid on a Rule of 78's Receivable in the same manner that it
calculates such amounts on Actuarial Receivables.
CHASE RV FINANCE
Prior to the Servicing Transfer, Chase and Chase USA, together with several
of their affiliates, were engaged in the recreational vehicle financing and
recreational vehicle loan servicing business. As used herein, the term Chase RV
Finance refers to such business of the Sellers, their respective predecessors
and their affiliates. Prior to the Servicing Transfer, recreational vehicle loan
servicing by Chase RV Finance was performed by CFMC.
Recreational Vehicle Loans originated by Chase RV Finance prior to mid-1990
were originated by several affiliates of Chase Financial Acceptance Corporation,
an Ohio corporation headquartered in Cleveland, Ohio and a wholly-owned
subsidiary of Chase USA ('CFAC'), and subsequently transferred to CFAC. On April
1, 1995, those Recreational Vehicle Loans owned by CFAC which at the time were
considered 'low quality assets' under Section 23 of the Federal Reserve Act were
transferred to Chase Financial Holdings, Inc., an Ohio headquartered in
Cleveland, Ohio and an affiliate of Chase and Chase USA ('CFHI'). Prior to the
Closing Date, 4.41% of the Receivables by Cutoff Date Pool Balance were sold by
CFAC to Chase USA and 0.01% of the Receivables by Cutoff Date Pool Balance were
sold by CFHI to Chase USA (collectively, the 'CHASE FINANCIAL RECEIVABLES').
Since mid-1990, all Recreational Vehicle Loans in the form of retail
installment sales contracts purchased from Dealers ('INDIRECT RECEIVABLES') were
originated by Chase. Commencing on November 1, 1990, all Recreational Vehicle
Loans in the form of purchase money loans or other loans made directly to
obligors (including transactions involving a Dealer) ('DIRECT RECEIVABLES') were
originated by Chase USA or its predecessor.
In July 1996, Chase N.A. and Chemical Bank, both wholly-owned subsidiaries
of the Corporation, merged, with Chemical Bank, a New York banking corporation,
continuing as the surviving entity under the name 'The Chase Manhattan Bank'
(the 'CHASE/CHEMICAL MERGER'). As survivor of the Chase/Chemical Merger, Chase
succeeded to all right, title and interest in the portfolio of Recreational
Vehicle Loans owned by Chemical Bank.
In connection with the Chase/Chemical Merger, Chemical Bank, N.A. changed
its name to Chase Manhattan Bank USA, N.A. and, on December 1, 1996, merged with
Chase USA, with Chase USA continuing as the surviving entity. As survivor of
this merger, Chase USA succeeded to all right, title and interest in the
portfolio of Recreational Vehicle Loans owned by Chemical Bank, N.A.
The term 'ORIGINATOR' refers to the affiliates of CFAC who originated
Recreational Vehicle Loans prior to mid-1990, Chase, Chase USA, and their
respective predecessors.
On June 3, 1997, the right to service or subservice the Recreational
Vehicle Loans then serviced by CFMC was sold to CITSF. CITSF began servicing
such Recreational Vehicle Loans on August 18,
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1997. CITSF also agreed to service any Recreational Vehicle Loans retained or
repurchased by either of the Sellers and to serve as Servicer under the Sale and
Servicing Agreement. Following the Servicing Transfer, none of the Sellers and
their affiliates (other than CIT and its affiliates) is financing or servicing
Recreational Vehicle Loans. Pursuant to the Servicing Transfer Agreements, CITSF
and its affiliate, The CIT Group Consumer Finance, Inc. (NY) have agreed to
acquire from the Sellers all Recreational Vehicle Loans owned by the Sellers as
of the Cutoff Date which did not satisfy the criteria for inclusion in the Trust
described herein under 'The Receivables Pool--General.'
ORIGINATION OF RECREATIONAL VEHICLE LOANS
In accordance with Chase RV Finance's underwriting criteria, the
Originators purchased recreational vehicle retail installment sales contracts
relating to new and used recreational vehicles from recreational vehicle dealers
who regularly originated and sold such contracts to the Originators pursuant to
the terms of approved Dealer Agreements and made purchase money loans secured by
financed vehicles directly to obligors or pursuant to arrangements with Dealers
in accordance with approved Dealer Agreements. The dealers who arranged the
Recreational Vehicle Loans, unless otherwise specified, are collectively
referred to herein as 'DEALERS.' The agreements with the Dealers and the
assignments of the Recreational Vehicle Loans by the Dealers are collectively
referred to herein as 'DEALER AGREEMENTS.' Dealer Agreements were entered into
with Dealers based upon a financial review of each Dealer, and in some cases,
the reputation and prior experience of Chase RV Finance with such Dealer and its
key management. The Dealer network was serviced by several account executives
who initiated and managed the Dealer relationships.
Almost all of the Receivables are Indirect Receivables and Direct
Receivables originated in accordance with Chase RV Finance's underwriting
criteria. A small percentage of the Receivables were purchased by Chase from an
unaffiliated finance company pursuant to a bulk purchase and were not originated
in accordance with Chase RV Finance's underwriting criteria (the 'BULK PURCHASE
RECEIVABLES').
The Originators made or purchased the Receivables throughout the United
States. Each Dealer made representations and warranties to the Originator with
respect to those Receivables made with the involvement of such Dealer, the
Obligors on such Receivables and the security interests in the Financed Vehicles
relating thereto, which representations and warranties typically included, among
others, that (i) each Obligor was of legal age and competent to execute a
binding contract at the time of such execution; (ii) the documentation submitted
by the Dealer evidenced a bona fide loan contract actually executed by the
Obligor; (iii) the property securing the loan had not been previously titled if
described as new; (iv) the property securing the loan as described in the
security agreement either had been or promptly was delivered to the purchaser;
(v) the amount represented by the Dealer as having been received from the
Obligor as a down payment was actually received in cash or by property received
in trade and valued at no more than its actual cash value; (vi) the Dealer had
not granted an extension of credit for any portion of the down payment; (vii) no
recoupments, counterclaims, or setoffs existed on the part of the Obligor
against the Dealer; (viii) the Dealer had complied with each and every
applicable federal, state and local law and administrative regulation in
connection with the transaction; (ix) the Dealer had fully performed the terms
of any purchase agreement with the Obligor at the time the Originator funded the
loan; and (x) application had been made for a certificate of title or other
ownership documents in the name of the Obligor with the security interest of the
Originator noted as a lien thereon.
Upon breach of any representation or warranty with respect to a Receivable
made by a Dealer, the Trust will have (or its assignee) will have a right of
recourse against such Dealer to require it to purchase or repurchase such
Receivable. Historically, in determining whether to exercise any right of
recourse, Chase RV Finance considered the prior performance of the Dealer and
other business and commercial factors. The Servicer will be obligated to enforce
such rights under the Dealer Agreements relating to the Receivables in
accordance with its customary practices, and the right to any proceeds received
upon such enforcement will be conveyed to the Trust pursuant to the Sale and
Servicing Agreement. In accordance with its customary practices in determining
whether to exercise any right of
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recourse, the Servicer considers the prior performance of the related Dealer and
other business and commercial factors, including its own commercial relationship
with such Dealer. The Sellers will make no representations as to the financial
condition of any Dealer to which any Seller may have recourse, and there can be
no assurance as to the ability of any such Dealer to perform its obligations
under a Dealer Agreement.
As described herein, certain of the Receivables were originated without the
involvement of Dealers. Since there were no Dealers involved in the origination
of these Receivables, no Dealer representations and warranties were made with
respect to them.
In substantially all cases, no Direct Receivable was entered into by the
Originator, and no Indirect Receivable was purchased from a Dealer by the
Originator, until a completed customer file, including the credit application of
the customer, was submitted to the Originator and was reviewed and approved by
one of the Originator's recreational vehicle finance specialists in accordance
with Chase RV Finance's underwriting procedures.
Until October 1996, certain aspects of Dealer liaison, Dealer sales, credit
underwriting and documentation reviews with respect to the Receivables
originated with the involvement of Dealers took place at several regional
support offices ('REGIONAL CENTERS'). At August 1995, there were eight Regional
Centers. The Regional Centers were consolidated over time until November 1996,
when all of such activities were centralized at the Regional Center in Mission
Viejo, California (except for some underwriting support functions which took
place in the Regional Center in Tampa, Florida). All origination and
underwriting functions with respect to the Receivables originated without the
involvement of Dealers were performed by Chase RV Finance on a centralized basis
in Cleveland, Ohio, including the funding of the Recreational Vehicle Loans,
customer service, document file keeping, computerized account record keeping and
vehicle title processing.
UNDERWRITING OF RECREATIONAL VEHICLE LOANS
Chase RV Finance's underwriting procedures were intended to assess the
applicant's ability to repay the amounts due on the Receivable and the adequacy
of the Financed Vehicle as collateral. The application, which listed the
liabilities, income and credit and employment history of the applicant, was
reviewed by Chase RV Finance for completeness and compliance with Chase RV
Finance's guidelines. Chase RV Finance's guidelines were intended to provide a
basis for lending decisions, but were not meant to supersede the credit judgment
of the recreational vehicle finance specialist overseeing the application. As a
result, certain Receivables may not comply with all of Chase RV Finance's stated
guidelines. The discretion granted to a recreational vehicle finance specialist
varied depending on the proposed loan amount and the applicant's credit. Chase
RV Finance also reviewed a credit report issued by an independent credit
reporting agency and, where deemed necessary, substantiated information
regarding the applicant's employment. The ability of the applicant to repay the
amount financed was evaluated by applying Chase RV Finance's then current credit
underwriting criteria, which were intended to provide a general indication based
on the information available to Chase RV Finance of the relative likelihood of
repayment of such amount. Among the criteria considered in evaluating the
individual applications were (i) stability of the obligor with specific regard
to the obligor's length of residence in the area, occupation, length of
employment and whether the obligor rents or owns his or her home; (ii) the
obligor's payment history with respect to present and past debt based on
information known directly by Chase RV Finance or as provided by various credit
reporting agencies; (iii) a debt service to gross monthly income ratio test
(Chase RV Finance's general policy was to reject applications for Recreational
Vehicle Loans whose applicants' debt service to gross monthly income ratios
exceeded 45%, although ratios of up to 55% were allowed if approved at senior
levels); (iv) a loan to value ratio test taking into account the age, type and
market value of the financed vehicle; and (v) a credit bureau score. Each
application was coded with the relevant recreational vehicle finance
specialist's name, and Chase RV Finance tracked the historical performance of
the Recreational Vehicle Loans approved by each recreational vehicle finance
specialist.
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Prior to 1994 Chase RV Finance sought to make Recreational Vehicle Loans
secured by a broad spectrum of recreational vehicle products. Commencing in
1994, Chase RV Finance through its pricing policies targeted obligors purchasing
higher priced recreational vehicles (Class A). See '--The Financed Vehicles'
herein.
Each Receivable arose from a credit sale, refinancing or casual sale of a
new or used recreational vehicle. In most cases, Chase RV Finance would not
finance a Recreational Vehicle Loan relating to a new recreational vehicle if
the amount financed under the loan exceeded the sum of (a) 110% of the
manufacturer's invoice price of the financed vehicle to the Dealer (or 100% if
the amount financed was greater than $125,000), (b) the cost to the Dealer of
any options and (c) the cost to the customer of any warranties, taxes, fees and
credit life and disability insurance. In the case of new recreational vehicles,
Chase RV Finance generally required an obligor to make a down payment of at
least 10% of the total purchase price; provided, however, that a 15% down
payment was required if the amount financed was greater than 110% of
manufacturer's invoice, and a 25% down payment was required if the amount
financed was in excess of $250,000.
With respect to Recreational Vehicle Loans relating to used recreational
vehicles, while Chase RV Finance generally reviewed the sale price of a used
recreational vehicle to determine whether it was within guidelines acceptable to
Chase RV Finance, the prices of used recreational vehicles vary significantly
based upon the individual circumstances of the sale. There can be no assurance
that a ready resale market exists for any used recreational vehicle. Chase RV
Finance used various national publications, including the Kelly Blue Book and
the National Automobile Dealers Association's ('NADA') Recreational Vehicle
Appraisal Guide, to assess the value of a used recreational vehicle and to
determine whether it met Chase RV Finance's underwriting criteria. Generally,
Chase RV Finance would not finance a Recreational Vehicle Loan relating to a
used recreational vehicle unless the amount financed under the contract was
consistent with such national publications or Chase RV Finance's appraisal and,
in any case, unless such amount did not exceed the sum of (a) 85% of the
wholesale value indicated in such national publications and (b) the cost to the
customer of any taxes, fees and credit life and disability insurance. In the
case of used recreational vehicles, Chase RV Finance generally required an
obligor to make a down payment of at least 15% of the amount financed (or 25% if
the amount financed was in excess of $75,000).
In addition, whether a financed vehicle was new or used, Chase RV Finance
also financed credit life/accident/health insurance and service warranties under
a Recreational Vehicle Loan.
INSURANCE PROCEDURES
Each Receivable requires the Obligor to obtain fire, theft and collision
insurance or comprehensive and collision insurance with respect to the related
Financed Vehicle. The Dealer Agreements include a representation and warranty
that each Financed Vehicle had such insurance at the time of origination of the
Receivable. Since Obligors may choose their own insurers to provide the required
coverage, the specific terms and conditions of their policies vary. Prior to
August 18, 1997, in the event an obligor under a Recreational Vehicle Loan did
not maintain the required insurance coverage with respect to the related
financed vehicle and the outstanding balance and months remaining to maturity on
such Recreational Vehicle Loan were greater than $5,000 and 15 months,
respectively, CFMC purchased a collateral protection insurance policy on behalf
of such obligor. The Principal Balance of a small percentage of the Receivables
will include the outstanding amount of premiums for collateral protection
insurance purchased by CFMC on behalf of the related Obligors prior to the
Cutoff Date. In addition, the Obligors with respect to a small percentage of the
Receivables will be obligated to make premium payments in respect of collateral
protection insurance purchased by CFMC. Such premium payment obligations will
not be included in the Principal Balance of the related Receivables and will not
be property of the Trust. Although insurance will continue to be required
pursuant to the terms of the Receivables, none of the Sellers or CITSF as
Servicer will purchase collateral protection insurance on behalf of any Obligor,
verify if such insurance is being maintained by any Obligor or be obligated to
pursue any remedies under any Receivable or applicable
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law as a result of the failure of any Obligor to maintain insurance. See
'Description of Transfer and Servicing Agreements--Servicing and Insurance
Procedures' herein.
CHASE AND CHASE USA
Chase, a wholly-owned banking subsidiary of the Corporation, is a New York
banking corporation, a member of the Federal Reserve System and is subject to
the primary supervision of the New York State Department of Banking. Chase's
activities are primarily related to retail and commercial banking. The principal
executive office of Chase is located at 270 Park Avenue, New York, New York
10017 (telephone (212) 270-3000).
At June 30, 1997, Chase's total assets were approximately $278.7 billion,
total liabilities were approximately $261.6 billion and total stockholders'
equity was approximately $17.1 billion.
Chase USA, a wholly-owned subsidiary of the Corporation, is a national
banking association, a member of the Federal Reserve System and is subject to
the primary supervision of the Office of the Comptroller of the Currency. Chase
USA's activities are primarily related to general consumer lending. The
principal executive office of Chase USA is located at 802 Delaware Avenue,
Wilmington, Delaware 19801 (telephone (302) 575-5000).
At June 30, 1997, Chase USA's total assets were approximately $26.6
billion, total liabilities were approximately $23.8 billion and total
stockholders' equity was approximately $2.8 billion.
Neither Chase nor Chase USA is currently originating Recreational Vehicle
Loans.
THE CIT GROUP/SALES FINANCING, INC., SERVICER
GENERAL
CITSF, a Delaware corporation, is a wholly-owned subsidiary of CIT. It has
its principal executive office at 650 CIT Drive, Livingston, New Jersey 07039,
and its telephone number is (201) 740-5000.
CITSF originates, purchases, sells and services conditional sales contracts
for recreational vehicles, manufactured housing, marine products and other
consumer goods throughout the United States. CITSF has been a lender to the
recreational vehicle industry for more than 30 years. CITSF has a centralized
asset service facility (the 'ASSET SERVICE CENTER') in Oklahoma City, Oklahoma.
Working through dealers and manufacturers, CITSF currently offers retail
installment credit. In addition to purchasing recreational vehicle contracts
from dealers on an individual basis, CITSF makes bulk purchases of recreational
vehicle contracts. These bulk purchases may be from the portfolios of other
lending institutions or finance companies, the portfolios of governmental
agencies or instrumentalities or the portfolios of other entities that purchase
and hold recreational vehicle contracts.
As of June 30, 1997, CITSF serviced approximately 231,500 contracts for
itself and others (consisting primarily of recreational vehicle, home equity,
marine and manufactured housing contracts), representing an outstanding balance
of approximately $5.9 billion. Of this portfolio, approximately 59,900 contracts
(representing an outstanding balance of approximately $1.3 billion) consisted of
recreational vehicle contracts. The foregoing statistics on CITSF's servicing
portfolio do not include the Recreational Vehicle Loans and other loans serviced
by CITSF pursuant to the Servicing Transfer Agreements.
The Asset Service Center of CITSF services consumer credit transactions in
50 states and the District of Columbia. It provides full servicing for
recreational vehicle, home equity, marine products and manufactured housing
retail installment contracts. The Asset Service Center is supplemented by
outside collectors and field remarketers located throughout the United States.
CIT, a Delaware corporation, is a successor to a company founded in St.
Louis, Missouri on February 11, 1908. It has its principal executive offices at
1211 Avenue of the Americas, New York, New York 10036, and its telephone number
is (212) 536-1950. CIT, operating directly or through its
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subsidiaries primarily in the United States, engages in financial services
activities through a nationwide distribution network. CIT provides financing
primarily on a secured basis to commercial borrowers, ranging from middle-market
to larger companies and to consumers. CIT has eight strategic business units
which offer commercial and consumer financing, and factoring products and
services to clients. CIT had 2,950 employees at December 31, 1996, up from 2,750
employees at December 31, 1995.
The Dai-Ichi Kangyo Bank, Limited ('DKB') owns eighty percent (80%) of the
issued and outstanding shares of common stock of CIT. DKB purchased a sixty
percent (60%) common stock interest in CIT from Manufacturers Hanover
Corporation ('MHC') (a predecessor of the Corporation) at year-end 1989 and
acquired an additional twenty percent (20%) common stock interest in CIT on
December 15, 1995 from CBC Holding (Delaware) Inc., a subsidiary of the
Corporation (formerly known as MHC Holdings (Delaware) Inc.) ('CBC HOLDING').
DKB has an option, expiring December 15, 2000, to purchase the remaining twenty
percent (20%) common stock interest in CIT from CBC Holding. CBC Holding became
a direct, wholly-owned subsidiary of Chemical Banking Corporation ('CBC') after
the merger between MHC and CBC on December 31, 1991. On March 31, 1996, CBC was
merged into the Corporation, and the Corporation became the sole stockholder of
CBC Holding and the holder of the twenty percent (20%) interest in CIT.
In accordance with a stockholders agreement among DKB, the Corporation, as
direct successor to CBC and indirect successor to MHC, and CIT, dated as of
December 29, 1989, as amended by an Amendment to Stockholders' Agreement, dated
December 15, 1995 (as amended, the 'STOCKHOLDERS AGREEMENT'), one nominee of the
Board of Directors of CIT is designated by the Corporation. The Stockholders
Agreement also contains restrictions with respect to the transfer of the stock
of CIT to third parties.
ASSET SERVICE CENTER
Through its Asset Service Center, CITSF services recreational vehicle,
manufactured housing, home equity, and other consumer loans. CITSF services all
of the recreational vehicle loans it originates or purchases (except those it
has sold to third parties on a servicing released basis). CITSF is actively
seeking arrangements pursuant to which it will service recreational vehicle
loans held by other entities, such as the Receivables. Generally, such servicing
responsibilities are, and would be, also carried out through the Asset Service
Center. Servicing responsibilities include collecting principal and interest
payments, taxes, insurance premiums, where applicable, and other payments from
obligors and remitting principal and interest payments to the holders of such
loans to the extent such holders are entitled thereto. Collections procedures
include repossession and resale of recreational vehicles securing defaulted
loans and, if deemed advisable by CITSF, entering into workout arrangements with
obligors under certain defaulted loans. Although decisions as to whether to
repossess any recreational vehicle are made on an individual discretionary
basis, CITSF's general policy is to institute repossession procedures promptly
after Asset Service Center personnel determine that it is unlikely that a
defaulted loan will be brought current or that the related financed vehicle is
at risk, and thereafter to diligently pursue the resale of such recreational
vehicle if the market is favorable.
CITSF'S SERVICING PROCEDURES
Collection activities with respect to delinquent Receivables will be
performed by the Servicer or its affiliates consistent with the Servicer's
servicing policies and practices in effect from time to time with respect to
recreational vehicle loans that it services for its own account (except as set
forth in the Servicing Transfer Agreements and described herein). CITSF may
change such policies and practices, provided, that any such change applicable to
the Receivables that would have a material effect on the collectibility of the
Receivables may not be made without CFMC's consent. Collection activities
include prompt investigation and evaluation of the causes of any delinquency. An
obligor is deemed current if an amount equal to no more than $65 of a scheduled
monthly payment remains unpaid.
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An automated collection system, together with manual collectors, are
utilized to assist in collection efforts. The automated collection system
provides relevant obligor information (for example, current addresses, phone
numbers and loan information), records of all contacts with obligors and, in
some cases, automated dialing. The system also records an obligor's promise to
pay and allows supervisor review of collection personnel activity, permits
supervisors to modify priorities as to which obligors should be contacted and
provides extensive reports concerning recreational vehicle loan delinquencies.
The Servicer may attempt to collect delinquent payments by sending letters or
making continued phone calls to obligors. In the event that contact by telephone
can not be made within 10 days of the due date of a payment, a manual review of
the recreational vehicle loan is made to determine the appropriate course of
action, which may be continued phone calls and/or sending of letters. Pursuant
to the Servicing Transfer Agreements, CITSF has agreed to attempt to make such
contacts with Obligors of delinquent Receivables at specified time intervals.
See 'Description of the Transfer and Servicing Agreements--Servicing and
Insurance Procedures' herein. Generally, after a recreational vehicle loan
continues to be delinquent for more than 30 days (regardless of whether contact
had been made), such recreational vehicle loan is assigned to a specific 'late
stage' collector until resolution. A field visit may be scheduled at this time.
The Servicer has agreed to employ the same means to cure delinquencies on the
Receivables as it does for recreational vehicle loans it services for itself,
including deferments and reschedulings, except as set forth in the Servicing
Transfer Agreements. CITSF may change such means in accordance with its business
judgment; provided, that any such change applicable to the Receivables that
would have a material effect on the collectibility of the Receivables may not be
made without CFMC's consent.
Chase RV Finance's collection procedures are substantially the same as
those of CITSF, although CITSF's individual collectors have more discretion than
Chase RV Finance's individual collectors had in determining what actions are
appropriate at different stages of delinquency. In addition, Chase RV Finance's
collection procedures at the initial stages of delinquency used a combination of
automatic dialing and letters and Chase RV Finance customarily assigned a
delinquent account to a specific late stage collector at 26 days delinquent
(with field visits scheduled if appropriate at 60 days delinquent).
CITSF implements repossession procedures when it is evident to it that the
obligor can no longer make payment on the recreational vehicle loan or if the
related financed vehicle is at risk. Repossessions are generally conducted by
third parties who are engaged in the business of repossessing vehicles for
secured parties. After repossession, the obligor generally has 10 to 30 days to
redeem the recreational vehicle before the recreational vehicle is resold. CITSF
uses site auctions, pool auctions, individual bids, brokers, retail sale
outlets, newspaper advertisements and telemarketing for asset remarketing.
Decisions on the remarketing method are made by an internal remarketer based
upon recommendations from field personnel. CITSF will typically send a
recreational vehicle to auction before attempting a retail sale.
Losses may occur in connection with delinquent recreational vehicle loans
and can arise in several ways, including the inability to locate the
recreational vehicle or the obligor, because of a discharge of the obligor in a
bankruptcy proceeding, or because of depreciation of the related financed
vehicle. Generally, CITSF recognizes some losses on recreational vehicle loans
when the loan is 180 days past due or when the related financed vehicle is
repossessed. Recreational Vehicle Loans are generally charged off when CITSF has
received all amounts that it expects to recover upon disposition or sale of the
related financed vehicle. The charge-off decision with respect to the
Receivables will be subject to the Servicer's discretion, except that CFMC has
the right to approve charge-offs in certain circumstances described in the
Servicing Transfer Agreements. See 'Description of the Transfer and Servicing
Agreements--Servicing and Insurance Procedures.' Upon charge- off, receivables
are routed to a recovery collector who, as appropriate, may assign the loan to a
collection agency or an attorney, and any deficiency remaining will be pursued
to the extent deemed practical and to the extent permitted by law and the
Servicing Transfer Agreements. The loss recognition and collection policies and
practices of the Servicer may change over time in accordance with CITSF's
business judgment; provided, that any such change applicable to the Receivables
that would have a material effect on the collectibility of the Receivables may
not be made without CFMC's
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consent. Under Chase RV Finance's loss recognition policies, losses on
Recreational Vehicle Loans were recognized upon repossession of the related
financed vehicle and all Recreational Vehicle Loans were required to be charged
off no later than when 240 days past due.
CITSF may, on a case-by-case basis, permit extensions with respect to the
Due Dates of payments on Receivables and other modifications of Receivables in
accordance with its normal and customary servicing practices and procedures, as
described more fully in 'Description of the Transfer and Servicing
Agreements--Modification of Receivables' herein. The extension policies of CITSF
may be changed over time in accordance with CITSF's business judgment, provided,
that any such change applicable to the Receivables that would have a material
effect on the collectibility of the Receivables may not be made without CFMC's
consent.
USE OF PROCEEDS
As consideration of the transfer of the Receivables to the Trust, the Trust
will issue the Notes and the Certificates to the Sellers, with (i) Chase
receiving 87.17% of the original principal amount of each class of Notes and the
original Certificate Balance and (ii) Chase USA receiving 12.83% of the original
principal amount of each class of Notes and the original Certificate Balance.
After the deposit of the Reserve Account Initial Deposit and the deduction of
estimated expenses, the net proceeds to be received by the Sellers from the sale
of the Securities will be added to their respective general funds.
WEIGHTED AVERAGE LIFE OF THE SECURITIES
GENERAL
The weighted average life of the Notes and the Certificates will generally
be influenced by the rate at which the principal balances of the Receivables are
paid, which payment may be in the form of scheduled amortization or prepayments.
For this purpose, the term 'PREPAYMENTS' includes prepayments in full, partial
prepayments, liquidations due to default, as well as receipts of proceeds from
theft and physical damage, credit life and credit disability insurance policies
covering the Financed Vehicles and amounts received in connection with certain
other Receivables repurchased by a Seller or purchased by the Servicer for
administrative reasons. The Receivables are prepayable by the Obligors at any
time.
The rate of prepayments on the Receivables may be influenced by a variety
of economic, social and other factors, including the fact that an Obligor may
not sell or transfer the Financed Vehicle securing a Receivable without the
Servicer's consent. The rate of prepayment of the Receivables may also be
influenced by programs offered by lenders (including the Sellers, the Servicer
and their respective affiliates) that solicit or make available credit that may
be used by Obligors to prepay the Receivables. Such credit includes but is not
limited to home equity lines of credit, consumer installment credit and credit
cards offered by lenders (including the Sellers, the Servicer and their
respective affiliates). The Sellers, the Servicer and their respective
affiliates may, in the ordinary course of business, offer general or targeted
solicitations for such extensions of credit, and such solicitations may be sent,
to Obligors. In addition, the Sale and Servicing Agreement permits the Servicer
to refinance an existing Receivable for an Obligor, so long as the proceeds of
such refinanced loan would be used to prepay such existing Receivable in full
and any such refinanced loan is evidenced by a new promissory note. Any such
loan thus created by a refinancing would not be the property of the Trust. See
'Description of the Transfer and Servicing Agreements--Termination' herein
regarding the Servicer's option to purchase the Receivables from the Trust.
In light of the above considerations, there can be no assurance as to the
amount of principal payments to be made on the Securities on each Distribution
Date since such amount will depend, in part, on the amount of principal
collected on the Receivables Pool during the applicable Collection Period. Any
reinvestment risks resulting from a faster or slower incidence of prepayment of
Receivables will be borne entirely by the Securityholders.
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No principal payments will be made on any class of Notes until all Notes
with preceding class designations have been paid in full. For example, no
principal payments will be made on the Class A-2 Notes until the Class A-1 Notes
have been paid in full, and no principal payments will be made on the Class A-3
Notes until the Class A-2 Notes have been paid in full. In addition, no
principal payments on the Certificates will be made until the Notes have been
paid in full. See 'Description of the Notes-- Payments of Principal' and
'Description of the Certificates--Distributions of Principal Payments' herein.
As the rate of payment of principal of each class of Notes and the Certificates
depends primarily on the rate of payment (including prepayments) of the
Principal Balances of the Receivables, final payment of any class of the Notes
and the final distribution in respect of the Certificates could occur
significantly earlier than their respective Note Final Scheduled Distribution
Dates or the Certificate Final Scheduled Distribution Date. It is expected that
final payment of the Notes and the final distribution in respect of the
Certificates will occur on or prior to the related Note Final Scheduled
Distribution Date or the Certificate Final Scheduled Distribution Date. However,
if sufficient funds are not available to pay the Notes or the Certificates in
full on or prior to the related Note Final Scheduled Distribution Date or the
Certificate Final Scheduled Distribution Date, final payment of the Notes and
the final distribution in respect of the Certificates could occur later than
such date. Securityholders will bear the risk of being able to reinvest
principal payments of the Securities at yields at least equal to the Interest
Rate or the Certificate Rate, as applicable.
With respect to the Receivables that are Simple Interest Receivables and,
to the extent that payments of the fixed monthly installments thereunder are
received prior to the scheduled due dates for such installments, the portions of
such installments allocable to interest will be less that they would be if the
payments were received as scheduled. If the Reserve Account is exhausted and
losses on the Receivables occur, the amount of interest distributed to the
Securityholders may be less than described above.
If an Event of Default occurs and the Notes are accelerated, the
Certificateholders will not be entitled to receive any distributions in respect
of their Certificates until the Notes have been paid in full.
Subject to the conditions set forth herein under the heading 'Description
of the Transfer and Servicing Agreements--Servicing and Insurance Procedures,'
the Servicer may reschedule the Due Date of any scheduled payment. Any such
deferrals will have the effect of increasing the weighted average life of the
Notes and Certificates. However, the Servicer will not be permitted to grant any
such deferral or extension if, as a result, the final scheduled payment on a
Receivable would fall after the Final Scheduled Maturity Date, unless the
Servicer purchases such Receivable.
PAID-AHEAD SIMPLE INTEREST RECEIVABLES
If an Obligor with respect to any Simple Interest Receivable, in addition
to making his or her regularly scheduled payment, makes one or more additional
scheduled payments in any Collection Period (for example, because the Obligor
intends to be on vacation the following month), the additional scheduled
payments made in such Collection Period will be treated as a principal
prepayment and applied to reduce the principal balance of the related Receivable
in such Collection Period and, unless otherwise requested by the Obligor, the
Obligor will not be required to make any scheduled payment in respect of such
Receivable (a 'PAID-AHEAD SIMPLE INTEREST RECEIVABLE') for the number of Due
Dates corresponding to the number of such additional scheduled payments (the
'PAID-AHEAD PERIOD'). During the Paid-Ahead Period, interest will continue to
accrue on the Principal Balance of such Paid-Ahead Simple Interest Receivable,
as reduced by the application of the additional scheduled payments made in the
Collection Period in which such Receivable was paid-ahead. The Obligor's
Receivable will not be considered delinquent during the Paid-Ahead Period. A
Payment Shortfall with respect to a Paid-Ahead Simple Interest Receivable will
exist during each Collection Period occurring during the Paid-Ahead Period, and
the Servicer may be required to make a Monthly Advance in respect of such
Payment Shortfall, as described under 'Description of the Transfer and Servicing
Agreements--Monthly Advances' herein; provided, that no Monthly Advances will be
made in respect of principal of a Paid-Ahead Simple Interest Receivable.
37
<PAGE>
When the Obligor resumes his required payments following the Paid-Ahead
Period, the payments so paid may be insufficient to cover the interest that has
accrued since the last payment by the Obligor. Notwithstanding such
insufficiency, the Obligor's Paid-Ahead Simple Interest Receivable would be
considered current. This situation will continue until the regularly scheduled
payments are once again sufficient to cover all accrued interest and to reduce
the Principal Balance of the Paid-Ahead Simple Interest Receivable. Depending on
the Principal Balance and the Contract Rate of the related Receivable, and on
the number of payments that were paid-ahead, there may be extended periods of
time during which Receivables that are current are not amortizing.
Paid-Ahead Simple Interest Receivables will affect the weighted average
life of the Securities. The distribution of the paid-ahead amount on the
Distribution Date following the Collection Period in which such amount was
received will generally shorten the weighted average life of the Securities. In
addition, to the extent the Servicer makes Monthly Advances with respect to a
Paid-Ahead Simple Interest Receivable which subsequently goes into default,
because liquidation proceeds with respect to such Receivable will be applied
first to reimburse the Servicer for such Monthly Advances, the loss with respect
to such Receivable may be larger than would have been the case had such Monthly
Advances not been made.
As of the Cutoff Date, approximately 25% of the number of Receivables were
Paid-Ahead Simple Interest Receivables with at least one scheduled monthly
payment having been paid-ahead. The Chase RV Finance Portfolio has historically
included Recreational Vehicle Loans which have been paid-ahead by one or more
scheduled monthly payments. There can be no assurance as to the number of
Receivables which may become Paid-Ahead Simple Interest Receivables or the
number or the principal amount of the scheduled payments which may be
paid-ahead.
If an Obligor with respect to any Precomputed Receivable, in addition to
making his or her regularly scheduled payment, makes one or more additional
scheduled payments in any Collection Period for similar reasons (such Receivable
being a 'PAID-AHEAD PRECOMPUTED RECEIVABLE'), the Paid-Ahead Amounts will be
deposited into an account in the name of the Indenture Trustee (the 'PAID-AHEAD
ACCOUNT') or the Collection Account and applied on subsequent Deposit Dates as
described herein under 'Description of the Transfer and Servicing
Agreements-Paid-Ahead Precomputed Receivables.' Because Paid-Ahead Amounts on
Paid-Ahead Precomputed Receivables are not deposited into the Collection Account
and distributed to Securityholders until the Deposit Date and Distribution Date,
respectively, related to the Collection Period during which any such scheduled
payment was due, no shortfalls of interest or principal will result therefrom.
Chase RV Finance maintains certain records of the historical prepayment
experience of the Chase RV Finance Portfolio. The Sellers believe that such
records are not adequate to provide meaningful information with respect to the
Receivables. In any event, no assurance can be given that prepayments on the
Receivables would conform to any historical experience, and no prediction can be
made as to the actual prepayment experience to be expected with respect to the
Receivables.
ABS TABLES
Prepayments on Recreational Vehicle Loans can be measured relative to a
prepayment standard or model. The model used in this Prospectus is the Absolute
Prepayment Model ('ABS'). ABS assumes that all the Receivables are the same size
and amortize at the same rate and that each Receivable in each month of its life
will either be paid as scheduled or be prepaid in full. For example, in a pool
of receivables originally containing 10,000 receivables, a 1% ABS rate means
that 100 receivables prepay each month. The ABS prepayment model, like any
prepayment model, does not purport to be either an historical description of
prepayment experience or a prediction of the anticipated rate of prepayment.
The tables captioned 'Percent of Initial Note Principal Balance at Various
ABS Percentages' and 'Percent of Initial Certificate Balance at Various ABS
Percentages' (each an 'ABS TABLE') have been prepared on the basis of the
characteristics of the Receivables. Each ABS Table assumes that (a) the
Receivables prepay in full at the specified constant percentage of ABS monthly,
with no defaults,
38
<PAGE>
losses or repurchases, (b) each scheduled monthly payment on the Receivables is
made on the last day of each month and each month has 30 days, (c) payments on
the Notes and distributions on the Certificates are made on each Distribution
Date (and each such date is assumed to be the 15th day of each applicable
month), (d) the balance in the Reserve Account on each Distribution Date is
equal to the Specified Reserve Account Balance, and (e) the Servicer does not
exercise its option to purchase the Receivables. The Receivables Pool has an
assumed cutoff date of the Cutoff Date. The ABS Tables indicate the projected
weighted average life of each class of Notes and the Certificates and set forth
the percent of the initial principal amount of each class of Notes and the
percent of the initial Certificate Balance, as applicable, that is projected to
be outstanding after each of the Distribution Dates or each September 15, as
indicated, at various ABS percentages.
The tables also assume that the Receivables have been aggregated into five
hypothetical pools with all of the Receivables within each such pool having the
following characteristics:
<TABLE>
<CAPTION>
WEIGHTED WEIGHTED
AVERAGE AVERAGE
AGGREGATE WEIGHTED ORIGINAL REMAINING
PRINCIPAL AVERAGE TERM TERM
POOL BALANCE CONTRACT RATE IN MONTHS IN MONTHS
- --------------------------------------------------- --------------- ------------- --------- ---------
<S> <C> <C> <C> <C>
1.................................................. $115,996,183.21 10.41% 125 60
2.................................................. 88,358,662.53 10.26% 155 98
3.................................................. 185,740,182.09 9.12% 175 123
4.................................................. 260,864,247.00 8.88% 179 144
5.................................................. 246,436,010.71 9.05% 180 166
---------------
$897,395,285.54
</TABLE>
The information included in the following tables represents forward-looking
statements and involves risks and uncertainties that could cause actual results
to differ materially from those in the forward-looking statements. The actual
characteristics and performance of the Receivables will differ from the
assumptions used in constructing each 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 Receivables will prepay at a constant
level of prepayment until maturity or that all of the Receivables will prepay at
the same level of ABS. Moreover, the diverse terms of the Receivables within
each of the five hypothetical pools could produce slower or faster principal
distributions than indicated in each ABS Table at the various constant
percentages of ABS specified, even if the original and remaining terms to
maturity of the Receivables are as assumed. Any difference between such
assumptions and the actual characteristics and performance of the Receivables,
or actual prepayment experience, will affect the percentages of initial balances
outstanding over time and the weighted average lives of each class of Notes and
the Certificates.
39
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-1 NOTES
--------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
--------------------------------------------------------------------
0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date.................................. 100 100 100 100 100 100 100 100
September 15, 1998............................ 0 0 0 0 0 0 0 0
September 15, 1999............................ 0 0 0 0 0 0 0 0
September 15, 2000............................ 0 0 0 0 0 0 0 0
September 15, 2001............................ 0 0 0 0 0 0 0 0
September 15, 2002............................ 0 0 0 0 0 0 0 0
September 15, 2003............................ 0 0 0 0 0 0 0 0
September 15, 2004............................ 0 0 0 0 0 0 0 0
September 15, 2005............................ 0 0 0 0 0 0 0 0
September 15, 2006............................ 0 0 0 0 0 0 0 0
September 15, 2007............................ 0 0 0 0 0 0 0 0
September 15, 2008............................ 0 0 0 0 0 0 0 0
September 15, 2009............................ 0 0 0 0 0 0 0 0
September 15, 2010............................ 0 0 0 0 0 0 0 0
September 15, 2011............................ 0 0 0 0 0 0 0 0
September 15, 2012............................ 0 0 0 0 0 0 0 0
Weighted Average Life (years)(1).............. 0.52 0.26 0.19 0.16 0.14 0.12 0.09 0.06
</TABLE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-2 NOTES
--------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
--------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date.................................. 100 100 100 100 100 100 100 100
September 15, 1998............................ 100 47 8 0 0 0 0 0
September 15, 1999............................ 45 0 0 0 0 0 0 0
September 15, 2000............................ 0 0 0 0 0 0 0 0
September 15, 2001............................ 0 0 0 0 0 0 0 0
September 15, 2002............................ 0 0 0 0 0 0 0 0
September 15, 2003............................ 0 0 0 0 0 0 0 0
September 15, 2004............................ 0 0 0 0 0 0 0 0
September 15, 2005............................ 0 0 0 0 0 0 0 0
September 15, 2006............................ 0 0 0 0 0 0 0 0
September 15, 2007............................ 0 0 0 0 0 0 0 0
September 15, 2008............................ 0 0 0 0 0 0 0 0
September 15, 2009............................ 0 0 0 0 0 0 0 0
September 15, 2010............................ 0 0 0 0 0 0 0 0
September 15, 2011............................ 0 0 0 0 0 0 0 0
September 15, 2012............................ 0 0 0 0 0 0 0 0
Weighted Average Life (years)(1).............. 1.91 0.99 0.71 0.58 0.50 0.43 0.33 0.10
</TABLE>
- ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
40
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-3 NOTES
--------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
--------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date.................................. 100 100 100 100 100 100 100 100
September 15, 1998............................ 100 100 100 75 47 13 0 0
September 15, 1999............................ 100 45 0 0 0 0 0 0
September 15, 2000............................ 83 0 0 0 0 0 0 0
September 15, 2001............................ 13 0 0 0 0 0 0 0
September 15, 2002............................ 0 0 0 0 0 0 0 0
September 15, 2003............................ 0 0 0 0 0 0 0 0
September 15, 2004............................ 0 0 0 0 0 0 0 0
September 15, 2005............................ 0 0 0 0 0 0 0 0
September 15, 2006............................ 0 0 0 0 0 0 0 0
September 15, 2007............................ 0 0 0 0 0 0 0 0
September 15, 2008............................ 0 0 0 0 0 0 0 0
September 15, 2009............................ 0 0 0 0 0 0 0 0
September 15, 2010............................ 0 0 0 0 0 0 0 0
September 15, 2011............................ 0 0 0 0 0 0 0 0
September 15, 2012............................ 0 0 0 0 0 0 0 0
Weighted Average Life (years)(1).............. 3.49 1.97 1.43 1.16 1.00 0.85 0.64 0.28
</TABLE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-4 NOTES
--------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
--------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date.................................. 100 100 100 100 100 100 100 100
September 15, 1998............................ 100 100 100 100 100 100 1 0
September 15, 1999............................ 100 100 53 0 0 0 0 0
September 15, 2000............................ 100 16 0 0 0 0 0 0
September 15, 2001............................ 100 0 0 0 0 0 0 0
September 15, 2002............................ 1 0 0 0 0 0 0 0
September 15, 2003............................ 0 0 0 0 0 0 0 0
September 15, 2004............................ 0 0 0 0 0 0 0 0
September 15, 2005............................ 0 0 0 0 0 0 0 0
September 15, 2006............................ 0 0 0 0 0 0 0 0
September 15, 2007............................ 0 0 0 0 0 0 0 0
September 15, 2008............................ 0 0 0 0 0 0 0 0
September 15, 2009............................ 0 0 0 0 0 0 0 0
September 15, 2010............................ 0 0 0 0 0 0 0 0
September 15, 2011............................ 0 0 0 0 0 0 0 0
September 15, 2012............................ 0 0 0 0 0 0 0 0
Weighted Average Life (years)(1).............. 4.61 2.79 2.03 1.65 1.42 1.21 0.91 0.49
</TABLE>
- ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
41
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-5 NOTES
--------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
--------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date.................................. 100 100 100 100 100 100 100 100
September 15, 1998............................ 100 100 100 100 100 100 100 0
September 15, 1999............................ 100 100 100 78 36 0 0 0
September 15, 2000............................ 100 100 23 0 0 0 0 0
September 15, 2001............................ 100 28 0 0 0 0 0 0
September 15, 2002............................ 100 0 0 0 0 0 0 0
September 15, 2003............................ 51 0 0 0 0 0 0 0
September 15, 2004............................ 0 0 0 0 0 0 0 0
September 15, 2005............................ 0 0 0 0 0 0 0 0
September 15, 2006............................ 0 0 0 0 0 0 0 0
September 15, 2007............................ 0 0 0 0 0 0 0 0
September 15, 2008............................ 0 0 0 0 0 0 0 0
September 15, 2009............................ 0 0 0 0 0 0 0 0
September 15, 2010............................ 0 0 0 0 0 0 0 0
September 15, 2011............................ 0 0 0 0 0 0 0 0
September 15, 2012............................ 0 0 0 0 0 0 0 0
Weighted Average Life (years)................. 6.02 3.74 2.75 2.24 1.92 1.63 1.23 0.73
</TABLE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-6 NOTES
--------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
--------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- ---------------------------------------------- ----- ----- ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date.................................. 100 100 100 100 100 100 100 100
September 15, 1998............................ 100 100 100 100 100 100 100 64
September 15, 1999............................ 100 100 100 100 100 75 0 0
September 15, 2000............................ 100 100 100 33 0 0 0 0
September 15, 2001............................ 100 100 0 0 0 0 0 0
September 15, 2002............................ 100 31 0 0 0 0 0 0
September 15, 2003............................ 100 0 0 0 0 0 0 0
September 15, 2004............................ 96 0 0 0 0 0 0 0
September 15, 2005............................ 8 0 0 0 0 0 0 0
September 15, 2006............................ 0 0 0 0 0 0 0 0
September 15, 2007............................ 0 0 0 0 0 0 0 0
September 15, 2008............................ 0 0 0 0 0 0 0 0
September 15, 2009............................ 0 0 0 0 0 0 0 0
September 15, 2010............................ 0 0 0 0 0 0 0 0
September 15, 2011............................ 0 0 0 0 0 0 0 0
September 15, 2012............................ 0 0 0 0 0 0 0 0
Weighted Average Life (years)................. 7.54 4.85 3.60 2.92 2.50 2.12 1.65 1.05
</TABLE>
- ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
42
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-7 NOTES
------------------------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
------------------------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- --------------------------------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date..................... 100 100 100 100 100 100 100 100
September 15, 1998............... 100 100 100 100 100 100 100 100
September 15, 1999............... 100 100 100 100 100 100 37 0
September 15, 2000............... 100 100 100 100 25 0 0 0
September 15, 2001............... 100 100 91 0 0 0 0 0
September 15, 2002............... 100 100 0 0 0 0 0 0
September 15, 2003............... 100 17 0 0 0 0 0 0
September 15, 2004............... 100 0 0 0 0 0 0 0
September 15, 2005............... 100 0 0 0 0 0 0 0
September 15, 2006............... 0 0 0 0 0 0 0 0
September 15, 2007............... 0 0 0 0 0 0 0 0
September 15, 2008............... 0 0 0 0 0 0 0 0
September 15, 2009............... 0 0 0 0 0 0 0 0
September 15, 2010............... 0 0 0 0 0 0 0 0
September 15, 2011............... 0 0 0 0 0 0 0 0
September 15, 2012............... 0 0 0 0 0 0 0 0
Weighted Average Life
(years)(1)..................... 8.50 5.76 4.23 3.42 2.93 2.51 1.98 1.34
</TABLE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-8 NOTES
------------------------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
------------------------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- --------------------------------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date..................... 100 100 100 100 100 100 100 100
September 15, 1998............... 100 100 100 100 100 100 100 100
September 15, 1999............... 100 100 100 100 100 100 100 11
September 15, 2000............... 100 100 100 100 100 39 0 0
September 15, 2001............... 100 100 100 44 0 0 0 0
September 15, 2002............... 100 100 41 0 0 0 0 0
September 15, 2003............... 100 100 0 0 0 0 0 0
September 15, 2004............... 100 32 0 0 0 0 0 0
September 15, 2005............... 100 0 0 0 0 0 0 0
September 15, 2006............... 91 0 0 0 0 0 0 0
September 15, 2007............... 2 0 0 0 0 0 0 0
September 15, 2008............... 0 0 0 0 0 0 0 0
September 15, 2009............... 0 0 0 0 0 0 0 0
September 15, 2010............... 0 0 0 0 0 0 0 0
September 15, 2011............... 0 0 0 0 0 0 0 0
September 15, 2012............... 0 0 0 0 0 0 0 0
Weighted Average Life
(years)(1)..................... 9.48 6.79 4.94 3.98 3.42 2.95 2.40 1.80
</TABLE>
- ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
43
<PAGE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-9 NOTES
------------------------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
------------------------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- --------------------------------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date..................... 100 100 100 100 100 100 100 100
September 15, 1998............... 100 100 100 100 100 100 100 100
September 15, 1999............... 100 100 100 100 100 100 100 100
September 15, 2000............... 100 100 100 100 100 100 52 0
September 15, 2001............... 100 100 100 100 54 0 0 0
September 15, 2002............... 100 100 100 3 0 0 0 0
September 15, 2003............... 100 100 27 0 0 0 0 0
September 15, 2004............... 100 100 0 0 0 0 0 0
September 15, 2005............... 100 48 0 0 0 0 0 0
September 15, 2006............... 100 0 0 0 0 0 0 0
September 15, 2007............... 100 0 0 0 0 0 0 0
September 15, 2008............... 3 0 0 0 0 0 0 0
September 15, 2009............... 0 0 0 0 0 0 0 0
September 15, 2010............... 0 0 0 0 0 0 0 0
September 15, 2011............... 0 0 0 0 0 0 0 0
September 15, 2012............... 0 0 0 0 0 0 0 0
Weighted Average Life
(years)(1)..................... 10.51 8.00 5.83 4.67 4.07 3.60 3.03 2.28
</TABLE>
PERCENT OF INITIAL NOTE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CLASS A-10 NOTES
------------------------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
------------------------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- --------------------------------- ------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date..................... 100 100 100 100 100 100 100 100
September 15, 1998............... 100 100 100 100 100 100 100 100
September 15, 1999............... 100 100 100 100 100 100 100 100
September 15, 2000............... 100 100 100 100 100 100 100 36
September 15, 2001............... 100 100 100 100 100 93 16 0
September 15, 2002............... 100 100 100 100 41 0 0 0
September 15, 2003............... 100 100 100 14 0 0 0 0
September 15, 2004............... 100 100 35 0 0 0 0 0
September 15, 2005............... 100 100 0 0 0 0 0 0
September 15, 2006............... 100 73 0 0 0 0 0 0
September 15, 2007............... 100 15 0 0 0 0 0 0
September 15, 2008............... 100 0 0 0 0 0 0 0
September 15, 2009............... 12 0 0 0 0 0 0 0
September 15, 2010............... 0 0 0 0 0 0 0 0
September 15, 2011............... 0 0 0 0 0 0 0 0
September 15, 2012............... 0 0 0 0 0 0 0 0
Weighted Average Life
(years)(1)..................... 11.61 9.41 6.85 5.60 4.93 4.37 3.69 2.89
</TABLE>
- ------------------
(1) The weighted average life of a Note is determined by (i) multiplying the
amount of each principal payment of such Note by the number of years from
the date of the issuance of such Note to the Distribution Date on which such
principal payment is made, (ii) adding the results and (iii) dividing the
sum by the initial principal balance of such Note.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
44
<PAGE>
PERCENT OF INITIAL CERTIFICATE PRINCIPAL BALANCE AT VARIOUS ABS PERCENTAGES
<TABLE>
<CAPTION>
CERTIFICATES
----------------------------------------------------------------------
ASSUMED ABS PERCENTAGE
----------------------------------------------------------------------
DISTRIBUTION DATES 0.00% 0.50% 0.75% 0.90% 1.00% 1.10% 1.25% 1.50%
- -------------------------------------------- ------ ------ ----- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date................................ 100 100 100 100 100 100 100 100
September 15, 1998.......................... 100 100 100 100 100 100 100 100
September 15, 1999.......................... 100 100 100 100 100 100 100 100
September 15, 2000.......................... 100 100 100 100 100 100 100 100
September 15, 2001.......................... 100 100 100 100 100 100 100 40
September 15, 2002.......................... 100 100 100 100 100 93 38 0
September 15, 2003.......................... 100 100 100 100 64 25 0 0
September 15, 2004.......................... 100 100 100 48 8 0 0 0
September 15, 2005.......................... 100 100 68 4 0 0 0 0
September 15, 2006.......................... 100 100 26 0 0 0 0 0
September 15, 2007.......................... 100 100 0 0 0 0 0 0
September 15, 2008.......................... 100 65 0 0 0 0 0 0
September 15, 2009.......................... 100 26 0 0 0 0 0 0
September 15, 2010.......................... 56 9 0 0 0 0 0 0
September 15, 2011.......................... 0 0 0 0 0 0 0 0
September 15, 2012.......................... 0 0 0 0 0 0 0 0
Weighted Average Life (years)(1)............ 13.09 11.55 8.50 7.02 6.26 5.64 4.88 3.93
</TABLE>
- ------------------
(1) The weighted average life of the Certificates is determined by (i)
multiplying the amount of each principal payment on the Certificates by the
number of years from the date of the issuance of the Certificates to the
Distribution Date on which such principal payment is made, (ii) adding the
results and (iii) dividing the sum by the initial Certificate Balance.
THE ABS TABLES HAVE BEEN PREPARED BASED ON THE ASSUMPTIONS DESCRIBED ABOVE
(INCLUDING THE ASSUMPTIONS REGARDING THE CHARACTERISTICS AND PERFORMANCE OF THE
RECEIVABLES WHICH WILL DIFFER FROM THE ACTUAL CHARACTERISTICS AND PERFORMANCE
THEREOF) AND SHOULD BE READ IN CONJUNCTION THEREWITH.
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POOL FACTORS AND TRADING INFORMATION
The 'NOTE POOL FACTOR' for each class of Notes will be an eight-digit
decimal that the Servicer will compute prior to each distribution with respect
to such class of Notes expressing the remaining outstanding principal balance of
such class of Notes, as of the applicable Distribution Date (after giving effect
to payments to be made on such Distribution Date), as a fraction of the initial
outstanding principal balance of such class of Notes. The 'CERTIFICATE POOL
FACTOR' for the Certificates will be an eight-digit decimal that the Servicer
will compute prior to each distribution with respect to the Certificates
expressing the remaining Certificate Balance, as of the applicable Distribution
Date (after giving effect to distributions to be made on such Distribution
Date), as a fraction of the initial Certificate Balance. Each Note Pool Factor
and the Certificate Pool Factor will be 1.00000000 as of the Cutoff Date and
thereafter will decline to reflect reductions in the outstanding principal
balance of the applicable class of Notes, or the reduction of the Certificate
Balance, as the case may be. A Noteholder's portion of the aggregate outstanding
principal balance of the related class of Notes is the product of (i) the
original denomination of such Noteholder's Note and (ii) the applicable Note
Pool Factor. A Certificateholder's portion of the aggregate outstanding
Certificate Balance is the product of (a) the original denomination of such
Certificateholder's Certificate and (b) the Certificate Pool Factor.
The Paying Agent will send to Securityholders monthly reports concerning
payments received on the Receivables, the Pool Balance, the Certificate Pool
Factor or each Note Pool Factor, as applicable, and various other items of
information specified herein. In addition, the Applicable Trustee or the Paying
Agent will furnish to Securityholders of record during any calendar year any
information for tax reporting purposes as required by law not later than the
latest date permitted by law. See 'Certain Information Regarding the
Securities--Reports to Securityholders' herein.
DESCRIPTION OF THE NOTES
GENERAL
The Notes will be issued pursuant to the terms of the Indenture
substantially in the form of the Indenture filed as an exhibit to the
Registration Statement of which this Prospectus forms a part. The following, as
well as other pertinent information included elsewhere herein, summarizes the
material terms of the Notes and the Indenture. The summary does not purport to
be complete and is subject to, and is qualified in its entirety by reference to,
all of the provisions of the Notes and the Indenture. Norwest Bank Minnesota,
National Association, a national banking corporation with its corporate trust
offices located at Norwest Center, Sixth Street and Marquette Avenue,
Minneapolis, Minnesota 55479-0070, will be the Indenture Trustee under the
Indenture. In the ordinary course of its business, the Indenture Trustee and its
affiliates have engaged and may in the future engage in commercial banking or
financial advisory transactions with the Sellers, the Servicer and their
respective affiliates.
PAYMENTS OF INTEREST
Interest on the outstanding principal amount of each class of Notes will
accrue at the applicable Interest Rate specified on the cover page hereof and
will be payable to the Noteholders of record monthly on each Distribution Date,
commencing October 15, 1997. Interest on the outstanding principal amount of
each class of Notes will accrue at the applicable Interest Rate for each
Interest Accrual Period and shall be calculated on the basis of a 360-day year
based on the actual number of days with respect to the Class A-1 Notes, and on
the basis of a 360-day year of twelve 30-day months with respect to all other
classes of Notes. Interest payments on the Notes will generally be derived from
the Available Amount after payment of the Servicer Payment and from amounts, if
any, on deposit in the Reserve Account. See 'Description of the Transfer and
Servicing Agreements--Distributions' and '--Subordination of the Certificates;
Reserve Account' herein.
Interest payments to all classes of Noteholders will have the same
priority. Under certain circumstances, the amount available for interest
payments on the Notes could be less than the amount of interest payable on the
Notes on any Distribution Date, in which case each class of Noteholders will
receive their ratable share (based upon the aggregate amount of interest due to
such class of Noteholders) of the aggregate amount available to be distributed
in respect of interest on the Notes.
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<PAGE>
PAYMENTS OF PRINCIPAL
Principal payments will be made to the Noteholders on each Distribution
Date in an amount generally equal to the Noteholders' Principal Distributable
Amount. Principal payments on the Notes will generally be derived from the
remaining Available Amount after payment of the Servicing Payment, the deposit
of the Noteholders' Interest Distributable Amount into the Note Distribution
Account and the deposit of the Certificateholders' Interest Distributable Amount
into the Certificate Distribution Account, and from amounts, if any, on deposit
in the Reserve Account.
On each Distribution Date, principal payments on the Notes, to the extent
of the Noteholders' Principal Distributable Amount, will be applied in the
following order of priority: (i) to the principal balance of the Class A-1 Notes
until the principal balance of the Class A-1 Notes is reduced to zero; (ii) to
the principal balance of the Class A-2 Notes until the principal balance of the
Class A-2 Notes is reduced to zero; (iii) to the principal balance of the Class
A-3 Notes until the principal balance of the Class A-3 Notes is reduced to zero;
(iv) to the principal balance of the Class A-4 Notes until the principal balance
of the Class A-4 Notes is reduced to zero; (v) to the principal balance of the
Class A-5 Notes until the principal balance of the Class A-5 Notes is reduced to
zero; (vi) to the principal balance of the Class A-6 Notes until the principal
balance of the Class A-6 Notes is reduced to zero; (vii) to the principal
balance of the Class A-7 Notes until the principal balance of the Class A-7
Notes is reduced to zero; (viii) to the principal balance of the Class A-8 Notes
until the principal balance of the Class A-8 Notes is reduced to zero; (ix) to
the principal balance of the Class A-9 Notes until the principal balance of the
Class A-9 Notes is reduced to zero; and (x) to the principal balance of the
Class A-10 Notes until the principal balance of the Class A-10 Notes is reduced
to zero. Notwithstanding the foregoing, if an Event of Default occurs and the
Notes are accelerated, the Noteholders' Principal Distributable Amount shall be
applied to the repayment of principal on each class of Notes pro rata on the
basis of their respective unpaid principal amounts. The principal balance of
each class of Notes, to the extent not previously paid, will be due on the Note
Final Scheduled Distribution Date with respect to such class specified on the
cover page hereof. The actual date on which the aggregate outstanding principal
amount of any class of Notes is paid may be earlier than the applicable Note
Final Scheduled Distribution Date based on a variety of factors, including those
described under 'Weighted Average Life of the Securities' herein.
THE INDENTURE
Modification of Indenture. The Trust and the Indenture Trustee may, with
the consent of the Noteholders representing not less than a majority of the
aggregate principal amount of the Notes then outstanding, execute a supplemental
indenture to add provisions to, change in any manner or eliminate any provisions
of, the Indenture, or modify (except as provided below) in any manner the rights
of the Noteholders.
Without the consent of the holder of each outstanding Note affected
thereby, no supplemental indenture will: (i) change the date of payment of any
installment of principal of or interest on any such Note or reduce the principal
amount thereof, the Interest Rate specified thereon or the redemption price with
respect thereto or change any place of payment where, or the coin or currency in
which, any such Note or any interest thereon is payable; (ii) impair the right
to institute suit for the enforcement of certain provisions of the Indenture
regarding payment; (iii) reduce the percentage of the aggregate principal amount
of the outstanding Notes, the consent of the Noteholders of which is required
(a) for any such supplemental indenture or (b) for any waiver of compliance with
certain provisions of the Indenture or of certain defaults thereunder and their
consequences as provided for in the Indenture; (iv) modify or alter the
provisions of the Indenture regarding the voting of Notes held by the Trust, any
other obligor on such Notes, the Sellers or an affiliate of any of them; (v)
reduce the percentage of the aggregate outstanding principal amount of such
Notes required to direct the Indenture Trustee to sell or liquidate the
Receivables, the consent of the Noteholders of which is required if the proceeds
of such sale or liquidation would be insufficient to pay the principal amount
and accrued but unpaid interest on the outstanding Notes; (vi) decrease the
percentage of the aggregate principal amount of the Notes required to amend the
sections of the Indenture that specify the applicable percentage of aggregate
principal amount of the Notes necessary to amend the Indenture or certain other
related
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<PAGE>
agreements; (vii) modify any provisions of the Indenture in such a manner as to
affect the calculation of the amount of any payment of interest or principal due
on any Note on any Distribution Date (including the calculation of any of the
individual components of such calculation); or (viii) permit the creation of any
lien ranking prior to or on a parity with the lien of the Indenture with respect
to any of the collateral for the Notes or, except as otherwise permitted or
contemplated in the Indenture, terminate the lien of the Indenture on any such
collateral or deprive the holder of any Note of the security afforded by the
lien of the Indenture.
The Trust and the Indenture Trustee may also enter into supplemental
indentures, without obtaining the consent of the Noteholders, for the purpose
of, among other things, adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture or modifying in any manner
the rights of the Noteholders; provided that such action will not materially
adversely affect the interest of any such Noteholder.
In addition to the foregoing limitations on executing supplemental
indentures, the Issuer will covenant in the Sale and Servicing Agreement not to
execute any supplemental indentures without the prior written consent of CITSF,
as Administrator.
Events of Default; Rights Upon Event of Default. With respect to the
Notes, 'EVENTS OF DEFAULT' under the Indenture will consist of: (i) a default in
the payment of any interest on any such Note for a period of 5 days; (ii) a
default in the payment of the principal of or any installment of the principal
of any such Note when the same becomes due and payable; (iii) a default in the
observance or performance of any covenant or agreement of the Trust made in the
Indenture, which default materially adversely affects the rights of the
Noteholders and which default continues for a period of 30 days after written
notice thereof is given to the Trust by the Indenture Trustee or to the Trust
and the Indenture Trustee by the Noteholders representing not less than 25% of
the aggregate principal amount of the Notes then outstanding (or for such longer
period, not in excess of 90 days, as may be reasonably necessary to remedy such
default; provided that such default is capable of remedy within 90 days or
less); or (iv) certain events of bankruptcy, insolvency, receivership or
liquidation of the Trust. However, the amount of principal required to be paid
to Noteholders under the Indenture will generally be limited to the Principal
Distributable Amount (absent acceleration of the Notes). Therefore, the failure
to pay principal on a class of Notes on any Distribution Date generally will not
result in the occurrence of an Event of Default until the Note Final Scheduled
Distribution Date for such class of Notes.
If an Event of Default occurs and is continuing with respect to the Notes,
the Indenture Trustee or the Noteholders representing not less than a majority
of the aggregate principal amount of the Notes then outstanding may declare the
principal of the Notes to be immediately due and payable. Such declaration may,
under certain circumstances, be rescinded by the Noteholders representing not
less than a majority of the aggregate principal amount of such Notes then
outstanding.
If the Notes are declared to be due and payable following an Event of
Default with respect thereto, the Indenture Trustee may institute proceedings to
collect amounts due or foreclose on the Trust property, exercise remedies as a
secured party, sell the Receivables or elect to have the Trust maintain
possession of the Receivables and continue to apply collections on the
Receivables as if there had been no declaration of acceleration. However, the
Indenture Trustee is prohibited from selling the Receivables following an Event
of Default, unless (i) Noteholders representing 100% of the aggregate principal
amount of the Notes then outstanding consent to such sale, (ii) the proceeds of
such sale are sufficient to pay in full the principal of and the accrued
interest on the outstanding Notes and the Certificate Balance and accrued
interest on the Certificates, in each case at the date of such sale, or (iii)
there has been an Event of Default arising from a failure to make a required
payment of principal of or interest on any Notes, and the Indenture Trustee
determines that the proceeds of Receivables would not be sufficient on an
ongoing basis to make all payments on the Notes as such payments would have
become due if such obligations had not been declared due and payable, and the
Indenture Trustee obtains the consent of Noteholders representing not less than
66-2/3% of the aggregate principal amount of the Notes then outstanding.
If an Event of Default occurs and is continuing with respect to the Notes,
the Indenture Trustee will be under no obligation to exercise any of the rights
or powers under the Indenture at the request or
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<PAGE>
direction of any of the Noteholders if the Indenture Trustee reasonably believes
it will not be adequately indemnified against the costs, expenses and
liabilities that might be incurred by it in complying with such request. Subject
to the provisions for indemnification and certain limitations contained in the
Indenture, Noteholders representing not less than a majority of the aggregate
principal amount of the Notes then outstanding will have the right to direct the
time, method and place of conducting any proceeding or any remedy available to
the Indenture Trustee, and Noteholders representing not less than a majority of
the aggregate principal amount of the Notes then outstanding may, in certain
cases, waive any default with respect thereto, except a default in the payment
of principal or interest or a default in respect of a covenant or provision of
the Indenture that cannot be modified without the waiver or consent of
Noteholders representing 100% of the aggregate principal amount of the Notes
then outstanding.
No Noteholders will have the right to institute any proceeding with respect
to the Indenture unless (i) such holder has previously given written notice to
the Indenture Trustee of a continuing Event of Default, (ii) Noteholders
representing not less than 25% of the aggregate principal amount of the Notes
then outstanding have made written request to the Indenture Trustee to institute
such proceeding in its own name as Indenture Trustee, (iii) such Noteholder or
Noteholders have offered the Indenture Trustee indemnity reasonably satisfactory
to it against the costs, expenses and liabilities to be incurred in complying
with such request, (iv) the Indenture Trustee has for 60 days after receipt of
such notice, request and offer of indemnity failed to institute such proceeding,
and (v) no direction inconsistent with such written request has been given to
the Indenture Trustee during such 60-day period by Noteholders representing not
less than a majority of the aggregate principal amount of the Notes then
outstanding.
In addition, the Indenture Trustee and the Noteholders, by accepting the
Notes, will covenant that they will not at any time institute against the Trust
any bankruptcy, reorganization or other proceeding under any federal or state
bankruptcy or similar law.
With respect to the Trust, neither the Indenture Trustee nor the Owner
Trustee in its individual capacity, nor any holder of a Certificate representing
an ownership interest in the Trust nor any of their respective owners,
beneficiaries, agents, officers, directors, employees, affiliates, successors or
assigns will, in the absence of an express agreement to the contrary, be
personally liable for the payment of the principal of or interest on the Notes
or for the agreements of the Trust contained in the Indenture.
CERTAIN COVENANTS
The Indenture will provide that the Trust may not consolidate with or merge
into any other entity, unless (i) the entity formed by or surviving such
consolidation or merger is organized under the laws of the United States, any
state of the United States or the District of Columbia, (ii) such entity
expressly assumes the Trust's obligation to make due and punctual payments of
principal of and interest on the Notes and the performance or observance of
every agreement and covenant of the Trust under the Indenture, (iii) no Event of
Default shall have occurred and be continuing immediately after such merger or
consolidation, (iv) the Trust has been advised that no rating then in effect of
the Notes or the Certificates by any Rating Agency would be downgraded or
withdrawn as a result of such merger or consolidation, (v) such action as was
necessary to maintain the lien and security interest created by the Indenture
shall have been taken and (vi) the Trust has received an opinion of counsel to
the effect that such consolidation or merger would have no material adverse tax
consequence to the Trust or to any Noteholder or Certificateholder.
The Trust will not, among other things, (i) except as expressly permitted
by the Indenture or the Sale and Servicing Agreement, sell, transfer, exchange
or otherwise dispose of any of the properties or assets of the Trust, (ii) claim
any credit on or make any deduction from the principal or interest payable in
respect of the Notes (other than amounts withheld under the Code or applicable
state law) or assert any claim against any present or former holder of such
Notes because of the payment of taxes levied or assessed upon the Trust, (iii)
permit the validity or effectiveness of the Indenture to be impaired, or permit
the lien of the Indenture to be amended, hypothecated, subordinated, terminated
or discharged
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<PAGE>
or permit any person to be released from any covenants or obligations with
respect to the Notes under the Indenture except as may be expressly permitted
thereby, (iv) permit any lien, charge, excise, claim, security interest,
mortgage or other encumbrance to be created on or extend to or otherwise arise
upon or burden the assets of the Trust or any party thereof, or any interest
therein or the proceeds thereof (other than tax liens, mechanics' liens and
other liens that arise by operation of law, in each case on a Financed Vehicle
and arising solely as a result of an action or omission of the related Obligor)
or (v) permit any lien of the Indenture not to constitute a valid first priority
security interest in the Trust (other than with respect to any such tax,
mechanics or other lien).
The Trust may not engage in any activity other than as specified herein.
The Trust will not incur, assume or guarantee any indebtedness other than
indebtedness incurred pursuant to the Notes and the Indenture or otherwise in
accordance with the Indenture or the Sale and Servicing Agreement.
Annual Compliance Statement. The Trust will be required to file annually
with the Indenture Trustee a written statement as to the fulfillment of its
obligations under the Indenture.
Indenture Trustee's Annual Report. The Indenture Trustee will be required
to mail each year to all Noteholders a brief report relating to its eligibility
and qualification to continue as Indenture Trustee under the Indenture, any
amounts advanced by it under the Indenture, the amount, interest rate and
maturity date of certain indebtedness owing by the Trust to the Indenture
Trustee in its individual capacity, the property and funds physically held by
the Indenture Trustee as such and any action taken by it that materially affects
the Notes and that has not been previously reported.
Satisfaction and Discharge of Indenture. The Indenture will be discharged
with respect to the Notes upon the delivery to the Indenture Trustee for
cancellation of all the Notes or, with certain limitations, upon deposit with
the Indenture Trustee of funds sufficient for the payment in full of all the
Notes.
THE INDENTURE TRUSTEE
The Indenture Trustee may resign at any time by notifying the Issuer and
the Noteholders, in which event the Issuer will be obligated to appoint a
successor indenture trustee. The Issuer may remove the Indenture Trustee if the
Indenture Trustee ceases to be eligible to continue as such under the Indenture
or if the Indenture Trustee becomes insolvent. Noteholders representing not less
than a majority of the aggregate principal amount of the Notes then outstanding
may also remove the Indenture Trustee by so notifying the Indenture Trustee. In
such circumstances, the Issuer will be obligated to appoint a successor
indenture trustee. Any resignation or removal of the Indenture Trustee and
appointment of a successor indenture trustee will not become effective until
acceptance of the appointment by the successor indenture trustee.
DESCRIPTION OF THE CERTIFICATES
GENERAL
The Certificates will be issued pursuant to the terms of the Trust
Agreement in substantially the form of the Trust Agreement filed as an exhibit
to the Registration Statement of which this Prospectus forms a part. The
following, as well as other pertinent information included elsewhere herein,
summarizes the material terms of the Certificates and the Trust Agreement. The
summary does not purport to be complete and is subject to, and qualified in its
entirety by reference to, all the provisions of the Certificates and the Trust
Agreement.
RESTRICTIONS ON OWNERSHIP
Purchasers of Certificates and their assignees will be deemed to represent
that the beneficial owners of such Certificates are not Foreign Investors and
that no Plan Assets of any Plan were used to acquire the Certificates. See
'Certain Federal Income Tax Consequences' and 'ERISA Considerations' herein.
50
<PAGE>
DISTRIBUTION OF INTEREST INCOME
On each Distribution Date, commencing October 15, 1997, the
Certificateholders will be entitled to distributions in an amount equal to the
amount of interest that would accrue on the Certificate Balance at the
Certificate Rate. Interest in respect of a Distribution Date will accrue during
the related Interest Accrual Period and shall be calculated on the basis of a
360-day year of twelve 30-day months. Interest distributions due for any
Distribution Date but not distributed 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 Certificate Rate (to the extent lawful). Interest distributions
with respect to the Certificates will generally be derived from the Available
Amount remaining after the payment of the Servicer Payment and the deposit of
the Noteholders' Interest Distributable Amount into the Note Distribution
Account and from amounts, if any, on deposit in the Reserve Account. See
'Description of the Transfer and Servicing Agreement--Distributions' and
'--Subordination of the Certificates; Reserve Account' herein.
The Certificateholders will not receive any distributions of interest with
respect to an Interest Accrual Period until the full amount of interest on the
Notes due with respect to such Interest Accrual Period has been deposited in the
Note Distribution Account. If an Event of Default occurs and the Notes are
accelerated, Certificateholders will not be entitled to receive any
distributions of interest or principal until the Notes have been paid in full.
DISTRIBUTIONS OF PRINCIPAL PAYMENTS
Certificateholders will be entitled to distributions of principal on each
Distribution Date in an amount generally equal to the Certificateholders'
Principal Distributable Amount. The Certificateholders' Principal Distributable
Amount will be zero for each Distribution Date occurring before the Distribution
Date on which the Notes have been paid in full; and on and after such
Distribution Date, it will generally be 100% of the Principal Distributable
Amount (after payment of all of the Notes in full). Distributions with respect
to principal payments on the Certificates will generally be derived from the
Available Amount remaining after the payment of the Servicer Payment, the
deposit of the Noteholders' Distributable Amount into the Note Distribution
Account and the deposit of the Certificateholders' Interest Distributable Amount
into the Certificate Distribution Account and from amounts, if any, on deposit
in the Reserve Account. Notwithstanding the foregoing, if an Event of Default
occurs and the Notes are accelerated, the Certificateholders will not be
entitled to receive any distributions of interest or principal until the Notes
have been paid in full. See 'Description of the Transfer and Servicing
Agreements--Distributions' and '--Subordination of the Certificates; Reserve
Account' herein.
OPTIONAL PREPAYMENT
On any Distribution Date, after the Notes have been paid in full, the
Certificates will be prepaid if the Servicer exercises its option to purchase
the Receivables. The Servicer may purchase the Receivables after the last day of
a Collection Period as to which the Pool Balance shall have declined to 5% or
less of the Cutoff Date Pool Balance. If the Servicer exercises its option to
purchase the Receivables, the Certificateholders will receive an amount equal to
the Certificate Balance then outstanding together with accrued interest at the
Certificate Rate, which distribution shall effect early retirement of the
Certificates. See 'Description of the Transfer and Servicing Agreements--
Termination' herein.
THE OWNER TRUSTEE
The Owner Trustee's liability in connection with the issuance and sale of
the Securities is limited solely to the express obligations of the Owner Trustee
set forth in the Trust Agreement and the Sale and Servicing Agreement. The Owner
Trustee under the Trust Agreement will perform administrative functions,
including making distributions from the Certificate Distribution Account. The
Owner Trustee may resign at any time by giving written notice thereof to the
Sellers under the Trust Agreement, in which event the Sellers will be obligated
to appoint a successor owner trustee. The Sellers may also remove the Owner
Trustee if the Owner Trustee ceases to be eligible to continue as Owner Trustee
under the Trust Agreement, becomes legally unable to act or if the Owner Trustee
becomes insolvent.
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<PAGE>
In such circumstances, the Sellers will be obligated to appoint a successor
owner trustee. Any resignation or removal of the Owner Trustee and appointment
of a successor owner trustee will not become effective until acceptance of the
appointment by the successor owner trustee.
CERTAIN INFORMATION REGARDING THE SECURITIES
BOOK-ENTRY REGISTRATION
Securityholders may hold their Securities through DTC (in the United
States) or Cedel or Euroclear (in Europe), which in turn hold through DTC, if
they are participants of such systems, or indirectly through organizations that
are participants in such systems.
The Sellers have been informed by DTC that DTC's nominee will be Cede.
Accordingly, such nominee is expected to be the holder of record of any
Book-Entry Securities. Unless and until Definitive Securities are issued under
the limited circumstances described herein, no Securityholder will be entitled
to receive a physical certificate representing its interest in such Security.
All references herein to actions by Securityholders refer to actions taken by
DTC upon instructions from its Participants and all references herein to
distributions, notices, reports and statements to Securityholders of Book-Entry
Securities refer to distributions, notices, reports and statements to DTC or its
nominee, as the registered holder of the Securities, for distribution to
Securityholders in accordance with DTC's procedures with respect thereto. See
'--Definitive Securities' herein.
Cedel and Euroclear will hold omnibus positions on behalf of the Cedel
Participants and the Euroclear Participants, respectively, through customers'
securities accounts in Cedel's and Euroclear's names on the books of their
respective depositaries (collectively, the 'DEPOSITARIES'), which in turn will
hold such positions in customers' securities accounts in the Depositaries' names
on the books of DTC.
DTC is a limited-purpose trust company organized under the laws of the
State of New York, a member of the Federal Reserve System, a 'CLEARING
CORPORATION' within the meaning of the New York Uniform Commercial Code and a
'CLEARING AGENCY' registered pursuant to the provisions of Section 17A of the
Exchange Act. DTC was created to hold securities for its Participants and
facilitate the clearance and settlement of securities transactions between
Participants through electronic book-entry changes in accounts of its
Participants, thereby eliminating the need for physical movement of
certificates. Participants include securities brokers and dealers (who may
include any Underwriter), banks, trust companies and clearing corporations and
may include certain other organizations, including Cedel and Euroclear. Indirect
access to the DTC system also is available to Indirect Participants such as
banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a Participant, either directly or indirectly.
Transfers between Participants will occur in accordance with DTC rules.
Transfers between Cedel Participants and Euroclear Participants will occur in
the ordinary way in accordance with their applicable rules and operating
procedures.
Cross-market transfers between persons holding directly or indirectly
through DTC in the United States, on the one hand, and directly or indirectly
through Cedel Participants or Euroclear Participants, on the other, will be
effected in DTC in accordance with DTC rules on behalf of the relevant European
international clearing system by its Depositary; however, such cross-market
transactions will require delivery of instructions to the relevant European
international clearing system by the counterparty in such system in accordance
with its rules and procedures and within its established deadlines (European
time). The relevant European international clearing system will, if the
transaction meets its settlement requirements, deliver instructions to its
Depositary to take action to effect final settlement on its behalf by delivering
or receiving securities in DTC, and making or receiving payment in accordance
with normal procedures for same-day funds settlement applicable to DTC. Cedel
Participants and Euroclear Participants may not deliver instructions directly to
the Depositaries.
Because of time-zone differences, credits or securities in Cedel or
Euroclear as a result of a transaction with a Participant will be made during
the subsequent securities settlement processing, dated the business day
following the DTC settlement date, and such credits or any transactions in
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<PAGE>
such securities settled during such processing will be reported to the relevant
Cedel Participant or Euroclear Participant on such business day. Cash received
in Cedel or Euroclear as a result of sales of securities by or through a Cedel
Participant or Euroclear Participant to a Participant will be received with
value on the DTC settlement date but will be available in the relevant Cedel or
Euroclear cash account only as of the business day following settlement in DTC.
A 'SECURITYHOLDER,' as used herein, shall mean a holder of a beneficial
interest in a Book-Entry Security. Securityholders that are not Participants or
Indirect Participants but desire to purchase, sell or otherwise transfer
ownership of, or other interest in, Securities may do so only through
Participants and Indirect Participants. In addition, Securityholders will
receive all distributions of principal of and interest on Securities from the
Owner Trustee or Indenture Trustee, as applicable (the 'APPLICABLE TRUSTEE'),
through the Participants, who in turn will receive them from DTC. Under a
book-entry format, Securityholders may experience some delay in their receipt of
payments, since such payments will be forwarded by the Applicable Trustee to
Cede, as nominee for DTC. DTC will forward such payments to its Participants
which thereafter will forward them to Indirect Participants or Securityholders.
It is anticipated that the only 'NOTEHOLDER' and 'CERTIFICATEHOLDER' will be
Cede, as nominee of DTC. Securityholders will not be recognized by the
Applicable Trustee as Noteholders or Certificateholders, as such term is used in
the Trust Agreement and Indenture, as applicable, and Securityholders will only
be permitted to exercise the rights of Securityholders indirectly through DTC,
Cedel or Euroclear and their respective participants or organizations.
Under the rules, regulations and procedures creating and affecting DTC and
its operations (the 'RULES'), DTC is required to make book-entry transfers of
Securities among Participants on whose behalf it acts with respect to the
Securities and to receive and transmit distributions of principal of, and
interest on, the Securities. Participants and Indirect Participants with which
Securityholders have accounts with respect to the Securities similarly are
required to make book-entry transfers and receive and transmit such payments on
behalf of their respective Securityholders. Accordingly, although
Securityholders will not physically possess Securities, the Rules provide a
mechanism by which Participants will receive payments and will be able to
transfer their interests.
Because DTC can only act on behalf of Participants, who in turn act on
behalf of Indirect Participants and certain banks, the ability of a
Securityholder to pledge Securities to persons or entities that do not
participate in the DTC system, or to otherwise act with respect to such
Securities, may be limited due to the lack of physical certificates for such
Securities.
DTC has advised the Sellers that it will take any action permitted to be
taken by a Noteholder under the Indenture or a Certificateholder under the Trust
Agreement, as applicable, only at the direction of one or more Participants to
whose accounts with DTC the applicable Notes or Certificates are credited. DTC
may take conflicting actions with respect to other undivided interests to the
extent that such actions are taken on behalf of Participants whose holdings
include such undivided interests.
Cedel Bank, societe anonyme ('CEDEL') is incorporated under the laws of
Luxembourg as a professional depository. Cedel holds securities for its
participating organizations ('CEDEL PARTICIPANTS') and facilitates the clearance
and settlement of securities transactions between Cedel Participants through
electronic book-entry changes in accounts of Cedel Participants, thereby
eliminating the need for physical movement of certificates. Transactions may be
settled by Cedel in any of 28 currencies, including United States dollars. Cedel
provides to its Cedel Participants, among other things, services for
safekeeping, administration, clearance and settlement of internationally traded
securities and securities lending and borrowing. Cedel interfaces with domestic
markets in several countries. As a professional depository, Cedel is subject to
regulations by the Luxembourg Monetary Institute. Cedel Participants are
recognized financial institutions around the world, including underwriters,
securities brokers and dealers, banks, trust companies, clearing corporations
and certain other organizations and may include any Underwriter. Indirect access
to Cedel is also available to others, such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a Cedel
Participant, either directly or indirectly.
The Euroclear System ('EUROCLEAR') was created in 1968 to hold securities
for participants of Euroclear ('EUROCLEAR PARTICIPANTS') and to clear and settle
transactions between Euroclear
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Participants through simultaneous electronic book-entry delivery against
payment, thereby eliminating the need for physical movement of certificates and
any risk from lack of simultaneous transfers of securities and cash.
Transactions may now be settled in any of 27 currencies, including United States
dollars. Euroclear includes various other services, including securities lending
and borrowing and interfaces with domestic markets in several countries
generally similar to the arrangement for cross-market transfers with DTC
described above. Euroclear is operated by Morgan Guaranty Trust Company of New
York, Brussels, Belgium office (the 'EUROCLEAR OPERATOR'), under contract with
Euroclear Clearance System, S.C., a Belgian cooperative corporation (the
'COOPERATIVE'). All operations are conducted by the Euroclear Operator, and all
Euroclear securities clearance accounts and Euroclear cash accounts are accounts
with the Euroclear Operator, not the Cooperative. The Cooperative establishes
policy for Euroclear on behalf of Euroclear Participants. Euroclear Participants
include banks (including central banks), securities brokers and dealers and
other professional financial intermediaries and may include any Underwriter.
Indirect access to Euroclear is also available to other firms that clear through
or maintain a custodial relationship with a Euroclear Participant, either
directly or indirectly.
The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member of the Federal Reserve System. As such, it is
regulated and examined by the Board of Governors of the Federal Reserve System
and the New York State Banking Department, as well as the Belgian Banking
Commission.
Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of Euroclear and applicable Belgian law
(collectively, the 'TERMS AND CONDITIONS'). The Terms and Conditions govern
transfers of securities and cash within Euroclear, withdrawal of securities and
cash from Euroclear, and receipts of payments with respect to securities in
Euroclear. All securities in Euroclear are held on a fungible basis without
attribution of specific certificates to specific securities clearance accounts.
Euroclear acts under the Terms and Conditions only on behalf of Euroclear
Participants and has no record of or relationship with persons holding through
Euroclear Participants.
Distributions with respect to Securities held through Cedel or Euroclear
will be credited to the cash accounts of Cedel Participants or Euroclear
Participants in accordance with the relevant system's rules and procedures, to
the extent received by its Depositary. Such distributions will be subject to tax
reporting in accordance with relevant United States tax laws and regulations.
Cedel or the Euroclear Operator, as the case may be, will take any other action
permitted to be taken by a Securityholder under the Indenture or the Trust
Agreement, as applicable, on behalf of a Cedel Participant or a Euroclear
Participant only in accordance with its relevant rules and procedures and
subject to its Depositary's ability to effect such actions on its behalf through
DTC.
Although DTC, Cedel and Euroclear have agreed to the foregoing procedures
in order to facilitate transfers of Securities among participants of DTC, Cedel
and Euroclear, they are under no obligation to perform or continue to perform
such procedures, and such procedures may be discontinued at any time.
Except as required by law, the Applicable Trustee will not have any
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests of the Securities held by DTC, Cedel or
Euroclear or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
DEFINITIVE SECURITIES
The Notes of any class and the Certificates issued in book-entry form will
be issued in fully registered, certificated form ('DEFINITIVE NOTES' and
'DEFINITIVE CERTIFICATES,' as the case may be, and collectively referred to
herein as 'DEFINITIVE SECURITIES') to Noteholders or Certificateholders or their
respective nominees, rather than to the DTC or its nominee, only if (i) the
Sellers advise the Applicable Trustee in writing that DTC is no longer willing
or able to discharge properly its responsibilities as depository with respect to
the Securities and the Applicable Trustee is unable to locate a qualified
successor depository, (ii) the Sellers, at their option, elect to terminate the
book-entry
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system through DTC or (iii) after the occurrence of an Event of Default or an
Event of Servicing Termination, holders representing not less than a majority of
the outstanding principal amount of the Notes of such class or the Certificates,
as applicable, advise DTC through Participants in writing (with instructions to
notify the Applicable Trustee in writing) that the continuation of a book-entry
system through DTC (or a successor thereto) with respect to such Notes or
Certificates is no longer in the best interest of the holders of such
Securities.
Upon the occurrence of any event described in the immediately preceding
paragraph, DTC will be required to notify all applicable Securityholders through
Participants of the availability of Definitive Securities. Upon surrender by DTC
of the definitive certificates representing the corresponding Securities and
receipt of instructions for re-registration, the Applicable Trustee will reissue
such Securities as Definitive Securities to such Securityholders.
Distributions of principal with respect to, and interest on, such
Definitive Securities will thereafter be made in accordance with the procedures
set forth in the Indenture or the Trust Agreement, as applicable, directly to
holders of Definitive Securities in whose names the Definitive Securities were
registered at the close of business on the Record Date. Such distributions will
be made by check mailed to the address of such holder as it appears on the
register maintained by the Applicable Trustee. The final payment on any such
Definitive Security (whether a Definitive Security or the Securities registered
in the name of Cede representing the Securities), however, will be made only
upon presentation and surrender of such Definitive Security at the office or
agency specified in the notice of final distribution to the applicable
Securityholders.
Definitive Securities will be transferable and exchangeable at the offices
of the transfer agent and registrar, which shall initially be the corporate
trust department of Chase (in such capacity, the 'TRANSFER AGENT AND
REGISTRAR'). No service charge will be imposed for any registration of transfer
or exchange, but the Applicable Trustee may require payment of a sum sufficient
to cover any tax or other governmental charge imposed in connection therewith.
LIST OF SECURITYHOLDERS
Three or more Noteholders (each of whom has owned a Note for at least six
months) may, by written request to the Indenture Trustee, obtain access to the
list of all Noteholders maintained by the Indenture Trustee for the purpose of
communicating with other Noteholders with respect to their rights under the
Indenture or the Notes. The Indenture Trustee may elect not to afford the
requesting Noteholders access to the list of such Noteholders if it agrees to
mail the desired communication or proxy, on behalf and at the expense of the
requesting Noteholders, to all Noteholders of record. Unless Definitive Notes
have been issued, the only Noteholder appearing on the list maintained by the
Indenture Trustee will be Cede, as nominee for DTC. In such circumstances, any
beneficial owner of a Note wishing to communicate with other beneficial owners
of Notes will not be able to identify those beneficial owners through the
Indenture Trustee and instead will have to attempt to identify them through DTC
and its Participants or such other means as such beneficial owner may find
available.
Three or more Certificateholders or one or more Certificateholders
representing not less than 25% of the Certificate Balance may, by written
request to the Owner Trustee or registrar for the Certificates specified in the
Trust Agreement, obtain access to the list of all Certificateholders for the
purpose of communicating with such Certificateholders with respect to their
rights under the Trust Agreement or under the Certificates. Unless Definitive
Certificates have been issued, the only Certificateholder appearing on the list
maintained by the Owner Trustee will be Cede, as nominee for DTC. In such
circumstances, any beneficial owner of a Certificate wishing to communicate with
other beneficial owners of Certificates will not be able to identify those
beneficial owners through the Owner Trustee and instead will have to attempt to
identify them through DTC and its Participants or such other means as such
beneficial owner may find available.
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REPORTS TO SECURITYHOLDERS
On each Distribution Date, the Paying Agent will include with each
distribution to each Noteholder and Certificateholder a statement prepared by
the Servicer. Each such statement to be delivered to Noteholders will include
(to the extent applicable), among other things, the following information as to
the Notes with respect to such Distribution Date or the period since the
previous Distribution Date, as applicable, and each such statement to be
delivered to Certificateholders will include (to the extent applicable) the
following information as to the Certificates with respect to such Distribution
Date or the period since the previous Distribution Date, as applicable:
(i) the amount of the distribution allocable to interest with respect
to each class of Notes and to the Certificate Balance and the derivation of
such amounts;
(ii) the amount of the distribution allocable to principal on or with
respect to each class of Notes and the Certificates;
(iii) the amount of the Servicing Fee paid and the amount of Monthly
Advances being reimbursed to the Servicer in respect of the related
Collection Period, and the total Servicer Payment;
(iv) the Pool Balance as of the close of business on the last day of
the preceding Collection Period;
(v) the aggregate outstanding principal balance and the Note Pool
Factor for each class of Notes, and the Certificate Balance and the
Certificate Pool Factor, in each case after giving effect to all payments
reported under clause (i) above on such date;
(vi) the amount of the Aggregate Net Losses, if any, for the preceding
Collection Period and the derivation of such amount, and the amount of
Aggregate Losses on all Liquidated Receivables for the year to date;
(vii) the Noteholders' Interest Carryover Shortfall, the Noteholders'
Principal Carryover Shortfall, the Certificateholders' Interest Carryover
Shortfall and the Certificateholders' Principal Carryover Shortfall, if
any, in each case as applicable to each class of Securities and the change
in such amounts from the preceding statement;
(viii) the aggregate Repurchase Amounts with respect to the
Receivables, if any, that were repurchased by either Seller or purchased by
the Servicer in such Collection Period;
(ix) the balance of the Reserve Account as of such date, after giving
effect to changes therein on such date, the Specified Reserve Account
Balance on such date and the components of calculating any such required
balance;
(x) the amount of Monthly Advances included in the Available Amount;
and
(xi) the balance of the Paid-Ahead Account as of such date, after
giving effect to any changes therein on such date.
Each amount set forth pursuant to subclauses (i), (ii) and (iii) with
respect to the Notes or the Certificates will be expressed as a dollar amount
per $1,000 of the initial principal balance of such Notes or the initial
Certificate Balance, as applicable.
The statements for each Collection Period will be delivered to DTC for
further distribution to Securityholders in accordance with DTC procedures. See
'Certain Information Regarding the Securities--Book-Entry Registration' herein.
Chase, as Administrator, will file with the Commission such periodic reports
with respect to the Trust as required under the Exchange Act and the rules and
regulations of the Commission thereunder.
Within the prescribed period of time for tax reporting purposes after the
end of each calendar year during the term of the Trust, the Applicable Trustee
or the Paying Agent will furnish to each person who at any time during such
calendar year has been a Noteholder or a Certificateholder and received any
payment thereon a statement containing certain information for the purposes of
such Securityholder's preparation of federal income tax returns. See 'Certain
Federal Income Tax Consequences' herein.
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DESCRIPTION OF THE TRANSFER AND SERVICING AGREEMENTS
The following, as well as other information included elsewhere herein,
summarizes the material terms of the Sale and Servicing Agreement, the Trust
Agreement and the Administration Agreements (collectively, the 'TRANSFER AND
SERVICING AGREEMENTS'). Each of the Transfer and Servicing Agreements is in
substantially the form of the corresponding agreement filed as an exhibit to the
Registration Statement of which this Prospectus forms a part. The summary does
not purport to be complete and is subject to, and qualified in its entirety by
reference to, all the provisions of the Transfer and Servicing Agreements. The
following summary supplements the description of the general terms and
provisions of the Transfer and Servicing Agreements set forth herein, to which
description reference is hereby made.
SALE AND ASSIGNMENT OF RECEIVABLES
Pursuant to the Sale and Servicing Agreement, on or before the Closing
Date, the Sellers will transfer and assign to the Trust in consideration of the
receipt of the Securities, without recourse, their entire interest in the
Receivables, certain related property and the proceeds thereof, including, among
other things, their respective security interests in the related Financed
Vehicles. Each Receivable will be identified in a schedule appearing as an
exhibit to the Sale and Servicing Agreement (a 'SCHEDULE OF RECEIVABLES'). The
Sellers will sell the Certificates to the Certificate Underwriter and the Notes
to the Note Underwriters. See 'Underwriting' herein.
In the Sale and Servicing Agreement, each Seller will make representations
and warranties with respect to its Receivables and the security interests in the
Financed Vehicles related thereto, which representations and warranties will
include, among others, the following: (i) each Receivable (A) was originated by
a Dealer and acquired by an Originator from such Dealer in the ordinary course
of business, (B) was originated by an Originator directly, or (C) was a Bulk
Purchase Receivable; (ii) each Receivable is secured by a Financed Vehicle;
(iii) each Receivable was originated in the form of a retail installment sales
contract with a Dealer or a purchase money loan from an Originator through a
Dealer located in one of the states of the United States (or the District of
Columbia) or without the involvement of a Dealer for the financing of a Financed
Vehicle, and in each case was fully and properly executed by the parties
thereto; (iv) (A) in the case of a Receivable originated with the involvement of
a Dealer, if in the form of a retail installment sales contract, such Receivable
was purchased by an Originator from the originating Dealer and was validly
assigned by such Dealer to such Originator and (B) in the case of a Chase
Financial Receivable, such Receivable was purchased by Chase USA from CFAC or
CFHI, and was validly assigned by CFAC or CFHI, as applicable, to Chase USA; (v)
no provision of a Receivable has been waived, altered or modified in any
respect, except by instruments or documents contained in the related Receivables
file; (vi) each Receivable is a legal, valid and binding obligation of the
related Obligor and is enforceable in accordance with its terms (except as may
be limited by laws affecting creditors' rights generally); (vii) as of the
Cutoff Date, such Seller had no knowledge of any facts which would give rise to
any right of rescission, setoff, counterclaim or defense or of the same being
asserted or threatened with respect to any Receivable; (viii) the Obligor on
each Receivable is required to maintain physical damage insurance covering the
related Financed Vehicle in accordance with its terms; (ix) no Receivable was
originated in or is subject to the laws of any jurisdiction whose laws would
prohibit (A) the transfer of the Receivable to the Trust pursuant to the Sale
and Servicing Agreement, (B) the ownership of the Receivable by the Trust or (C)
the pledge by the Trust of such Receivable to the Indenture Trustee; (x) each
Receivable complies with all requirements of law in all material respects; (xi)
no Receivable has been satisfied, subordinated in whole or in part or rescinded,
and no Financed Vehicle has been released from the security interest of the
related Receivable in whole or in part; (xii) each Receivable creates a valid
and enforceable first priority security interest in favor of the originator of
such Receivable in the Financed Vehicle covered thereby, such security interest
is assignable to the Trust (by such originator to such Seller, if such
originator is not such Seller, and by such Seller to the Trust), and all
necessary action with respect to such Receivable has been taken to perfect the
security interest in the related Financed Vehicle in favor of such originator;
(xiii) all parties to each Receivable had capacity to execute such Receivable;
(xiv) no Receivable has been
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sold, assigned or pledged by such Seller to any person other than the Trust and,
prior to the transfer of the Receivables by such Seller to the Trust, such
Seller had good and marketable title to such Receivable, free and clear of any
lien, encumbrance, equity, loan, pledge, charge, claim or security interest, and
such Seller was the sole owner and had full right to transfer such Receivable to
the Trust; (xv) as of the Cutoff Date, such Seller had no knowledge that a
default, breach, violation or event permitting acceleration under any Receivable
existed; such Seller had no knowledge of any event which with notice and the
expiration of any grace or cure period would constitute a default, breach,
violation or event permitting acceleration under such Receivable (except for
payment delinquencies permitted as described herein), and such Seller has not
waived any of the foregoing (except for payment delinquencies permitted); (xvi)
as of the Cutoff Date, such Seller had no knowledge of any liens or claims which
have been filed for work, labor or materials affecting a Financed Vehicle
securing a Receivable, which are or may be liens prior to or equal or coordinate
with the security interest of the Receivable; (xvii) each Receivable is a fully
amortizing loan with interest at a fixed rate (the 'CONTRACT RATE'), provides
for level payments over the term of such Receivable and is either a Simple
Interest Receivable or a Precomputed Receivable; (xviii) each Receivable
contains customary and enforceable provisions such as to render the rights and
remedies of the holder thereof adequate for realization against the related
collateral (except as may be limited by creditors' rights generally); (xix) the
description of each Receivable set forth in the Schedule of Receivables is true
and correct as of its date; (xx) no Obligor is the United States of America or
any state or any agency, department, instrumentality or political subdivision
thereof; (xxi) if the Obligor is in the military (including an Obligor who is a
member of the National Guard or is in the reserves) and the Receivable is
subject to the Soldiers' and Sailors' Civil Relief Act of 1940, as amended (the
'SOLDIERS' AND SAILORS' CIVIL RELIEF ACT'), or the California Military Reservist
Relief Act of 1991 (the 'MILITARY RESERVIST RELIEF ACT'), such Obligor has not
made a claim to a Seller or the Servicer that (A) the amount of interest on the
Receivable should be limited to 6% pursuant to the Soldiers' and Sailors' Civil
Relief Act during the period of such Obligor's active duty status or (B)
payments on the Receivable should be delayed pursuant to the Military Reservist
Relief Act, in either case unless a court has ordered otherwise upon application
of a Seller (in either case 'RELIEF ACT REDUCTION'); (xxii) there is only one
original executed copy of each Receivable, which, prior to the execution of the
Sale and Servicing Agreement, was transferred to the Servicer on behalf of the
Trust; (xxiii) the Receivable is 'chattel paper' as defined in the New York and
Ohio Uniform Commercial Codes; (xxiv) each Receivable satisfies the other
criteria specified above under 'The Receivables Pool' herein; and (xxv) each
Receivable was originated in the United States of America. The representations
and warranties will be for the benefit of the Trust and, with respect to any
Receivable purchased by the Servicer, the Servicer.
As of the last day of the month following the date (or, if the related
Seller elects, the last day of the month including such date) on which the
related Seller discovers or receives written notice from the Owner Trustee or
the Indenture Trustee that a Receivable did not meet any of the criteria set
forth in the Sale and Servicing Agreement as of the Closing Date or the Cutoff
Date, as applicable, and such failure materially adversely affects the interests
of the Securityholders in such Receivable (regardless of whether such Seller had
actual knowledge of such failure as of the Cutoff Date), such Seller, unless it
has cured the failed criterion, will repurchase such Receivable from the Trust
at a price equal to the Actual Principal Balance owed by the Obligor thereof
plus accrued and unpaid interest thereon at the respective Contract Rate through
such last day (the 'REPURCHASE AMOUNT'). For administrative convenience, if
Chase is obligated pursuant to the Sale and Servicing Agreement to repurchase a
Receivable from the Trust, Chase USA, at its option, may satisfy Chase's
obligation by repurchasing such Receivable on the same terms. The repurchase
obligation will constitute the sole remedy available to the Certificateholders
or the Owner Trustee and the Noteholders or the Indenture Trustee for the
failure of a Receivable to meet any of the criteria set forth in the Sale and
Servicing Agreement. 'ACTUAL PRINCIPAL BALANCE' means, as of the close of
business on the last day of any month, (a) with respect to a Precomputed
Receivable, the sum of (i) the Principal Balance thereof as of such day and (ii)
the portion of all scheduled payments on such Receivable due and unpaid on or
prior to such day allocable to principal using the actuarial method and (b) with
respect to a Simple Interest Receivable, its Principal Balance as of such day.
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CUSTODY OF RECEIVABLES
Pursuant to the Sale and Servicing Agreement, to assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Owner Trustee
on behalf of the Trust and the Indenture Trustee will appoint the Servicer as
initial custodian of the Receivables files. Receivables will not be stamped or
otherwise marked to reflect the transfer of the Receivables to the Trust and
will not be segregated from the other recreational vehicle loans owned or
serviced by the Servicer, CFMC or any of their respective affiliates. Custody of
the Receivables files may be held by the Servicer or a third party custodian
together with files for recreational vehicle loans or other loans owned by Chase
RV Finance or CITSF. The Obligors under the Receivables will not be notified of
the transfer of the Receivables to the Trust, but each Seller's accounting
records and computer systems will be purged of all references to the Receivables
to reflect the sale and assignment of the Receivables to the Trust. See 'Certain
Legal Aspects of the Receivables' herein.
ACCOUNTS
The Sellers will establish the Collection Account, the Reserve Account and
the Paid-Ahead Account in the name of the Indenture Trustee on behalf of the
Noteholders and the Certificateholders and the Note Distribution Account in the
name of the Indenture Trustee on behalf of the Noteholders. The Owner Trustee
will establish the Certificate Distribution Account in the name of the Owner
Trustee on behalf of the Certificateholders. Each of the Collection Account, the
Paid-Ahead Account, the Reserve Account, the Note Distribution Account and the
Certificate Distribution Account are collectively referred to herein as the
'TRUST ACCOUNTS.' Each Trust Account (other than the Reserve Account) will be
established initially with the trust department of Chase, and the Reserve
Account will be established initially with the trust department of Norwest Bank
Minnesota, National Association. Chase, in its capacity as the initial paying
agent (the 'PAYING AGENT'), will have the revocable right, at the direction of
the Servicer, to withdraw funds from each Trust Account (other than the Reserve
Account) for the purpose of making distributions to Securityholders in the
manner provided in the Transfer and Servicing Agreements. See '--Subordination
of the Certificates; Reserve Account' below.
The Trust Accounts will be maintained as Eligible Deposit Accounts. An
'ELIGIBLE DEPOSIT ACCOUNT' shall be either (a) a separately identifiable deposit
account established in the deposit taking department of a Qualified Institution
or (b) a segregated identifiable trust account established in the trust
department of a Qualified Trust Institution. A 'QUALIFIED INSTITUTION' shall be
a depository institution (including Chase) organized under the laws of the
United States or any state thereof or incorporated under the laws of a foreign
jurisdiction with a branch or agency located in the United States or any state
thereof and subject to supervision and examination by federal or state banking
authorities, having a short-term certificate of deposit rating and a long-term
unsecured debt rating confirmed by each Rating Agency as being consistent with
the ratings of the Securities and, in the case of any such institution
(including Chase) organized under the laws of the United States, the deposits of
which are insured by the FDIC. A 'QUALIFIED TRUST INSTITUTION' shall be an
institution organized under the laws of the United States or any state thereof
or incorporated under the laws of a foreign jurisdiction with a branch or agency
located in the United States and subject to supervision and examination by
federal or state banking authorities with the authority to act under such laws
as a trustee or in any other fiduciary capacity, having not less than $1 billion
in assets under fiduciary management and a long-term deposit rating confirmed by
each Rating Agency as being consistent with the ratings of the Securities.
Should Chase, Norwest Bank Minnesota, National Association or any other
depositary of a Trust Account cease to be a Qualified Institution or Qualified
Trust Institution, such Trust Account shall be moved to a Qualified Institution
or Qualified Trust Institution, provided that such Trust Account may remain at
such depositary if the Owner Trustee and the Indenture Trustee receive written
confirmation from each related Rating Agency to the effect that the ratings of
the Securities will not be adversely affected.
Funds in the Trust Accounts will be invested as provided in the Sale and
Servicing Agreement in Permitted Investments. 'PERMITTED INVESTMENTS' are
generally limited to investments confirmed by
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the related Rating Agencies as being consistent with the ratings of the
Securities. Permitted Investments may include Securities issued by either Seller
or its affiliates or trusts originated by either Seller or its affiliates, and
may also include certain money market mutual funds for which Chase or any of its
affiliates serves as an investment advisor, administrator, shareholder servicing
agent and/or custodian or subcustodian (for which it collects fees and
expenses). Permitted Investments are limited to obligations or securities that
mature on or before the Business Day preceding the next Distribution Date (each
such preceding day, a 'DEPOSIT DATE'). Investment earnings on funds deposited in
the Trust Accounts (other than the Reserve Account), net of losses and
investment expenses (collectively, 'INVESTMENT EARNINGS'), shall be paid to the
Sellers.
PAID-AHEAD PRECOMPUTED RECEIVABLES
So long as CITSF is the Servicer and provided that (i) there exists no
Event of Servicing Termination and (ii) each other condition to holding
Paid-Ahead Amounts as may be required by the Sale and Servicing Agreement is
satisfied, Paid-Ahead Amounts will be retained by the Servicer until the Deposit
Date relating to the Collection Period in which such amounts were due. As
provided in the Servicing Transfer Agreements, pending deposit into the
Collection Account, Paid-Ahead Amounts will be transferred by the Servicer to
CFMC and held by CFMC on behalf of the Servicer until the Business Day prior to
the applicable Deposit Date. If any of the above-described conditions to
retaining Paid-Ahead Amounts is not satisfied, Paid-Ahead Amounts will be
deposited into the Paid-Ahead Account and retained therein until such time as
the paid-ahead payment falls due. As of the Cutoff Date, the Servicer held
$561,500.57 of Paid-Ahead Amounts on the Receivables. Until such time as
Paid-Ahead Amounts are transferred from the Paid-Ahead Account or by the
Servicer to the Collection Account, they will not constitute collected interest
or collected principal and will not be available for distribution to the
Noteholders or Certificateholders.
SERVICING COMPENSATION
The Servicer will be entitled to receive, out of collections on the
Receivables, a Servicing Fee for each Collection Period, payable on the
following Distribution Date, equal to the sum of (i) one-twelfth of the product
of the Servicing Fee Rate and the Pool Balance as of the related Settlement Date
(or, in the case of the first Distribution Date, the Cutoff Date Pool Balance)
and (ii) any Administrative Fees paid by the Obligors during the related
Collection Period. 'ADMINISTRATIVE FEES' shall mean late payment fees, extension
fees and transfer of equity and assumption fees with respect to the Receivables.
In addition, the Servicing Transfer Agreements provide that CFMC may be
required to pay to CITSF a fee, or, in the alternative, CITSF may be required to
pay CFMC a fee, in each case, based on the performance of the Receivables. If
the ratio (expressed as a percentage) of (x) the Aggregate Losses on the
Receivables for any calendar year or partial calendar year over (y) the average
monthly Pool Balance with respect to such calendar year or partial calendar year
is less than 0.60%, CFMC will be required to pay to CITSF an additional fee of
up to 0.475% per annum of such average monthly Pool Balance (based on the actual
level of Aggregate Losses), and if such ratio exceeds 0.60%, CITSF will be
required to refund to CFMC an amount up to 0.200% per annum of such average
monthly Pool Balance (based on the actual level of Aggregate Losses). Neither
the Trust nor any successor Servicer under the Sale and Servicing Agreement will
be entitled to receive from CFMC or will be required to refund to CFMC any of
the foregoing amounts. A 'LOSS' on a Receivable is equal to the sum of its
principal balance, accrued interest thereon, collection and insurance expenses,
repossession and liquidation expenses and forbearance expenses related to such
Receivable, net of any liquidation proceeds, insurance proceeds, collections,
and any recoveries on such Receivable. 'AGGREGATE LOSSES' mean, with respect to
any calendar year or partial calendar year, an amount equal to (x) the sum of
the Losses for such calendar year or partial calendar year, less (y) any
recoveries (including, but not limited to, sales proceeds and insurance credits)
received during such calendar year or partial calendar year in respect of the
Receivables in default in, and included in the calculation of Aggregate Losses
with respect to, any prior calendar year or partial calendar year.
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Payments to the Servicer of such amounts will compensate the Servicer for
performing the functions of a third party servicer of Recreational Vehicle Loans
as an agent for the Trust, including collecting and posting all payments,
responding to inquiries of Obligors, investigating delinquencies, reporting
federal income tax information to Obligors, monitoring the Financed Vehicles in
cases of Obligor default and handling the foreclosure or other liquidation of
the Financed Vehicle in appropriate instances (subject to reimbursement of its
expenses incurred in connection with such foreclosure, liquidation or other
realization on the Receivables to the extent described herein). The Servicing
Fee will also compensate the Servicer for serving as an Administrator under its
related Administration Agreement. The Servicer will also be responsible for
compensating Chase for serving as an Administrator under its related
Administration Agreement. The Servicer shall be responsible for all of its own
expenses and costs incurred in carrying out its obligations under the Sale and
Servicing Agreement, except that, in accordance with the Servicing Transfer
Agreements, CFMC has agreed to reimburse the Servicer for customary or necessary
repossession and other expenses incurred in connection with the repair, care and
custody of repossessed Financed Vehicles in an amount up to $1,000 per defaulted
Receivable, legal fees in an amount up to $1,000 per defaulted Receivable, or
such higher amounts as CFMC shall agree to from time to time, and funds advanced
by the Servicer to pay taxes or satisfy tax liens in respect of Financed
Vehicles. The Servicer is not required to take any action which would cause it
to incur expenses in excess of such amounts nor is CFMC required to reimburse
any such expenses in excess of such amounts. CFMC has also agreed to pay the
Servicer reasonable compensation and reimburse it for its expenses if, at the
request of CFMC, the Servicer takes action beyond its agreed-upon scope in
servicing the Receivables.
The Servicing Fee also will compensate the Servicer for administering the
Receivables, including reimbursing the Servicer for accounting for collections,
furnishing monthly and annual statements to the Owner Trustee and Indenture
Trustee with respect to distributions and providing certain federal income tax
information to the Paying Agent. The Servicing Fee also will compensate the
Servicer for accounting fees, outside auditor fees, data processing costs and
other costs incurred in connection with administering and servicing the
Receivables.
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).
SERVICING AND INSURANCE PROCEDURES
The Servicer will make reasonable efforts, consistent with the customary
servicing practices and procedures employed by the Servicer with respect to
recreational vehicle loans owned by it (except as set forth in the Servicing
Transfer Agreements and described herein), to collect all payments due with
respect to the Receivables and, in a manner consistent with the Transfer and
Servicing Agreements, will continue such normal collection practices and
procedures as it follows with respect to comparable recreational vehicle loans
that it services for itself (except as set forth in the Servicing Transfer
Agreements and described herein). The Servicer will follow such normal
collection practices and procedures as it deems necessary or advisable to
realize upon any Receivable with respect to which it determines that eventual
payment in full is unlikely or to realize upon any defaulted Receivable. The
Servicer may sell the related Financed Vehicle securing such Receivable at a
public or private sale in accordance with the Servicing Transfer Agreements, or
take any other action permitted by applicable law. See 'Certain Legal Aspects of
the Receivables.' The proceeds of any such realization will be deposited in the
Collection Account. CITSF's customary servicing practices and procedures with
respect to recreational vehicle loans may be changed in accordance with CITSF's
business judgment; provided, that any such change relating to the Receivables
that would have a material effect on the collectibility of the Receivables may
not be made without CFMC's consent.
In accordance with the Servicing Transfer Agreements, CITSF has agreed to
several limitations on how it services the Receivables. In addition, CFMC has
retained the right to direct CITSF with respect to loss mitigation strategies,
to require CITSF to initiate repossession actions or to direct CITSF to refrain
from repossessing Financed Vehicles, in each case based upon reasonable criteria
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communicated in writing to CITSF from time to time. Such limitations and
instructions may result in the Servicer's taking actions from time to time
different from actions it otherwise would take in accordance with its customary
servicing policies and procedures at such time.
The Servicer has agreed that, with respect to defaulted Receivables having
Principal Balances in excess of $30,000, the Servicer may not enter into a
repossession sale or short sale/settlement which would result in a loss
exceeding 60% of such Principal Balance without the approval of CFMC. In
addition, the Servicer may not charge-off a Receivable (by deeming it to be a
Liquidated Receivable) in connection with a non-repossession loss if the
resulting charge-off would exceed $50,000 without the approval of CFMC. Pursuant
to the Servicing Transfer Agreements, the Servicer has agreed to attempt to
contact by telephone Obligors whose Receivables have become more than ten days
delinquent, and in the event contact by telephone is not made on or before the
21st day of delinquency, to perform a manual review of the Receivable to
determine the appropriate course of action, which may be continued phone calls
and/or the sending of letters.
In accordance with the Servicing Transfer Agreements, the Servicer is not
permitted to initiate litigation with respect to any Receivable without CFMC's
consent except for actions to recover possession or to foreclose upon a Financed
Vehicle, collection suits or actions to recover deficiencies (subject to
limitations on reimbursement of the Servicer's expenses as described under
'--Servicing Compensation' herein). The Servicing Transfer Agreements also
require that the Servicer, before commencing any litigation to collect amounts
owing with respect to a Receivable, review the related files to determine if
there exist facts which might constitute a defense or counterclaim in any such
litigation. If such review indicates the existence of facts which might
constitute a defense or counterclaim, the Servicer is not permitted to initiate
any litigation with respect to such Receivable without the prior written consent
of CFMC.
The Servicer shall, at its own cost and expense, keep in force throughout
the term of the Transfer and Servicing Agreements a fidelity bond. Such fidelity
bond shall protect against losses, including forgery, theft, embezzlement and
fraud and shall have such deductibles, and be in such form and amount as is
generally customary among persons which service a portfolio of recreational
vehicle loans having an aggregate principal amount of $100 million or more and
which are generally regarded as servicers acceptable to institutional investors,
but in no case shall such fidelity bond be less than $5,000,000.
PURCHASE BY THE SERVICER
Under the Sale and Servicing Agreement, the Servicer will agree not to,
except as expressly provided therein, (i) release the Financed Vehicle securing
each Receivable from the security interest granted by such Receivable except in
accordance with the terms of such Receivable and applicable law, (ii) impair the
rights of the Trust in the Receivables or take any action inconsistent with the
Trust's ownership of the Receivables, (iii) increase the number of payments
under a Receivable, or increase the principal amount of a Receivable which is
used to finance the purchase price of the related Financed Vehicle, or extend or
forgive payments on a Receivable, or (iv) fail to file and process claims under
any insurance policy covering a Receivable, if the failure to file and process
such claims would impair the protection or benefit to be afforded by such
insurance policy. A breach of any of the above described covenants that
materially adversely affects the Trust's interest in any Receivable will require
the Servicer to purchase such Receivable from the Trust for the Repurchase
Amount, unless such breach is cured by the last day of the Collection Period
following the Collection Period in which such discovery occurred. The purchase
obligation will constitute the sole remedy available to the Certificateholders
or the Owner Trustee and the Noteholders or the Indenture Trustee for a breach
of any of the above covenants.
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MODIFICATION OF RECEIVABLES
Consistent with its customary servicing procedures in effect from time to
time (except as described herein), the Servicer may, in its discretion, arrange
with an Obligor to defer, reschedule, extend or modify the payment schedule on a
Receivable or otherwise to modify the terms of a Receivable, provided that (i)
the maturity of such Receivable would not extend beyond the Final Scheduled
Maturity Date and (ii) if any such modification constitutes a refinancing, the
proceeds of such refinancing are used to pay the related Receivable in full.
CITSF may change such servicing procedures in accordance with its business
judgment, provided, that any such change relating to the Receivables that would
have a material effect on the collectibility of the Receivables may not be made
without CFMC's consent. Notwithstanding the foregoing, in connection with the
settlement by the Servicer of a defaulted Receivable, the Servicer may forgive a
portion of such Receivable, if in its discretion it believes that the acceptance
of the settlement proceeds from the related Obligor would result in the Trust's
receiving a greater amount of collections than the Net Liquidation Proceeds that
would result from repossessing and liquidating the related Financed Vehicle.
REMOVAL OF RECEIVABLES
Except as otherwise specified herein, none of the Sellers or the Servicer
will have the right to remove any Receivables from the Trust after the Closing
Date. In certain circumstances, a Seller may have the obligation to repurchase,
the Servicer may have the obligation to purchase or the Servicer may have the
option to purchase, a Receivable from the Trust, but all such repurchases or
purchases will be made at the Repurchase Amount.
COLLECTIONS
The Servicer may deposit all payments on or with respect to the Receivables
during each Collection Period (other than Paid-Ahead Amounts) into the
Collection Account monthly on the Deposit Date following the last day of such
Collection Period, provided that (i) (A) CITSF or any of its affiliates is the
Servicer and (B) the Servicer or the direct or indirect parent of the Servicer
has and maintains a short-term debt rating of at least A-1 by Standard & Poor's
and at least 'D-1' by Duff & Phelps (if rated by Duff & Phelps) and either a
short-term debt rating of P-1 or a long-term debt rating of at least A2 by
Moody's, or (ii) the Sellers or the Servicer obtain a letter of credit, surety
bond or insurance policy as set forth in the Sale and Servicing Agreement, under
which demands for payment may be made to secure timely remittance of monthly
collections to the Collection Account and, in the case of clause (ii), the Owner
Trustee and the Indenture Trustee are provided with a letter from each Rating
Agency to the effect that the utilization of such alternative remittance
schedule will not result in a qualification, reduction or withdrawal of any of
its then-current ratings of the Securities. As of the date of this Prospectus,
CITSF, as Servicer, will be permitted to remit collections to the Collection
Account on a monthly basis by virtue of clause (i) above. In the event that the
Servicer is permitted to make remittances of collections to the Collection
Account on a monthly basis pursuant to satisfaction of clause (ii) above, the
Sale and Servicing Agreement will be modified, to the extent necessary, without
the consent of any Securityholder. Pending such a monthly deposit into the
Collection Account, the Servicing Transfer Agreements require that collections
be transferred by the Servicer to CFMC and held by CFMC until the Business Day
prior to the Deposit Date. See 'Risk Factors--Risk of Commingling.' If the
Servicer is not permitted to remit collections to the Collection Account on a
monthly basis, the Servicer will be obligated to deposit all payments on or with
respect to the Receivables and all proceeds of Receivables collected on or with
respect to the Receivables during each Collection Period into the Collection
Account or the Paid-Ahead Account (in the case of Paid-Ahead Amounts) not later
than two Business Days after receipt.
A Seller or the Servicer, as the case may be, will remit the aggregate
Repurchase Amount of any Receivables to be purchased from the Trust into the
Collection Account on or before the next succeeding Deposit Date.
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The Servicer will not be required to deposit in the Collection Account
amounts relating to the Receivables attributable to the following: (a) amounts
received with respect to each Receivable (or property acquired in respect
thereof) which has been repurchased by a Seller or purchased by the Servicer,
respectively, pursuant to the Sale and Servicing Agreement, (b) Investment
Earnings on funds deposited in the Collection Account or the Paid-Ahead Account,
(c) amounts to be reimbursed to the Servicer in respect of nonrecoverable
Monthly Advances, (d) Net Liquidation Proceeds of any Liquidated Receivable to
the extent such proceeds exceed its Principal Balance, (e) Administrative Fees
incurred by the Obligors prior to August 18, 1997, (f) any Excluded
Forced-Placed Insurance Premiums or (g) any Excluded Precomputed Amounts.
MONTHLY ADVANCES
With respect to each Receivable as to which there has been a Payment
Shortfall during the related Collection Period (other than a Payment Shortfall
arising from a Receivable which has been prepaid in full or which has been
subject to a Relief Act Reduction during the related Collection Period), on each
Deposit Date the Servicer will be obligated to make a Monthly Advance but only
to the extent that the Servicer, in its good faith judgment, expects to recover
such Monthly Advance from subsequent collections on such Receivable made by or
on behalf of the Obligor (but only to the extent of expected interest
collections in the case of a Simple Interest Receivable) or from Net Liquidation
Proceeds or insurance proceeds with respect to such Receivable. The Servicer
shall be reimbursed for any Monthly Advance from subsequent collections with
respect to such Receivable. If the Servicer determines in its good faith
judgment that an unreimbursed Monthly Advance shall not ultimately be
recoverable from subsequent collections or that the related Receivable will be
sold pursuant to the Sale and Servicing Agreement, the Servicer shall be
reimbursed for such Monthly Advance from collections on all Receivables in
accordance with the priority of distributions described herein. In determining
whether a Monthly Advance is or will be nonrecoverable, the Servicer need not
take into account that it might receive any amounts in a deficiency judgment
against an Obligor. The Servicer will not make a Monthly Advance in respect of
(i) the principal component of any scheduled payment on a Simple Interest
Receivable or (ii) a Payment Shortfall arising from a Receivable which has been
prepaid in full or which has been subject to a Relief Act Reduction during the
related Collection Period.
NET DEPOSITS
As an administrative convenience, the Servicer will be permitted to make
deposits of collections, Monthly Advances, and the aggregate Repurchase Amount
of Receivables purchased by the Servicer for, or with respect to, a Collection
Period net of distributions to be made to the Sellers (to the extent of
Investment Earnings and amounts received with respect to Excluded Forced-Placed
Insurance Premiums and Excluded Precomputed Amounts) or to the Servicer
(including, without limitation, the Servicer Payment, amounts received with
respect to Administrative Fees incurred by Obligors prior to August 18, 1997 and
amounts to be deducted in the definition of 'Available Amount' and paid to the
Servicer set forth under '--Distributions' below). The Servicer, however, will
account to the Owner Trustee and the Indenture Trustee and to the
Securityholders as if all such deposits and distributions were made on an
aggregate basis for each type of payment or deposit. On each Distribution Date,
the Servicer will pay directly to the Sellers any Investment Earnings on funds
deposited in the Collection Account or the Paid-Ahead Account and any other
amounts the Sellers are entitled to (such as amounts received with respect to
Excluded Forced-Placed Insurance Premiums and Excluded Precomputed Amounts).
DISTRIBUTIONS
Deposits to Collection Account. On or before the third Business Day prior
to a Distribution Date, the Servicer will inform the Indenture Trustee, the
Owner Trustee and the Paying Agent of the following amounts: (i) the Available
Amount and the Principal Distribution Amount for the next succeeding
Distribution Date; (ii) the aggregate Repurchase Amount, if any, of Receivables
to be repurchased by the Sellers or purchased by the Servicer with respect to
the preceding Collection Period; (iii) the
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amount to be withdrawn from the Reserve Account on the next succeeding Deposit
Date and deposited into the Certificate Distribution Account; (iv) the
Noteholders' Interest Distributable Amount with respect to each class of Notes,
the Noteholders' Principal Distributable Amount, the Certificateholders'
Interest Distributable Amount and the Certificateholders' Principal
Distributable Amount for the next succeeding Distribution Date; (v) the Servicer
Payment; (vi) the amount deposited in the Paid-Ahead Account or retained by the
Servicer on account of Paid-Ahead Amounts during the preceding Collection Period
and any Paid-Ahead Amounts to be deposited into the Collection Account on the
related Deposit Date; (vii) the Monthly Advances to be deposited into the
Collection Account on the related Deposit Date; and (viii) the amount to be
deposited in the Reserve Account and the amount to be distributed to the Sellers
therefrom on such Distribution Date.
On or before each Deposit Date, the Servicer will cause all collections and
other amounts constituting the Available Amount for the related Distribution
Date to be deposited into the Collection Account, together with any amounts
withdrawn by the Indenture Trustee from the Reserve Account on such Deposit
Date.
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 Receivables in the related
Collection Period (including Net Liquidation Proceeds, any recoveries on
Liquidated Receivables and any applied Paid-Ahead Amounts), (ii) the Repurchase
Amount for any Receivable repurchased by either Seller or purchased by the
Servicer and the price paid by the Servicer, if any, to purchase the assets of
the Trust as described herein under '--Termination' and (iii) any Monthly
Advances made by the Servicer (with respect to (ii) and (iii) above, to the
extent such amounts are paid on or before 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 Receivables): (i) any amounts incorrectly deposited in the Collection
Account, (ii) net investment earnings on the funds in the Collection Account,
(iii) any amounts received with respect to Administrative Fees incurred by the
Obligors prior to August 18, 1997, Excluded Forced-Placed Insurance Premiums or
Excluded Precomputed Amounts and (iv) any other amounts, if any, permitted to be
withdrawn from the Collection Account by the Servicer (or to be retained by the
Servicer from collections on the Receivables) pursuant to the Sale and Servicing
Agreement.
Principal Distribution Amount. The 'PRINCIPAL DISTRIBUTION AMOUNT' on each
Distribution Date is equal to the sum of the following amounts with respect to
the related Collection Period, in each case calculated in accordance with the
method specified in each Receivable: (i) (A) all payments of principal
(including all Principal Prepayments applied during the related Collection
Period as described below) made on each Simple Interest Receivable during the
related Collection Period and (B) the portion of the scheduled payment due
during such Collection Period allocable to principal using the actuarial method
with respect to each Precomputed Receivable (or the Principal Balance thereof if
such Precomputed Receivable is prepaid in full during such Collection Period),
(ii) the Principal Balance of each Receivable which, during the related
Collection Period, was repurchased by a Seller or purchased by the Servicer
pursuant to the Sale and Servicing Agreement (a 'REPURCHASED RECEIVABLE') and
(iii) the Principal Balance of each Receivable that became a Liquidated
Receivable during the related Collection Period provided, however, that (x)
payments of principal (including Principal Prepayments) with respect to a
Repurchased Receivable received after the last day of the Collection Period in
which the Receivable became a Repurchased Receivable shall not be included in
the Principal Distribution Amount and (y) if a Liquidated Receivable is
purchased by a Seller or the Servicer pursuant to the Sale and Servicing
Agreement on the Deposit Date immediately following the Collection Period in
which it became a Liquidated Receivable, no amount will be included with respect
to such Receivable in the Principal Distribution Amount pursuant to clause (iii)
of the definition thereof.
'PRINCIPAL BALANCE' means, as of the close of business on the last day of a
Collection Period, (a) with respect to a Precomputed Receivable, the amount
originally advanced thereunder minus the sum of (i) that portion of all
scheduled payments due on or prior to such day allocable to principal using the
actuarial method, (ii) any payment of the Repurchase Amount with respect to such
Precomputed Receivable allocable to principal and (iii) any Principal Prepayment
applied to reduce
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the Principal Balance of such Precomputed Receivable in full and (b) with
respect to a Simple Interest Receivable, the amount originally advanced
thereunder minus the sum of (i) the portion of all payments made by or on behalf
of the related Obligor on or prior to such day and allocable to principal using
the simple interest method and (ii) any payment of the Repurchase Amount with
respect to such Simple Interest Receivable allocable to principal, in each case
without giving effect to any adjustments due to bankruptcy or similar
proceedings. A 'LIQUIDATED RECEIVABLE' is a defaulted Receivable as to which the
Servicer has recovered all amounts that it expects to recover either by sale or
disposition of the related Financed Vehicle or otherwise, but in any event a
Receivable will be deemed to become a Liquidated Receivable no later than the
date on which the Servicer has received proceeds from the sale or disposition of
such Financed Vehicle. 'PRINCIPAL PREPAYMENT' means a payment or other recovery
of principal on a Receivable (including insurance proceeds and Net Liquidation
Proceeds applied to principal on a Receivable) which is received in advance of
its Due Date. 'NET LIQUIDATION PROCEEDS' means the monies collected by the
Servicer (from whatever source) during a Collection Period on a Liquidated
Receivable, net of (i) any payments required by law to be remitted to the
Obligor and (ii) other expenses customarily deducted from sales proceeds by
third parties in connection with sales or other dispositions of recreational
vehicles.
Deposits to the Distribution Accounts. On each Distribution Date, the
Servicer shall instruct the Indenture Trustee or the Paying Agent to make the
following distributions, to the extent of the sum of the Available Amount and
any amounts withdrawn from the Reserve Account then on deposit in the Collection
Account, in the following order of priority (except under the limited
circumstances provided herein):
(i) to the Servicer, the Servicer Payment with respect to such
Distribution Date and all unpaid Servicing Fees with respect to prior
Distribution Dates, to the extent such amounts are not deducted from the
Servicer's remittance to the Collection Account;
(ii) to the Note Distribution Account, the Noteholders' Interest
Distributable Amount for each class of Notes;
(iii) to the Owner Trustee for deposit into the Certificate
Distribution Account, the Certificateholders' Interest Distributable Amount
(unless the Notes have been accelerated as described herein);
(iv) to the Note Distribution Account, the Noteholders' Principal
Distributable Amount;
(v) to the Owner Trustee for deposit into the Certificate Distribution
Account, the Certificateholders' Principal Distributable Amount; and
(vi) to the Reserve Account, any remaining portion of the Available
Amount.
Notwithstanding the foregoing, if an Event of Default occurs and the Notes
are accelerated, the Certificateholders will not be entitled to receive any
distributions in respect of their Certificates, until the Notes have been paid
in full.
For purposes hereof, the following terms shall have the following meanings:
'CERTIFICATE BALANCE' shall be an amount equal to $44,895,285.54
(approximately 5% of the Cutoff Date Pool Balance) as of the Closing Date and,
thereafter, shall be an amount equal to such initial Certificate Balance,
reduced by all amounts allocable to principal previously distributed to
Certificateholders. The Certificate Balance shall also be reduced on any
Distribution Date by the excess, if any, of (i) the sum of (A) the Certificate
Balance and (B) the outstanding principal amount of the Notes (in each case
after giving effect to amounts in respect of principal to be deposited in the
Certificate Distribution Account and the Note Distribution Account on such
Distribution Date), over (ii) the Pool Balance as of the close of business on
the last day of the preceding Collection Period. Thereafter, the Certificate
Balance shall be increased on any Distribution Date to the extent that any
portion of the Available Amount on such Distribution Date is available to pay
the existing Certificateholders' Principal Carryover Shortfall, but not by more
than the aggregate reductions in the Certificate Balance set forth in the
preceding sentence.
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'CERTIFICATEHOLDERS' DISTRIBUTABLE AMOUNT' means, for any Distribution
Date, the sum of the Certificateholders' Principal Distributable Amount and the
Certificateholders' Interest Distributable Amount.
'CERTIFICATEHOLDERS' INTEREST CARRYOVER SHORTFALL' means, for any
Distribution Date, the excess of the Certificateholders' Interest Distributable
Amount for the preceding Distribution Date over the amount in respect of
interest at the Certificate Rate that was actually deposited into the
Certificate Distribution Account on such preceding Distribution Date, plus
interest on such excess, to the extent permitted by law, at the Certificate Rate
from and including such preceding Distribution Date to but excluding the current
Distribution Date.
'CERTIFICATEHOLDERS' INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, the sum of the Certificateholders' Monthly Interest
Distributable Amount for such Distribution Date and the Certificateholders'
Interest Carryover Shortfall for such Distribution Date.
'CERTIFICATEHOLDERS' MONTHLY INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, one month's interest (or, in the case of the first
Distribution Date, interest accrued from and including the Closing Date to but
excluding such Distribution Date) at the Certificate Rate on the Certificate
Balance on the immediately preceding Distribution Date (or, in the case of the
first Distribution Date, the Certificate Balance on the Closing Date), after
giving effect to all distributions of principal to the Certificateholders on or
prior to such Distribution Date.
'CERTIFICATEHOLDERS' MONTHLY PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any
Distribution Date prior to the Distribution Date on which the Notes have been
paid in full, zero; and for any Distribution Date commencing on or after the
Distribution Date on which the Notes have been paid in full, 100% of the
Principal Distribution Amount (less the portion of the Principal Distribution
Amount required on the first such Distribution Date to pay the Notes in full).
'CERTIFICATEHOLDERS' PRINCIPAL CARRYOVER SHORTFALL' means, for any
Distribution Date, the sum of (a) the excess of (i) the Certificateholders'
Principal Distributable Amount for the preceding Distribution Date, over (ii)
the amount in respect of principal that was actually deposited into the
Certificate Distribution Account on such Distribution Date and (b) without
duplication of clause (a), the unreimbursed portion of the amount by which the
Certificate Balance has been reduced pursuant to the second sentence of the
definition thereof.
'CERTIFICATEHOLDERS' PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, the sum of (i) the Certificateholders' Monthly Principal
Distributable Amount for such Distribution Date and (ii) the Certificateholders'
Principal Carryover Shortfall for such Distribution Date; provided, that the
Certificateholders' Principal Distributable Amount shall not exceed the
Certificate Balance. In addition, on the Certificate Final Scheduled
Distribution Date, the principal required to be distributed to
Certificateholders will include the lesser of (a) any payments of principal due
and remaining unpaid on each Receivable owned by the Trust as of the last day of
the immediately preceding Collection Period, or (b) the amount that is necessary
(after giving effect to the other amounts to be deposited in the Certificate
Distribution Account on such Distribution Date and allocable to principal) to
reduce the Certificate Balance to zero.
'NOTEHOLDERS' DISTRIBUTABLE AMOUNT' means, for any Distribution Date, the
sum of the Noteholders' Principal Distributable Amount and the Noteholders'
Interest Distributable Amount for all classes of Notes.
'NOTEHOLDERS' INTEREST CARRYOVER SHORTFALL' means, for any Distribution
Date for each class of Notes (other than the initial Distribution Date), the
excess of (i) the Noteholders' Interest Distributable Amount for the preceding
Distribution Date for such class of Notes, over (ii) the amount in respect of
interest that was actually deposited into the Note Distribution Account in
respect of such class of Notes on such preceding Distribution Date, plus
interest on the amount of interest due but not paid to the Noteholders of such
class on the preceding Distribution Date, to the extent permitted by law, at the
applicable Interest Rates borne by such class of Notes for the related Interest
Accrual Period.
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'NOTEHOLDERS' INTEREST DISTRIBUTABLE AMOUNT' means, for any Distribution
Date for any class of Notes, the sum of (x) the Noteholders' Monthly Interest
Distributable Amount for such Distribution Date for such class of Notes and (y)
the Noteholders' Interest Carryover Shortfall for such Distribution Date for
such class of Notes.
'NOTEHOLDERS' MONTHLY INTEREST DISTRIBUTABLE AMOUNT' means, for any
Distribution Date for any class of Notes, interest accrued during the related
Interest Accrual Period at the applicable Interest Rate on the outstanding
principal balance of the Notes of such class on such Distribution Date (or, in
the case of the first Distribution Date, on the Closing Date).
'NOTEHOLDERS' MONTHLY PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any
Distribution Date, prior to the Distribution Date on which the Notes have been
paid in full, 100% of the Principal Distribution Amount; and for the
Distribution Date on which the Notes are paid in full, the portion of the
Principal Distribution Amount required to pay the Notes in full.
'NOTEHOLDERS' PRINCIPAL CARRYOVER SHORTFALL' means, for any Distribution
Date, the excess of (x) the Noteholders' Principal Distributable Amount for the
preceding Distribution Date over (y) the amount in respect of principal that was
actually deposited into the Note Distribution Account on such preceding
Distribution Date.
'NOTEHOLDERS' PRINCIPAL DISTRIBUTABLE AMOUNT' means, for any Distribution
Date, the sum of (i) the Noteholders' Monthly Principal Distributable Amount for
such Distribution Date and (ii) the Noteholders' Principal Carryover Shortfall
for such Distribution Date; provided, that the Noteholders' Principal
Distributable Amount shall not exceed the outstanding principal balance of the
Notes. In addition, on the Note Final Scheduled Distribution Date of each class
of Notes, the principal required to be deposited in the Note Distribution
Account will include the amount necessary (after giving effect to other amounts
to be deposited in the Note Distribution Account on such Distribution Date and
allocable to principal) to reduce the outstanding principal balance of the
related class of Notes to zero.
SUBORDINATION OF THE CERTIFICATES; RESERVE ACCOUNT
The rights of the Certificateholders to receive distributions with respect
to the Receivables generally will be subordinated to the rights of the
Noteholders in the event of defaults and delinquencies on the Receivables as
provided in the Sale and Servicing Agreement. The protection afforded to the
Noteholders through subordination of the Certificates will be effected by the
preferential right of the Noteholders both to receive current distributions with
respect to the Receivables and withdrawals from the Reserve Account. The Reserve
Account will be funded with an initial deposit by the Sellers of cash or
Permitted Investments having a value of at least the Reserve Account Initial
Deposit. In addition, on each Distribution Date, the Reserve Account will be
augmented by the deposit therein of the Available Amount remaining after the
payment of the Servicer Payment, the deposit of the Noteholders' Distributable
Amount in the Note Distribution Account, and the deposit of the
Certificateholders' Distributable Amount in the Certificate Distribution
Account, in each case as described above under '--Distributions.' On each
Distribution Date, any amounts on deposit in the Reserve Account (after giving
effect to deposits and withdrawals made on such Distribution Date) in excess of
the Specified Reserve Account Balance on such Distribution Date will be released
and paid to the Sellers in accordance with the terms of the Sale and Servicing
Agreement.
Under the Sale and Servicing Agreement, on each Deposit Date, the Indenture
Trustee is required to demand a withdrawal from the amounts on deposit in the
Reserve Account, up to the Available Reserve Account Amount, in an amount equal
to the excess, if any, of the sum of the Noteholders' Distributable Amount and
the Certificateholders' Distributable Amount for the related Distribution Date
over the Available Amount for such Distribution Date remaining after the payment
of the Servicer Payment for such Distribution Date. Amounts so withdrawn will be
deposited in the Collection Account.
On each Distribution Date, the amount available in the Reserve Account (the
'AVAILABLE RESERVE ACCOUNT AMOUNT') will equal the lesser of (i) the amount on
deposit in the Reserve Account and (ii) the Specified Reserve Account Balance.
The aggregate amount withdrawn from the Reserve
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Account on any Deposit Date may not exceed the Available Reserve Account Amount
for the related Distribution Date.
The Specified Reserve Account Balance on any Distribution Date will equal
2.00% of the Pool Balance as of the related Settlement Date, but in any event
will not be less than the lesser of (i) $8,973,952.86 (1.00% of the Cutoff Date
Pool Balance) and (ii) such Pool Balance; provided, that the Specified Reserve
Account Balance will be calculated using a percentage of 3.00% on any
Distribution Date (beginning with the December 1997 Distribution Date) for which
(x) the Average Net Loss Ratio exceeds 1.75% or (y) the Average Delinquency
Percentage exceeds 2.00%. If the Specified Reserve Account Balance is increased
pursuant the foregoing proviso, it will revert back to the amount as previously
calculated if, for any three consecutive Distribution Dates, clauses (x) or (y)
is not triggered.
'AGGREGATE NET LOSSES' means, for any Distribution Date, the amount equal
to (i) the aggregate Principal Balance of all Receivables that became Liquidated
Receivables during the related Collection Period minus (ii) the Net Liquidation
Proceeds collected during such Collection Period with respect to any Liquidated
Receivables.
'AVERAGE DELINQUENCY PERCENTAGE' means, for any Distribution Date, the
average of the Delinquency Percentages for such Distribution Date and the
preceding two Distribution Dates.
'AVERAGE NET LOSS RATIO' means, for any Distribution Date, the average of
the Net Loss Ratios for such Distribution Date and the preceding two
Distribution Dates.
'DELINQUENCY PERCENTAGE' means, for any Distribution Date, the sum of the
outstanding Principal Balances of all Receivables which are 60 days or more
delinquent (including Receivables, which are not Liquidated Receivables,
relating to Financed Vehicles that have been repossessed), as of the close of
business on the last day of the Collection Period immediately preceding such
Distribution Date, determined in accordance with the Servicer's normal
practices, such sum expressed as a percentage of the Pool Balance as of the
close of business on the last day of such Collection Period.
'NET LOSS RATIO' means, for any Distribution Date, an amount expressed as a
percentage, equal to (i) the Aggregate Net Losses for such Distribution Date,
divided by (ii) the average of the Pool Balances on each of the related
Settlement Date and the last day of the related Collection Period.
The Specified Reserve Account Balance may be reduced to a lesser amount as
determined by the Sellers; provided, that such reduction may not adversely
affect any rating by a Rating Agency of a Security. Upon distribution to the
Sellers of amounts from the Reserve Account, neither the Noteholders nor the
Certificateholders will have any rights in, or claims to, such amounts.
The availability of funds in the Reserve Account and the subordination of
amounts distributable to the Certificateholders are intended to enhance the
likelihood of receipt by Noteholders of the full amount of principal and
interest due them, and to decrease the likelihood that the Noteholders will
experience losses. There is no other protection against losses on the
Receivables afforded the Noteholders. In addition, the availability of funds in
the Reserve Account is intended solely to enhance the likelihood of receipt by
Certificateholders of the full amount of principal and interest due them and to
decrease the likelihood that the Certificateholders will experience losses.
However, in certain circumstances, the Reserve Account could be depleted. If the
amount required to be withdrawn from the Reserve Account to cover shortfalls in
collections on the Receivables exceeds the amount of available cash in the
Reserve Account, Noteholders or Certificateholders could incur losses or a
temporary shortfall in the amounts distributed to the Noteholders or
Certificateholders could result, which could, in turn, increase the average life
of the Notes or Certificates. Such shortfalls may result from, among other
things, Aggregate Net Losses on the Receivables or the failure by either Seller
or the Servicer to make any remittance under the Sale and Servicing Agreement.
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ADMINISTRATION AGREEMENTS
Each of CITSF and Chase, as Administrators, will enter into an
Administration Agreement with the Trust and the Indenture Trustee. Pursuant to
each Administration Agreement, the Administrator party thereto will agree on
behalf of the Trust to provide certain notices and to perform certain other
administrative functions required by the Transfer and Servicing Agreements and
the Indenture and specified in such Administration Agreement as being the
responsibility of such Administrator. Compensation for the performance by CITSF
of its obligations under the Administration Agreement to which it is a party
will be included in the Servicing Fee. CITSF will be responsible for
compensating Chase for the performance of Chase's obligations under the
Administration Agreement to which Chase is a party.
Each Administration Agreement provides that the Administrator party thereto
may act directly or through its agents or attorneys pursuant to agreements
entered into with any of them, and that such Administrator will not be liable
for the conduct or misconduct of such agents or attorneys if such agents or
attorneys shall have been selected by such Administrator with due care.
STATEMENTS TO THE OWNER TRUSTEE AND THE INDENTURE TRUSTEE
Prior to each Distribution Date, the Servicer will provide to the Owner
Trustee and Indenture Trustee a statement setting forth substantially the same
information for such date and the related Collection Period as is required to be
provided in the periodic reports provided to Noteholders and Certificateholders
described herein under 'Certain Information Regarding the Securities--Reports to
Securityholders.'
EVIDENCE AS TO COMPLIANCE
The Sale and Servicing Agreement will provide that a firm of independent
public accountants will annually furnish to the Sellers, the Owner Trustee and
the Indenture Trustee a statement as to compliance by the Servicer during the
preceding twelve months (or, in the case of the first such certificate, from the
Closing Date) with certain standards relating to the servicing of the
Receivables, or as to the effectiveness of its processing and reporting
procedures and certain other matters.
The Sale and Servicing Agreement will also provide for delivery to the
related firm of independent public accountants referred to in the immediately
preceding paragraph, substantially simultaneously with the delivery of such
accountants' statement referred to above, of a certificate signed by an officer
of the Servicer stating that the Servicer has fulfilled its obligations in all
material respects under the Sale and Servicing Agreement throughout the
preceding twelve months (or, in the case of the first such certificate, from the
Closing Date) or, if there has been a default in the fulfillment of any such
obligation, describing each such default.
Copies of such statements and certificates may be obtained by
Securityholders by a request in writing addressed to the Servicer.
CERTAIN MATTERS REGARDING THE SERVICER
The Sale and Servicing Agreement will provide that the Servicer may not
resign from its obligations and duties as Servicer thereunder, except upon a
determination that the Servicer's performance of such duties is no longer
permissible under applicable law. Such resignation will not become effective
until a successor Servicer has assumed the Servicer's servicing obligations and
duties under the Transfer and Servicing Agreements.
Pursuant to the Sale and Servicing Agreement, the Sellers will have the
right to terminate all rights and obligations of the Servicer thereunder at any
time after a calendar year, or in the case of 1997, the last four calendar
months of such year, during which Aggregate Losses on the Receivables exceed
0.80% of the average of the month-end principal balances of the Receivables for
each month in such calendar year, or such four calendar months, so long as
Chase, Chase USA or another party
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acceptable to the Rating Agencies assumes the Servicer's servicing obligations
and duties under the Transfer and Servicing Agreements.
The Sale and Servicing Agreement will provide that neither the Servicer nor
any of its shareholders, affiliates, directors, officers, employees and agents
shall be under any liability to the Owner Trustee, the Indenture Trustee, the
Trust or the Securityholders for taking any action or for refraining from taking
any action pursuant to the Transfer and Servicing Agreements or for errors in
judgment; provided, however, that neither the Servicer nor any such person will
be protected against any liability which otherwise would be imposed by reason of
willful misfeasance, bad faith or negligence in the performance of duties or by
reason of reckless disregard of obligations and duties thereunder. In addition,
the Transfer and Servicing Agreements will provide that the Servicer is under no
obligation to appear in, prosecute or defend any legal action which arises under
the Transfer and Servicing Agreements and that, in its opinion, may cause it to
incur any expense or liability. The Servicer may, however, undertake any
reasonable action that it may deem necessary or desirable in respect of the
Transfer and Servicing Agreements and the rights and duties of the parties
thereto and the interests of the Securityholders thereunder. In the event that
the Servicer, in its discretion, undertakes any action which it deems necessary
or desirable in connection with its rights and duties under the Transfer and
Servicing Agreements or the interests of the Securityholders thereunder, the
legal expenses and costs of such action and any liability resulting therefrom
will be expenses, costs and liabilities of the Trust, and the Servicer will be
entitled to be reimbursed therefor out of amounts otherwise distributable to the
Sellers from the Reserve Account.
Any corporation or other entity into which the Servicer may be merged or
consolidated, or any corporation or other entity resulting from any merger,
conversion or consolidation to which the Servicer is a party, or any corporation
or other entity succeeding to the business of the Servicer, which corporation or
other entity assumes the obligations of the Servicer, will be the successor of
the Servicer under the Transfer and Servicing Agreements.
EVENTS OF SERVICING TERMINATION
'EVENTS OF SERVICING TERMINATION' under the Sale and Servicing Agreement
will consist of (i) any failure by the Servicer to deliver to the Owner Trustee
or the Indenture Trustee the Servicer's certificate for the related Collection
Period or any failure by the Servicer to deliver to the Owner Trustee or the
Indenture Trustee for deposit in any Trust Account any proceeds or payments
required to be delivered under the terms of the Securities or the Sale and
Servicing Agreement (or, in the case of a payment or deposit to be made not
later than the Deposit Date, the failure to make such payment or deposit on such
Deposit Date), which failure continues unremedied for five Business Days after
discovery by the Servicer or for five Business Days after receipt of written
notice to the Servicer by the Owner Trustee or the Indenture Trustee or to the
Owner Trustee or the Indenture Trustee and the Servicer by Noteholders
representing not less than 25% of the aggregate principal amount of the Notes
then outstanding (so long as Notes are outstanding) or, if no Notes are
outstanding, Certificateholders representing not less than 25% of the
Certificate Balance then outstanding; (ii) any failure by the Servicer to duly
observe or perform in any material respect any other covenant or agreement of
the Servicer set forth in the Sale and Servicing Agreement or Indenture, which
failure materially adversely affects the rights of the Trust or the
Securityholders and which continues unremedied for 60 days after receipt of
written notice of such failure to the Servicer by the Owner Trustee or the
Indenture Trustee or to the Owner Trustee or the Indenture Trustee and the
Servicer by Noteholders representing not less than 25% of the aggregate
principal amount of the Notes then outstanding (so long as Notes are
outstanding) or, if no Notes are outstanding, Certificateholders representing
not less than 25% of the Certificate Balance then outstanding; (iii) a court or
other governmental authority having jurisdiction in the premises shall have
entered a decree or order for relief in respect of the Servicer in an
involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator (or similar official) of the Servicer, as the
case may be, or for any substantial liquidation of its affairs, and such order
remains undischarged and unstayed for at least 60 days; or
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(iv) the Servicer shall have commenced a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or shall
have consented to the entry of an order for relief in an involuntary case under
any such law, or shall have consented to the appointment of or taking possession
by a receiver, liquidator, assignee, trustee, custodian or sequestrator (or
other similar official) of the Servicer or for any substantial part of its
property, or shall have made any general assignment for the benefit of its
creditors, or shall have failed to, or admitted in writing its inability to, pay
its debts as they become due, or shall have taken any corporate action in
furtherance of the foregoing.
RIGHTS UPON EVENT OF SERVICING TERMINATION
As long as an Event of Servicing Termination under the Sale and Servicing
Agreement remains unremedied, the Indenture Trustee or Noteholders representing
not less than a majority of the aggregate principal amount of the Notes then
outstanding (or, if the Notes have been paid in full and the Indenture has been
discharged in accordance with its terms, by the Owner Trustee or
Certificateholders representing not less than a majority of the Certificate
Balance then outstanding) may terminate all the rights and obligations of the
Servicer under the Sale and Servicing Agreement, whereupon Chase will succeed to
all the responsibilities, duties and liabilities of the Servicer under the Sale
and Servicing Agreement and will be entitled to similar compensation
arrangements. In the event that Chase is unwilling or unable to so act, the
Sellers may appoint, or petition a court of competent jurisdiction for the
appointment of, a successor Servicer to act as successor to the outgoing
Servicer. The Sellers may make such arrangements for compensation to be paid,
which in no event may be greater than the Servicing Fee paid to the Servicer
under the Sale and Servicing Agreement.
WAIVER OF PAST DEFAULTS
The Noteholders representing not less than a majority of the aggregate
principal amount of the Notes then outstanding (or the Certificateholders
representing not less than a majority of the Certificate Balance then
outstanding, in the case of any Event of Servicing Termination that does not
adversely affect the Indenture Trustee or the Noteholders) may, on behalf of all
the Noteholders and Certificateholders, waive any default by the Servicer in the
performance of its obligations under the Sale and Servicing Agreement and its
consequences, except an Event of Servicing Termination in making any required
deposits to or payments from any of the Trust Accounts in accordance with the
Sale and Servicing Agreement. Therefore, the Noteholders have the ability, as
limited above, to waive defaults by the Servicer that could in certain instances
materially adversely affect the Certificateholders. No such waiver will impair
such Certificateholders' rights with respect to subsequent defaults.
AMENDMENT
Each of the Transfer and Servicing Agreements may be amended by the parties
thereto, without prior notice to the Noteholders or Certificateholders but with
prior consent of the Owner Trustee and notice to the Rating Agencies (i) to cure
any ambiguity, to correct or supplement any provision therein or in the
Securities that may be inconsistent with any other provision therein, to
evidence a succession to the Servicer or a Seller pursuant to the related
Transfer and Servicing Agreement, or to add any other provisions with respect to
matters or questions arising under such Transfer and Servicing Agreement that
are not inconsistent with the provisions of such Transfer and Servicing
Agreement; provided, however, that such action will not, on the basis of
officer's certificate of the Servicer and the Sellers reasonably acceptable to
the Owner Trustee and the Indenture Trustee, materially adversely affect the
interests of the Trust or any Securityholder or (ii) to effect a transfer or
assignment of the Trust's or the Servicer's rights, obligations and duties under
such Transfer and Servicing Agreement. The Transfer and Servicing Agreements may
also be amended by the Sellers, the Servicer, the Owner Trustee and the
Indenture Trustee with the consent of the Noteholders representing not less than
a majority of the aggregate principal amount of the Notes then outstanding, if
any, and the Certificateholders representing not less than a majority of the
Certificate Balance then outstanding, for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions
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of such Transfer and Servicing Agreements or of modifying in any manner the
rights of the Noteholders or Certificateholders; provided, however, that no such
amendment may (i) increase or reduce in any manner the amount of, or accelerate
or delay the timing of, collections of payments on the Receivables or
distributions that are required to be made for the benefit of the Noteholders or
Certificateholders or (ii) reduce the aforesaid percentage of the Noteholders or
Certificateholders that are required to consent to any such amendment, without
the consent of Noteholders representing 100% of the aggregate principal amount
of the Notes then outstanding or the Certificateholders representing 100% of the
Certificate Balance then outstanding, as the case may be. In addition to the
foregoing limitations, the Sellers will covenant in the Sale and Servicing
Agreement that they will not amend the Trust Agreement without the prior written
consent of CITSF, as Administrator.
PAYMENT OF NOTES
Upon the payment in full of all outstanding Notes and the satisfaction and
discharge of the Indenture, the Owner Trustee will succeed to all the rights of
the Indenture Trustee, and the Certificateholders will succeed to all the rights
of the Noteholders under the Sale and Servicing Agreement, except as otherwise
provided therein.
TERMINATION
The obligations of the Servicer, the Sellers, the Owner Trustee and the
Indenture Trustee pursuant to the Transfer and Servicing Agreements will
terminate upon the earlier of (i) the Distribution Date next succeeding the
month that is six months after the maturity or other liquidation of the last
Receivable and the disposition of any amounts received upon liquidation of any
property remaining in the Trust and (ii) the payment to Noteholders and
Certificateholders of all amounts required to be paid to them pursuant to the
Transfer and Servicing Agreements.
In order to avoid excessive administrative expense, the Servicer will be
permitted at its option to purchase from the Trust, as of the last day of any
applicable Collection Period, if the outstanding Pool Balance with respect to
the Receivables held by the Trust is 5% or less of the Cutoff Date Pool Balance
as of such last day, all assets of the Trust (other than the Trust Accounts,
except for the Paid-Ahead Account), including the remaining Receivables, any
related Paid-Ahead Amounts and any rights of the Trust to Liquidated
Receivables, at the price specified in the Sale and Servicing Agreement, which
price shall not be less than the amount necessary to retire the Certificates on
the related Distribution Date after paying the Servicer Payment to the Servicer.
The subsequent distribution to the Certificateholders of all amounts required to
be distributed to them pursuant to the Trust Agreement will effect early
retirement of the Certificates.
The Owner Trustee and the Indenture Trustee will give written notice of
termination to each Securityholder of record, which notice will specify the
Distribution Date upon which such Securityholders may surrender their Securities
to the Owner Trustee or the Transfer Agent and Registrar, as the case may be,
for final payment. The final distribution to any Securityholder will be made
only upon surrender and cancellation of such holder's Security (whether a
Definitive Security or the Securities registered in the name of Cede
representing the Securities) at the office or agency of the Owner Trustee or the
Transfer Agent and Registrar, as the case may be, specified in the notice of
termination.
Subject to applicable law and after the Indenture Trustee has taken certain
measures to notify Noteholders, any money held by the Indenture Trustee or the
Paying Agent in trust for payment on the Notes that remain unclaimed for two
years shall, upon request of the Trust, be paid to the Trust. Following any such
payment, the Owner Trustee and the Paying Agent shall no longer be liable to any
Noteholder with respect to such unclaimed amount, and any claim with respect to
such amount shall be an unsecured claim against the Trust. If, within 18 months
after the first notice of final payment on the Certificates, there remain
Certificates that have not been surrendered for cancellation, the Owner Trustee
may take appropriate steps to notify the applicable Certificateholders (the cost
thereof paid out of the unclaimed amounts). Subject to applicable law, any funds
that then remain shall be paid to the Sellers in accordance with the Trust
Agreement.
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CERTAIN LEGAL ASPECTS OF THE RECEIVABLES
TRANSFER OF RECEIVABLES TO THE TRUST
The Receivables are 'chattel paper' as defined in the Uniform Commercial
Code (the 'UCC') in effect in the State of New York. Pursuant to the UCC, the
sale of chattel paper is treated in a manner similar to a security interest in
chattel paper. In order to protect the Trust's ownership or security interest in
the Receivables, the Sellers will file UCC-1 financing statements with the
appropriate governmental authorities in the States of New York and Delaware, to
give notice of the Trust's and the Indenture Trustee's ownership of and security
interest in the Receivables and their proceeds. Under the Sale and Servicing
Agreement, the Servicer will be obligated to maintain the perfection of the
Trust's and the Indenture Trustee's interest in the Receivables. It should be
noted, however, that a purchaser of chattel paper who gives new value and takes
possession of it in the ordinary course of such purchaser's business has
priority over a security interest, including an ownership interest, in the
chattel paper that is perfected by filing UCC-1 financing statements and not by
possession of such chattel paper by the original secured party, if such
purchaser acts in good faith without knowledge that the related chattel paper is
subject to a security interest, including an ownership interest. Any such
purchaser would not be deemed to have such knowledge merely because there are
UCC filings and would not learn of the sale of or security interest in the
Receivables from a review of the Receivables files since they would not be
marked to show such sale, although Chase RV Finance's master computer records
will indicate such sale.
Each of the Sellers intends that the transfer of the Receivables by it to
the Trust under the Sale and Servicing Agreement constitutes a sale. In the
event that either Seller were to become insolvent, the FDIA sets forth certain
powers that the FDIC may exercise if it were appointed receiver of such Seller.
To the extent that a Seller has granted a security interest in the Receivables
transferred by it to the Trust and that interest was validly perfected before
such Seller's insolvency and was not taken in contemplation of insolvency or
with the intent to hinder, delay or defraud such Seller or its creditors, that
security interest would not be subject to avoidance by the FDIC as receiver of
such Seller. Positions taken by the FDIC staff prior to the passage of FIRREA do
not suggest that the FDIC, if appointed receiver of either Seller, would
interfere with the timely transfer to the Trust of payments collected on the
Receivables. If, however, the FDIC were to assert a contrary position, or were
to require the Owner Trustee to establish its rights to those payments by
submitting to and completing the administrative claims procedure established
under the FDIA, or the conservator or receiver were to request a stay of
proceedings with respect to such Seller as provided under the FDIA, delays in
payments on the Securities and possible reductions in the amount of those
payments could occur.
SECURITY INTERESTS IN THE FINANCED VEHICLES
The Receivables represent installment sale contracts, purchase money notes
and other notes that evidence the financing of Financed Vehicles. The
Receivables also constitute personal property security agreements and include
grants of security interests in the Financed Vehicles under the Uniform
Commercial Code as adopted in each state. Perfection rules relating to security
interests in recreational vehicles are generally governed under state
certificate of title statutes (Alabama, Connecticut, Georgia, Maine,
Massachusetts, Minnesota, Mississippi, New Hampshire, New York, Rhode Island and
Vermont have adopted the Uniform Motor Vehicle Certificate of Title and
Anti-Theft Act) or by the vehicle registration laws of the state in which each
recreational vehicle is located. In states which have adopted the Uniform Motor
Vehicle Certificate of Title and Anti-Theft Act, security interests in
recreational vehicles may be perfected either by notation of the secured party's
lien on the certificate of title or by delivery of the certificate of title and
payment of a fee to the state motor vehicle authority, depending on the
particular state law. In states in which perfection of a security interest in a
particular motor vehicle is not governed by a certificate of title statute,
perfection is usually accomplished by filing pursuant to the provisions of the
applicable Uniform Commercial Code. Notwithstanding the foregoing, in certain
states, folding camping trailers and/or slide-in campers are not subject to
state titling and vehicle registration laws and a security interest in such
recreational
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vehicles is perfected by filing pursuant to the provisions of the applicable
Uniform Commercial Code. In most states, a security interest in a recreational
vehicle is perfected by notation of the secured party's lien on the vehicle's
certificate of title.
Chase RV Finance had policies and procedures in place to ensure that all
actions necessary under the laws of the states in which the related Financed
Vehicles were located at the time of origination of the Receivables to perfect
the originators' security interests in such Financed Vehicles were taken,
including, where applicable, having a notation of the originator's lien recorded
on the related certificate of title or delivering the required documents and
fees, obtaining possession of the related certificate of title (if possible),
or, where applicable, by perfecting its security interest in the related
Financed Vehicles under the applicable Uniform Commercial Code. In the event
that the originator of a Receivable failed, due to clerical errors, to effect
such notation or delivery, or attempted to perfect the security interest under
an inapplicable statute (for example, under the Uniform Commercial Code rather
than under a motor vehicle title law), such originator would not have a
perfected first priority security interest in such Financed Vehicle. In this
event the only recourse of the Trust would be against the Obligor on an
unsecured basis, if applicable, against a Dealer pursuant to its repurchase
obligation or against the related Seller.
Pursuant to the terms of the Sale and Servicing Agreement, each Seller will
assign its security interest in the Financed Vehicles to the Trust and the Trust
will assign the security interest in the Financed Vehicles to the Indenture
Trustee. However, because of the administrative burden and expense, none of the
Sellers or the Owner Trustee will amend the certificates of title or UCC-1
financing statements with respect to the Financed Vehicles to identify the Trust
or the Indenture Trustee as the new secured party nor will either such entity
execute and file any transfer instruments. In addition, the certificates of
title and the UCC-1 financing statements with respect to the Financed Vehicles
relating to those Receivables not originated by either Seller have not and will
not be amended to reflect any interim transfers of ownership of the security
interests in such Financed Vehicles. In a majority of states, the assignment of
a Receivable together with the related security interest is an effective
conveyance of such security interest without amendment of any lien noted on the
related certificate of title or of any UCC-1 financing statement or the filing
of any transfer instruments with the appropriate governmental authorities, and
the new owner of the Receivable succeeds to the original secured party's rights
in the related Financed Vehicle as against creditors of the Obligor. In certain
states, in the absence of such amendment and delivery or execution and filing of
transfer instruments with the appropriate governmental authorities to reflect
the successive assignments of the security interest in such Financed Vehicle,
the related Seller, the Trust and/or the Indenture Trustee may not have a
perfected security interest in such Financed Vehicle. In California, a security
interest in a recreational vehicle may be perfected only by depositing with the
state department of motor vehicles a properly endorsed certificate of title for
the vehicle showing the secured party as legal owner. A transferee (such as the
Trust) of a security interest in a motor vehicle may be required to file
appropriate documents with the California Department of Motor Vehicles. No such
applications will be made with respect to the assignments under the Sale and
Servicing Agreement, and thus the Trust may not have a perfected security
interest in the Financed Vehicles titled in California. The failure of the Trust
to possess perfected security interests in the Financed Vehicles titled in
California may affect the Trust's ability to realize on such Financed Vehicles
and thus may reduce the proceeds to be distributed to Securityholders. However,
in the absence of fraud, negligence or administrative error, the notation of the
originator's lien on the certificates of title should be sufficient to protect
the Trust against the risk that it will not be able to realize on the Financed
Vehicles titled in California.
In the event that the Trust does not have a perfected first priority
security interest in any Financed Vehicle, the only recourse of the Trust would
be against an Obligor on an unsecured basis or against the related Seller
pursuant to its repurchase obligation if the related originator did not have a
perfected first priority security interest in such Financed Vehicle. See
'Description of the Transfer and Servicing Agreements--Sale and Assignment of
Receivables' herein.
Except as described above, in the absence of fraud or forgery by a vehicle
owner or administrative error by state recording officials, the notation of the
lien of the originator of each
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Receivable on the certificate of title with respect to the related Financed
Vehicle will be sufficient to protect the Trust against the rights of subsequent
purchasers of such Financed Vehicle or subsequent lenders who take a security
interest in such Financed Vehicle. If there are any Financed Vehicles as to
which the originator of the related Receivable has failed to perfect the
security interest assigned to the Trust (i) such security interest would be
subordinate to, among others, holders of perfected security interests and (ii)
subsequent purchasers of such Financed Vehicles would take possession free and
clear of such security interest. There is also a risk that in not identifying
the Trust or the Indenture Trustee as the new secured party on the certificates
of title or executing and filing of transfer instruments, the security interest
of the Trust or Indenture Trustee could be released through fraud or negligence.
Under the laws of most states (including California), a perfected security
interest in a recreational vehicle continues for four months after the vehicle
is moved to a new state (from the state in which a financing statement was
properly filed initially to perfect the security interest or in which the
certificate of title was issued) and thereafter until the owner re-registers
such recreational vehicle in the new state. A majority of states generally
require surrender of a certificate of title to re-register a recreational
vehicle. Accordingly, the Servicer must surrender possession if it holds the
certificate of title to such a recreational vehicle or, in the case of a
recreational vehicle originally registered in a state which provides for
notation of lien on the certificate of title (e.g., California) but not
possession of the certificate of title by the holder of the security interest in
the related recreational vehicle, the Servicer should receive notice of
surrender if the security interest in the recreational vehicle is noted on the
certificate of title. Accordingly, the Servicer should have the opportunity to
re-perfect the security interest in the recreational vehicle in the state of
relocation. In states that do not require a surrender of the old certificate of
title for registration of a recreational vehicle, re-registration could defeat
perfection. In the ordinary course of servicing its portfolio of recreational
vehicle loans, the Servicer takes steps to effect such re-perfection upon
receipt of notice of re-registration or information from the obligor as to
relocation. Similarly, when an Obligor under a Receivable sells a Financed
Vehicle, unless the Servicer surrenders possession of the certificate of title,
it will receive notice as a result of the lien noted thereon and accordingly
will have an opportunity to require satisfaction of the related Receivable
before release of the lien. Under the Sale and Servicing Agreement, the Servicer
is obligated to take such steps, at the Servicer's expense, as are necessary to
maintain perfection of security interests in the Financed Vehicles.
Under the laws of many states (including California), certain possessory
liens for repairs performed on a motor vehicle and storage, as well as certain
rights in favor of Federal and state governmental authorities arising from the
use of a motor vehicle in connection with illegal activities, may take priority
even over a perfected security interest. Certain U.S. federal tax liens may have
priority over the lien of a secured party. Each Seller will represent in the
Sale and Servicing Agreement that, as of the Cutoff Date, it had no knowledge of
any such liens with respect to any Financed Vehicle related to a Receivable
transferred by such Seller to the Trust. However, such liens could arise at any
time during the term of a Receivable. No notice will be given to the Owner
Trustee or the Indenture Trustee in the event such a lien arises.
ENFORCEMENT OF SECURITY INTERESTS IN VEHICLES
The Servicer on behalf of the Trust and the Indenture Trustee may take
action to enforce the Trust's security interest by repossession and resale of
the Financed Vehicles securing the Receivables. The actual repossession may be
contracted out to third party contractors. Under the Uniform Commercial Code and
laws applicable in most states, a creditor can repossess a motor vehicle
securing a loan by voluntary surrender, 'self-help' repossession that is
'peaceful' (i.e., without breach of the peace) and, in the absence of voluntary
surrender and the ability to repossess without breach of the peace, by judicial
process. In California, under certain circumstances after the financed vehicle
has been repossessed, an obligor may reinstate the contract by paying the
delinquent installments and other amounts due. In the event of default by the
obligor, some jurisdictions (not including California) require that the obligor
be notified of the default and be given a time period within
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which to cure the default prior to repossession. Generally, this right of cure
may be exercised on a limited number of occasions during the term of the
contract. The Uniform Commercial Code and consumer protection laws in most
states place restrictions on repossession sales, including requiring prior
notice to the debtor and commercial reasonableness in effecting such a sale. In
the event of such repossession and resale of a Financed Vehicle, the Trust would
be entitled to be paid out of the sale proceeds before such proceeds could be
applied to the payment of the claims of unsecured creditors or the holders of
subsequently perfected security interests or, thereafter, to the debtor.
Under the Uniform Commercial Code and laws applicable in most states, a
creditor is entitled to obtain a deficiency judgment from a debtor for any
deficiency on repossession and resale of the motor vehicle securing such
debtor's loan. However, many states (including California) impose prohibitions
or limitations on deficiency judgments. In general, a defaulting Obligor may not
have sufficient assets to make the pursuit of a deficiency worthwhile.
Certain other statutory provisions, including federal and state bankruptcy
and insolvency laws, and general equitable principles may limit or delay the
ability of a lender to repossess and resell collateral or enforce a deficiency
judgment.
OTHER MATTERS
Numerous federal and state consumer protection laws may impose requirements
applicable to the origination and servicing of the Receivables, including the
Truth in Lending Act, the Fair Credit Reporting Act, the Equal Credit
Opportunity Act, the Magnuson-Moss Warranty Act and the Federal Trade Commission
Act.
The so-called 'Holder-in-Due-Course' Rule of the Federal Trade Commission
(the 'FTC RULE'), other state statutes or the common law in certain states have
the effect of subjecting a seller (and certain related lenders and their
assignees) in a consumer credit transaction and any assignee of the seller
(which would include the Trust) to all claims and defenses that the obligor in
the transaction could assert against the seller of the goods. Liability of a
subsequent holder under the FTC Rule is limited to the amounts paid by the
obligor under the contract, and a subsequent holder of the contract may also be
unable to collect any balance remaining due thereunder from the obligor. The
Uniform Consumer Credit Code applicable in certain states contains provisions
that generally duplicate this rule.
LEGAL INVESTMENT
The Class A-1 Notes will be eligible securities for purchase by money
market funds under paragraph (a)(9) of Rule 2a-7 under the Investment Company
Act of 1940, as amended.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a general summary of the material United States ('U.S.')
federal income tax consequences that may be relevant to the purchase, ownership
and disposition of the Notes and the Certificates by an investor who purchases
the Notes or the Certificates pursuant to their original issuance at their
original issue price. This summary is based upon the Internal Revenue Code of
1986, as amended (the 'CODE'), the Treasury regulations promulgated thereunder,
administrative rulings or pronouncements and judicial decisions, all as in
effect on the date hereof and all of which are subject to change, possibly
retroactively. The following discussion does not deal with all aspects of U.S.
income taxation, nor does it address U.S. federal income tax consequences that
may be relevant to certain types of investors, such as banks, insurance
companies, dealers in securities, tax-exempt organizations or persons whose
functional currency is not the U.S. dollar, who may be subject to special
treatment under the Code. In addition, the following discussion does not address
the alternative minimum tax consequences of an investment in the Notes or the
Certificates or the consequences of such an investment under state and local tax
laws or foreign tax laws. Accordingly, investors should consult their own tax
advisors to determine the federal, state, local, and other tax
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consequences that may be relevant to their purchase, ownership and disposition
of the Notes or the Certificates based upon their particular facts and
circumstances. Prospective investors should note that no rulings have been or
will be sought from the Internal Revenue Service ('IRS') with respect to any of
the U.S. federal income tax consequences discussed herein and opinions of
counsel are not binding on the IRS or the courts. Thus, no assurance can be
given that the IRS will not take positions contrary to those described below.
The opinions of Simpson Thacher & Bartlett, special U.S. federal income tax
counsel to the Sellers ('FEDERAL TAX COUNSEL'), described herein will be based
upon certain representations and assumptions, including, but not limited to, the
assumption that all relevant parties will comply with the terms of the Trust
Agreement and related documents.
This summary is intended as an explanatory discussion of the tax matters
affecting investors generally, but does not purport to furnish information in
the level of detail or with the attention to the investor's specific tax
circumstances that would be provided by an investor's own tax adviser.
Accordingly, each investor is advised to consult its own advisers with regard to
the tax consequences to it of investing in the Notes and the Certificates. An
opinion of Federal Tax Counsel will be filed as an Exhibit to the Registration
Statement.
For purposes of the following discussion, except as otherwise provided
herein, the terms 'NOTEHOLDER' and 'CERTIFICATEHOLDER' refer, respectively, to
the beneficial owner of a Note or Certificate. In addition, the discussion below
assumes that Noteholders and Certificateholders will hold their Notes and
Certificates as 'capital assets' within the meaning of Section 1221 of the Code.
TRUST TREATED AS PARTNERSHIP
Tax Characterization of the Trust. In the opinion of Federal Tax Counsel,
the Trust will not be classified as an association (or publicly traded
partnership) taxable as a corporation. This opinion is based on, among other
things, certain facts and assumptions contained in such opinion and Federal Tax
Counsel's conclusion that the nature of the Trust's income exempts it from the
rule that certain publicly traded partnerships are taxable as corporations.
The Sellers and the Certificateholders, by their purchase of Certificates,
will agree to treat the Trust as a partnership for all U.S. tax purposes with
the assets of such partnership being the assets held by the Trust (including the
Reserve Account and all Investment Earnings earned thereon), the partners of the
partnership being the Certificateholders and the Sellers, and the Notes being
debt of the partnership. However, the proper characterization of the arrangement
involving the Trust, the Certificateholders, the Noteholders and the Sellers is
not clear.
A variety of alternative characterizations are possible. For example,
because the Certificates have certain features characteristic of debt, the
Certificates might be considered debt of the Sellers or the Trust. Any such
characterization generally would not result in materially adverse tax
consequences as compared to the tax consequences that will result from treating
the Certificates as equity interests in a partnership which are described below
under the caption 'Tax Consequences to Certificateholders.' The following
discussion assumes that, for U.S. federal income tax purposes, (i) the Trust
will be classified as a partnership and (ii) the Certificates will represent
equity interests in such partnership.
TAX CONSEQUENCES TO NOTEHOLDERS
Treatment of the Notes as Indebtedness. The Trust and the Noteholders, by
their purchase of the Notes, agree to treat the Notes as debt for all U.S. tax
purposes. In the opinion of Federal Tax Counsel, the Notes will be characterized
as debt for U.S. federal income tax purposes. The discussion below assumes this
characterization of the Notes is correct.
Interest Income on the Notes. The Notes will not be considered to have
been issued with original issue discount ('OID') in excess of the statutorily
defined de minimis amount (i.e., 1/4% of the principal amount of a Note
multiplied by its weighted average to maturity). Consequently, the stated
interest thereon will be taxable to a Noteholder as ordinary interest income at
the time it is received or accrued in accordance with such Noteholder's method
of tax accounting. Under the applicable
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Treasury regulations, a holder of a Note issued with a de minimis amount of OID
must include such OID in income, on a pro rata basis, as principal payments are
made on the Note. A purchaser who buys a Note for more or less than its
principal amount generally will be subject, respectively, to the premium
amortization or market discount rules of the Code.
Sale or Other Disposition. If a Noteholder sells or otherwise disposes of
a Note in a taxable transaction, the former Noteholder will recognize gain or
loss in an amount equal to the difference between the amount realized on such
sale or other disposition and the former Noteholder's adjusted tax basis in the
Note. The adjusted tax basis of a Note to a particular Noteholder generally will
equal the holder's cost therefor increased by any market discount previously
included in income by such Noteholder and decreased by the amount of bond
premium (if any) previously amortized and the amount of any payments, other than
payments of stated interest, previously received by such Noteholder with respect
to such Note. Any such gain or loss will be capital gain or loss if the Note was
held as a capital asset, except to the extent such gain represents accrued
interest or accrued market discount not previously included in income. Capital
losses generally may be used only to offset capital gains.
Foreign Noteholders. For purposes of this discussion, the term 'FOREIGN
INVESTOR' means any person other than (i) a citizen or resident of the United
States, (ii) a corporation, partnership or other entity organized in or under
the laws of the United States or any political subdivision thereof, (iii) an
estate, the income of which is includible in gross income for U.S. federal
income tax purposes regardless of its source, or (iv) a trust if the primary
supervision over the administration of such trust can be exercised by a U.S.
court and one or more U.S. fiduciaries have the authority to control all
substantial decisions of such trust.
Under present U.S. federal income tax law, and subject to the discussion
below concerning backup withholding:
(a) no withholding of U.S. federal income tax will be required with
respect to the payment by the Trust of principal or interest on a Note
owned by a Foreign Investor, provided that the beneficial owner of the Note
(i) is not actually or constructively a '10 percent shareholder' of the
Trust (including a holder of 10% or more of such Trust's outstanding
Certificates) or either Seller, (ii) is not a 'controlled foreign
corporation' with respect to which the Trust or either Seller is a 'related
person' within the meaning of the Code and (iii) satisfies the statement
requirement (described generally below) set forth in Section 871(h) and
Section 881(c) of the Code and the regulations thereunder; and
(b) no withholding of U.S. federal income tax will be required with
respect to any gain realized by a Foreign Investor upon the sale, exchange
or retirement of a Note provided that, in the case of any gain representing
accrued interest, the conditions described in (a) above are satisfied.
To satisfy the requirement referred to in (a)(iii) above, the beneficial
owner of such Note, or a financial institution holding the Note on behalf of
such owner, must provide, in accordance with specified procedures, the U.S.
entity that would otherwise be required to withhold U.S. taxes with a statement
to the effect that the beneficial owner is not a U.S. person. Pursuant to
current temporary Treasury regulations, these requirements will be met if (i)
the beneficial owner provides his name and address, and certifies, under
penalties of perjury that he, she or it is not a 'U.S. person' (which
certification may be made on an IRS Form W-8 or successor form), or (ii) a
financial institution or securities clearing organization holding the Note on
behalf of such beneficial owner certifies, under penalties of perjury, that such
statement has been received by it and furnishes the U.S. entity otherwise
required to withhold U.S. taxes with a copy thereof.
If a Foreign Investor cannot satisfy the requirements of the 'portfolio
interest' exception described in (a) above, payments of premium, if any, and
interest (including OID) made to a Foreign Investor with respect to a Note will
be subject to a 30% U.S. withholding tax unless the beneficial owner of the Note
provides the U.S. entity otherwise required to withhold U.S. taxes with a
properly executed (i) IRS Form 1001 (or successor form) claiming an exemption
from withholding under the benefit of a tax
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treaty or (ii) IRS Form 4224 (or successor form) stating that the interest paid
on the Note is not subject to U.S. withholding tax because such interest income
is effectively connected with the beneficial owner's conduct of a trade or
business in the United States.
If a Foreign Investor is engaged in a trade or business in the United
States and premium, if any, or interest on the Note is effectively connected
with the conduct of such trade or business, the Foreign Investor, although
exempt from the U.S. withholding tax discussed above, will be subject to U.S.
federal income tax on such premium, if any, and interest on a net income basis
in the same manner as if it were a U.S. person. In addition, if such Foreign
Investor is a foreign corporation, it may be subject to a branch profits tax
equal to 30% of its effectively connected earnings and profits for the taxable
year, subject to adjustments. For this purpose, such premium, if any, and
interest on the Note will be included in such foreign corporation's effectively
connected earnings and profits.
Any gain realized by a Foreign Investor upon the sale, exchange or
retirement of a Note generally will not be subject to U.S. federal income tax
unless (i) such gain or income is effectively connected with a trade or business
conducted by the Foreign Investor in the United States and (ii) in the case of a
Foreign Investor who is an individual, such individual is present in the United
States for 183 days or more in the taxable year of such sale, exchange or
retirement, and certain other conditions are met.
Information Reporting and Backup Withholding. In general, information
reporting requirements generally will apply to payments of principal, interest
and premium, if any, paid on the Notes and to the proceeds from the sale of a
Note paid to U.S. persons, other than certain exempt recipients (such as
corporations). In addition, a 31% U.S. backup withholding tax will apply to such
payments if the Noteholder (i) is a U.S. person who fails to provide a taxpayer
identification number, (ii) fails to certify such Noteholder's foreign or other
exempt status or (iii) fails to report in full dividend and interest income.
No information reporting or backup withholding will be required with
respect to payments made by the Trust to a Foreign Investor if a statement
described in (a)(iii) above under the caption 'Foreign Noteholders' has been
received by the U.S. entity otherwise required to withhold U.S. taxes and such
entity does not have actual knowledge that the beneficial owner is a U.S.
person.
In addition, backup withholding and information reporting will not apply if
payments of principal, interest and premium (if any) on a Note are paid or
collected by a foreign office of a custodian, nominee or other foreign agent on
behalf of the beneficial owner of such Note, or if a foreign office of a broker
(as defined in applicable Treasury regulations) pays the proceeds from the sale
of a Note to the owner thereof. If, however, such nominee, custodian, agent or
broker is, for U.S. federal income tax purposes, a U.S. person, a controlled
foreign corporation or a foreign person that derives 50% or more of its gross
income for certain periods from the conduct of a trade or business in the United
States, such payments will not be subject to backup withholding but will be
subject to information reporting, unless (i) such custodian, nominee, agent or
broker has documentary evidence in its records that the beneficial owner is not
a U.S. person and certain other conditions are met or (ii) the beneficial owner
otherwise establishes an exemption. Temporary Treasury regulations provide that
the Treasury is considering whether backup withholding will apply with respect
to such payments of principal, interest and premium (if any), or to the proceeds
from a sale that are not subject to backup withholding under the current
regulations. Under proposed Treasury regulations, not currently in effect,
backup withholding will not apply to such payments absent actual knowledge that
the payee is a U.S. person.
Payments of principal, interest and premium (if any) on a Note paid to the
beneficial owner of a Note by a United States office of a custodian, nominee or
agent, or the payment by the United States office of a broker of the proceeds
from the sale of a Note, will be subject to both backup withholding and
information reporting unless the beneficial owner (i) provides the statement
referred to in (a)(iii) above and the payor does not have actual knowledge that
the beneficial owner is a U.S. person or (ii) otherwise establishes an
exemption.
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Any amounts withheld under the backup withholding rules will be allowed as
a refund or a credit against such holder's U.S. federal income tax liability
provided the required information is furnished to the IRS.
Possible Alternative Classification of the Notes. If, contrary to the
opinion of Federal Tax Counsel, the IRS successfully asserted that one or more
of the Notes did not represent debt for U.S. federal income tax purposes, the
Notes might be treated as equity interests in the Trust. Treatment of the Notes
as equity interests in the Trust could have adverse tax consequences to certain
Noteholders. For example, income to Foreign Investors generally would be subject
to U.S. tax and U.S. tax return filing and withholding requirements and
Noteholders who are individuals might be subject to certain limitations on their
ability to deduct their allocable share of the Trust's expenses. See 'Tax
Consequences to Certificateholders' below.
TAX CONSEQUENCES TO CERTIFICATEHOLDERS
Treatment of the Trust as a Partnership. As discussed above under the
caption 'Trust Treated as Partnership--Tax Characterization of the Trust,' the
following discussion assumes that (i) the Trust will be treated as a partnership
(other than a publicly traded partnership) and (ii) the Certificates represent
equity interests in such partnership, for U.S. federal income tax purposes.
Partnership Taxation. As a partnership, the Trust will not be subject to
U.S. federal income tax. Rather, each Certificateholder will be required to
separately take into account such Certificateholder's allocable share of the
Trust's income, gains, losses, deductions and credits. The Trust's income will
consist primarily of interest and Administrative Fees earned on the Receivables
(including appropriate adjustments for market discount, OID and bond premium)
and any gain realized upon the collection or disposition of Receivables. The
Trust's deductions will consist primarily of interest accruing with respect to
the Notes, servicing and other fees, and losses or deductions realized upon the
collection or disposition of Receivables.
The tax items of a partnership are allocable to the partners in accordance
with the Code, the relevant Treasury regulations promulgated thereunder and the
partnership agreement (here, the Trust Agreement and related documents).
However, inasmuch as the Trust's payment of the Certificate Rate on the
Certificates is payable to the Certificateholders without regard to the income
of the Trust, the Trust's payment of such amounts to Certificateholders should
be treated (and the Trust intends to so treat such payments) as 'guaranteed
payments' within the meaning of Section 707(c) of the Code, and not as a
distributive share of the Trust's income. Such guaranteed payments will be
considered ordinary income to a Certificateholder but may not be considered
interest income for U.S. federal income tax purposes.
In the event that such tax treatment is not respected, the Trust Agreement
provides that the Certificateholders will be allocated gross income of the Trust
for each calendar month equal to the sum of (i) the amount of interest that
accrues on the Certificates for such calendar month, (ii) an amount equivalent
to interest that accrues during such period on amounts previously due on the
Certificates but not yet distributed, and (iii) any gross income of the Trust
attributable to discount on the Receivables that corresponds to any excess of
the principal amount of the Certificates over their initial issue price. All
remaining income of the Trust will be allocated to the Sellers. All deductions
and losses also will be allocated to the Sellers.
Based on the economic arrangement of the parties, such allocations should
be respected for U.S. federal income tax purposes. However, no assurance can be
given that the IRS would not require the Trust to allocate a greater amount of
income to the Certificateholders. Moreover, even under the foregoing method of
allocation, Certificateholders may be allocated income equal to the entire
Certificate Rate plus the other items described above, even though the Trust may
not have sufficient cash to make current cash distributions with respect to such
income. Thus, cash method Certificateholders will be required effectively to
report income from the Certificates on an accrual basis and all
Certificateholders will be liable for the U.S. federal income taxes due on their
allocable share of the Trust's income even if they have not received any cash
distributions from the Trust with respect to
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such income. In addition, because tax allocations and tax reporting will be done
on a uniform basis for all Certificateholders, Certificateholders purchasing
Certificates at different times and at different prices may be required to
recognize an amount of taxable income that is greater or less than the amount
reported to them by the Trust. See '--Allocations between Transferors and
Transferees' below.
The Trust intends to make all tax calculations relating to income and
allocations to Certificateholders on an aggregate basis. If the IRS were to
require that such calculations be made separately for each Receivable, the Trust
might be required to incur additional expense, but it is believed that there
would not be a material adverse effect on Certificateholders.
Discount and Premium. It is anticipated that the Receivables held by the
Trust will not have been issued with OID. Therefore, the Trust should not have
to accrue any OID income. However, the purchase price paid by the Trust for the
Receivables may be greater or less than the remaining principal balance of the
Receivables at the time of purchase. If so, the Receivables will have been
acquired at a premium or discount, as the case may be. (As indicated above, the
Trust will make this calculation on an aggregate basis, but might be required to
recompute it on a Receivable-by-Receivable basis.)
If the Trust acquires the Receivables at a market discount or premium, the
Trust will elect to include any such discount in income currently as it accrues
over the life of the Receivables or to offset any such premium against interest
income on the Receivables. As indicated above, a portion of such market discount
income or premium deduction may be allocated to Certificateholders.
Section 708 Termination. Under Section 708 of the Code, the Trust will be
deemed to terminate for U.S. federal income tax purposes if 50% or more of the
capital and profits interests in the Trust are sold or exchanged within a
12-month period. If such a termination occurs, the Trust would be considered to
have transferred all of its assets and liabilities to a new Trust and then to
have immediately liquidated and distributed the interests in the new Trust to
the continuing Certificateholders. The Trust will not comply with certain
technical requirements that might apply should such a constructive termination
occur. Consequently, the Trust may be subject to certain tax penalties and may
incur additional expenses if it is required to comply with these requirements.
Disposition of Certificates. Generally, a Certificateholder will recognize
capital gain or loss on a sale or other taxable disposition of Certificates in
an amount equal to the difference between the amount realized by the
Certificateholder on such sale or disposition and the Certificateholder's tax
basis in such Certificates. A Certificateholder's tax basis in a Certificate
generally will equal the Certificateholder's cost therefor increased by the
Certificateholder's allocable share of Trust income and decreased by any
distributions received with respect to such Certificate. In addition, both the
tax basis in the Certificates and the amount realized on a sale of a Certificate
would include the Certificateholder's allocable share of the Notes and other
liabilities of the Trust. A Certificateholder acquiring Certificates at
different prices may be required to maintain a single aggregate adjusted tax
basis in such Certificates, and, upon sale or other disposition of some of the
Certificates, allocate a portion of such aggregate tax basis to the Certificates
sold (rather than maintaining a separate tax basis in each Certificate for
purposes of computing gain or loss on a sale of that Certificate).
Any gain on the sale of a Certificate attributable to the
Certificateholder's share of unrecognized accrued market discount on the
Receivables generally would be treated as ordinary income to the
Certificateholder and would give rise to special tax reporting requirements. The
Trust does not expect to have any other assets that would give rise to such
special reporting requirements. Thus, to avoid those special reporting
requirements, the Trust will elect to include market discount in income as it
accrues.
If a Certificateholder is required to recognize an aggregate amount of
income (not including income attributable to disallowed itemized deductions
described above) over the life of the Certificates that exceeds the aggregate
cash distributions with respect thereto, such excess generally will give rise
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to a capital loss upon the retirement of the Certificates. The deductibility of
capital losses is subject to limitations.
Allocations Between Transferors and Transferees. In general, the Trust's
taxable income and losses will be determined monthly and the tax items for a
particular calendar month will be apportioned among the Certificateholders in
proportion to the principal amount of Certificates owned by them as of the close
of the last day of such month. As a result, an investor purchasing Certificates
may be allocated tax items (which will affect its tax liability and tax basis)
attributable to periods before the actual transaction.
The use of such a monthly convention may not be permitted by existing
regulations. If a monthly convention is not allowed (or only applies to
transfers of less than all of the partner's interest), taxable income or losses
of the Trust might be reallocated among the Certificateholders. The Owner
Trustee is authorized to revise the Trust's method of allocation between
transferors and transferees to conform to a method permitted by future
regulations.
Section 754 Election. In the event that a Certificateholder sells its
Certificates at a profit (or loss), the purchasing Certificateholder will have a
higher (or lower) tax basis in the Certificates than the selling
Certificateholder had. The tax basis of the Trust's assets will not be adjusted
to reflect that higher (or lower) basis unless the Trust were to file an
election under Section 754 of the Code. In order to avoid the administrative
complexities that would be involved in keeping accurate accounting records, as
well as potentially onerous information reporting requirements, the Trust will
not make such an election. As a result, Certificateholders might be allocated a
greater or lesser amount of Trust income than would be appropriate based on
their own purchase price for Certificates.
Administrative Matters. The Owner Trustee will be required to keep
complete and accurate books for the Trust. Such books will be maintained for
financial reporting and tax purposes on an accrual basis and the fiscal year of
the Trust will be the calendar year. The Owner Trustee will file or cause to be
filed a partnership information return (IRS Form 1065) with the IRS for each
taxable year of the Trust and will report each Certificateholder's allocable
share of items of Trust income and expense to holders and the IRS on Schedule
K-1. The Owner Trustee will provide or cause to be provided the Schedule K-1
information to nominees that fail to provide the Trust with the information
statement described below and such nominees will be required to forward such
information to the beneficial owners of the Certificates. Generally,
Certificateholders must file tax returns that are consistent with the
information return filed by the Trust or be subject to penalties unless the
Certificateholder notifies the IRS of all such inconsistencies.
Under Section 6031 of the Code, any person that holds Certificates as a
nominee at any time during a calendar year is required to furnish the Trust with
a statement containing certain information on the nominee, the beneficial owners
and the Certificates so held. Such information includes (i) the name, address
and taxpayer identification number of the nominee and (ii) as to each beneficial
owner (x) the name, address and taxpayer identification number of such person,
(y) whether such person is a United States person, a tax-exempt entity or a
foreign government, an international organization, or any wholly owned agency or
instrumentality of either of the foregoing, and (z) certain information on
Certificates that were held, bought or sold on behalf of such person throughout
the year. In addition, brokers and financial institutions that hold Certificates
through a nominee are required to furnish directly to the Trust information as
to themselves and their ownership of Certificates. A clearing agency registered
under Section 17A of the Exchange Act is not required to furnish any such
information statement to the Trust. The information referred to above for any
calendar year must be furnished to the Trust on or before the following January
31. Nominees, brokers and financial institutions that fail to provide the Trust
with the information described above may be subject to penalties.
Chase will be designated as the tax matters partner in the Trust Agreement
and, as such, will be responsible for representing the Certificateholders in any
dispute with the IRS. The Code provides for administrative examination of a
partnership as if the partnership were a separate and distinct taxpayer.
Generally, the statute of limitations for partnership items does not expire
before three years after the date on which the partnership information return is
filed. Any adverse determination following an audit
83
<PAGE>
of the return of the Trust by the appropriate taxing authorities could result in
an adjustment of the returns of the Certificateholders, and, under certain
circumstances, a Certificateholder may be precluded from separately litigating a
proposed adjustment to the items of the Trust. An adjustment could result in an
audit of a Certificateholder's U.S. federal income tax returns and,
consequently, to adjustments of items not related to the Certificateholder's
allocable share of the income and losses of the Trust.
Tax Consequences to Foreign Certificateholders. Under the terms of the
Trust Agreement, the Certificates may not be acquired by or for the account of
an individual or entity that is not a U.S. person as defined in Section
7701(a)(30) of the Code, and any transfer of a Certificate to a person that is
not a U.S. person shall be void. Moreover, in order to protect the Trust from
the potential adverse tax consequences that may result if the Trust failed to
withhold on amounts allocable to Foreign Investors, the Trust intends to, and
will, withhold on any amounts allocable or payable to a Foreign Investor at a
rate of 35% for Foreign Investors that are taxable as corporations and 39.6% for
all other Foreign Investors. In determining a Certificateholder's withholding
status, the U.S. entity otherwise required to withhold U.S. taxes may rely on
IRS Form W-8, IRS Form W-9 or a Certificateholder's certification of nonforeign
status signed under penalties of perjury.
Backup Withholding. Distributions made on the Certificates and proceeds
from the sale of the Certificates generally will be subject to the 31% U.S.
backup withholding tax if the Certificateholder fails to comply with certain
identification procedures or otherwise fails to establish an exemption.
CERTAIN STATE TAX CONSEQUENCES
The activities to be undertaken by the Servicer in servicing and collecting
the Receivables will take place in Oklahoma. The State of Oklahoma imposes a
state income tax on individuals, nonresident aliens (with respect to Oklahoma
taxable income), corporations, certain foreign corporations, and trusts and
estates with Oklahoma taxable income. No ruling on any of the issues discussed
below will be sought from the Oklahoma Tax Commission.
Because of the variation in each state's or locality's tax laws, it is
impossible to predict the tax consequences to Noteholders, Certificateholders or
the Trust in all of the other state and local taxing jurisdictions. Noteholders
and Certificateholders, particularly financial institutions, are urged to
consult their own tax advisors with respect to state and local tax consequences
arising out of the purchase, ownership and disposition of the Notes and/or the
Certificates.
TAX CONSEQUENCES WITH RESPECT TO THE NOTES
Crowe & Dunlevy, P.C., Oklahoma tax counsel to the Sellers ('OKLAHOMA TAX
COUNSEL'), will advise the Trust that, assuming the Notes will be treated as
debt for federal income tax purposes, the Notes will be treated as debt for
Oklahoma income tax purposes, and the Noteholders not otherwise subject to
taxation in Oklahoma should not become subject to taxation in Oklahoma solely
because of a holder's ownership of Notes. However, a Noteholder already subject
to Oklahoma's income tax could be required to pay additional Oklahoma tax as a
result of the holder's ownership or disposition of Notes.
TAX CONSEQUENCES WITH RESPECT TO THE CERTIFICATES ISSUED BY A TRUST TREATED AS A
PARTNERSHIP
Oklahoma Tax Counsel will advise the Trust that if the arrangement created
by the Trust Agreement is treated as a partnership (not taxable as a
corporation) for U.S. federal income tax purposes, the same treatment should
also apply for Oklahoma income tax purposes; under current law,
Certificateholders that are nonresidents of Oklahoma and are not otherwise
subject to Oklahoma income tax should not be subject to Oklahoma income tax on
the income from the Trust because it is unlikely that the Trust has established
a nonunitary business or commercial situs in Oklahoma. In any event,
classification of the arrangement as a 'partnership' would not cause a
Certificateholder not otherwise subject to taxation in Oklahoma to pay Oklahoma
income tax on income beyond that derived from the Certificates.
84
<PAGE>
ERISA CONSIDERATIONS
GENERAL
The Employee Retirement Income Security Act of 1974, as amended ('ERISA'),
and Section 4975 of the Code, impose certain requirements on employee benefit
plans and certain other plans and arrangements, including individual retirement
accounts and annuities, Keogh plans and certain collective investment funds or
insurance company general or separate accounts in which such plans, accounts or
arrangements are invested, that are subject to the fiduciary responsibility
provisions of ERISA and/or Section 4975 of the Code (collectively, 'PLANS'), and
on persons who are fiduciaries with respect to Plans, in connection with the
investment of 'plan assets' of any Plan ('PLAN ASSETS'). ERISA generally imposes
on Plan fiduciaries certain general fiduciary requirements, including those of
investment prudence and diversification and the requirement that a Plan's
investments be made in accordance with the documents governing the Plan.
Generally, any person who has discretionary authority or control respecting the
management or disposition of Plan Assets, and any person who provides investment
advice with respect to such assets for a fee, is a fiduciary with respect to
such Plan Assets.
ERISA and Section 4975 of the Code prohibit a broad range of transactions
involving Plan Assets and persons ('Parties in Interest' under ERISA and
'Disqualified Persons' under the Code) who have certain specified relationships
to a Plan or its Plan Assets, unless a statutory or administrative exemption is
available. Parties in Interest or Disqualified Persons that participate in a
prohibited transaction may be subject to a penalty imposed under ERISA and/or an
excise tax imposed pursuant to Section 4975 of the Code, unless a statutory or
administrative exemption is available. These prohibited transactions generally
are set forth in Section 406 of ERISA and Section 4975 of the Code.
Any fiduciary or other Plan investor considering whether to purchase any
Securities on behalf of or with Plan Assets of any Plan should consult with its
counsel for guidance regarding the ERISA Considerations applicable to the
Securities offered hereby.
Certain employee benefit plans, such as governmental plans (as defined in
Section 3(32) of ERISA) and certain church plans (as defined in Section 3(33) of
ERISA), are not subject to the requirements of ERISA or Section 4975 of the
Code. Accordingly, assets of such plans may be invested in the Securities
without regard to the ERISA considerations described herein, subject to the
provisions of other applicable federal and state law. However, any such plan
that is qualified and exempt from taxation under Sections 401(a) and 501(a) of
the Code is subject to the prohibited transaction rules set forth in Section 503
of the Code.
THE NOTES
Subject to the considerations described below, the Notes are eligible for
purchase with Plan Assets of any Plan.
Any fiduciary or other Plan investor considering whether to purchase the
Notes with Plan Assets of any Plan should determine whether such purchase is
consistent with its fiduciary duties and whether such purchase would constitute
or result in a non-exempt prohibited transaction under ERISA and/or Section 4975
of the Code because any of the Sellers, the Servicer, the Trust (by reason of
the Seller's ownership of Certificates), the Indenture Trustee, the Owner
Trustee, any other Certificateholder or any other parties may be deemed to be
benefiting from the issuance of the Notes and may be Parties in Interest or
Disqualified Persons with respect to the investing Plan. Any fiduciary or other
Plan investor considering whether to purchase the Notes should consult with its
counsel regarding the applicability of the fiduciary responsibility and
prohibited transaction provisions of ERISA and Section 4975 of the Code to such
investment, and of the Seller, the Servicer or the Trust as a Party-in-Interest
or Disqualified Person with respect to the investing Plan, the availability of
exemptive relief under any prohibited transaction exemption. For example, DOL
Prohibited Transaction Exemptions 96-23 (relating to transactions determined by
'in-house asset managers'), 95-60 (relating to transactions involving insurance
company general accounts), 91-38 (relating to transactions involving bank
collective investment funds), 90-1 (relating to transactions involving insurance
company pooled separate accounts) or 84-14 (relating to transactions determined
by independent 'qualified
85
<PAGE>
professional asset managers') may be available. A purchaser of the Notes should
be aware, however, that even if the conditions specified in an exemption are
met, the scope of the exemptive relief provided by the exemption might not cover
all acts which might be construed as prohibited transactions.
In addition, under U.S. Department of Labor Regulation Section 2510.3-101
(the 'PLAN ASSET REGULATION'), the purchase with Plan Assets of equity interests
in the Trust could, in certain circumstances, cause the Receivables and other
assets of the Trust to be deemed Plan Assets of the investing Plan which, in
turn, would subject the Trust and its assets to the fiduciary responsibility
provisions of ERISA and the prohibited transaction provisions of ERISA and
Section 4975 of the Code. Nevertheless, because the Notes (a) should be treated
as indebtedness under local law and debt, rather than equity, for tax purposes
(see 'Certain Federal Income Tax Consequences--Tax Consequences to
Noteholders--Treatment of the Notes as Indebtedness' herein), and (b) should not
be deemed to have any 'substantial equity features,' purchases of the Notes with
Plan Assets should not be treated as equity investments and, therefore, the
Receivables and other assets included as assets of the Trust should not be
deemed to be Plan Assets of the investing Plans. Those conclusions are based, in
part, upon the traditional debt features of the Notes, including the reasonable
expectation of purchasers of Notes that the Notes (which are highly rated by the
Rating Agencies) will be repaid when due, as well as the absence of conversion
rights, warrants and other typical equity features. Before purchasing the Notes,
a fiduciary or other Plan investor should itself confirm that the Notes
constitute debt for purposes of the Plan Asset Regulation.
The Notes may not be purchased with Plan Assets of any Plan if any of the
Sellers, the Servicer, the Indenture Trustee, the Owner Trustee or any of their
respective affiliates (a) has investment or administrative discretion with
respect to the Plan Assets used to effect such purchase; (b) has authority or
responsibility to give, or regularly gives, investment advice with respect to
such Plan Assets, for a fee and pursuant to an agreement or understanding that
such advice (1) will serve as a primary basis for investment decisions with
respect to such Plan Assets, and (2) will be based on the particular investment
needs of such Plan; or (c) is an employer maintaining or contributing to such
Plan. Each purchaser will be deemed to have represented and warranted that its
purchase of a Note or any interest therein does not violate the foregoing
limitation.
THE CERTIFICATES
Because purchases of the Certificates are equity investments, the
Certificates may not be purchased by, on behalf of or with the Plan Assets of
any Plan. In addition, each purchaser of the Certificates will be deemed to have
represented and warranted that it is neither a Plan nor purchasing the
Certificates on behalf of or with Plan Assets of a Plan.
The Small Business Job Protection Act of 1996 added new Section 401(c) of
ERISA relating to the status of the assets of insurance company general accounts
under ERISA and Section 4975 of the Code. Pursuant to Section 401(c), the
Department of Labor is required to issue final regulations (the 'GENERAL ACCOUNT
REGULATIONS') not later than December 31, 1997 with respect to insurance
policies issued on or before December 31, 1998 that are supported by an
insurer's general account. The General Account Regulations are to provide
guidance on which assets held by the insurer constitute Plan Assets for purposes
of the fiduciary responsibility provisions of ERISA and Section 4975 of the
Code. The assets of a general account that support insurance policies (other
than 'guaranteed benefit policies' within the meaning of Section 401(b)(2) of
ERISA) (i) issued to Plans after December 31, 1998 or (ii) issued to Plans on or
before December 31, 1998 for which the insurance company does not comply with
the General Account Regulations, may be treated as Plan Assets. However, except
in the case of avoidance of the General Account Regulations and actions brought
by the Secretary of Labor relating to certain breaches of fiduciary duties that
also constitute breaches of state or federal criminal law, until the date that
is 18 months after the General Account Regulations become final, no liability
under the fiduciary responsibility and prohibited transaction provisions of
ERISA and Section 4975 may result on the basis of a claim that the assets of the
general account of an insurance company constitute the Plan Assets of any Plan.
The Plan Asset status of insurance company separate accounts
86
<PAGE>
is unaffected by new Section 401(c) of ERISA, and separate account assets
continue to be treated as the Plan Assets of any Plan invested in a separate
account.
If the assets of a general account invested in the Certificates are treated
as Plan Assets of any Plan or the protections of Section 401(c) of ERISA become
unavailable, certain violations of the prohibited transaction rules may be
deemed to occur as a result of the operation of the Trust. Insurance companies
contemplating the investment of general account assets in the Certificates
should consult with their own counsel concerning the impact of Section 401(c) of
ERISA, including the status of assets of the general account and its ability to
continue to hold the Certificates after the date that is 18 months after the
General Account Regulations become final. The deemed representation and warranty
regarding the acquisition and holding of Certificates by any Plan or person
investing Plan Assets of any Plan (See 'Summary of Terms--ERISA Considerations'
herein) will not apply to the acquisition or holding of Certificates with the
assets of the general account of an insurance company to the extent that such
acquisition or holding, respectively, (i) is and will be permitted by Section
401(c) of ERISA and final regulations thereunder or another exemption under
ERISA and (ii) does not and will not result in the contemplated operations of
the Trust being treated as non-exempt prohibited transactions.
UNDERWRITING
As consideration for the transfer of the Receivables to the Trust, the
Trust will issue the Notes and the Certificates to the Sellers, with (i) Chase
receiving 87.17% of the original principal amount of each class of Notes and the
original Certificate Balance and (ii) Chase USA receiving 12.83% of the original
principal amount of each class of Notes and the original Certificate Balance.
Subject to the terms and conditions set forth in the note underwriting
agreement (the 'NOTE UNDERWRITING AGREEMENT') and the certificate underwriting
agreement (the 'CERTIFICATE UNDERWRITING AGREEMENT,' and together with the Note
Underwriting Agreement, the 'UNDERWRITING AGREEMENTS'), the Sellers have agreed
to sell to the note underwriters indicated below (the 'NOTE UNDERWRITERS') and
to Chase Securities Inc. (the 'CERTIFICATE UNDERWRITER,' and together with the
Note Underwriters, the 'UNDERWRITERS'), and each of the Underwriters has agreed
to purchase, the principal amount of each class of Notes and the Certificates
set forth opposite its name below.
<TABLE>
<CAPTION>
MERRILL, LYNCH, PIERCE,
CHASE BEAR, STEARNS FENNER & SMITH SALOMON
SECURITIES INC. & CO. INC. INCORPORATED BROTHERS INC
--------------- ------------- ----------------------- -------------
<S> <C> <C> <C> <C>
Class A-1................................. $ $ $ $
Class A-2.................................
Class A-3.................................
Class A-4.................................
Class A-5.................................
Class A-6.................................
Class A-7.................................
Class A-8.................................
Class A-9.................................
Class A-10................................
Certificates..............................
--------------- ------------- ----------------------- -------------
Total................................ $ $ $ $
--------------- ------------- ----------------------- -------------
--------------- ------------- ----------------------- -------------
</TABLE>
The Underwriters initially propose to offer all or a part of the Notes and
Certificates, as applicable, directly to the public at the respective public
offering prices set forth on the cover page of this Prospectus and may offer a
portion of the Notes and Certificates, as applicable, to dealers at a price
which represents a concession not in excess of the amounts set forth below for
the respective classes of Notes and the Certificates. The Underwriters may
allow, and such dealers may allow, a concession not in excess of the amounts set
forth below for the respective classes of the Notes and the Certificates
87
<PAGE>
for certain dealers. After the initial public offering, the public offering
prices and such concessions may from time to time be varied by the Underwriters.
<TABLE>
<CAPTION>
CONCESSION TO REALLOWANCE
DEALERS CONCESSION
------------- -----------
<S> <C> <C>
Class A-1......................................................................... % %
Class A-2.........................................................................
Class A-3.........................................................................
Class A-4.........................................................................
Class A-5.........................................................................
Class A-6.........................................................................
Class A-7.........................................................................
Class A-8.........................................................................
Class A-9.........................................................................
Class A-10........................................................................
Certificates......................................................................
</TABLE>
The Indenture Trustee and the Owner Trustee (on behalf of the Trust) may,
from time to time, invest the funds in the Collection Account, the Paid-Ahead
Account and the Reserve Account in Permitted Investments acquired from the
Underwriters.
Chase Securities Inc. may engage in over-allotment transactions,
stabilizing transactions, syndicate covering transactions and penalty bids with
respect to the Securities in accordance with Regulation M under the Exchange
Act. Over-allotment transactions involve syndicate sales in excess of the
offering size, which creates a syndicate short position. Stabilizing
transactions permit bids to purchase the Security so long as the stabilizing
bids do not exceed a specified maximum. Syndicate covering transactions involve
purchases of the Securities in the open market after the distribution has been
completed in order to cover syndicate short positions. Penalty bids permit Chase
Securities Inc. to reclaim a selling concession from a syndicate member when the
Securities originally sold by such syndicate member are purchased in a syndicate
covering transaction. Such over-allotment transactions, stabilizing
transactions, syndicate covering transactions and penalty bids may cause the
prices of the Securities to be higher than they would otherwise be in the
absence of such transactions. Neither the Issuer nor Chase Securities Inc.
represent that Chase Securities Inc. will engage in any such transactions or
that such transactions, if commenced, will not be discontinued without notice.
This Prospectus may be used by Chase Securities Inc., an affiliate of the
Sellers and a subsidiary of the Corporation, in connection with offers and sales
related to market-making transactions in the Securities. Chase Securities Inc.
may act as principal or agent in such transactions. Such sales will be made at
prices related to prevailing market prices at the time of sale. Chase Securities
Inc. has no obligation to make a market in the Securities, and it may
discontinue any such market-making activities at any time without notice, in its
sole discretion.
The Sellers and CITSF will indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act or contribute to
payments the Underwriters may be required to make in respect thereof.
LEGAL MATTERS
Certain legal matters relating to the issuance of the Securities will be
passed upon for the Sellers by Simpson Thacher & Bartlett (a partnership that
includes professional corporations), New York, New York and certain other legal
matters will be passed upon for the Sellers by Orest J. Lechnowsky, Esq., a
Senior Vice President of Chase Financial Corporation, an affiliate of the
Sellers, and for the Underwriters by Orrick, Herrington & Sutcliffe LLP, New
York, New York. Certain Oklahoma state tax matters will be passed upon for the
Sellers by Crowe & Dunlevy, P.C., Oklahoma City, Oklahoma. From time to time
Simpson Thacher & Bartlett and Orrick, Herrington & Sutcliffe LLP provide legal
services to the Sellers and their affiliates.
88
<PAGE>
INDEX OF TERMS
<TABLE>
<CAPTION>
TERM PAGE
- ---------------------------------------------------------------------------------------------------- -----------
<S> <C>
ABS................................................................................................. 38
ABS Table........................................................................................... 38
Actual Principal Balance............................................................................ 58
Actuarial Receivables............................................................................... 28
Administration Agreement............................................................................ 10
Administrative Fees................................................................................. 60
Administrator....................................................................................... 10
Aggregate Losses.................................................................................... 60
Aggregate Net Losses................................................................................ 69
Applicable Trustee.................................................................................. 53
Asset Service Center................................................................................ 33
Available Amount.................................................................................... 65
Available Reserve Account Amount.................................................................... 68
Average Delinquency Percentage...................................................................... 69
Average Net Loss Ratio.............................................................................. 69
Banks............................................................................................... 1
Bulk Purchase Receivables........................................................................... 30
Business Day........................................................................................ 4
CBC................................................................................................. 34
CBC Holding......................................................................................... 34
Cede................................................................................................ ii
Cedel............................................................................................... i, 53
Cedel Participants.................................................................................. 53
Certificate Balance................................................................................. 66
Certificate Final Scheduled Distribution Date....................................................... 6
Certificate Pool Factor............................................................................. 46
Certificate Rate.................................................................................... 6
Certificate Underwriter............................................................................. 87
Certificate Underwriting Agreement.................................................................. 87
Certificateholder................................................................................... 53, 78
Certificateholders.................................................................................. 6
Certificateholders' Distributable Amount............................................................ 67
Certificateholders' Interest Carryover Shortfall.................................................... 67
Certificateholders' Interest Distributable Amount................................................... 67
Certificateholders' Monthly Interest Distributable Amount........................................... 67
Certificateholders' Monthly Principal Distributable Amount.......................................... 67
Certificateholders' Principal Carryover Shortfall................................................... 67
Certificateholders' Principal Distributable Amount.................................................. 67
Certificates........................................................................................ ii, 3
CFAC................................................................................................ 29
CFHI................................................................................................ 29
CFMC................................................................................................ 1
Chase............................................................................................... ii
Chase Financial Receivables......................................................................... 29
</TABLE>
89
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- ---------------------------------------------------------------------------------------------------- -----------
<S> <C>
Chase N.A........................................................................................... 1
Chase RV Finance.................................................................................... 1
Chase RV Finance Portfolio.......................................................................... 15
Chase USA........................................................................................... ii
Chase/Chemical Merger............................................................................... 29
CIT................................................................................................. 1
CITSF............................................................................................... ii, 1
Class A-1 Notes..................................................................................... ii
Class A-2 Notes..................................................................................... ii
Class A-3 Notes..................................................................................... ii
Class A-4 Notes..................................................................................... ii
Class A-5 Notes..................................................................................... ii
Class A-6 Notes..................................................................................... ii
Class A-7 Notes..................................................................................... ii
Class A-8 Notes..................................................................................... ii
Class A-9 Notes..................................................................................... ii
Class A-10 Notes.................................................................................... ii
Clearing agency..................................................................................... 52
Clearing corporation................................................................................ 52
Closing Date........................................................................................ i
Code................................................................................................ 77
Collection Account.................................................................................. 9
Collection Period................................................................................... 7
Commission.......................................................................................... iii
Contract Rate....................................................................................... 58
Cooperative......................................................................................... 54
Corporation......................................................................................... i
Cutoff Date......................................................................................... ii
Cutoff Date Pool Balance............................................................................ 4
Dealer Agreements................................................................................... 30
Dealers............................................................................................. 30
Definitive Certificates............................................................................. 54
Definitive Notes.................................................................................... 54
Definitive Securities............................................................................... 54
Delinquency Percentage.............................................................................. 69
Deposit Date........................................................................................ 60
Depositaries........................................................................................ 52
Direct Receivables.................................................................................. 29
Distribution Date................................................................................... ii
DKB................................................................................................. 34
DTC................................................................................................. i
Due Date............................................................................................ 28
Duff & Phelps....................................................................................... 11
Eligible Deposit Account............................................................................ 59
ERISA............................................................................................... 85
</TABLE>
90
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- ---------------------------------------------------------------------------------------------------- -----------
<S> <C>
Euroclear........................................................................................... i, 53
Euroclear Operator.................................................................................. 54
Euroclear Participants.............................................................................. 53
Events of Default................................................................................... 48
Events of Servicing Termination..................................................................... 71
Exchange Act........................................................................................ iii
Excluded Forced-Placed Insurance Premiums........................................................... 17
Excluded Precomputed Amounts........................................................................ 17
FDIA................................................................................................ 14
FDIC................................................................................................ i
Federal Tax Counsel................................................................................. 78
Final Scheduled Maturity Date....................................................................... 4
Financed Vehicles................................................................................... 4
FIRREA.............................................................................................. 14
Foreign Investor.................................................................................... 79
FTC Rule............................................................................................ 77
General Account Regulations......................................................................... 86
Indenture........................................................................................... ii, 2
Indenture Trustee................................................................................... ii, 2
Indirect Receivables................................................................................ 29
Interest Accrual Period............................................................................. 5
Interest Rate....................................................................................... 4
Investment Earnings................................................................................. 60
IRS................................................................................................. 78
Issuer.............................................................................................. i, 1
Liquidated Receivable............................................................................... 66
Loss................................................................................................ 60
MHC................................................................................................. 34
Military Reservist Relief Act....................................................................... 58
Monthly Advance..................................................................................... 8
Moody's............................................................................................. 11
NADA................................................................................................ 32
Net Liquidation Proceeds............................................................................ 66
Net Loss Ratio...................................................................................... 69
New Financed Vehicle................................................................................ 18
Note Final Scheduled Distribution Date.............................................................. 5
Note Pool Factor.................................................................................... 46
Note Underwriters................................................................................... 87
Note Underwriting Agreement......................................................................... 87
Noteholder.......................................................................................... 53, 78
Noteholders......................................................................................... 4
Noteholders' Distributable Amount................................................................... 67
Noteholders' Interest Carryover Shortfall........................................................... 67
Noteholders' Interest Distributable Amount.......................................................... 68
Noteholders' Monthly Interest Distributable Amount.................................................. 68
</TABLE>
91
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- ---------------------------------------------------------------------------------------------------- -----------
<S> <C>
Noteholders' Monthly Principal Distributable Amount................................................. 68
Noteholders' Principal Carryover Shortfall.......................................................... 68
Noteholders' Principal Distributable Amount......................................................... 68
Notes............................................................................................... ii, 2
Obligor............................................................................................. 8
OID................................................................................................. 78
Oklahoma Tax Counsel................................................................................ 84
Original Pool Balance............................................................................... 4
Originator.......................................................................................... 29
Owner Trustee....................................................................................... ii, 2
Paid-Ahead Account.................................................................................. 38
Paid-Ahead Amounts.................................................................................. 9
Paid-Ahead Period................................................................................... 37
Paid-Ahead Precomputed Receivable................................................................... 38
Paid-Ahead Simple Interest Receivable............................................................... 37
Participants........................................................................................ iii
Paying Agent........................................................................................ 59
Payment Shortfall................................................................................... 8
Permitted Investments............................................................................... 59
Plan Asset Regulation............................................................................... 86
Plan Assets......................................................................................... 85
Plans............................................................................................... 85
Pool Balance........................................................................................ 4
Precomputed Receivables............................................................................. 28
Prepayments......................................................................................... 36
Principal Balance................................................................................... 65
Principal Distribution Amount....................................................................... 65
Principal Prepayment................................................................................ 66
Qualified Institution............................................................................... 59
Qualified Trust Institution......................................................................... 59
Rating Agencies..................................................................................... 11
Receivables......................................................................................... 17
Receivables Pool.................................................................................... 17
Record Date......................................................................................... 4
Recreational Vehicle Loans.......................................................................... 17
Regional Centers.................................................................................... 31
Registration Statement.............................................................................. iii
Relief Act Reduction................................................................................ 58
Repurchase Amount................................................................................... 58
Repurchased Receivable.............................................................................. 65
Reserve Account..................................................................................... 7
Reserve Account Initial Deposit..................................................................... 7
Rule of 78's........................................................................................ 29
Rule of 78's Receivables............................................................................ 29
Rules............................................................................................... 53
</TABLE>
92
<PAGE>
<TABLE>
<CAPTION>
TERM PAGE
- ---------------------------------------------------------------------------------------------------- -----------
<S> <C>
Sale and Servicing Agreement........................................................................ 4
Schedule of Receivables............................................................................. 57
Securities.......................................................................................... ii
Securities Act...................................................................................... iii
Securityholder...................................................................................... 53
Securityholders..................................................................................... 6
Sellers............................................................................................. ii, 1
Servicer............................................................................................ ii, 1
Servicer Payment.................................................................................... 10
Servicing Fee....................................................................................... 10
Servicing Fee Rate.................................................................................. 10
Servicing Transfer.................................................................................. 1
Servicing Transfer Agreements....................................................................... 2
Settlement Date..................................................................................... 10
Simple Interest Receivables......................................................................... 28
Soldiers' and Sailors' Civil Relief Act............................................................. 58
Specified Reserve Account Balance................................................................... 8
Standard & Poor's................................................................................... 11
Stockholders Agreement.............................................................................. 34
Terms and Conditions................................................................................ 54
Transfer Agent and Registrar........................................................................ 55
Transfer and Servicing Agreements................................................................... 57
Trust............................................................................................... i, 1
Trust Accounts...................................................................................... 59
Trust Agreement..................................................................................... 1
UCC................................................................................................. 74
Underwriters........................................................................................ 87
Underwriting Agreements............................................................................. 87
U.S................................................................................................. 77
Used Financed Vehicle............................................................................... 18
</TABLE>
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<PAGE>
ANNEX A
GLOBAL CLEARANCE, SETTLEMENT AND TAX DOCUMENTATION PROCEDURES
Except in certain limited circumstances, the globally offered Chase
Manhattan RV Trust 1997-A Class A-1 % Asset Backed Notes, Class A-2
% Asset Backed Notes, Class A-3 % Asset Backed Notes, Class A-4
% Asset Backed Notes, Class A-5 Asset Backed Notes, Class A-6 Asset Backed
Notes, Class A-7 Asset Backed Notes, Class A-8 Asset Backed Notes, Class A-9
Asset Backed Notes, and Class A-10 % Asset Backed Notes (the 'GLOBAL
NOTES') and % Asset Backed Certificates (the 'GLOBAL CERTIFICATES,' and
together with the Global Notes, the 'GLOBAL SECURITIES') to be issued will be
available only in book-entry form. Investors in the Global Securities may hold
Global Notes through any of The Depository Trust Company ('DTC'), Cedel or
Euroclear or hold Global Certificates through DTC. The Global Securities will be
tradeable as home market instruments in both the European and U.S. domestic
markets. Initial settlement and all secondary trades will settle in same-day
funds.
Secondary market trading between investors holding Global Notes through
Cedel and Euroclear will be conducted in the ordinary way in accordance with
their normal rules and operating procedures and in accordance with conventional
eurobond practice (i.e., seven calendar day settlement).
Secondary market trading between investors holding Global Securities
through DTC will be conducted according to the rules and procedures applicable
to U.S. corporate debt obligations.
Secondary cross-market trading between Cedel or Euroclear and DTC
Participants holding Global Notes will be effected on a delivery-against-payment
basis through the respective Depositaries of Cedel and Euroclear (in such
capacity) and as DTC Participants.
Non-U.S. holders (as described below) of Global Securities will be subject
to U.S. withholding taxes unless such holders meet certain requirements and
deliver appropriate U.S. tax documents to the securities clearing corporation
organizations or their participants.
INITIAL SETTLEMENT
All Global Securities will be held in book-entry form by DTC in the name of
Cede & Co. as nominee or DTC. Investors' interests in the Global Securities will
be represented through financial institutions acting on their behalf as direct
and indirect Participants in DTC. As a result, Cedel and Euroclear will hold
positions on behalf of their participants through their respective Depositaries,
which in turn will hold such positions in accounts as DTC Participants.
Investors electing to hold their Global Securities through DTC will follow
the settlement practice applicable to U.S. corporate debt obligations. Investor
securities custody accounts will be credited with the holdings against payment
in same-day funds on the settlement date.
Investors electing to hold their Global Notes through Cedel or Euroclear
accounts will follow the settlement procedures applicable to conventional
eurobonds, except that there will be no temporary global security and no
'lock-up' or restricted period. Global Securities will be credited to the
securities custody accounts on the settlement date against payment in same-day
funds.
SECONDARY MARKET TRADING
Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.
Trading between DTC Participants. Secondary market trading between DTC
Participants will be settled using the procedures applicable to U.S. corporate
debt obligations in same-day funds.
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<PAGE>
Trading between Cedel and/or Euroclear Participants. Secondary market
trading between Cedel Participants or Euroclear Participants will be settled
using the procedures applicable to conventional eurobonds in same-day funds.
Trading between DTC seller and Cedel or Euroclear purchaser. When Global
Notes are to be transferred from the account of a DTC Participant to the account
of a Cedel Participant or a Euroclear Participant, the purchaser will send
instructions to Cedel, or Euroclear through a Cedel Participant or Euroclear
Participant, at least one business day prior to settlement. Cedel or Euroclear
will instruct the respective Depositary to receive the Global Notes against
payment. Payment will include interest accrued on the Global Notes from and
including the last coupon payment date to and excluding the settlement date.
Payment will then be made by the respective Depositary to the DTC Participant's
account against delivery of the Global Notes. After settlement has been
completed, the Global Notes will be credited to the respective clearing system
and by the clearing system, in accordance with its usual procedures, to the
Cedel Participant's or Euroclear Participant's account. The Global Notes credit
will appear the next day (European time) and the cash debit will be
backed-valued to, and the interest on the Global Notes will accrue from, the
value date (which would be the preceding day when settlement occurred in New
York). If settlement is not completed on the intended value date (i.e., the
trade fails), the Cedel or Euroclear cash debit will be valued instead as of the
actual settlement date.
Cedel Participants and Euroclear Participants will need to make available
to the respective clearing systems the funds necessary to process same-day funds
settlement. The most direct means of doing so is to preposition funds for
settlement, either from cash on hand or existing lines of credit, as they would
for any settlement occurring within Cedel or Euroclear. Under this approach,
they may take on credit exposure to Cedel or Euroclear until the Global Notes
are credited to their accounts one day later.
As an alternative, if Cedel or Euroclear has extended a line of credit to
them, Cedel Participants or Euroclear Participants can elect not to preposition
funds and allow that credit line to be drawn upon the finance settlement. Under
this procedure, Cedel Participants or Euroclear Participants purchasing Global
Notes would incur overdraft charges for one day, assuming they cleared the
overdraft when the Global Notes were credited to their accounts. However,
interest on the Global Notes would accrue from the value date. Therefore, in
many cases the investment income on the Global Notes earned during the one-day
period may substantially reduce or offset the amount of such overdraft charges,
although this result will depend on each Cedel Participant's or Euroclear
Participant's particular cost of funds.
Since the settlement is taking place during New York business hours, DTC
Participants can employ their usual procedures for sending Global Notes to the
respective Depositary for the benefit of Cedel Participants or Euroclear
Participants. The sale proceeds will be available to the DTC seller on the
settlement date. Thus, to the DTC Participant a cross-market transaction will
settle no differently than a trade between two DTC Participants.
Trading between Cedel or Euroclear seller and DTC purchaser. Due to time
zone differences in their favor, Cedel Participants and Euroclear Participants
may employ their customary procedures for transactions in which Global Notes are
to be transferred by the respective clearing system, through the respective
Depositary, to a DTC Participant. The seller will send instructions to Cedel or
Euroclear through a Cedel Participant or Euroclear Participant at least one
business day prior to settlement. In these cases, Cedel or Euroclear will
instruct the respective Depositary, as appropriate, to deliver the bonds to the
DTC Participant's account against payment. Payment will include interest accrued
on the Global Notes from and including the last coupon payment date to and
excluding the settlement date. The payment will then be reflected in the account
of the Cedel Participant or Euroclear Participant the following day, and receipt
of the cash proceeds in the Cedel Participant's or Euroclear Participant's
account would be back-valued to the value date (which would be the preceding
day, when settlement occurred in New York). Should the Cedel Participant or
Euroclear Participant have a line of credit with its respective clearing system
and elect to be in debit in anticipation of receipt of the sale proceeds in its
account, the back-valuation will extinguish any overdraft charges incurred over
that one-day period.
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<PAGE>
If settlement is not completed on the intended value date (i.e., the trade
fails), receipt of the cash proceeds in the Cedel Participant's or Euroclear
Participant's account would instead be valued as of the actual settlement date.
Finally, day traders that use Cedel or Euroclear and that purchase Global
Notes from DTC Participants for delivery to Cedel Participants or Euroclear
Participants should note that these trades would automatically fail on the sale
side unless affirmative action were taken. At least three techniques should be
readily available to eliminate this potential problem:
(a) borrowing through Cedel or Euroclear for one day (until the
purchase side of the day trade is reflected in their Cedel or Euroclear
accounts) in accordance with the clearing system's custom procedures;
(b) borrowing the Global Notes in the U.S. from a DTC Participant no
later than one day prior to settlement, which would give the Global Notes
sufficient time to be reflected in their Cedel or Euroclear account in
order to settle the sale side of the trade; or
(c) staggering the value dates for the buy and sell sides of the trade
so that the value date for the purchase from the DTC Participant is at
least one day prior to the value date for the sale to the Cedel Participant
or Euroclear Participant.
CERTAIN U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS
GLOBAL NOTES
A beneficial owner of Global Notes holding securities through Cedel or
Euroclear (or through DTC if the holder has an address outside the U.S.) will be
subject to the 30% U.S. withholding tax that generally applies to payments of
interest (including original issue discount) on registered debt issued by U.S.
Persons, unless (i) each clearing system, bank or other financial institution
that holds customers' securities in the ordinary course of its trade or business
in the chain of intermediaries between such beneficial owner and the U.S. entity
required to withhold tax complies with applicable certification requirements and
(ii) such beneficial owner takes one of the following steps to obtain an
exemption or reduced tax rate:
Exemption for non-U.S. Persons (Form W-8). Beneficial owners of the
Notes that are non-U.S. Persons can obtain a complete exemption from the
withholding tax by filing a signed Form W-8 (Certificate of Foreign
Status). If the information shown on Form W-8 changes, a new Form W-8 must
be filed within 30 days of such change.
Exemption for non-U.S. Persons with effectively connected income
(Form 4224). A non-U.S. Person, including a non-U.S. corporation or bank
with a U.S. branch, for which the interest income is effectively connected
with its conduct of a trade or business in the United States, can obtain an
exemption from the withholding tax by filing Form 4224 (Exemption from
Withholding of Tax on Income Effectively Connected with the Conduct of a
Trade or Business in the United States).
Exemption or reduced rate for non-U.S. Persons resident in treaty
countries (Form 1001). Non-U.S. Persons that are beneficial owners of Notes
and who reside in a country that has a tax treaty with the United States
can obtain an exemption or reduced tax rate (depending on the treaty terms)
by filing Form 1001 (Ownership, Exemption of Reduced Rate Certificate). If
the treaty provides only for a reduced rate, withholding tax will be
imposed at that rate unless the filer alternatively files Form W-8. Form
1001 may be filed by such beneficial owner or his agent.
Exemption for U.S. Persons (Form W-9). U.S. Persons can obtain a
complete exemption from the withholding tax by filing Form W-9 (Payer's
Request for Taxpayer Identification Number and Certification).
U.S. Federal Income Tax Reporting Procedure. The beneficial owner of
a Global Note or, in the case of a Form 1001 or a Form 4224 filer, his
agent, files by submitting the appropriate form to the person through whom
it holds (the clearing agency, in the case of persons holding directly on
A-3
<PAGE>
the books of the clearing agency). Form W-8 and Form 1001 are effective for
three calendar years and Form 4224 is effective for one calendar year.
The term 'U.S. PERSON' means (i) a citizen or resident of the United
States, (ii) a corporation or partnership organized in or under the laws of the
United States or any political subdivision thereof, (iii) an estate the income
of which is includible in gross income for United States tax purposes regardless
of its source or (iv) a trust if a court within the United States is able to
exercise primary supervision over the administration of such trust and one or
more United States fiduciaries have the authority to control all substantial
decisions of such trust. This summary does not deal with all aspects of U.S.
federal income tax withholding that may be relevant to foreign holders of the
Global Notes. Investors are advised to consult their own tax advisors for
specific tax advice concerning their holding and disposing of the Global Notes.
GLOBAL CERTIFICATES
A beneficial owner of Global Certificates holding such Certificates through
DTC will be subject to U.S. withholding tax at a rate of 35% in the case of
corporations and at a rate of 39.6% in the case of all other persons if such
holder has an address outside of the U.S., unless (i) each clearing system, bank
or other financial institution that holds customers' securities in the ordinary
course of its business in the chain of intermediaries between such beneficial
owner and the U.S. entity required to withhold tax complies with applicable
certification requirements and (ii) such beneficial owner certifies that it is a
U.S. Person and such certification is signed under penalties of perjury.
A-4
<PAGE>
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY THE SELLERS, THE SERVICER OR BY THE UNDERWRITERS.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER
ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE SELLERS, THE SERVICER OR THE RECEIVABLES SINCE THE DATE HEREOF OR
THEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR A SOLICITATION BY
ANYONE IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN
WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR
TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
- ------------------------------------------------------------
TABLE OF CONTENTS
<TABLE>
<S> <C>
Summary of Terms.............................................. 1
Risk Factors.................................................. 12
The Trust..................................................... 16
The Receivables Pool.......................................... 18
Chase and Chase USA........................................... 33
The CIT Group/Sales Financing, Inc., Servicer................. 33
Use of Proceeds............................................... 36
Weighted Average Life of the Securities....................... 36
Pool Factors and Trading Information.......................... 46
Description of the Notes...................................... 46
Description of the Certificates............................... 50
Certain Information Regarding
the Securities.............................................. 52
Description of the Transfer and Servicing Agreements.......... 57
Certain Legal Aspects of the Receivables...................... 74
Legal Investment.............................................. 77
Certain Federal Income Tax
Consequences................................................ 77
Certain State Tax Consequences................................ 84
ERISA Considerations.......................................... 85
Underwriting.................................................. 87
Legal Matters................................................. 88
Index of Terms................................................ 89
Annex A....................................................... A-1
</TABLE>
Until December , 1997 (90 days after the date of this Prospectus), all dealers
effecting transactions in the Securities, whether or not participating in this
distribution, may be required to deliver this Prospectus. This delivery
requirement is in addition to the obligation of dealers to deliver this
Prospectus when acting as underwriters and with respect to their unsold
allotments or subscriptions.
PROSPECTUS
$897,395,285.54
CHASE MANHATTAN RV
OWNER TRUST 1997-A
$852,500,000.00
ASSET BACKED NOTES
$ 44,895,285.54
ASSET BACKED CERTIFICATES
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION
THE CHASE MANHATTAN BANK
SELLERS
THE CIT GROUP/
SALES FINANCING, INC.
SERVICER
UNDERWRITERS OF THE NOTES
CHASE SECURITIES INC.
BEAR, STEARNS & CO. INC.
MERRILL LYNCH & CO.
SALOMON BROTHERS INC
UNDERWRITER OF THE CERTIFICATES
CHASE SECURITIES INC.
SEPTEMBER , 1997
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
Estimated expenses in connection with the offering of the Securities being
registered hereunder (other than underwriting discounts and commissions) are
estimated as follow:
Registration Fee............................... $271,938
Legal Fees and Expenses........................ 175,000
Accounting Fees and Expenses................... 25,000
Blue Sky Fees and Expenses..................... 5,000
Rating Agency Fees............................. 280,000
Trustee's Fees and Expenses.................... 20,000
Printing ..................................... 75,000
Miscellaneous.................................. 62
--------
Total ...................................... $852,000
========
Item 15. Indemnification of Directors and Officers.
In addition to the indemnification provisions set forth below, directors
and officers liability insurance policies presently exist that insure directors
and officers of Chase Manhattan Bank USA, National Association, a national
banking association having its principal executive offices in Wilmington,
Delaware ("Chase USA") and The Chase Manhattan Bank, a New York banking
corporation having its principal executive offices in New York, New York
("Chase"), their parent and certain of their subsidiaries. The policies cover
losses for which Chase USA, Chase, their parent and certain of their
subsidiaries shall be required or permitted by law to indemnify directors and
officers and which result from claims made against such directors or officers
based upon the commission of wrongful acts in the performance of their duties.
The policies also cover losses that the directors or officers must pay as the
result of claims brought against them based upon the commission of wrongful acts
in the performance of their duties and for which they are not indemnified by
Chase USA, Chase, their parent or any of those subsidiaries. The losses covered
by the policies are subject to certain exclusions and do not include fines or
penalties imposed by law or other matters deemed uninsurable under the law. The
policies contain self-insured retention provisions.
Pursuant to the terms of the Underwriting Agreements and an indemnification
agreement among the Sellers, the Underwriters and CITSF, the Underwriters and
CITSF, respectively, will agree to indemnify each controlling person, director
and officer of the Sellers against certain liabilities under the Securities Act,
or contribute to payments such persons may be required to make in respect
thereof.
Chase USA: Article TENTH of the Articles of Association of Chase USA
("Chase USA") provide that any person who was or is made a party or is
threatened to be made a party to or is otherwise involved in any action, suit or
proceeding, whether civil, criminal, administrative or investigative (a
"proceeding"), by reason of the fact that he or she is or was a director or
officer of Chase USA or is or was serving at the request of Chase USA as a
director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust or other enterprise, including service with respect to an
employee benefit plan (an "indemnitee"), whether the basis of such proceeding is
alleged action in an official capacity as a director, officer, employee or agent
or in any other capacity while serving as a director, officer, employee or
agent, shall be indemnified and held harmless by Chase USA to the fullest extent
authorized by the Delaware General Corporation Law, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits Chase USA to provide broader indemnification rights
than permitted prior thereto), against all expense, liability and loss
(including attorneys' fees, judgments, fines, ERISA excise taxes or penalties
and amounts paid in settlement) reasonably incurred or suffered by such
indemnitee in connection therewith and such indemnification shall continue as to
an indemnitee who has ceased to be a director, officer, employee or agent and
shall inure to the benefit of the indemnitee's heirs, executors and
administrators; provided, however, that, except as provided in the second
following paragraph with respect to proceedings to enforce rights to
indemnification, Chase USA shall indemnify any such indemnitee in connection
with a proceeding (or part thereof) initiated by such indemnitee only if such
proceeding (or part thereof) was authorized by the board of directors of Chase
USA.
The rights to indemnification described in the immediately preceding
paragraph shall include the right to be paid by Chase USA the expenses incurred
in defending any proceeding for which such right to indemnification is
applicable in advance of its final disposition (hereinafter an "advancement of
expenses"); provided, however, that, if the Delaware General Corporation Law
requires, an advancement of expenses incurred by an indemnitee in his or her
capacity as a director or officer (and not in any other capacity in which
service was or is rendered by such indemnitee, including, without limitation,
service to an employee benefit plan) shall be made only upon delivery to Chase
USA of an undertaking (hereinafter an "undertaking"), by or on behalf of such
indemnitee, to repay all amounts so advanced if it shall ultimately be
determined by final judicial decision from which there is no further right to
appeal (hereinafter a "final adjudication") that such indemnitee is not entitled
to be indemnified for such expenses under such Article TENTH or otherwise.
The rights to indemnification and to the advancement of expenses described
in the two preceding paragraphs are contract rights. If a claim under either of
such paragraphs is not paid in full by Chase USA within sixty days after a
written claim has been received by Chase USA (except in the case of a claim for
an advancement of expenses, in which case the applicable period shall be twenty
days), the indemnitee may at any time thereafter bring suit against Chase USA to
recover the unpaid amount of the claim. If successful in whole or in part in any
such
II-1
<PAGE>
suit, or in a suit brought by Chase USA to recover an advancement of expenses
pursuant to the terms of an undertaking, the indemnitee shall be entitled to be
paid also the expense of prosecuting or defending such suit. In any suit brought
by the indemnitee to enforce a right to indemnification under such Article TENTH
(but not in a suit brought by the indemnitee to enforce a right to an
advancement of expenses) it shall be a defense that, and in any suit by Chase
USA to recover an advancement of expenses pursuant to the terms of an
undertaking, Chase USA shall be entitled to recover such expense upon a final
adjudication that, the indemnitee has not met any applicable standard for
indemnification set forth in the Delaware General Corporation Law. Neither the
failure of Chase USA (including its board of directors, independent legal
counsel, or its stockholders) to have made a determination prior to the
commencement of such suit that indemnification of the indemnitee is proper in
the circumstances because the indemnitee has met the applicable standard of
conduct set forth in the Delaware General Corporation Law, nor an actual
determination by Chase USA (including its board of directors, independent legal
counsel, or its stockholders) that the indemnitee has not met such applicable
standard of conduct, shall create a presumption that the indemnitee has not met
such applicable standard of conduct or, in the case of such a suit brought by
the indemnitee, be a defense to such suit. In any suit brought by the indemnitee
to enforce a right to indemnification or to an advancement of expenses under
such Article TENTH, or by Chase USA to recover an advancement of expenses
pursuant to the terms of an undertaking, the burden of proving that the
indemnitee is not entitled to be indemnified, or to such advancement of
expenses, under such Article TENTH or otherwise shall be on Chase USA.
Article TENTH of Chase USA's Articles of Association also provides that the
foregoing right of indemnification or reimbursement shall not be exclusive of
other rights to which any person may be entitled under any statute, Articles of
Association, by-law, agreement, or vote of stockholders or disinterested
stockholders or otherwise. Section 145 of the Delaware General Corporation Law
provides that a Delaware corporation must indemnify a director or officer who
has defended successfully, on the merits or otherwise, any proceeding against
him or any claim, matter or issue therein, for reasonable expenses actually
incurred in such defense.
Article 7 of the Business Corporation Law of the State of New York,
Sections 721 through 726, provides, under certain circumstances, for
indemnification of directors and officers of a corporation who are made or
threatened to be made, a party to an action or proceeding (other than one by or
in the right of a corporation to procure a judgment in its favor), whether civil
or criminal, by reason of their service as an officer or director of a
corporation against judgments, fines, amounts paid in settlement and reasonable
expenses, including attorneys' fees actually and necessarily incurred as a
result of such action or proceeding or any appeal therein. Article 7 of the New
York Business Corporation Law also provides that the statutory indemnification
provisions are nonexclusive, but prohibits indemnification if a judgment or
other final adjudication adverse to the director or officer of a corporation
establishes that the officer's or director's acts were committed in bad faith or
were the result of active and deliberate dishonesty and were material to the
cause of action so adjudicated, or that such director or officer personally
gained in fact a financial profit or other advantage to which the officer or
director was not legally entitled, or that would be inconsistent with the laws
of the jurisdiction of incorporation (in the case of corporations formed under
the laws of any jurisdiction other than New York), the corporation's certificate
of incorporation, by-laws, resolutions or other proper corporate action or any
court settlement.
Chase: Article VII of Chase's By-Laws provides that Chase shall, to the
fullest extent permitted by applicable law as then in effect, indemnify any
person (the "indemnitee") who was or is involved in any manner (including,
without limitation, as a party or a witness), or is threatened to be made so
involved, in any threatened pending or completed investigation, claim, action,
suit or proceeding, whether civil, administrative or investigative (including,
without limitation, any action , suit or proceeding by or in the right of Chase
to procure a judgment in its favor) (a "proceeding") by reason of the fact that
he is or was a director, officer, employee or agent of Chase, or is or was
serving at the request of Chase as a director, officer or employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against all expense (including attorney's fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection with
such proceeding. Article VII provides that the foregoing indemnification shall
be a contract right and shall include the right to receive payment in advance of
any expenses incurred by the indemnitee in connection with such proceeding,
consistent with the provisions of applicable law as then in effect.
Article VII further provides that Chase may enter into contracts with any
director, officer, employee or agent of Chase in furtherance of the provisions
thereof and may create a trust fund, grant a security interest or use other
means (including, without limitation a letter of credit) to ensure the payment
of such amounts as may be necessary to effect indemnification under Article VII.
Article VII expressly provides that the right of indemnification and
advancement of expenses thereunder shall not be exclusive of any other rights to
which a person seeking indemnification may otherwise be entitled, under any
statute, by-law, agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office.
II-2
<PAGE>
Item 16. Exhibits.
<TABLE>
<CAPTION>
(a) Exhibits:
<S> <C>
1.1(A) -- Note Underwriting Agreement (Notes).
1.1(B) -- Certificate Underwriting Agreement (Certificates).
3.1(A) -- Articles of Association of Chase USA.
3.1(B) -- Restated Organization Certificate of Chase.
3.2(A) -- By-laws of Chase USA.
3.2(B) -- By-laws of Chase.
4.1 -- Sale and Servicing Agreement.
4.2 -- Indenture.
4.3(A) -- Certificate of Trust.
4.3(B) -- Amended and Restated Trust Agreement.
4.4(A) -- Chase Administration Agreement.
4.4(B) -- CITSF Administration Agreement.
5.1 -- Opinion of Simpson Thacher & Bartlett with respect to legality.
8.1 -- Opinion of Simpson Thacher & Bartlett with respect to U.S. federal tax matters.
8.2 -- Opinion of Crowe & Dunlevy, P.C. with respect to Oklahoma state tax matters.
10.1 -- Amended and Restated Servicing Agreement.
23.1 -- Consent of Simpson Thacher & Bartlett (included as part of Exhibit 5.1).
23.2 -- Consent of Simpson Thacher & Bartlett (included as part of Exhibit 8.1).
24.1(A) -- Powers of Attorney of directors and officers of Chase USA.*
24.1(B) -- Powers of Attorney of directors and officers of Chase.*
25.1 -- Statement of Eligibility of Trustee on Form T-1.**
</TABLE>
* Previously filed
** Exhibit 7 to Form T-1 filed herewith was filed in paper pursuant to a
continuing hardship exemption.
(b) Financial Statements:
Not applicable.
Item 17. Undertakings.
The undersigned Registrant hereby undertakes that:
(a) That, for purposes of determining any liability under the Act, each
filing of a Registrant's annual report pursuant to Section 13(a) or
15(d) of the Exchange Act (and, where applicable, each filing of a
employee benefit plan's annual report pursuant to Section 15(d) of the
Exchange Act) with respect to any Trust that is incorporated by
reference in the Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(b) To provide to the Underwriters at the closing specified in the
Underwriting Agreement certificates in such denominations and
registered in such names as required by the Underwriters to permit
prompt delivery to each purchaser.
(c) That, insofar as indemnification for liabilities arising under the Act
may be permitted to directors, offices and controlling persons of a
Registrant pursuant to the foregoing provisions, or otherwise, the
Registrants have been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Act and is therefore unenforceable. In the event that
a claim for indemnification against such liabilities (other than
payment by a Registrant of expenses incurred or paid by a director,
officer or controlling person of such Registrant in the successful
defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the
securities being registered, such Registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of
such issue.
(d) (1) That, for purposes of determining any liability under the
Act, the information omitted from the form of prospectus filed
as part of this registration statement in reliance upon Rule
430A and contained in the form of prospectus filed by the
Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under
the Act shall be deemed to be part of the registration
statement as of the time it was declared effective.
(2) That, for the purpose of determining any liability under the
Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at the time shall be deemed to be the
initial bona fide offering thereof.
II-3
<PAGE>
SIGNATURES FOR CHASE USA
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Amendment
No. 1 to Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Wilmington, State of Delaware, on
September 17, 1997.
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
By: /s/ Keith Schuck
-----------------------------------------
Keith Schuck
Controller
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to Registration Statement has been signed on September 17, 1997 by the
following persons in the capacities indicated.
Signature Title
- --------- -----
* Chairman of the Board and Director
- ------------------------------ and Chief Executive Officer
Donald L. Boudreau
* President and Director
- ------------------------------
Michael J. Barrett
* Director
- ------------------------------
Luke S. Hayden
* Director
- ------------------------------
John J. Hehir, Jr.
* Director
- ------------------------------
William H. Hoefling
* Director
- ------------------------------
Kevin T. Hurley
* Director
- ------------------------------
Thomas Jacob
* Director
- ------------------------------
John M. Nuzum, Jr.
/s/ Keith Schuck Controller (Principal Accounting
- ------------------------------ Officer and Principal Financial Officer)
Keith Schuck
* Director
- ------------------------------
Michael Urkowitz
* The undersigned, by signing his name hereto, does hereby sign this
Amendment No. 1 to Registration Statement on behalf of the above-indicated
directors and officers of the Registrant pursuant to powers of attorney
signed by such officers and directors.
By: /s/ Keith Schuck
------------------------------
Keith Schuck
Attorney-in-Fact
RV
II-6
<PAGE>
SIGNATURES FOR CHASE
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Amendment
No. 1 to Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, State of New York, on
September 17, 1997.
THE CHASE MANHATTAN BANK
By: /s/ Deborah L. Duncan
-----------------------------
Deborah L. Duncan
Executive Vice President
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to Registration Statement has been signed on September 17, 1997 by the
following persons in the capacities indicated.
Signature Title
- --------- -----
* Chairman of the Board and Director
- ------------------------------ and Chief Executive Officer
Walter V. Shipley
* Director
- ------------------------------
Frank A. Bennack Jr.
* Director
- ------------------------------
Susan V. Berresford
* Director
- ------------------------------
M. Anthony Burns
Director
- ------------------------------
H. Laurance Fuller
* Director
- ------------------------------
Melvin R. Goodes
* Director
- ------------------------------
William H. Gray, III
* Director
- ------------------------------
George V. Grune
* Director and Vice Chairman of the Board
- ------------------------------
William B. Harrison Jr.
* Director
- ------------------------------
Harold S. Hook
* Director
- ------------------------------
Helene L. Kaplan
* Director, President and Chief
- ------------------------------ Operating Officer
Thomas G. Labrecque
* Director
- ------------------------------
Henry B. Schacht
* Controller (Principal Accounting
- ------------------------------ Officer)
Joseph L. Sclafani
* The undersigned, by signing his name hereto, does hereby sign this
Amendment No. 1 to Registration Statement on behalf of the above-indicated
directors and officers of the Registrant pursuant to powers of attorney
signed by such officers and directors.
By: /s/ Deborah L. Duncan
------------------------------
Deborah L. Duncan
Attorney-in-Fact
RV
II-5
<PAGE>
SIGNATURES FOR CHASE
Signature Title
- --------- -----
* Director
- ------------------------------
Andrew C. Sigler
* Director
- ------------------------------
John R. Stafford
* Executive Vice President
- ------------------------------ (Principal Financial Officer)
Peter J. Tobin
* Director
- ------------------------------
Marina v.N. Whitman
* The undersigned, by signing his name hereto, does hereby sign this
Amendment No. 1 to Registration Statement on behalf of the above-indicated
directors and officers of the Registrant pursuant to powers of attorney
signed by such officers and directors.
By: /s/ Deborah L. Duncan
------------------------------
Deborah L. Duncan
Attorney-in-Fact
RV
II-6
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit Sequentially
Number Exhibit Numbered Page
- ------ ------- -------------
<S> <C>
1.1(A) -- Note Underwriting Agreement.
1.1(B) -- Certificate Underwriting Agreement.
3.1(A) -- Articles of Association of Chase USA.
3.1(B) -- Restated Organization Certificate of Chase.
3.2(A) -- By-laws of Chase USA.
3.2(B) -- By-laws of Chase.
4.1 -- Sale and Servicing Agreement.
4.2 -- Indenture.
4.3(A) -- Certificate of Trust.
4.3(B) -- Amended and Restated Trust Agreement.
4.4(A) -- Chase Administration Agreement.
4.4(B) -- CITSF Administration Agreement.
5.1 -- Opinion of Simpson Thacher & Bartlett with respect to legality.
8.1 -- Opinion of Simpson Thacher & Bartlett with respect to federal tax matters.
8.2 -- Opinion of Crowe & Dunlevy, P.C. with respect to Oklahoma state tax matters.
10.1 -- Amended and Restated Servicing Agreement.
23.1 -- Consent of Simpson Thacher & Bartlett (included as part of Exhibit 5.1).
23.2 -- Consent of Simpson Thacher & Bartlett (included as part of Exhibit 8.1).
24.1(A) -- Powers of Attorney of directors and officers of Chase USA.*
24.1(B) -- Powers of Attorney of directors and officers of Chase.*
25.1 -- Statement of Eligibility of Trustee on Form T-1.**
</TABLE>
- ----------
* Previously filed.
** Exhibit 7 to Form T-1 filed herewith was filed in paper pursuant to a
continuing hardship exemption.
RV
II-7
<PAGE>
OH&S DRAFT
9/17/97
CHASE MANHATTAN RV OWNER TRUST 1997-A
ASSET BACKED NOTES
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
and
THE CHASE MANHATTAN BANK,
Sellers
THE CIT GROUP/SALES FINANCING, INC.,
Servicer
NOTE UNDERWRITING AGREEMENT
September __, 1997
Chase Securities Inc.,
As Representative of the
Several Underwriters,
270 Park Avenue
New York, NY 10017
Ladies and Gentlemen:
1. Introductory. Chase Manhattan Bank USA, National
Association ("Chase USA"), a national banking association and The Chase
Manhattan Bank ("Chase"), a New York banking corporation (each, a "Bank", and
together referred to herein as the "Banks"), propose to form Chase Manhattan RV
Owner Trust 1997-A (the "Trust") to sell $59,500,000 aggregate principal amount
of Class A-1 _____% Asset Backed Notes (the "Class A-1 Notes"), $119,000,000
aggregate principal amount of Class A-2 _____% Asset Backed Notes (the "Class
A-2 Notes"), $113,000,000 aggregate principal amount of Class A-3 _____%
Asset Backed Notes (the "Class A-3 Notes"), $73,000,000 aggregate principal
amount of Class A-4 _____% Asset Backed Notes (the "Class A-4 Notes"),
$132,000,000 aggregate principal amount of Class A-5 _____% Asset Backed
Notes (the "Class A-5 Notes"), $88,000,000 aggregate principal amount of
Class A-6 _____% Asset Backed Notes (the "Class A-6 Notes"), $57,000,000
aggregate principal amount of Class A-7 _____% Asset Backed Notes (the "Class
A-7 Notes"), $85,000,000 aggregate principal amount of Class A-8 _____%
Asset Backed Notes (the "Class A-8 Notes"), $61,000,000 aggregate principal
amount of Class A-9 _____% Asset Backed Notes (the "Class A-9 Notes") and
$65,000,000 aggregate principal
<PAGE>
amount of Class A-10 _____% Asset Backed Notes (the "Class A-10 Notes" and,
together with 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, the Class A-6 Notes, the Class A-7 Notes,
the Class A-8 Notes, Class A-9 Notes and the Class A-10 Notes, the "Notes").
The assets of the Trust will include, among other things, a
pool of retail installment sales contracts and purchase money notes and other
notes (the "Receivables") secured by new and used recreational vehicles (the
"Financed Vehicles") and certain monies received or due thereunder after the
Cutoff Date (as hereinafter defined), such Receivables to be transferred to the
Trust by the Banks, and serviced by The CIT Group/Sales Financing, Inc.
("CITSF") and in its capacity as Servicer, the "Servicer"), or by a successor
Servicer. The Pool Balance of the Receivables as of the close of business on
September 1, 1997 (the "Cutoff Date") was equal to $897,395,285.54 (the
"Cutoff Date Pool Balance"). The Notes will be issued pursuant to the Indenture
to be dated as of September 1, 1997 (as amended and supplemented from time to
time, the "Indenture"), between the Trust and Norwest Bank Minnesota, National
Association, as indenture trustee (the "Indenture Trustee").
Simultaneously with the issuance and sale of the Notes as
contemplated herein, the Trust will issue $44,895,285.54 aggregate principal
amount of _____% Asset Backed Certificates (the "Certificates") pursuant to the
Amended and Restated Trust Agreement to be dated as of September 1, 1997 (as
amended and supplemented from time to time, the "Trust Agreement"), among the
Banks and Wilmington Trust Company, as owner trustee (the "Owner Trustee"), each
representing a fractional undivided ownership interest in the Trust, which will
be sold pursuant to an underwriting agreement dated the date hereof (the
"Certificate Underwriting Agreement" and, together with this Agreement, the
"Underwriting Agreements") among the Banks and Chase Securities Inc. The Notes
and the Certificates are sometimes referred to collectively herein as the
"Securities".
Capitalized terms used and not otherwise defined herein shall
have the meanings assigned to such terms in the Sale and Servicing Agreement to
be dated as of September 1, 1997 (as amended and supplemented from time to time,
the "Sale and Servicing Agreement"), among the Trust, and the Banks, as Sellers,
and the Servicer.
This is to confirm the agreement concerning the purchase of
the Notes from the Banks by the several underwriters named in Schedule I hereto
(the "Underwriters"), for whom Chase Securities Inc. is acting as representative
(the "Representative").
2. Representations and Warranties of the Banks. Each Bank
represents and warrants to, and agrees with, the Underwriters, that:
2
<PAGE>
(a) A registration statement on Form S-3 (No. 333-32263),
including a form of prospectus, relating to the Securities has been filed with
the Securities and Exchange Commission (the "Commission") in accordance with the
provisions of the Securities Act of 1933, as amended (the "Act"), and the Rules
and Regulations under the Act (the "Rules and Regulations"). The Banks may have
filed one or more amendments thereto, including the related preliminary
prospectus, each of which has previously been furnished to you. The Banks have
included in the registration statement, as amended on the date such registration
statement became effective, all information (other than information permitted to
be omitted from a registration statement when it becomes effective pursuant to
Rule 430A ("Rule 430A Information") required by the Act and the Rules and
Regulations to be included in the final prospectus with respect to the
Securities and the offering thereof. Such registration statement, as amended on
the date that such registration statement or the most recent post-effective
amendment thereto, if any, became or becomes effective under the Act, including
the exhibits thereto and the 430A Information, is hereinafter referred to as the
"Registration Statement." The Registration Statement has become effective, and
no stop order suspending the effectiveness of the Registration Statement has
been issued, and no proceeding for that purpose has been instituted or, to the
knowledge of such Bank, threatened by the Commission. The conditions to the use
of a registration statement on Form S-3 under the Act, as set forth in the
General Instructions to Form S-3 have been satisfied with respect to the
Registration Statement.
(b) The Banks propose to file with the Commission pursuant to
Rules 430A and 424(b)(1) or 424(b)(4) under the Rules and Regulations a final
prospectus relating to the sale of the Securities. The prospectus in the form
filed with the Commission pursuant to Rules 430A and 424(b)(1) or 424(b)(4)
under the Rules and Regulations is hereinafter referred to as the "Prospectus."
As filed, the Prospectus shall include all Rule 430A Information, together with
all other such required information, with respect to the Securities and the
offering thereof and, except to the extent that the Representative shall have
agreed to a modification, the Prospectus shall be in all substantive respects in
the form furnished to the Representative prior to the execution of this
Agreement or, to the extent not completed at such time, shall contain only such
material changes as the Banks have advised the Representative, prior to such
time, will be included or made therein. "Preliminary Prospectus" means each
prospectus included in the Registration Statement, or amendments thereof, before
it became effective under the Act, any prospectus filed with the Commission by
the Banks pursuant to Rule 424(a) and the prospectus included in the
Registration Statement on the date the Registration Statement became effective.
(c) The Registration Statement, at the time it became
effective, did, and the Prospectus, at the time the Prospectus is
3
<PAGE>
first filed in accordance with Rule 424(b) and on the Closing Date (as defined
herein), will, comply in all material respects with the applicable requirements
of the Act and the Trust Indenture Act of 1939 and the Rules and Regulations. At
the time the Registration Statement became effective, it did not include any
untrue statement of a material fact or, did not omit to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading and, on the date of the filing of the Prospectus pursuant to Rules
430A and 424(b) and on the Closing Date, the Prospectus (together with any
supplement thereto) will not, include any untrue statement of a material fact or
omit to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading; provided, however, that such Bank makes no representation or
warranty with respect to information contained in or omitted from the
Registration Statement or the Prospectus in reliance upon, or in conformity
with, information furnished in writing to either Bank by or on behalf of any
Underwriter through the Representative specifically for use in connection with
the preparation of the Registration Statement or the Prospectus.
(d) In the case of Chase USA, such Bank is a national banking
association organized under the laws of the United States, and in the case of
Chase, such Bank is a New York banking corporation, in each case, with full
power and authority to own its properties and conduct its business as described
in the Prospectus, and had at all relevant times and has power, authority and
legal right to acquire, own and sell the Receivables being transferred by such
Bank to the Trust.
(e) When the Notes have been duly executed and delivered by
the Owner Trustee and, when authenticated by the Indenture Trustee in accordance
with the Indenture and delivered upon the order of the Banks to the Underwriters
pursuant to this Agreement and the Sale and Servicing Agreement, the Notes will
be duly issued and will constitute legal, valid and binding obligations of the
Trust enforceable against the Trust in accordance with their terms, except to
the extent that the enforceability thereof may be subject to bankruptcy,
insolvency, reorganization, conservatorship, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights as such laws would
apply in the event of the insolvency, liquidation or reorganization or other
similar occurrence with respect to either Bank or the Trust or in the event of
any moratorium or similar occurrence affecting either Bank or the Trust and to
general principles of equity.
(f) The direction by such Bank to the Owner Trustee to
execute and authenticate the Certificates has been duly authorized by such Bank
and, when the Certificates have been duly executed, authenticated and delivered
by the Owner Trustee in accordance with the Trust Agreement and delivered upon
the order of the Banks to Chase Securities Inc. pursuant to the Certificate
4
<PAGE>
Underwriting Agreement and the Sale and Servicing Agreement, the Certificates
will be duly issued and entitled to the benefits and security afforded by the
Trust Agreement.
(g) The execution, delivery and performance by such Bank of
this Agreement, the Certificate Underwriting Agreement, and the Basic Documents
to which such Bank is a party, and the consummation by such Bank of the
transactions provided for herein and therein have been, or will have been, duly
authorized by such Bank by all necessary action on the part of such Bank; and
neither the execution and delivery by such Bank of such instruments, nor the
performance by such Bank of the transactions herein or therein contemplated, nor
the compliance by such Bank with the provisions hereof or thereof, will (i)
conflict with or result in a breach or violation of any of the material terms
and provisions of, or constitute a material default under, any of the provisions
of the charter or by-laws of such Bank, or (ii) conflict with any of the
provisions of any law, governmental rule, regulation, judgment, decree or order
binding on such Bank or the properties of such Bank, or (iii) conflict with any
of the material provisions of any material indenture, mortgage, contract or
other instrument to which such Bank is a party or by which such Bank is bound,
or (iv) result in the creation or imposition of any lien, charge or encumbrance
upon any of its property pursuant to the terms of any such indenture, mortgage,
contract or other instruments, except, in the case of clauses (ii) and (iii) ,
for any such breaches or conflicts as would not individually or in the aggregate
have a material adverse effect on the transactions contemplated hereby or on the
ability of such Bank to consummate such transactions.
(h) When executed and delivered by the parties thereto, each
of the Sale and Servicing Agreement and the Trust Agreement will constitute a
legal, valid and binding obligation of such Bank, enforceable against such Bank
in accordance with its terms, except to the extent that the enforceability
thereof may be subject to bankruptcy, insolvency, reorganization,
conservatorship, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights as such laws would apply in the event of the
insolvency, liquidation or reorganization or other similar occurrence with
respect to such Bank or in the event of any moratorium or similar occurrence
affecting such Bank and to general principles of equity.
(i) All approvals, authorizations, consents, orders or other
actions of any person, corporation or other organization, or of any court,
governmental agency or body or official (except with respect to the state
securities or "blue sky" laws of various jurisdictions) required in connection
with the execution, delivery and performance of this Agreement, the Certificate
Underwriting Agreement and the Basic Documents to which such Bank is a party,
have been or will be taken or obtained on or prior to the Closing Date.
5
<PAGE>
(j) As of the Closing Date, the representations and
warranties of such Bank in the Trust Agreement will be true and correct.
(k) This Agreement and the Certificate Underwriting Agreement
have been duly executed and delivered by such Bank.
3. Purchase, Sale, Payment and Delivery of the Notes. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, Chase USA agrees to sell
to each Underwriter, and each Underwriter agrees, severally and not jointly, to
purchase from Chase USA, (a) at a purchase price of _________% of the principal
amount thereof, the principal amount of the Class A-1 Notes set forth opposite
the name of such Underwriter in Schedule I hereto, (b) at a purchase price of
_________% of the principal amount thereof, the principal amount of the Class
A-2 Notes set forth opposite the name of such Underwriter in Schedule I hereto,
(c) at a purchase price of _________% of the principal amount thereof, the
principal amount of the Class A-3 Notes set forth opposite the name of such
Underwriter in Schedule I hereto, (d) at a purchase price of _________% of the
principal amount thereof, the principal amount of the Class A-4 Notes set forth
opposite the name of such Underwriter in Schedule I hereto, (e) at a purchase
price of _________% of the principal amount thereof, the principal amount of the
Class A-5 Notes set forth opposite the name of such Underwriter in Schedule I
hereto, (f) at a purchase price of _________% of the principal amount thereof,
the principal amount of the Class A-6 Notes set forth opposite the name of such
Underwriter in Schedule I hereto, (g) at a purchase price of _________% of the
principal amount thereof, the principal amount of the Class A-7 Notes set forth
opposite the name of such Underwriter in Schedule I hereto, (h) at a purchase
price of _________% of the principal amount thereof, the principal amount of the
Class A-8 Notes set forth opposite the name of such Underwriter in Schedule I
hereto, (i) at a purchase price of _________% of the principal amount thereof,
the principal amount of the Class A-9 Notes set forth opposite the name of such
Underwriter in Schedule I hereto and (j) at a purchase price of _________% of
the principal amount thereof, the principal amount of the Class A-10 Notes set
forth opposite the name of such Underwriter in Schedule I hereto, plus, in each
case, accrued interest at the applicable Interest Rate from September 1, 1997 to
but excluding the Closing Date.
On the basis of the representations, warranties and agreements
herein contained, but subject to the terms and conditions herein set forth,
Chase agrees to sell to each Underwriter, and each Underwriter agrees, severally
and not jointly, to purchase from Chase, (a) at a purchase price of _________%
of the principal amount thereof, the principal amount of the Class A-1 Notes set
forth opposite the name of such Underwriter in Schedule II hereto, (b) at a
purchase price of _________% of the principal amount thereof, the principal
amount
6
<PAGE>
of the Class A-2 Notes set forth opposite the name of such Underwriter in
Schedule II hereto, (c) at a purchase price of _________% of the principal
amount thereof, the principal amount of the Class A-3 Notes set forth opposite
the name of such Underwriter in Schedule II hereto, (d) at a purchase price of
_________% of the principal amount thereof, the principal amount of the Class
A-4 Notes set forth opposite the name of such Underwriter in Schedule II hereto,
(e) at a purchase price of _________% of the principal amount thereof, the
principal amount of the Class A-5 Notes set forth opposite the name of such
Underwriter in Schedule II hereto, (f) at a purchase price of _________% of the
principal amount thereof, the principal amount of the Class A-6 Notes set forth
opposite the name of such Underwriter in Schedule II hereto, (g) at a purchase
price of _________% of the principal amount thereof, the principal amount of the
Class A-7 Notes set forth opposite the name of such Underwriter in Schedule II
hereto, (h) at a purchase price of _________% of the principal amount thereof,
the principal amount of the Class A-8 Notes set forth opposite the name of such
Underwriter in Schedule II hereto, (i) at a purchase price of _________% of the
principal amount thereof, the principal amount of the Class A-9 Notes set forth
opposite the name of such Underwriter in Schedule II hereto and (j) at a
purchase price of _________% of the principal amount thereof, the principal
amount of the Class A-10 Notes set forth opposite the name of such underwriter
in Schedule II hereto, plus, in each case, accrued interest at the applicable
Interest Rate from September 1, 1997 to but excluding the Closing Date.
Each Bank will deliver the Notes being sold by it hereunder to
the Representative for the respective accounts of the Underwriters against
payment of the purchase price in immediately available funds drawn to the order
of ____________ on behalf of the Banks at the offices of Orrick, Herrington &
Sutcliffe LLP in New York, New York at 10:00 a.m., New York City time, on
September __, 1997 or at such other time not later than seven full business days
thereafter as the Representative and the Banks determine, such time being herein
referred to as the "Closing Date." The Notes of each class to be so delivered
will be initially represented by one or more definitive Notes registered in the
name of Cede & Co., the nominee of The Depository Trust Company ("DTC") and will
be made available for inspection by the Representative at the office where
delivery and payment for such Notes is to take place no later than 1:00 p.m.,
New York City time, on the Business Day prior to the Closing Date.
4. Offering by the Underwriters. It is understood that the
Underwriters propose to offer the Notes for sale to the public (which may
include selected brokers and dealers) as set forth in the Prospectus.
5. Covenants of the Banks. Each Bank covenants and agrees
with the Underwriters that:
7
<PAGE>
(a) Such Bank will file the Prospectus with the Commission
pursuant to Rule 424(b)(1) or 424(b)(4), as applicable, of the Rules and
Regulations within the time prescribed therein and will provide evidence
satisfactory to the Representative of such timely filing. During any period that
a prospectus relating to the Notes is required to be delivered to purchasers of
the Notes by the Underwriters and dealers participating in the initial offering
and sale of the Notes on the Closing Date under the Act (without regard to any
market making prospectus required to be delivered by any Underwriter under the
Act) (a "prospectus delivery period"), such Bank will not file any amendments to
the Registration Statement, or any amendments or supplements to the Prospectus,
unless it shall first have delivered copies of such amendments or supplements to
the Representative, and if the Representative shall have reasonably objected
thereto promptly after receipt thereof; such Bank will promptly advise the
Representative or its counsel (i) when notice is received from the Commission
that any post-effective amendment to the Registration Statement has become or
will become effective, (ii) of any request by the Commission for any amendment
or supplement to the Registration Statement or the Prospectus or for any
additional information and (iii) of any order or communication suspending or
preventing, or threatening to suspend or prevent, the offer and sale of the
Notes or of any proceedings or examinations that may lead to such an order or
communication, whether by or of the Commission or any authority administering
any state securities or "blue sky" law, as soon as such Bank is advised thereof,
and such Bank will use its reasonable efforts to prevent the issuance of any
such order or communication and to obtain as soon as possible its lifting, if
issued.
(b) If, at any time during the prospectus delivery period,
any event occurs as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading, or if
it is necessary at any time to amend the Prospectus in order to comply with the
Act or the Rules and Regulations, such Bank promptly will prepare and file with
the Commission (subject to the Representative's prior review pursuant to
paragraph (a) of this Section 5), an amendment or supplement which will correct
such statement or omission or an amendment or supplement which will effect such
compliance.
(c) Such Bank will furnish to the Representative copies of
the Registration Statement, as originally filed with the Commission, and each
amendment thereto filed with the Commission, including all consents and exhibits
filed therewith and each Preliminary Prospectus, the Prospectus and any amended
or supplemented Prospectus, in each case as soon as available and in such
quantities as the Representative may reasonably request.
8
<PAGE>
(d) Such Bank will cooperate with the Representative in
arranging for the qualification of the Notes for sale and the determination of
their eligibility for investment under the laws of such jurisdictions, or as
necessary to qualify for the Euroclear System or Cedel Bank, societe anonyme, as
the Representative designates and will cooperate in continuing such
qualifications in effect so long as required for the distribution of the Notes;
provided, however, that neither any such Bank nor the Trust shall be obligated
to qualify to do business in any jurisdiction in which it is not currently so
qualified or to take any action which would subject it to general or unlimited
service of process in any jurisdiction where it is not now so subject.
(e) [Reserved]
(f) So long as any of the Notes is outstanding, such Bank
will furnish to the Representative as soon as practicable, (A) all documents
distributed, or caused to be distributed, by such Bank to the Noteholders, (B)
all documents filed, or caused to be filed, by such Bank with respect to the
Trust with the Commission pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and any order of the Commission thereunder or
pursuant to a "no-action" letter from the staff of the Commission and (C) from
time to time, such other information in the possession of such Bank concerning
the Trust and any other information concerning such Bank filed with any
governmental or regulatory authority which is otherwise publicly available, as
the Representative may reasonably request.
(g) On or before the Closing Date, such Bank shall cause its
computer records relating to the Receivables to be marked to show the Trust's
absolute ownership of the Receivables transferred by such Bank to the Trust, and
from and after the Closing Date neither such Bank nor the Servicer shall take
any action inconsistent with the Trust's ownership of such Receivables and the
security interest of the Indenture Trustee therein, other than as permitted by
the Sale and Servicing Agreement.
(h) To the extent, if any, that the rating provided with
respect to the Notes by Moody's, Standard & Poor's and/or Duff & Phelps is
conditional upon the furnishing of documents or the taking of any other actions
by such Bank agreed upon on or prior to the Closing Date, such Bank shall
furnish such documents and take any such other actions.
(i) For the period beginning on the date hereof and ending on
the Closing Date, unless waived by the Representative, neither such Bank nor any
trust originated, directly or indirectly, by such Bank will offer to sell or
sell notes (other than the Notes) collateralized by, or certificates (other than
the Certificates) evidencing an ownership interest in, receivables generated
pursuant to recreational vehicle installment sale contracts or purchase money
loans.
9
<PAGE>
6. Payment of Expenses. The Banks will pay all expenses
incident to the performance of their respective obligations under this
Agreement, including (i) the printing and filing of the Registration Statement
as originally filed and of each amendment thereto, (ii) the Indenture Trustee's
and Owner Trustee's acceptance fee and the reasonable fees and disbursements of
the counsel to the Indenture Trustee and counsel to the Owner Trustee, (iii) the
fees and disbursements of Price Waterhouse LLP and Arthur Andersen, (iv) the
fees of the Rating Agencies and (v) blue sky expenses; provided, however, that
the Underwriters may reimburse the Banks for certain expenses incurred by the
Banks as agreed to by the Underwriters and the Banks.
7. Conditions to the Obligations of the Underwriters. The
obligation of the several Underwriters to purchase and pay for the Notes will be
subject to the accuracy of the representations and warranties on the part of the
Banks herein on the date hereof and as of the Closing Date, to the accuracy of
the statements of officers of the Banks made pursuant to the provisions hereof,
to the performance by the Banks of their respective obligations hereunder and to
the following additional conditions precedent:
(a) On or prior to the date hereof, the
Representative shall have received a letter (a "Procedures
Letter"), dated the date of this Agreement of each of Price
Waterhouse LLP and Arthur Andersen verifying the accuracy of
such financial and statistical data contained in the
Prospectus as the Representative shall deem reasonably
advisable. In addition, if any amendment or supplement to the
Prospectus made after the date hereof contains financial or
statistical data, the Representative shall have received a
letter dated the Closing Date confirming the Procedures Letter
and providing additional comfort on such new data.
(b) The Prospectus shall have been filed in the
manner and within the time period required by Rule 424(b) of
the Rules and Regulations; and prior to the Closing Date, no
stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or
any development involving a prospective change, in or
affecting particularly the business or properties of any of
the Banks, The Chase Manhattan Corporation, CITSF or The CIT
Group Holdings, Inc. which, in the reasonable judgment of the
Representative, materially impairs the investment
10
<PAGE>
quality of the Notes or makes it impractical to market the
Notes; (ii) any suspension or material limitation of trading
in securities generally on the New York Stock Exchange, or any
setting of minimum prices for trading on such exchange, or any
suspension of trading of any securities of any of the Banks or
The Chase Manhattan Corporation, on any exchange or in the
over-the-counter market by such exchange or over-the-counter
market or by the Commission; (iii) any banking moratorium
declared by federal or New York authorities; or (iv) any
outbreak or material escalation of major hostilities or any
other substantial national or international calamity or
emergency if, in the reasonable judgment of the
Representative, the effect of any such outbreak, escalation,
calamity or emergency on the United States financial markets
makes it impracticable or inadvisable to proceed with
completion of the sale of and any payment for the Notes.
(d) The Representative shall have received opinions,
dated the Closing Date and reasonably satisfactory, when taken
together, in form and substance to the Representative, of
Simpson Thacher & Bartlett, special counsel to the Banks,
Richards, Layton & Finger, special counsel to the Trust, and
such other counsel otherwise reasonably acceptable to the
Representative, with respect to such matters as are customary
for the type of transaction contemplated by this Agreement.
(e) The Representative shall have received an
opinion or opinions of Simpson Thacher & Bartlett, special
counsel to the Banks, dated the Closing Date and satisfactory
in form and substance to the Representative, with respect to
certain matters relating to the transfers from each Bank to
the Trust of its Receivables, with respect to the perfection
of the Trust's interest in the Receivables transferred by
hase and with respect to the grant of a security interest in
the Receivables to the Indenture Trustee, and an opinion of
Richards, Layton & Finger, special counsel to the Trust, with
respect to the perfection of the Trust's interest in the
Receivables transferred by Chase USA and the Indenture
Trustee's interests in the Receivables.
(f) The Representative shall have received from
Schulte Roth & Zabel, counsel to the Servicer, such opinion or
opinions, dated the Closing Date and satisfactory in form and
substance to the Representative, with respect to corporate and
securities law matters.
11
<PAGE>
(g) The Representative shall have received from
Orrick, Herrington & Sutcliffe LLP, counsel to the
Underwriters, such opinion or opinions, dated the Closing Date
and satisfactory in form and substance to the Representative,
with respect to the validity of the Notes, the Registration
Statement, the Prospectus (including certain matters relating
to the transfer to the Trust of security interests in
California Financed Vehicles) and other related matters as the
Representative may require, and the Banks shall have furnished
to such counsel such documents as they reasonably request for
the purpose of enabling them to pass upon such matters.
(h) The Representative shall have received an
opinion of Simpson Thacher & Bartlett, special U.S. tax
counsel to the Banks, dated the Closing Date and reasonably
satisfactory in form and substance to the Representative,
with respect to such matters as are customary for the type of
transaction contemplated by this Agreement.
(i) The Representative shall have received form
Crowe & Dunlevy, P.C., special Oklahoma tax counsel to the
Banks, dated the Closing Date and satisfactory in form and
substance to the Representative, with respect to such matters
as are customary for the type of transaction covered by this
Agreement.
(j) The Representative shall have received an
opinion of Dorsey & Whitney LLP, counsel to the Indenture
Trustee, dated the Closing Date and satisfactory in form and
substance to the Representative, with respect to such matters
as are customary for the transactions contemplated by this
Agreement.
In rendering such opinions, counsel to the Indenture Trustee
may rely on the opinion of the office of the general counsel to the Indenture
Trustee.
(i) The Representative shall have received an
opinion of Richards, Layton & Finger, special counsel to the
Owner Trustee, and such other counsel reasonably satisfactory
to the Representative and its counsel, dated the Closing Date
and satisfactory in form and substance to the Representative,
with respect to such matters as are customary for the type of
transaction contemplated by this Agreement;
(j) The Class A-1 Notes shall have been rated "A-1+"
by Standard & Poor's, P-1 by Moody's and "D-1" by Duff &
Phelps. The Notes other than the Class A-1 Notes shall have
been rated "A" by Standard & Poor's,
12
<PAGE>
A3 by Moody's and "A" by Duff & Phelps. The Certificates
shall have been rated "A" by Standard & Poor's, A3 by
Moody's or "A+" by Duff & Phelps;
(k) The Representative shall have received a
certificate, dated the Closing Date, of an attorney-in-fact, a
Vice President or more senior officer of each Bank in which
such person, to the best of his or her knowledge after
reasonable investigation, shall state that (i) the
representations and warranties of such Bank in this Agreement
are true and correct in all material respects on and as of the
Closing Date, (ii) such Bank has complied with all agreements
and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date, (iii) the
representations and warranties of such Bank, as Seller, in the
Sale and Servicing Agreement and, as Depositor in the Trust
Agreement are true and correct as of the dates specified in
the Sale and Servicing Agreement and the Trust Agreement, (iv)
that no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for
that purpose have been instituted or are threatened by the
Commission and (v) the Prospectus does not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances in which
they were made, not misleading;
(l) On the Closing Date, $44,895,285.54 aggregate
amount of Certificates shall have been issued and sold
pursuant to the Certificate Underwriting Agreement; and
(m) CITSF, the Banks and the Representative on
behalf of the Note Underwriters shall have entered into an
Indemnification Agreement (the "Indemnification Agreement")
satisfactory in form and substance to the parties thereto.
Each Bank will furnish the Representative, or cause the
Representative to be furnished, with such number of conformed copies of such
opinions, certificates, letters and documents as the Representative reasonably
requests.
8. Indemnification. (a) The Banks jointly and severally will
indemnify and hold harmless each Underwriter against any losses, claims, damages
or liabilities, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of, or are based upon, any untrue statement or
alleged untrue statement of any material fact contained in the Preliminary
Prospectus, the Registration Statement, the Prospectus (other than any market
making
13
<PAGE>
prospectus) or any amendment or supplement thereto, or arise out of, or are
based upon, the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading; and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such action or claim; provided, however, that (i) the Banks shall
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of, or is based upon, an untrue statement or alleged
untrue statement or omission or alleged omission made (A) in the Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to either Bank by any Underwriter through the Representative expressly
for use therein or (B) in the CITSF Information (as defined in the
Indemnification Agreement) contained in the Preliminary Prospectus, the
Registration Statement or the Prospectus and (ii) such indemnity with respect to
the Preliminary Prospectus shall not inure to the benefit of any Underwriter (or
any person controlling any such Underwriter) from whom the person asserting any
such loss, claim, damage or liability purchased the Notes which are the subject
thereof if such person did not receive a copy of the Prospectus (or the
Prospectus as supplemented) at or prior to the confirmation of the sale of such
Notes to such person in any case where such delivery is required by the Act and
the untrue statement or omission of a material fact contained in the Preliminary
Prospectus was corrected in the Prospectus (or the Prospectus as supplemented).
(b) Each Underwriter severally agrees to indemnify and hold
harmless each Bank, the directors, the officers or agents of each Bank who
signed the Registration Statement, and each person, if any, who controls each
Bank within the meaning of Section 15 of the Act against any and all loss,
liability, claim, damage and expense described in the indemnity contained in
subsection (a) of this Section 8, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Preliminary Prospectus, the Registration Statement or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to either Bank by such Underwriter through the
Representative expressly for use in the Preliminary Prospectus, the Registration
Statement or the Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give prompt notice to the
indemnifying party of any action commenced against the indemnified party in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have hereunder or otherwise, other than on account of this
indemnity agreement. In case any such action shall be brought against an
indemnified party and it shall have notified the
14
<PAGE>
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, to assume
the defense thereof, with counsel reasonably satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party with respect to such action), and it being
understood that the indemnifying party shall not, in connection with any one
such action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys, and, after notice from the indemnifying party to the indemnified
party of its election so to assume the defense thereof, the indemnifying party
shall not be liable to the indemnified party under subsections (a) or (b) of
this Section 8 for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by the indemnified party, in connection with the
defense thereof other than reasonable costs of investigation.
(d) The obligations of each Bank under this Section 8 shall
be in addition to any liability which such Bank may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Underwriter within the meaning of the Act; and each Underwriter's
obligations under this Section 8 shall be in addition to any liability which
such Underwriter may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of each Bank and to each person, if
any, who controls each Bank within the meaning of Section 15 of the Act.
9. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 8 is for any reason held to be unavailable other than in accordance with
its terms, the Banks and the Underwriters shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
said indemnity agreement incurred by the Banks or the Underwriters, as incurred,
in such proportions so that the Underwriters are responsible for that portion
represented by the percentage that the underwriting discount and commissions
bear to the initial public offering price appearing thereon and the Banks are
responsible for the balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section, each person, if any,
who controls an Underwriter within the meaning of Section 15 of the Act shall
have the same rights to contribution as such Underwriter, and each director of
each Bank, each officer or agent of each Bank who signed the Registration
Statement, and each person, if any, who controls each Bank within the meaning of
Section 15 of the Act shall have the same rights to contribution as such Bank.
15
<PAGE>
10. Default of Underwriters. If any Underwriter defaults in
its obligations to purchase Notes hereunder and the aggregate principal amount
of the Notes that such defaulting Underwriter agreed but failed to purchase does
not exceed 10% of the total principal amount of Notes, the Representative may
make arrangements satisfactory to the Banks for the purchase of such Notes by
other persons, including the non-defaulting Underwriters, but if no such
arrangements are made by the Closing Date, the non-defaulting Underwriters shall
be obligated severally, in proportion to their respective commitments hereunder,
to purchase the Notes that such defaulting Underwriter agreed but failed to
purchase. If any Underwriter so defaults and the aggregate principal amount of
the Notes with respect to which such default or defaults occur exceeds 10% of
the total principal amount of the Notes and arrangements satisfactory to the
Representative and the Banks for the purchase of such Notes by other persons are
not made within 36 hours after such default, this Agreement will terminate
without liability on the part of any non-defaulting Underwriter or the Banks,
except as provided in Section 11. Nothing herein will relieve a defaulting
Underwriter from liability for its default.
11. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Banks or their respective officers and of the Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation or statement as to the results thereof,
made by or on behalf of the Underwriters, the Banks or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Notes. If for any reason the purchase of
the Notes by the Underwriters is not consummated, each Bank shall remain
responsible for the expenses to be paid or reimbursed by it pursuant to Section
6 and the respective obligations of each Bank and the Underwriters pursuant to
Section 8 and 9 shall remain in effect. If the purchase of the Notes by the
Underwriters is not consummated for any reason other than solely because of the
occurrence of any event specified in clauses (ii), (iii) or (iv) of Section
7(c), the Banks will reimburse each Underwriter for all out-of-pocket expenses
(including fees and disbursements of counsel) reasonably incurred by it in
connection with the offering of the Notes.
12. Notices. All communications hereunder will be in writing
and, if sent to the Representative or the Underwriters, will be mailed,
delivered or telegraphed and confirmed to the Representative at Chase Securities
Inc., 270 Park Avenue, 7th Floor, New York, New York 10017, Attention: Asset
Backed Finance Division, or, if sent to the Banks, will be mailed, delivered, or
telegraphed and confirmed to (i) Chase Manhattan Bank USA, National Association,
802 Delaware Avenue, Wilmington, Delaware 19801, Attention:_____________________
and (ii) The Chase
16
<PAGE>
Manhattan Bank, 270 Park Avenue, New York, New York 10017, Attention:
_____________.
13. Successors. This Agreement will inure to the benefit of,
and be binding upon, the parties hereto and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons and officers and directors
referred to in Sections 8 and 9 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
parties hereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Notes from any
Underwriter shall be deemed to be a successor by reason merely of such purchase.
14. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same Agreement.
15. No Bankruptcy Petition. Each Underwriter covenants and
agrees that, prior to the date which is one year and one day after the payment
in full of all securities issued by the Trust, it will not institute against, or
join any other person in instituting against, the Trust any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
proceedings under any Federal or state bankruptcy or similar law.
16. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
17
<PAGE>
If the foregoing is in accordance with the Representative's
understanding of our agreement, kindly sign and return to us the enclosed
duplicate hereof, whereupon it will become a binding agreement among the Banks
and the several Underwriters in accordance with its terms.
Very truly yours,
CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION
By
-------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK
By
-------------------------------
Name:
Title:
The foregoing Note
Underwriting Agreement is
hereby confirmed and
accepted as of the date
first written above:
CHASE SECURITIES INC.
on behalf of itself and
as Representative
of the Several Underwriters,
named in Schedule I
By
--------------------------------------
Name:
Title:
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Principal Amount of Principal Amount of Principal Amount of Principal Amount of Principal Amount of
Underwriter Class A-1 Notes Class A-2 Notes Class A-3 Notes Class A-4 Notes Class A-5 Notes
- ----------- ------------------- ------------------- ------------------- ------------------- -------------------
<S> <C> <C> <C> <C> <C>
-------- -------- -------- -------- --------
Total
<CAPTION>
Principal Amount of Principal Amount of Principal Amount of Principal Amount of Principal Amount of
Underwriter Class A-6 Notes Class A-7 Notes Class A-8 Notes Class A-9 Notes Class A-10 Notes
- ----------- ------------------- ------------------- ------------------- ------------------- -------------------
<S> <C> <C> <C> <C> <C>
-------- -------- -------- -------- --------
Total
</TABLE>
19
<PAGE>
SCHEDULE II
<TABLE>
<CAPTION>
Principal Amount of Principal Amount of Principal Amount of Principal Amount of Principal Amount of
Underwriter Class A-1 Notes Class A-2 Notes Class A-3 Notes Class A-4 Notes Class A-5 Notes
- ----------- ------------------- ------------------- ------------------- ------------------- -------------------
<S> <C> <C> <C> <C> <C>
-------- -------- -------- -------- --------
Total
<CAPTION>
Principal Amount of Principal Amount of Principal Amount of Principal Amount of Principal Amount of
Underwriter Class A-6 Notes Class A-7 Notes Class A-8 Notes Class A-9 Notes Class A-10 Notes
- ----------- ------------------- ------------------- ------------------- ------------------- -------------------
<S> <C> <C> <C> <C> <C>
-------- -------- -------- -------- --------
Total
</TABLE>
20
<PAGE>
OH&S DRAFT
9/17/97
CHASE MANHATTAN RV OWNER TRUST 1997-A
ASSET BACKED CERTIFICATES
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
and
THE CHASE MANHATTAN BANK,
Sellers
THE CIT GROUP/SALES FINANCING, INC.,
Servicer
CERTIFICATE UNDERWRITING AGREEMENT
September __, 1997
Chase Securities Inc.
270 Park Avenue
New York, NY 10017
Ladies and Gentlemen:
1. Introductory. Chase Manhattan Bank USA, National
Association ("Chase USA"), a national banking association, and The Chase
Manhattan Bank ("Chase"), a New York banking corporation (each, a "Bank", and
together the "Banks"), propose to form Chase Manhattan RV Owner Trust 1997-A
(the "Trust") to sell $44,895,285.54 aggregate principal amount of ____% Asset
Backed Certificates (the "Certificates"), each representing a fractional
undivided interest in the Trust.
The assets of the Trust will include, among other things, a
pool of retail installment sales contracts and purchase money notes and other
notes (the "Receivables") secured by new and used recreational vehicles (the
"Financed Vehicles") and certain monies received or due thereunder on and after
the Cutoff Date (as hereinafter defined), such Receivables to be transferred to
the Trust and serviced by The CIT Group/Sales Financing, Inc. ("CITSF," and in
its capacity as Servicer, the "Servicer"), or by a successor Servicer. The Pool
Balance of the Receivables as of
<PAGE>
the close of business on September 1, 1997 (the "Cutoff Date") was equal to
$897,395,285.54 (the "Cutoff Date Pool Balance"). The Certificates will be
issued pursuant to the Trust Agreement to be dated as of September 1, 1997 (as
amended and supplemented from time to time, the "Trust Agreement"), among the
Banks and Wilmington Trust Company, as owner trustee (the "Owner Trustee").
Simultaneously with the issuance and sale of the Certificates
as contemplated herein, the Trust will issue $59,500,000 aggregate
principal amount of Class A-1 ____% Asset Backed Notes (the "Class A-1
Notes"), $119,000,000 aggregate principal amount of Class A-2 ____% Asset
Backed Notes (the "Class A-2 Notes"), $113,000,000 aggregate principal amount
of Class A-3 ____% Asset Backed Notes (the "Class A-3 Notes"), $73,000,000
aggregate principal amount of Class A-4 ___% Asset Backed Notes (the "Class A-4
Notes"), $132,000,000 aggregate principal amount of Class A-5 _____% Asset
Backed Notes (the "Class A-5 Notes"), $88,000,000 aggregate principal amount
of Class A-6 _____% Asset Backed Notes (the "Class A-6 Notes"), $57,000,000
aggregate principal amount of Class A-7 _____% Asset Backed Notes (the "Class
A-7 Notes"), $85,000,000 aggregate principal amount of Class A-8 _____% Asset
Backed Notes (the "Class A-8 Notes"), $61,000,000 aggregate principal amount
of Class A-9 _____% Asset Backed Notes (the "Class A-9 Notes") and
$65,000,000 aggregate principal amount of Class A-10 _____% Asset Backed
Notes (the "Class A-10 Notes" and, together with 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, the
Class A-6 Notes, the Class A-7 Notes, the Class A-8 Notes, Class A-9 Notes and
the Class A-10 Notes, the "Notes"), pursuant to the Indenture to be dated as of
September 1, 1997 (as amended and supplemented from time to time, the
"Indenture"), among the Banks and Norwest Bank Minnesota, National Association,
as indenture trustee (the "Indenture Trustee"), which will be sold pursuant to
an underwriting agreement dated the date hereof (the "Note Underwriting
Agreement"; together with this Agreement, the "Underwriting Agreements") among
the Banks and the underwriters named therein (the "Note Underwriters"). The
Notes and the Certificates are sometimes referred to collectively herein as the
"Securities".
Capitalized terms used and not otherwise defined herein shall
have the meanings assigned to such terms in the Sale and Servicing Agreement to
be dated as of September 1, 1997 (as amended and supplemented from time to time,
the "Sale and Servicing Agreement"), among the Trust, the Banks, as Sellers, and
the Servicer.
This is to confirm the agreement concerning the
purchase of the Certificates from the Banks by Chase Securities
Inc. (the "Underwriter").
2
<PAGE>
2. Representations and Warranties of the Banks. Each Bank
represents and warrants to, and agrees with, the Underwriter, that:
(a) A registration statement on Form S-3 (No. 333- 32263)
including a form of prospectus, relating to the Securities has been filed with
the Securities and Exchange Commission (the "Commission") in accordance with the
provisions of the Securities Act of 1933, as amended (the "Act"), and the Rules
and Regulations under the Act (the "Rules and Regulations"). The Banks may have
filed one or more amendments thereto, including the related preliminary
prospectus, each of which has previously been furnished to you. The Banks have
included in such registration statement, as amended on the date such
registration statement became effective, all information (other than information
permitted to be omitted from a registration statement when it becomes effective
pursuant to Rule 430A ("Rule 430A Information") required by the Act and the
Rules and Regulations to be included in the final prospectus with respect to the
Securities and the offering thereof. Such registration statement, as amended on
the date that such registration statement or the most recent post-effective
amendment thereto, if any, became or becomes effective under the Act, including
the exhibits thereto and the 430 Information, is hereinafter referred to as the
"Registration Statement." The Registration Statement has become effective, and
no stop order suspending the effectiveness of the Registration Statement has
been issued, and no proceeding for that purpose has been instituted or, to the
knowledge of such Bank, threatened by the Commission. The conditions to the use
of a registration statement on Form S-3 under the Act, as set forth in the
General Instructions to Form S-3, have been satisfied with respect to the
Registration Statement.
(b) The Banks propose to file with the Commission pursuant to
Rules 430A and 424(b)(1) or 424(b)(4) under the Rules and Regulations a final
prospectus relating to the sale of the Securities. The prospectus in the form
filed with the Commission pursuant to Rules 430A and 424(b)(1) or 424(b)(4)
under the Rules and Regulations is hereinafter referred to as the "Prospectus."
As filed, the Prospectus shall include all Rule 430A Information, together with
all other such required information, with respect to the Securities and the
offering thereof and, except to the extent that the Underwriter shall have
agreed to a modification, the Prospectus shall be in all substantive respects in
the form furnished to the Underwriter prior to the execution of this Agreement
or, to the extent not completed at such time, shall contain only such material
changes as the Banks have advised the Underwriter, prior to such time, will be
included or made therein. "Preliminary Prospectus" means each prospectus
included in the Registration Statement, or amendments thereof, before it became
effective under the Act, any prospectus filed with the Commission by the Banks
pursuant to Rule 424(a) and the prospectus included in the Registration
3
<PAGE>
Statement on the date the Registration Statement became effective;
(c) The Registration Statement, at the time it became
effective, did, and the Prospectus, at the time the Prospectus is first filed in
accordance with Rule 424(b) and on the Closing Date (as defined herein), will,
comply in all material respects with the applicable requirements of the Act and
the Trust Indenture Act of 1939 and the Rules and Regulations. At the time the
Registration Statement became effective, it did not include any untrue statement
of a material fact or, did not omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading and,
on the date of the filing of the Prospectus pursuant to Rules 430A and 424(b)
and on the Closing Date, the Prospectus (together with any supplement thereto)
will not, include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, however,
that such Bank makes no representation or warranty with respect to information
contained in or omitted from the Registration Statement or the Prospectus in
reliance upon, or in conformity with, information furnished in writing to either
Bank by or on behalf of the Underwriter through the Underwriter specifically for
use in connection with the preparation of the Registration Statement or the
Prospectus.
(d) In the case of Chase USA, such Bank is a national banking
association organized under the laws of the United States, and in the case of
Chase, such Bank is a New York banking corporation, in each case, with full
power and authority to own its properties and conduct its business as described
in the Prospectus, and had at all relevant times and has power, authority and
legal right to acquire, own, and sell the Receivables being transferred by such
Bank to the Trust;
(e) When the Notes have been duly executed and delivered by
the Owner Trustee and, when authenticated by the Indenture Trustee in accordance
with the Indenture and delivered upon the order of the Banks to the Note
Underwriters pursuant to the Note Underwriting Agreement and the Sale and
Servicing Agreement, the Notes will be duly issued and will constitute legal,
valid and binding obligations of the Trust enforceable against the Trust in
accordance with their terms, except to the extent that the enforceability
thereof may be subject to bankruptcy, insolvency, reorganization,
conservatorship, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights as such laws would apply in the event of the
insolvency, liquidation or reorganization or other similar occurrence with
respect to either Bank or the Trust or in the event of any moratorium or similar
occurrence affecting either Bank or the Trust and to general principles of
equity;
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(f) The direction by such Bank to the Owner Trustee to
execute and authenticate the Certificates has been duly authorized by such Bank
and, when the Certificates have been duly executed, authenticated and delivered
by the Owner Trustee in accordance with the Trust Agreement and delivered upon
the order of the Banks to the Underwriter pursuant to this Agreement and the
Sale and Servicing Agreement, the Certificates will be duly issued and entitled
to the benefits and security afforded by the Trust Agreement;
(g) The execution, delivery and performance by such Bank of
this Agreement, the Note Underwriting Agreement, and the Basic Documents to
which such Bank is a party, and the consummation by such Bank of the
transactions provided for herein and therein have been, or will have been, duly
authorized by such Bank by all necessary action on the part of such Bank; and
neither the execution and delivery by such Bank of such instruments, nor the
performance by such Bank of the transactions herein or therein contemplated, nor
the compliance by such Bank with the provisions hereof or thereof, will (i)
conflict with or result in a breach or violation of any of the material terms
and provisions of, or constitute a material default under, any of the provisions
of the charter or by-laws of such Bank, or (ii) conflict with any of the
provisions of any law, governmental rule, regulation, judgment, decree or order
binding on such Bank or the properties of such Bank, or (iii) conflict with any
of the material provisions of any material indenture, mortgage, contract or
other instrument to which such Bank is a party or by which such Bank is bound,
or (iv) result in the creation or imposition of any lien, charge or encumbrance
upon any of its property pursuant to the terms of any such indenture, mortgage,
contract or other instruments, except, in the case of clauses (ii) and (iii) ,
for any such breaches or conflicts as would not individually or in the aggregate
have a material adverse effect on the transactions contemplated hereby or on the
ability of such Bank to consummate such transactions;
(h) When executed and delivered by the parties thereto, such
of the Sale and Servicing Agreement and the Trust Agreement will constitute a
legal, valid and binding obligation of such Bank, enforceable against such Bank
in accordance with its terms, except to the extent that the enforceability
thereof may be subject to bankruptcy, insolvency, reorganization,
conservatorship, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights as such laws would apply in the event of the
insolvency, liquidation or reorganization or other similar occurrence with
respect to such Bank or in the event of any moratorium or similar occurrence
affecting such Bank and to general principles of equity;
(i) All approvals, authorizations, consents, orders or other
actions of any person, corporation or other organization, or of any court,
governmental agency or body or official (except with respect to the state
securities or "blue sky" laws of
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<PAGE>
various jurisdictions) if so required in connection with the execution, delivery
and performance of this Agreement, the Note Underwriting Agreement and the Basic
Documents to which such Bank is a party has been or will be taken or obtained on
or prior to the Closing Date;
(j) As of the Closing Date, the representations and
warranties of such Bank, in the Trust Agreement will be true and correct;
(k) This Agreement and the Note Underwriting Agreement have
been duly executed and delivered by such Bank;
3. Purchase, Sale, Payment and Delivery of the Certificates.
On the basis of the representations, warranties and agreements herein contained,
but subject to the terms and conditions herein set forth, Chase USA agree to
sell to the Underwriter, and the Underwriter agrees, to purchase from Chase USA,
at a purchase price of ________% of the face amount thereof, $44,895,285.54
principal amount of the Certificates plus accrued interest at the Certificate
Rate from September 1, 1997 to but excluding the Closing Date.
On the basis of the representations, warranties and agreements
herein contained, but subject to the terms and conditions herein set forth,
Chase agrees to sell to the Underwriter, and the Underwriter agrees, to purchase
from Chase, at a purchase price of ________% of the face amount thereof,
$44,895,285.54 principal amount of the Certificates plus accrued interest at the
Certificate Rate from September 1, 1997 to but excluding the Closing Date.
Each Bank will deliver the Certificates being sold by it
hereunder to the Underwriter against payment of the purchase price in
immediately available funds drawn to the order of ______________ on behalf of
the Banks at the offices of Orrick, Herrington & Sutcliffe LLP in New York, New
York at 10:00 a.m., New York City time, on September 1, 1997 or at such other
time not later than seven full business days thereafter as the Underwriter and
the Banks determine, such time being herein referred to as the "Closing Date."
The Certificates to be so delivered will be initially represented by one or more
definitive Certificates registered in the name of Cede & Co., the nominee of The
Depository Trust Company ("DTC"), except for a Certificate registered in the
name of Chase Securities Inc. in an amount of $___.__, and will be made
available for inspection by the Underwriter at the office where delivery and
payment for such Certificates is to take place no later than 1:00 p.m., New York
City time, on the Business Day prior to the Closing Date.
4. Offering by the Underwriter. It is understood that the
Underwriter proposes to offer the Certificates for sale to the public (which may
include selected brokers and dealers) as set forth in the Prospectus.
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<PAGE>
5. Covenants of the Banks. Each Bank covenants and agrees
with the Underwriter that:
(a) Such Bank will file the Prospectus with the Commission
pursuant to Rule 424(b)(1) or 424(b)(4) of the Rules and Regulations within the
time prescribed therein and will provide evidence satisfactory to the
Underwriter of such timely filing. During any period that a prospectus relating
to the Certificates is required under the Act to be delivered to purchasers of
the Certificates by the underwriters and dealers participating in the initial
offering and sale of the Certificates on the Closing Date under the Act (without
regard to any market making prospectus required to be delivered by the
Underwriter pursuant to the Act) (a "prospectus delivery period"), such Bank
will not file any amendments to the Registration Statement, or any amendments or
supplements to the Prospectus, unless it shall first have delivered copies of
such amendments or supplements to the Underwriter, and, if the Underwriter shall
have reasonably objected thereto promptly after receipt thereof; such Bank will
promptly advise the Underwriter or its counsel (i) when notice is received from
the Commission that any post-effective amendment to the Registration Statement
has become or will become effective, (ii) of any request by the Commission for
any amendment or supplement to the Registration Statement or the Prospectus or
for any additional information and (iii) of any order or communication
suspending or preventing, or threatening to suspend or prevent, the offer and
sale of the Certificates or of any proceedings or examinations that may lead to
such an order or communication, whether by or of the Commission or any authority
administering any state securities or "blue sky" law, as soon as such Bank is
advised thereof, and such Bank will use its reasonable efforts to prevent the
issuance of any such order or communication and to obtain as soon as possible
its lifting, if issued.
(b) If, at any time during the prospectus delivery period, any
event occurs as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, or if it is
necessary at any time to amend the Prospectus in order to comply with the Act or
the Rules and Regulations, such Bank promptly will prepare and file with the
Commission (subject to the Underwriter's prior review pursuant to paragraph (a)
of this Section 5), an amendment or supplement which will correct such statement
or omission or an amendment or supplement which will effect such compliance.
(c) Such Bank will furnish to the Underwriter copies of the
Registration Statement, as originally filed with the Commission, and each
amendment thereto filed with the Commission, including all consents and exhibits
filed therewith and each Preliminary Prospectus, the Prospectus and any amended
or
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<PAGE>
supplemented Prospectus; in each case as soon as available and in such
quantities as the Underwriter may reasonably request.
(d) Such Bank will cooperate with the Underwriter in
arranging for the qualification of the Certificates for sale and the
determination of their eligibility for investment under the laws of such
jurisdictions as the Underwriter designates and will cooperate in continuing
such qualifications in effect so long as required for the distribution of the
Certificates; provided, however, that neither any such Bank nor the Trust shall
be obligated to qualify to do business in any jurisdiction in which it is not
currently so qualified or to take any action which would subject it to general
or unlimited service of process in any jurisdiction where it is not now so
subject.
(e) [Reserved]
(f) So long as any of the Certificates is outstanding, such
Bank will furnish to the Underwriter as soon as practicable, (A) all documents
distributed, or caused to be distributed, by such Bank to the
Certificateholders, (B) all documents filed, or caused to be filed, by such Bank
with respect to the Trust with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and any order of the
Commission thereunder or pursuant to a "no-action" letter from the staff of the
Commission and (C) from time to time, such other information in the possession
of such Bank concerning the Trust and any other information concerning such Bank
filed with any governmental or regulatory authority which is otherwise publicly
available, as the Underwriter may reasonably request.
(g) On or before the Closing Date, such Bank shall cause its
computer records relating to the Receivables to be marked to show the Trust's
absolute ownership of such Receivables transferred by such Bank to the Trust,
and from and after the Closing Date neither such Bank nor the Servicer shall
take any action inconsistent with the Trust's ownership of such Receivables and
the security interest of the Indenture Trustee therein, other than as permitted
by the Sale and Servicing Agreement.
(h) To the extent, if any, that the rating provided with
respect to the Certificates by Moody's, Standard & Poor's and/or Duff & Phelps
is conditional upon the furnishing of documents or the taking of any other
actions by such Bank agreed upon on or prior to the Closing Date, such Bank
shall furnish such documents and take any such other actions.
(i) For the period beginning on the date hereof and ending on
the Closing Date, unless waived by the Underwriter, neither such Bank nor any
trust originated, directly or indirectly, by such Bank will offer to sell or
sell notes (other than the Notes) collateralized by, or certificates (other than
the Certificates) evidencing an ownership interest in,
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<PAGE>
receivables generated pursuant to recreational vehicle installment sale
contracts or purchase money loans.
6. Payment of Expenses. The Banks will pay all expenses
incident to the performance of their respective obligations under this
Agreement, including (i) the printing and filing of the Registration Statement
as originally filed and of each amendment thereto, (ii) the Indenture Trustee's
and Owner Trustee's acceptance fee and the reasonable fees and disbursements of
the counsel to the Indenture Trustee and counsel to the Owner Trustee, (iii) the
fees and disbursements of Price Waterhouse LLP and Arthur Andersen, (iv) the
fees of the Rating Agencies and (v) blue sky expenses; provided, however, that
the Underwriter may reimburse the Banks for certain expenses incurred by the
Banks as agreed to by the Underwriter and the Banks.
7. Conditions to the Obligations of the Underwriter. The
obligation of the Underwriter to purchase and pay for the Certificates will be
subject to the accuracy of the representations and warranties on the part of the
Banks herein on the date hereof and as of the Closing Date, to the accuracy of
the statements of officers of the Banks made pursuant to the provisions hereof,
to the performance by the Banks of their respective obligations hereunder and to
the following additional conditions precedent:
(a) On or prior to the date hereof the Underwriter
shall have received a letter (a "Procedures Letter"), dated
the date of this Agreement of each of Price Waterhouse LLP and
Arthur Andersen verifying the accuracy of such financial and
statistical data contained in the Prospectus as the
Underwriter shall deem reasonably advisable. In addition, if
any amendment or supplement to the Prospectus made after the
date hereof contains financial or statistical data, the
Underwriter shall have received a letter dated the Closing
Date confirming each Procedures Letter and providing
additional comfort on such new data;
(b) The Prospectus shall have been filed in the
manner and within the time period required by Rule 424(b) of
the Rules and Regulations; and prior to the Closing Date, no
stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened;
(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or
any development involving a prospective change, in or
affecting particularly the business or properties of any of
the Banks, The Chase Manhattan Corporation, CITSF or The CIT
Group Holdings, Inc. which, in the reasonable judgment of the
Underwriter,
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<PAGE>
materially impairs the investment quality of the
Certificates or makes it impractical to market the
Certificates; (ii) any suspension or material limitation of
trading in securities generally on the New York Stock
Exchange, or any setting of minimum prices for trading
on such exchange, or any suspension of trading of any
securities of any of the Banks or The Chase Manhattan
Corporation, on any exchange or in the over-the-counter market
by such exchange or over-the-counter market or by the
Commission; (iii) any banking moratorium declared by Federal
or New York authorities; or (iv) any outbreak or material
escalation of major hostilities or any other substantial
national or international calamity or emergency if, in the
reasonable judgment of the Underwriter, the effect of any such
outbreak, escalation, calamity or emergency on the United
States financial markets makes it impracticable or inadvisable
to proceed with completion of the sale of and any payment for
the Certificates;
(d) The Underwriter shall have received opinions,
dated the Closing Date and reasonably satisfactory, when taken
together, in form and substance to the Underwriter, of Simpson
Thacher & Bartlett, special counsel to the Banks, Richards,
Layton & Finger, special counsel to the Trust, and such other
counsel otherwise reasonably acceptable to the Underwriter,
with respect to such matters as are customary for the type of
transaction contemplated by this Agreement;
(e) The Underwriter shall have received an opinion
or opinions of Simpson Thacher & Bartlett, special counsel to
the Banks, dated the Closing Date and satisfactory in form and
substance to the Underwriter, with respect to certain matters
relating to the transfers from each Bank to the Trust of its
Receivables, with respect to the perfection of the Trust's
interest in the Receivables transferred by Chase and with
respect to the grant of a security interest in the Receivables
to the Indenture Trustee, and an opinion of Richards, Layton &
Finger, Special Counsel to the Trust, with respect to the
perfection of the Trust's interest in the Receivables
transferred by Chase USA and the Indenture Trustee's interests
in the Receivables;
(f) The Underwriter shall have received from Schulte
Roth & Zabel, counsel to the Servicer, such opinion or
opinions, dated the Closing Date and satisfactory in form and
substance to the Underwriter, with respect to corporate and
securities law matters.
(g) The Underwriter shall have received from Orrick,
Herrington & Sutcliffe LLP, counsel to the
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<PAGE>
Underwriter, such opinion or opinions, dated the Closing
Date and satisfactory in form and substance to the
Underwriter, with respect to the validity of the
Certificates, the Registration Statement, the Prospectus
(including certain matters relating to the transfer to the
Trust of security interests in California Financed Vehicles)
and other related matters as the Underwriter may require, and
the Banks shall have furnished to such counsel such documents
as they reasonably request for the purpose of enabling them to
pass upon such matters;
(h) The Underwriter shall have received an opinion
of Simpson Thacher & Bartlett, special U.S. tax counsel to the
Banks, dated the Closing Date and reasonably satisfactory in
form and substance to the Underwriter, with respect to such
matters as are customary for the type of transaction
contemplated by this Agreement;
(i) The Underwriter shall have received form Crowe &
Dunlevy, P.C., special Oklahoma tax counsel to the Banks,
dated the Closing Date and satisfactory in form and substance
to the Underwriter, with respect to such matters as are
customary for the type of transaction covered by this
Agreement.
(j) The Underwriter shall have received an opinion
of Dorsey & Whitney LLP, counsel to the Indenture Trustee,
dated the Closing Date and satisfactory in form and substance
to the Underwriter with respect to such matters as are
customary for the transactions contemplated by this Agreement;
In rendering such opinions, counsel to the Indenture Trustee
may rely on the opinion of the office of the general counsel to the Indenture
Trustee.
(k) The Underwriter shall have received an opinion
of counsel to the Owner Trustee, and such other counsel
reasonably satisfactory to the Underwriter and its counsel,
dated the Closing Date and satisfactory in form and substance
to the Underwriter, with respect to such matters as are
customary for the type of transaction contemplated by this
Agreement;
(l) The Certificates have been rated at least "A"
by Standard & Poor's, A3 by Moody's or "A+" by Duff &
Phelps. The Class A-1 Notes shall have been rated "A-1+" by
Standard & Poor's, P-1 by Moody's and "D-1" by Duff & Phelps.
The Notes other than the Class A-1 Notes shall have been
rated "A" by Standard & Poor's, A3 by Moody's and "A" by
Duff & Phelps;
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(m) The Underwriter shall have received a
certificate, dated the Closing Date, of an attorney-in-fact, a
Vice President or more senior officer of each Bank in which
such person, to the best of his or her knowledge after
reasonable investigation, shall state that (i) the
representations and warranties of such Bank in this Agreement
are true and correct in all material respects on and as of the
Closing Date, (ii) that such Bank has complied with all
agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing
Date, (iii) the representations and warranties of such Bank,
as Seller, in the Sale and Servicing Agreement and, as
Depositor, in the Trust Agreement, are true and correct as of
the dates specified in the Sale and Servicing Agreement and
the Trust Agreement, (iv) that no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or
are threatened by the Commission and (v) the Prospectus does
not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of
the circumstances in which they were made, not misleading;
(n) On the Closing Date, all of the Notes shall have
been issued and sold pursuant to the Note Underwriting
Agreement; and
(o) CITSF, the Banks and the Underwriter on behalf
of the Note Underwriters shall have entered into an
Indemnification Agreement (the "Indemnification Agreement")
satisfactory in form and substance to the parties thereto.
Each Bank will furnish the Underwriter, or cause the
Underwriter to be furnished, with such number of conformed copies of such
opinions, certificates, letters and documents as the Underwriter reasonably
requests.
8. Indemnification. (a) The Banks jointly and severally will
indemnify and hold harmless the Underwriter against any losses, claims, damages
or liabilities, to which the Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of, or are based upon, any untrue statement or
alleged untrue statement of any material fact contained in the Preliminary
Prospectus, the Registration Statement, the Prospectus (other than any market
making prospectus) or any amendment or supplement thereto, or arise out of, or
are based upon, the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading; and will
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<PAGE>
reimburse the Underwriter for any legal or other expenses reasonably incurred by
the Underwriter in connection with investigating or defending any such action or
claim; provided, however, that (i) the Banks shall not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of,
or is based upon, an untrue statement or alleged untrue statement or omission or
alleged omission made (A) in Preliminary Prospectus, the Registration Statement
or the Prospectus or any such amendment or supplement in reliance upon and in
conformity with written information furnished to either Bank by the Underwriter
expressly for use therein or (B) in the CITSF Information (as defined in the
Indemnification Agreement) contained in the Preliminary Prospectus, the
Registration Statement or the Prospectus and (ii) such indemnity with respect to
the Preliminary Prospectus shall not inure to the benefit of the Underwriter (or
any person controlling any the Underwriter) from whom the person asserting any
such loss, claim, damage or liability purchased the Certificates which are the
subject thereof if such person did not receive a copy of the Prospectus (or the
Prospectus as supplemented) at or prior to the confirmation of the sale of such
Certificates to such person in any case where such delivery is required by the
Act and the untrue statement or omission of a material fact contained in the
Preliminary Prospectus was corrected in the Prospectus (or the Prospectus as
supplemented).
(b) The Underwriter agrees to indemnify and hold harmless
each Bank, the directors, the officers or agents of each Bank who signed the
Registration Statement, and each person, if any, who controls each Bank within
the meaning of Section 15 of the Act against any and all loss, liability, claim,
damage and expense described in the indemnity contained in subsection (a) of
this Section 8, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Preliminary
Prospectus, the Registration Statement or the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with written information
furnished to either Bank by the Underwriter expressly for use in the Preliminary
Prospectus, the Registration Statement or the Prospectus (or any amendment or
supplement).
(c) Each indemnified party shall give prompt notice to the
indemnifying party of any action commenced against the indemnified party in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have hereunder or otherwise, other than on account of this
indemnity agreement. In case any such action shall be brought against an
indemnified party and it shall have notified the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to
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<PAGE>
the indemnifying party with respect to such action), and it being understood
that the indemnifying party shall not, in connection with any one such action or
separate but substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys, and,
after notice from the indemnifying party to the indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to the indemnified party under subsections (a) or (b) of this Section 8
for any legal expenses of other counsel or any other expenses, in each case
subsequently incurred by the indemnified party, in connection with the defense
thereof other than reasonable costs of investigation.
(d) The obligations of each Bank under this Section 8 shall
be in addition to any liability which such Bank may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
the Underwriter within the meaning of the Act; and the Underwriter's obligations
under this Section 8 shall be in addition to any liability which the Underwriter
may otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of each Bank and to each person, if any, who controls each
Bank within the meaning of Section 15 of the Act.
9. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 8 is for any reason held to be unavailable other than in accordance with
its terms, the Banks and the Underwriter shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
said indemnity agreement incurred by the Banks or the Underwriter, as incurred,
in such proportions so that the Underwriter is responsible for that portion
represented by the percentage that the underwriting discount and commissions
bear to the initial public offering price appearing thereon and the Banks are
responsible for the balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section, each person, if any,
who controls the Underwriter within the meaning of Section 15 of the Act shall
have the same rights to contribution as the Underwriter, and each director of
each Bank, each officer or agent of each Bank who signed the Registration
Statement, and each person, if any, who controls each Bank within the meaning of
Section 15 of the Act shall have the same rights to contribution as such Bank.
10. Survival of Certain Representations and Obligations.
The respective indemnities, agreements, representations, warranties and other
statements of the Banks or their respective officers and of the Underwriter set
forth in or
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made pursuant to this Agreement will remain in full force and effect, regardless
of any investigation or statement as to the results thereof, made by or on
behalf of the Underwriter, each Bank or any of their respective representatives,
officers or directors or any controlling person, and will survive delivery of
and payment for the Certificates. If for any reason the purchase of the
Certificates by the Underwriter is not consummated, each Bank shall remain
responsible for the expenses to be paid or reimbursed by it pursuant to Section
6 and the respective obligations of the Banks and the Underwriter pursuant to
Section 5, 6, 8 and 9 shall remain in effect. If the purchase of the
Certificates by the Underwriter is not consummated for any reason other than
solely because of the occurrence of any event specified in clauses (ii), (iii)
or (iv) of Section 7(c), the Banks will reimburse the Underwriter for all
out-of-pocket expenses (including fees and disbursements of counsel) reasonably
incurred by it in connection with the offering of the Certificates.
11. Notices. All communications hereunder will be in writing
and, if sent to the Underwriter, will be mailed, delivered or telegraphed and
confirmed to the Underwriter at Chase Securities Inc., 270 Park Avenue, 7th
Floor, New York, New York 10017, Attention: Asset Backed Finance Division, or,
if sent to the Banks, will be mailed, delivered, or telegraphed and confirmed to
(i) Chase Manhattan Bank USA, National Association, 802 Delaware Avenue,
Wilmington, Delaware 19801, Attention: ______ and (ii) The Chase Manhattan Bank,
270 Park Avenue, New York, New York 10017, Attention: ___________.
12. Successors. This Agreement will inure to the benefit of,
and be binding upon, the parties hereto and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons and officers and directors
referred to in Sections 8 and 9 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
parties hereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Certificates
from the Underwriter shall be deemed to be a successor by reason merely of such
purchase.
13. Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same Agreement.
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14. No Bankruptcy Petition. The Underwriter covenants and
agrees that, prior to the date which is one year and one day after the payment
in full of all securities issued by the Trust, it will not institute against, or
join any other person in instituting against, the Trust any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
proceedings under any federal or state bankruptcy or similar law.
15. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
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If the foregoing is in accordance with the Underwriter's
understanding of our agreement, kindly sign and return to us the enclosed
duplicate hereof, whereupon it will become a binding agreement between the Banks
and the Underwriter in accordance with its terms.
Very truly yours,
CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION
By
---------------------------------
Name: Keith Schuck
Title: Vice President
THE CHASE MANHATTAN BANK
By
--------------------------------
Name:
Title:
The foregoing Underwriting
Agreement is hereby
confirmed and accepted
as of the date
first written above:
CHASE SECURITIES INC.
By
------------------------------
Name:
Title:
<PAGE>
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION
Charter No. 23160
ARTICLES OF ASSOCIATION
For the purpose of organizing an Association to perform any lawful activities of
national banks, the undersigned do enter into the following Articles of
Association:
FIRST. The title of this Association shall be Chase Manhattan Bank USA, National
Association (the "Association").
SECOND. The main office of the Association shall be in the City of Wilmington,
County of New Castle, State of Delaware. The general business of the Association
shall be conducted at its main office and its branches.
THIRD. The board of directors of this Association shall consist of not less than
five nor more than twenty-five persons, the exact number to be fixed and
determined from time to time by resolution of a majority of the full board of
directors or by resolution of a majority of the shareholders at any annual or
special meeting thereof. Each director, during the full term of his
directorship, shall own common or preferred stock of the Association or of a
holding company owning the Association, with an aggregate par, fair market or
equity value of not less than $1,000. Any vacancy in the board of directors may
be filled by action of the shareholders or a majority of the remaining directors
Terms of directors, including directors selected to fill vacancies, shall expire
at the next regular meeting of shareholders at which directors are elected,
unless the directors resign or are removed from office.
Despite the expiration of a director's term, the director shall continue to
serve until his or her successor is elected and qualifies or until there is a
decrease in the number of directors and his or her position is eliminated.
Honorary or advisory members of the board of directors, without voting power or
power of final decision in matters concerning the business of the Association,
may be appointed by resolution of a majority of the full board of directors, or
by resolution of shareholders at any annual or special meeting. Honorary or
advisory directors shall not be counted to determine the number of directors of
the Association or the presence of a quorum in connection with any board action,
and shall not be required to own qualifying shares.
FOURTH. There shall be an annual meeting of the shareholders to elect directors
and transact whatever other business may be brought before the meeting. It shall
be held at the main office or any other convenient place the board of directors
may designate, on the day of each year specified therefore in the bylaws, or if
that day falls on a legal holiday in the state in which the Association is
located, on the next following banking day. If no election is held on the day
fixed or in event of a legal holiday, on the following banking day, an election
may be held on any subsequent day within 60 days of the day fixed, to be
designated by the board of directors, or, if the directors fail to fix the day,
by shareholders representing two-thirds of the shares issued and outstanding. In
all cases at least 10 days advance notice of the meeting shall be given to the
shareholders by first class mail.
In all elections of directors, the number of votes each common shareholder may
cast will be determined by multiplying the number of shares he or she owns by
the number of directors to be elected. Those votes may be cumulated and cast for
a single candidate or may be distributed among two or more candidates in the
manner selected by the shareholder. On all other questions, each common
shareholder shall be entitled to one vote for each share of stock held by him or
her.
A director may resign at any time by delivering written notice to the board of
directors, its Chairperson, or to the Association, which resignation shall be
effective when the notice is delivered unless the notice specifies a later
effective date.
<PAGE>
A director may be removed by shareholders at a meeting called to remove him or
her, when notice of the meeting stating that the purpose or one of the purposes
is to remove him or her is provided, if there is a failure to fulfill one of the
affirmative requirements for qualification, or for cause, provided, however,
that a director may not be removed if the number of votes sufficient to elect
him or her under cumulative voting is voted against his or her removal.
FIFTH. The authorized amount of capital stock of this Association shall be
417,000 shares of common stock of the par value of One Hundred dollars ($100.00)
each; but said capital stock may be increased or decreased from time to time,
according to the provisions of the laws of the United States.
No holder of shares of the capital stock of any class of the Association shall
have any preemptive or preferential right of subscription to any shares of any
class of stock of the Association, whether now or hereafter authorized, or to
any obligations convertible into stock of the Association, issued, or sold, nor
any right of subscription to any thereof other than such, if any, as the board
of directors, in its discretion may from time to time determine and at such
price as the board of directors may from time to time fix.
Unless otherwise specified in the Articles of Association or required by law,
(1) all matters requiring shareholder action, including amendments to the
Articles of Association, must be approved by shareholders owning a majority
voting interest in the outstanding voting stock, and (2) each shareholder shall
be entitled to one vote per share.
The Association, at any time and from time to time, may authorize and issue debt
obligations, whether or not subordinated, without the approval of the
shareholders.
SIXTH. The board of directors shall appoint one of its members President of this
Association, and one of its members Chairperson of the board and shall have the
power to appoint one or more Vice Presidents, a Secretary who shall keep minutes
of the directors' and shareholders' meetings and be responsible for
authenticating the records of the Association, and such other officers and
employees as may be required to transact the business of this Association. A
duly appointed officer may appoint one or more officers or assistant officers if
authorized by the board of directors in accordance with the bylaws.
The board of directors shall have the power to:
(1) Define the duties of the officers, employees, and agents of the
Association.
(2) Delegate the performance of its duties, but not the responsibility for its
duties, to the officers, employees, and agents of the Association.
(3) Fix the compensation and enter into employment contracts with its officers
and employees upon reasonable terms and conditions consistent with
applicable law.
(4) Dismiss officers and employees.
(5) Require bonds from officers and employees and to fix the penalty thereof.
(6) Ratify written policies authorized by the Association's management or
committees of the board.
(7) Regulate the manner in which any increase or decrease of the capital of the
Association shall be made, provided that nothing herein shall restrict the
power of shareholders to increase or decrease the capital of the
Association in accordance with law.
(8) Manage and administer the business and affairs of the Association.
(9) Adopt initial bylaws, not inconsistent with law or the Articles of
Association, for managing the business and regulating the affairs of
the Association.
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(10) Amend or repeal bylaws, except to the extent that the Articles of
Association reserve this power in whole or in part to shareholders.
(11) Make contracts.
(12) Generally perform all acts that are legal for a board of directors to
perform.
SEVENTH. The board of directors shall have the power to change the location of
the main office to any other place within the limits of the City of Wilmington,
without the approval of the shareholders, and shall have the power to establish
or change the location of any branch or branches of the Association to any other
location permitted under applicable law, without the approval of the
shareholders subject to approval by the Office of the Comptroller of the
Currency.
EIGHTH. The corporate existence of this Association shall continue until
termination according to the laws of the United States.
NINTH. These Articles of Association may be amended at any regular or special
meeting of the shareholders by the affirmative vote of the holders of a majority
of the stock of this Association, unless the vote of the holders of a greater
amount of stock is required by law, and in that case by the vote of the holders
of such greater amount. The Association's board of directors may propose one or
more amendments to the Articles of Association for submission to the
shareholders.
In witness whereof, we have hereunto set our hands as of
this 8th of August, 1996.
/s/ Donald L. Boudreau /s/ Michael Urkowitz
- --------------------------------- ----------------------------------
/s/ William H. Hoefling /s/ Luke S. Hayden
- --------------------------------- ----------------------------------
/s/ Michael J. Barrett /s/ Thomas Jacob
- --------------------------------- ----------------------------------
/s/ Kevin T. Hurley
- --------------------------------- ----------------------------------
/s/ John J. Hehir, Jr.
- ---------------------------------
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RESTATED
ORGANIZATION CERTIFICATE
OF
THE CHASE MANHATTAN BANK
Under Section 8007 of the New York Banking Law
WE, WALTER V. SHIPLEY and ANTHONY J. HORAN, being, respectively, the
Chairman of the Board and the Secretary of THE CHASE MANHATTAN BANK, a New York
banking organization, do hereby certify as follows:
1. The name of the Corporation is The Chase Manhattan Bank. The Corporation
was formed under the name Chemical Bank.
2. The Organization Certificate of The Chase Manhattan Bank was filed by
the Superintendent of Banks of the State of New York on November 26, 1968.
3. The text of the organization certificate, as amended heretofore, is
hereby restated without further amendment or change to read as herein set forth
in full:
FIRST: The name by which the Corporation is to be known is THE CHASE
MANHATTAN BANK.
SECOND: The principal office of the Corporation is to be located in New
York, New York.
THIRD: The amount of authorized stock which the Corporation is hereafter to
have is $1,335,000,000 and the number of shares into which such capital stock is
to be divided is 125,000,000 shares consisting of 110,000,000 shares of Common
Stock, par value $12 per share, and 15,000,000 shares of Preferred Stock, par
value $1 per share, which shall be issued in one or more classes or series
having such designations, relative rights, preferences or limitations as fixed
by the Board of Directors of the Corporation at the time of issuance of any such
Preferred Stock.
FOURTH: The number of directors of the Corporation shall be not less than
seven nor more than twenty-five.
FIFTH: The Corporation is to exercise the powers conferred by
Section 100 of the banking laws of the State of New York.
4. This restated organization certificate was approved by a resolution
adopted by the Board of Directors of the Corporation, on July 16, 1996.
<PAGE>
2
IN WITNESS WHEREOF, the undersigned have executed this restated
organization certificate this 25th day of March, 1997.
/s/ Walter V. Shipley
--------------------------------
Walter V. Shipley
Chairman of the Board
/s/ Anthony J. Horan
--------------------------------
Anthony J. Horan
Secretary
<PAGE>
3
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
I, ANTHONY J. HORAN, being duly sworn, depose and say that I, the said
ANTHONY J. HORAN, am the Secretary of THE CHASE MANHATTAN BANK, and that I have
read and signed the foregoing Certificate and know the contents thereof and the
statements contained therein are true.
/s/ Anthony J. Horan
------------------------------
Anthony J. Horan
Secretary
Subscribed and sworn to before
me this 25th day of March 1997.
- ------------------------------
Notary Public
<PAGE>
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION
BY-LAWS
Article I
Meetings of Shareholders
Section 1.1. Annual Meeting. The regular annual meeting of the shareholders to
elect directors and transact whatever other business may properly come before
the meeting, shall be held at the main office of the Association, or such other
place as the board may designate, at noon, on April 1st of each year, or if that
date falls on a legal holiday in the State in which the Association is located,
on the next following banking day. Notice of the meeting shall be mailed,
postage prepaid, at least 10 days and no more than 60 days prior to the date
thereof, addressed to each shareholder at his/her address appearing on the books
of the Association. If, for any cause, an election of directors is not made on
that date, or in the event of a legal holiday, on the next following banking
day, an election may be held on any subsequent day within 60 days of the date
fixed, to be designated by the board, or, if the directors fail to fix the date,
by shareholders representing two thirds of the shares issued and outstanding.
Section 1.2. Special Meetings. Except as otherwise specifically provided by
statute, special meetings of the shareholders may be called for any purpose at
any time by a majority of the board of directors or by any one or more
shareholders owning, in the aggregate, not less than twenty-five percent of the
stock of the Association or by the Chairperson of the board of directors or the
President . Every such special meeting, unless otherwise provided by law, shall
be called by mailing, postage prepaid, not less than 10 days nor more than 60
days prior to the date fixed for the meeting, to each shareholder at the address
appearing on the books of the Association a notice stating the purpose of the
meeting.
Section 1.3. Nominations of Directors. Nominations for election to the board of
directors may be made by the board of directors or by any stockholder of any
outstanding class of capital stock of the Association entitled to vote for the
election of directors. Nominations, other than those made by or on behalf of the
existing management of the Association, shall be made in writing and shall be
delivered or mailed to the President of the Association and to the Comptroller
of the Currency, Washington, D.C., not less than 14 days nor more than 50 days
prior to any meeting of shareholders called for the election of directors,
provided, however, that if less than 21 days' notice of the meeting is given to
shareholders, such nomination shall be mailed or delivered to the President of
the Association and to the Comptroller of the Currency not later than the close
of business on the seventh day following the day on which the notice of meeting
was mailed. Such notification shall contain the following information to the
extent known to the notifying shareholder:
(1) The name and address of each proposed nominee.
(2) The principal occupation of each proposed nominee.
(3) The total number of shares of capital stock of the Association that
will be voted for each proposed nominee.
(4) The name and residence address of the notifying shareholder.
(5) The number of shares of capital stock of the Association owned by the
notifying shareholder.
Nominations not made in accordance herewith may, in his/her discretion, be
disregarded by the Chairperson of the meeting, and upon his/her instructions,
the vote tellers may disregard all votes cast for each such nominee.
Section 1.4. Proxies. Shareholders may vote at any meeting of the shareholders
by proxies duly authorized in writing, but no officer or employee of this
Association shall act as proxy. Proxies shall be valid only for one meeting, to
be specified therein, and any adjournments of such meeting. Proxies shall be
dated and filed with the records of the meeting. Proxies with rubber stamped
facsimile signatures may be used and unexecuted
<PAGE>
proxies may be counted upon receipt of a confirming telegram from the
shareholder. Proxies meeting the above requirements submitted at any time during
a meeting shall be accepted.
Section 1.5. Quorum. A majority of the outstanding capital stock, represented in
person or by proxy, shall constitute a quorum at any meeting of shareholders,
unless otherwise provided by law, or by the shareholders or directors pursuant
to Section 10.2, but less than a quorum may adjourn any meeting, from time to
time, and the meeting may be held, as adjourned, without further notice. A
majority of the votes cast shall decide every question or matter submitted to
the shareholders at any meeting, unless otherwise provided by law or by the
Articles of Association, or by the shareholders or directors pursuant to Section
10.2. Any action required or permitted to be taken by the shareholders may be
taken without a meeting by unanimous written consent of the shareholders to a
resolution authorizing the action. The resolution and the written consent shall
be filed with the minutes of the proceedings of the shareholders.
Article II
Directors
Section 2.1. Board of Directors. The board of directors ("board") shall have the
power to manage and administer the business and affairs of the Association.
Except as expressly limited by law, all corporate powers of the Association
shall be vested in and may be exercised by the board.
Section 2.2. Number. The board shall consist of not less than five nor more than
twenty-five persons, the exact number within such minimum and maximum limits to
be fixed and determined from time to time by resolution of a majority of the
full board or by resolution of a majority of the shareholders at any meeting
thereof; provided, however, that a majority of the full board may not increase
the number of directors to a number which: (1) exceeds by more than two the
number of directors last elected by shareholders where such number was 15 or
less; and (2) exceeds by more than four the number of directors last elected by
shareholders where such number was 16 or more, but in no event shall the number
of directors exceed 25.
Section 2.3. Organization Meeting. The Secretary shall notify the
directors-elect of their election and of the time at which they are required to
meet at the main office of the Association to organize the new board and elect
and appoint officers of the Association for the succeeding year. Such meeting
shall be held on the day of the election or as soon thereafter as practicable,
and, in any event, within 30 days thereof. If, at the time fixed for such
meeting, there shall not be a quorum, the directors present may adjourn the
meeting, from time to time, until a quorum is obtained.
Section 2.4. Regular Meetings. The time and location of regular meetings of the
board shall be set by the board. Such meetings may be held without notice. Any
business may be transacted at any regular meeting. The board may adopt any
procedures for the notice and conduct of any meetings as are not prohibited by
law.
Section 2.5. Special Meetings. Special meetings of the board may be called at
the request of the Chairperson of the board, the President, or three or more
directors. Each member of the board shall be given notice stating the time and
place, by telegram, telephone, letter or in person, of each such special meeting
at least one day prior to such meeting. Any business may be transacted at any
special meeting.
Section 2.6. Action by the Board. Except as otherwise provided by law, corporate
action to be taken by the board shall mean such action at a meeting of the
board. Any action required or permitted to be taken by the board or any
committee of the board may be taken without a meeting if all members of the
board or the committee consent in writing to a resolution authorizing the
action. The resolution and the written consents thereto shall be filed with the
minutes of the proceedings of the board or committee. Any one or more members of
the board or any committee may participate in a meeting of the board or
committee by means of a conference telephone or similar communications equipment
allowing all persons participating in the meeting to
2
<PAGE>
hear each other at the same time. Participation by such means shall constitute
presence in person at such meeting.
Section 2.7. Waiver of Notice. Notice of a special meeting need not be given to
any director who submits a signed waiver of notice, whether before or after the
meeting, or who attends the meeting without protesting, prior thereto or at its
commencement, the lack of notice to him or her.
Section 2.8. Quorum and Manner of Acting. Except as otherwise required by law,
the Articles of Association or these by-laws, a majority of the directors shall
constitute a quorum for the transaction of any business at any meeting of the
board and the act of a majority of the directors present and voting at a meeting
at which a quorum is present shall be the act of the board. In the absence of a
quorum, a majority of the directors present may adjourn any meeting, from time
to time, until a quorum is present and no notice of any adjourned meeting need
be given. At any such adjourned meeting at which a quorum is present, any
business may be transacted which might have been transacted at the meeting as
originally called.
Section 2.9. Vacancies. In the event a majority of the full board increases the
number of directors to a number which exceeds the number of directors last
elected by shareholders, as permitted by Section 2.2, directors may be appointed
to fill the resulting vacancies by vote of such majority of the full board. In
the event of a vacancy in the board for any other cause, a director may be
appointed to fill such vacancy by vote of majority of the remaining directors
then in office.
Section 2.10. Removal of Directors. The vacancy created by the removal of a
director pursuant to this Section may be filled by the board in accordance with
Section 2.9 of these by-laws or by the shareholders.
Article III
Committees
Section 3.1. Executive Committee. There may be an executive committee consisting
of the Chairperson of the board and not less than two other directors appointed
by the board annually or more often. Subject to the limitations in Section
3.5(g) of these by-laws, the executive committee shall have the maximum
authority permitted by law.
Section 3.2. Audit Committee. There may be an audit committee composed of not
less than two directors, exclusive of any active officers, appointed by the
board annually or more often, whose duty it shall be to make an examination at
least once during each calendar year and within fifteen months of the last
examination into the affairs of the Association, or cause continuous suitable
examinations to be made, by auditors responsible only to the board, and to
report the results of any such examinations in writing to the board from time to
time. Such examinations shall include audits of the fiduciary business of the
Association as may be required by law or regulation.
Section 3.3. Trust Committee. There may be a trust committee consisting of at
least two directors, as appointed by the board, who shall serve on the trust
committee at the pleasure of the board. The trust committee shall have power to
review the general conduct of the fiduciary business of the Association and to
pass upon all such matters relating to the conduct of the fiduciary business of
the Association as may be submitted to the trust committee and shall, from time
to time, exercise such other powers as may be assigned to it by the board.
Section 3.4. Other Committees. The board may appoint, from time to time, other
committees of one or more persons, for such purposes and with such powers as the
board may determine.
Section 3.5. General.
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(a) Each committee shall elect a Chairperson from among the members
thereof and shall also designate a Secretary of the committee, who shall keep a
record of its proceedings.
(b) Vacancies occurring from time to time in the membership of any
committee shall be filled by the board for the unexpired term of the member
whose departure causes such vacancy. The board may designate one or more
alternate members of any committee, who may replace any absent member or members
at any meeting of such committee.
(c) Each committee shall adopt its own rules of procedure and shall
meet at such stated times as it may, by resolution, appoint. It shall also meet
whenever called together by its Chairperson or the Chairperson of the board.
(d) No notice of regular meetings of any committee need be given.
Notice of every special meeting shall be given either by mailing such notice to
each member of such committee at his or her address, as the same appears in the
records of the Association, at least two days before the day of such meeting, or
by notifying each member on or before the day of such meeting by telephone or by
personal notice, or by leaving a written notice at his or her residence or place
of business on or before the day of such meeting. Waiver of notice in writing of
any meeting, whether prior or subsequent to such meeting, or attendance at such
meeting, shall be equivalent to notice of such meeting. Unless otherwise
indicated in the notice thereof, any and all business may be transacted at any
special meeting.
(e) All committees shall, with respect to all matters, be subject to
the authority and direction of the board and shall report to it when required.
(f) Unless otherwise required by law, the Articles of Association or
these by-laws, a quorum at any meeting of any committee shall be one-third of
the full membership and the act of a majority of members present and voting at a
meeting at which a quorum is present shall be the act of the committee.
(g) No committee shall have authority to take any action which is
expressly required by law or regulation to be taken at a meeting of the board or
by a specified proportion of directors.
Article IV
Officers and Employees
Section 4.1. Chairperson of the Board. The board shall appoint one of its
members to be the Chairperson of the board to serve at its pleasure. Such person
shall preside at all meetings of the board. The Chairperson of the board shall
supervise the carrying out of the policies adopted or approved by the board;
shall have general executive powers, as well as the specific powers conferred by
these by-laws; and shall also have and may exercise such further powers and
duties as from time to time may be conferred upon, or assigned by the board.
Section 4.2. President. The board shall appoint one of its members to be the
President of the Association. In the absence of the Chairperson, the President
shall preside at any meeting of the board. The President shall have general
executive powers, and shall have and may exercise any and all other powers and
duties pertaining by law, regulation, or practice to the office of President, or
imposed by these by-laws. The President shall also have and may exercise such
further powers and duties as from time to time may be conferred, or assigned by
the board.
Section 4.3. Vice President. The board may appoint one or more Vice Presidents.
Each Vice President shall have such powers and duties as may be assigned by the
board.
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Section 4.4. Secretary. The board shall appoint a Secretary, Cashier, or other
designated officer who shall be Secretary of the board and of the Association,
and shall keep accurate minutes of all meetings. The Secretary shall attend to
the giving of all notices required by these by-laws; shall be custodian of the
corporate seal, records, documents and papers of the Association; shall provide
for the keeping of proper records of all transactions of the Association; shall
have and may exercise any and all other powers and duties pertaining by law,
regulation or practice, to the office of Cashier, or imposed by these by-laws;
and shall also perform such other duties as may be assigned from time to time,
by the board.
Section 4.5. Other Officers. The board may appoint one or more Assistant Vice
Presidents, one or more Trust Officers, one or more Assistant Secretaries, one
or more Assistant Cashiers, one or more Managers and Assistant Managers of
branches and such other officers and attorneys in fact as from time to time may
appear to the board to be required or desirable to transact the business of the
Association. Such officers shall respectively exercise such powers and perform
such duties as pertain to their several offices, or as may be conferred upon, or
assigned to, them by the board, the Chairperson of the board, or the President.
The board may authorize an officer to appoint one or more officers or assistant
officers.
Section 4.6. Tenure and Compensation. The Chairperson of the board and the
President shall be appointed by the board to hold office until the next annual
organization meeting of the board and until their successors are appointed and
qualified. The term of office of all other officers shall be at the pleasure of
the board. The compensation of all officers shall be fixed by resolution of the
board, except that the board may authorize the Chairperson of the board and the
President each to fix and to delegate to such other officers as the board may
designate authority to fix any compensation of any person in any official
position level not above a level specified by the board. Any officer may be
dismissed at the pleasure of the board.
Section 4.7. Resignation. An officer may resign at any time by delivering notice
to the Association. A resignation is effective when the notice is given unless
the notice specifies a later effective date.
Article V
Fiduciary Activities
Section 5.1. Trust Investments. Funds held in a fiduciary capacity shall be
invested according to the instrument establishing the fiduciary relationship and
local law. Where such instrument does not specify the character and class of
investments to be made and does not vest in the Association a discretion in the
matter, funds held pursuant to such instrument shall be invested in investments
in which corporate fiduciaries may invest under applicable law.
Article VI
Stock and Stock Certificates
Section 6.1. Transfers. Shares of stock shall be transferable on the books of
the Association, and a transfer book shall be kept in which all transfers of
stock shall be recorded. Every person becoming a shareholder by such transfer
shall, in proportion to his or her shares, succeed to all rights of the prior
holder of such shares. The board may impose conditions upon the transfer of the
stock reasonably calculated to simplify the work of the Association with respect
to stock transfers, voting at shareholder meetings, and related matters and to
protect it against fraudulent transfers.
Section 6.2. Stock Certificates. Certificates of stock shall bear the signature
of the President (which may be engraved, printed or impressed), and shall be
signed manually or by facsimile process by the Secretary, Assistant Secretary,
Cashier, Assistant Cashier, or any other officer appointed by the board for that
purpose, to be known as an authorized officer, and the seal of the Association
shall be engraved thereon. Each certificate
5
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shall recite on its face that the stock represented thereby is transferable only
upon the books of the Association properly endorsed. In case any such officer
who has signed or whose facsimile signature has been placed upon such
certificate shall have ceased to be such before such certificate is issued, it
may be issued by the Association with the same effect as if such officer had not
ceased to be such at the time of its issue. The corporate seal may be a
facsimile, engraved or printed.
Article VII
Corporate Seal
The President, the Cashier, the Secretary or any Assistant Cashier or Assistant
Secretary, or other officer thereunto designated by the board, shall have
authority to affix the corporate seal to any document requiring such seal, and
to attest the same. Such seal shall be substantially in the following form: A
circle, with the words "Chase Manhattan Bank USA, National Association" within
such circle.
Article VIII
Miscellaneous Provisions
Section 8.1. Fiscal Year. The fiscal year of the Association shall be the
calendar year.
Section 8.2. Execution of Instruments. All agreements, indentures, mortgages,
deeds, conveyances, transfers, certificates, declarations, receipts, discharges,
releases, satisfactions, settlements, petitions, schedules, accounts,
affidavits, bonds, undertakings, proxies and other instruments or documents may
be signed, executed, acknowledged, verified, delivered or accepted on behalf of
the Association by the Chairperson of the board, or the President, or any Vice
President, or the Secretary, or the Cashier, or, if in connection with exercise
of fiduciary powers of the Association, by any of those officers or by any Trust
Officer. Any such instruments may also be executed, acknowledged, verified,
delivered or accepted on behalf of the Association in such other manner and by
such other officers as the board may from time to time direct. The provisions of
this Section 8.2 are supplementary to any other provision of these by-laws.
Section 8.3. Records. The Articles of Association, the by-laws and the
proceedings of all meetings of the shareholders, the board, and standing
committees of the board, shall be recorded in appropriate minute books provided
for that purpose. The minutes of each meeting shall be signed by the Secretary,
Cashier or other officer appointed to act as Secretary of the meeting.
Section 8.4. Corporate Governance Procedures. To the extent not inconsistent
with applicable Federal banking law, bank safety and soundness or these by-laws,
the corporate governance procedures found in the Delaware General Corporation
Law shall be followed by the Association.
Article IX
Indemnification
Section 9.1. Right to Indemnification. Each person who was or is made a party or
is threatened to be made a party to or is otherwise involved in any action, suit
or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that he or she is or was a
director or an officer of the Association or is or was serving at the request of
the Association as a director, officer, employee or agent of another corporation
or of a partnership, joint venture, trust or other enterprise, including service
with
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respect to an employee benefit plan (hereinafter an "indemnitee"), whether the
basis of such proceeding is alleged action in an official capacity as a
director, officer, employee or agent or in any other capacity while serving as a
director, officer, employee or agent, shall be indemnified and held harmless by
the Association to the fullest extent authorized by the Delaware General
Corporation Law, as the same exists or may hereafter be amended (but, in the
case of any such amendment, only to the extent that such amendment permits the
Association to provide broader indemnification rights than such law permitted
the Association to provide prior to such amendment), against all expense,
liability and loss (including attorneys' fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid in settlement) reasonably incurred or
suffered by such indemnitee in connection therewith; provided, however, that,
except as provided in Section 9.3 of these by-laws with respect to proceedings
to enforce rights to indemnification, the Association shall indemnify any such
indemnitee in connection with a proceeding (or part thereof) initiated by such
indemnitee only if such proceeding (or part thereof) was authorized by the
board.
Section 9.2. Right to Advancement of Expenses. The right to indemnification
conferred in Section 9.1 of these by-laws shall include the right to be paid by
the Association the expenses (including attorney's fees) incurred in defending
any such proceeding in advance of its final disposition (hereinafter an
"advancement of expenses"); provided, however, that, if the Delaware General
Corporation Law requires, an advancement of expenses incurred by an indemnitee
in his or her capacity as a director or officer (and not in any other capacity
in which service was or is rendered by such indemnitee, including, without
limitation, service to an employee benefit plan) shall be made only upon
delivery to the Association of an undertaking (hereinafter an "undertaking"), by
or on behalf of such indemnitee, to repay all amounts so advanced if it shall
ultimately be determined by final judicial decision from which there is no
further right to appeal (hereinafter a "final adjudication") that such
indemnitee is not entitled to be indemnified for such expenses under this
Section 9.2 or otherwise. The rights to indemnification and to the advancement
of expenses conferred in Sections 9.1 and 9.2 of these by-laws shall be contract
rights and such rights shall continue as to an indemnitee who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
indemnitee's heirs, executors and administrators.
Section 9.3. Right of Indemnitee to Bring Suit. If a claim under Section 9.1 or
9.2 of these by-laws is not paid in full by the Association within sixty (60)
days after a written claim has been received by the Association, except in the
case of a claim for an advancement of expenses, in which case the applicable
period shall be twenty (20) days, the indemnitee may at any time thereafter
bring suit against the Association to recover the unpaid amount of the claim. If
successful in whole or in part in any such suit, or in a suit brought by the
Association to recover an advancement of expenses pursuant to the terms of an
undertaking, the indemnitee shall be entitled to be paid also the expense of
prosecuting or defending such suit. In (1) any suit brought by the indemnitee to
enforce a right to indemnification hereunder (but not in a suit brought by the
indemnitee to enforce a right to an advancement of expenses) it shall be a
defense that, and (2) in any suit brought by the Association to recover an
advancement of expenses pursuant to the terms of an undertaking, the Association
shall be entitled to recover such expenses upon a final adjudication that, the
indemnitee has not met any applicable standard for indemnification set forth in
the Delaware General Corporation Law. Neither the failure of the Association
(including the board, the Association's independent legal counsel, or its
shareholders) to have made a determination prior to the commencement of such
suit that indemnification of the indemnitee is proper in the circumstances
because the indemnitee has met the applicable standard of conduct set forth in
the Delaware General Corporation Law, nor an actual determination by the
Association (including the board, the Association's independent legal counsel,
or its shareholders) that the indemnitee has not met such applicable standard of
conduct, shall create a presumption that the indemnitee has not met the
applicable standard of conduct or, in the case of such a suit brought by the
indemnitee, be a defense to such suit. In any suit brought by the indemnitee to
enforce a right to indemnification or to an advancement of expenses hereunder,
or brought by the Association to recover an advancement of expenses pursuant to
the terms of an undertaking, the burden of proving that the indemnitee is not
entitled to be indemnified, or to such advancement of expenses, under this
Article IX or otherwise shall be on the Association.
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Section 9.4. Non-Exclusivity of Rights. The rights to indemnification and to the
advancement of expenses conferred in this Article IX shall not be exclusive of
any other right which any person may have or hereafter acquire under any
statute, the Association's Articles of Association, by-laws, agreement, vote of
shareholders or disinterested directors or otherwise.
Section 9.5. Insurance. The Association may maintain insurance, at its expense,
to protect itself and any director, officer, employee or agent of the
Association or another corporation, partnership, joint venture, trust or other
enterprise against any expense, liability or loss, whether or not the
Association would have the power to indemnify such person against such expense,
liability or loss under the Delaware General Corporation Law.
Section 9.6. Indemnification of Employees and Agents of the Association. The
Association may, to the extent authorized from time to time by the board, grant
rights to indemnification and to the advancement of expenses to any employee or
agent of the Association to the fullest extent of the provisions of this Article
IX with respect to the indemnification and advancement of expenses of directors
and officers of the Association.
Article X
By-laws
Section 10.1. Inspection. A copy of the by-laws, with all amendments, shall at
all times be kept in a convenient place at the main office of the Association,
and shall be open for inspection to all shareholders during banking hours.
Section 10.2. Amendments. The by-laws may be amended, altered or repealed, at
any regular meeting of the board, by a vote of a majority of the total number of
the directors except as provided below. The Association's shareholders may amend
or repeal the by-laws even though the by-laws also may be amended or repealed by
its board.
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I, Andrew T. Semmelman, certify that: (1) I am the duly constituted Secretary of
The Chase Manhattan Bank (USA) and Secretary of its board, and as such officer
am the official custodian of its records; (2) the foregoing by-laws will be the
by-laws of The Chase Manhattan Bank (USA) upon its conversion to a national
banking association charter under the name "Chase Manhattan Bank USA, National
Association", and all of them thereafter will be lawfully in force and effect.
I have hereunto affixed my official signature and the seal of The Chase
Manhattan Bank (USA), in the city of Wilmington, State of Delaware, on this 7th
day of August, 1996.
/s/ Andrew T. Semmelman
------------------------------
Secretary
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BY-LAWS
THE CHASE MANHATTAN BANK
(formerly known as Chemical Bank)
AS AMENDED THROUGH
March 18, 1997
Office of the Secretary
270 Park Avenue, 35th floor
New York, NY 10017
<PAGE>
CONTENTS
SUBJECT
Article
I Meetings of Stockholders
Section 1.01 Annual Meeting
Section 1.02 Special Meetings
Section 1.03 Quorum
II Board of Directors
Section 2.01 Number
Section 2.02 Vacancies
Section 2.03 Annual Meeting
Section 2.04 Regular Meetings
Section 2.05 Special Meetings
Section 2.06 Quorum
Section 2.07 Rules and Regulations
Section 2.08 Compensation
III Committees
Section 3.01 Executive Committee
Section 3.02 Examining Committee
Section 3.03 Other Committees
IV Officers and Agents
Section 4.01 Officers
Section 4.02 Clerks and Agents
Section 4.03 Term of Office
Section 4.04 Chairman of the Board
Section 4.05 President
Section 4.06 Vice Chairman of the Board
Section 4.07 Chief Financial Officer
Section 4.08 Controller
Section 4.09 Secretary
Section 4.10 General Auditor
Section 4.11 Powers and Duties of Other
Officers
Section 4.12 Fidelity Bonds
V Corporate Seal
VI Fiscal Year
VII Indemnification
Section 7.01 Right to Indemnification
Section 7.02 Contracts and Funding
Section 7.03 Employee Benefit Plans
Section 7.04 Indemnification Not Exclusive Right
Section 7.05 Advancement of Expenses; Procedures
VIII By-laws
Section 8.01 Inspection
Section 8.02 Amendments
Section 8.03 Construction
<PAGE>
BY-LAWS
OF
THE CHASE MANHATTAN BANK
ARTICLE I
Meetings of Stockholders
Section 1.01. Annual Meeting. The annual meeting of stockholders of The
Chase Manhattan Bank (herein called the Bank), shall be held in the Borough of
Manhattan, City of New York, State of New York, within the first four months of
each calendar year, on such date and at such time and place as the Board of
Directors (herein called the Board), may determine, for the election of
directors and the transaction of such other business as may properly come before
the meeting. Notice of such meeting, stating the purpose or purposes thereof and
the time when and the place where it is to be held and signed by the Chairman of
the Board (herein called the Chairman), the President, a Vice Chairman of the
Board or the Secretary or an Assistant Corporate Secretary of the Bank, shall be
served by personal delivery upon each stockholder of record entitled to vote at
such meeting not less than 10 nor more than 50 days before said meeting.
Section 1.02. Special Meetings. A special meeting of the stockholders may
be called at any time by the Board, the Chairman, the President, or a Vice
Chairman of the Board, or upon the request in writing of the holders of record
of not less than 40% of the outstanding capital stock. Notice of any special
meeting, stating the time, place and purpose or purposes thereof, shall be given
by personal delivery to the stockholders in the manner provided in Section 1.01
for the giving of notice of annual meetings of stockholders. In the case of any
meeting of stockholders, annual or special, called for a purpose requiring other
or further notice, such notice shall be given as required by law.
Section 1.03. Quorum. A majority of the outstanding common stock,
represented in person or by proxy, shall constitute a quorum at any meeting of
stockholders, unless otherwise provided by law; but less than a quorum may
adjourn any meeting, from time to time, and the meeting may be held as
adjourned, without further notice.
ARTICLE II
Board of Directors
Section 2.01. Number. The business and affairs of the Bank shall be managed
by or under the direction of a Board of Directors, of such number as may be
fixed from time to time by resolution adopted by the Board, but in no event less
than 7 or more than 25, selected, organized and continued in accordance with the
provisions of the New York Banking Law. Each director hereafter elected shall
hold office until the next annual meeting of the stockholders and until his
successor is elected and has qualified, or until his death or until he shall
resign or shall have been removed.
Section 2.02. Vacancies. In case of any increase in the number of
directors, the additional director or directors, and in case of any vacancy in
the board due to death, resignation, removal, disqualification or any other
cause, the successors to fill the vacancies, not exceeding one-third of the
entire Board, shall be elected by a majority of the directors then in office.
Section 2.03. Annual Meeting. An annual meeting of the directors shall be
held each year, without notice, immediately following the annual meeting of
stockholders. The time and place of such meeting shall be designated by the
Board. At such meeting, the directors shall, after qualifying, elect from their
own number a Chairman of the Board, a President and one or more Vice Chairmen of
the
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Board, and shall elect or appoint such other officers authorized by these
By-laws as they may deem desirable, and appoint the Committees specified in
Article III hereof. The directors may also elect to serve at the pleasure of the
Board, one or more Honorary Directors, not members of the Board. Honorary
Directors of the Board shall be paid such compensation or such fees for
attendance at meetings of the Board, and meetings of other committees of the
Board, as the Board shall determine from time to time.
Section 2.04. Regular Meetings. The Board shall hold a regular meeting
without notice at the principal office of the Bank on the third Tuesday in each
month, with such exceptions as shall be determined by the Board, at such time as
shall be determined by the Board, unless another time or place, within or
without the State, shall be fixed by resolution of the Board. Should the day
appointed for a regular meeting fall on a legal holiday, the meeting shall be
held at the same time on the preceding day or on such other day as the Board may
order.
Section 2.05. Special Meetings. Special meetings of the Board shall be held
whenever called by the Chairman, the President, a Vice Chairman of the Board,
the Secretary or a majority of the directors at the time in office. A notice
shall be given as hereinafter in this Section provided of each such special
meeting, in which shall be stated the time and place of such meeting, but,
except as otherwise expressly provided by law or by these By-laws, the purposes
thereof need not be stated in such notice. Except as otherwise provided by law,
notice of each such meeting shall be mailed to each director, addressed to him
at his residence or usual place of business, at least two (2) days before the
day on which such meeting is to be held, or shall be sent addressed to him at
such place by telegraph, cable, wireless or other form of recorded communication
or be delivered personally or by telephone not later than noon of the calendar
day before the day on which such meeting is to be held. At any regular or
special meeting of the Board, or any committee thereof, one or more Board or
committee members may participate in such meeting by means of a conference
telephone or similar communications equipment allowing all persons participating
in the meeting to hear each other at the same time. This type of participation
shall constitute presence in person at the meeting. Notice of any meeting of the
Board shall not, however, be required to be given to any director who submits a
signed waiver of notice whether before or after the meeting, or if he shall be
present at such meeting; and any meeting of the Board shall be a legal meeting
without any notice thereof having been given if all the directors of the Bank
then in office shall be present thereat.
Section 2.06. Quorum. One-third of the members of the entire Board, or the
next highest integer in the event of a fraction, shall constitute a quorum, but
if less than a quorum be present, a majority of those present may adjourn any
meeting from time to time and the meeting may be held as adjourned without
further notice.
Section 2.07. Rules and Regulations. The Board may adopt such rules and
regulations for the conduct of its meetings and the management of the affairs of
the Bank as it may deem proper, not inconsistent with the laws of the State of
New York or these By-laws.
Section 2.08. Compensation. Directors shall be entitled to receive from the
Bank such fees for attendance at meetings of the Board or of any committee, or
both, as the Board from time to time shall determine. The Board may also
likewise provide that the Bank shall reimburse each such director or member of
such committee for any expenses paid by him on account of his attendance at any
such meeting. Nothing in this Section contained shall be construed to preclude
any director from serving the Bank in any other capacity and receiving
compensation therefor.
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ARTICLE III
Committees
Section 3.01. Executive Committee. The Board, by resolution adopted by a
majority of the entire Board, shall appoint an Executive Committee which, when
the Board is not in session, shall have and may exercise all the powers of the
Board that lawfully may be delegated including, without limitation, the power
and authority to declare dividends. The Executive Committee shall consist of
such number of directors as the Board shall from time to time determine, but not
less than five and one of whom shall be designated by the Board as Chairman
thereof, as follows: (a) the Chairman of the Board, the President, the Vice
Chairmen of the Board; and (b) such other directors, none of whom shall be an
officer of the Bank, as shall be appointed to serve at the pleasure of the
Board. The Board, by resolution adopted by a majority of the entire Board, may
designate one or more directors as alternate members of the Executive Committee
and the manner and circumstances in which such alternate members shall replace
or act in the place of absent or disqualified members of the Executive
Committee. The attendance of one-third of the members of the Committee or their
substitutes, or the next highest integer in the event of a fraction, at any
meeting shall constitute a quorum, and the act of a majority of those present at
a meeting thereof at which a quorum is present shall be the act of the
Committee. All acts done and powers conferred by the Committee from time to time
shall be deemed to be, and may be certified as being done or conferred under
authority of the Board. The Committee shall fix its own rules and procedures,
and the minutes of the meetings of the Committee shall be submitted at the next
regular meeting of the Board at which a quorum is present, or if impracticable
at the next such subsequent meeting. The Committee shall hold meetings "On Call"
and such meetings may be called by the Chairman of the Executive Committee, the
Chairman of the Board, the President, a Vice Chairman of the Board, or the
Secretary. Notice of each such meeting of the Committee shall be given by mail,
telegraph, cable, wireless or other form of recorded communication or be
delivered personally or by telephone to each member of the Committee not later
than the day before the day on which such meeting is to be held. Notice of any
such meeting need not be given to any member of the Committee who submits a
signed waiver of notice whether before or after the meeting, or if he shall be
present at such meeting; and any meeting of the Committee shall be a legal
meeting without any notice thereof having been given, if all the members of the
Committee shall be present thereat. In the case of any meeting, in the absence
of the Chairman of the Executive Committee, such member as shall be designated
by the Chairman of the Executive Committee or the Executive Committee shall act
as Chairman of the meeting.
Section 3.02. Examining Committee. The Board, by resolution adopted by a
majority of the entire Board, shall appoint an Examining Committee composed of
not less than three of its members, none of whom shall be an officer of the
Bank, to hold office at its pleasure and one of whom shall be designated by the
Board as chairman thereof. The Committee shall make such examination into the
affairs of the Bank and its loans and discounts and make such reports in writing
thereof as may be directed by the Board or required by the Banking Law. The
attendance of one-third of the members of the Committee, or the next highest
integer in the event of a fraction, at any meeting shall constitute a quorum,
and the act of a majority of those present at a meeting thereof at which a
quorum is present shall be the act of the Committee.
Section 3.03. Other Committees. The Board, by resolution adopted by a
majority of the entire Board, may appoint, from time to time, such other
committees composed of not less than three of its members for such purposes and
with such duties and powers as the Board may determine. The attendance of
one-third of the members of such other committees, or the next highest integer
in the event of a fraction, at any meeting shall constitute a quorum, and the
act of a majority of those present at a meeting thereof at which a quorum is
present shall be the act of such other committees.
ARTICLE IV
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Officers and Agents
Section 4.01. Officers. The officers of the Bank shall be (a) a Chairman of
the Board, a President and one or more Vice Chairmen of the Board, each of whom
must be a director and shall be elected by the Board; (b) a Chief Financial
Officer, a Controller, a Secretary and a General Auditor, each of whom shall be
elected by the Board; and (c) may include a Chief Credit Officer, a Chief
Administrative Officer, a Chief Technology Officer, one or more Group Executives
and such other officers as may from time to time be elected by the Board or
under its authority, or appointed by the Chairman or the President or a Vice
Chairman of the Board.
Section 4.02. Clerks and Agents. The Board may elect and dismiss, or the
Chairman or the President or a Vice Chairman of the Board may appoint and
dismiss, or delegate to any other officers authority to appoint and dismiss,
such clerks, agents and employees as may be deemed advisable for the prompt and
orderly transaction of the Bank's business, and may prescribe, or authorize the
appointing officers to prescribe, their respective duties, subject to the
provisions of these By-laws.
Section 4.03. Term of Office. The officers designated in Section 4.01(a)
shall be elected by the Board at its annual meeting. The officers designated in
Section 4.01(b) may be elected at the annual or any other meeting of the Board.
The officers designated in Section 4.01(c) may be elected at the annual or any
other meeting of the Board or appointed at any time by the designated proper
officers. Any vacancy occurring in any office designated in Section 4.01(a) may
be filled at any regular or special meeting of the Board. The officers elected
pursuant to Section 4.01(a) shall each hold office for the term of one year and
until their successors are elected, unless sooner disqualified or removed by a
vote of two-thirds of the whole Board. The officers elected by the Board
pursuant to Section 4.01(b) of these By-laws shall hold office at the pleasure
of the Board. All other officers, clerks, agents and employees elected by the
Board, or appointed by the Chairman, the President or a Vice Chairman of the
Board, or under their authority, shall hold their respective offices at the
pleasure of the Board or officers elected pursuant to Section 4.01(a).
Section 4.04. Chairman of the Board. The Chairman shall be the chief
executive officer of the Bank and shall have, subject to the control of the
Board, general supervision and direction of the policies and operations of the
Bank. He shall preside at all meetings of the stockholders and at all meetings
of the Board. He shall have the right to execute any document or perform any act
which could be or is required to be executed or performed by the President of
the Bank. He shall have the power to sign checks, orders, contracts, leases,
notes, drafts and other documents and instruments in connection with the
business of the Bank, and together with the Secretary or an Assistant Corporate
Secretary to execute conveyances of real estate and other documents and
instruments to which the seal of the Bank is affixed. He shall perform such
other duties as from time to time may be prescribed by the Board.
Section 4.05. President. The President shall, subject to the direction and
control of the Board and the Chairman, participate in the supervision of the
policies and operations of the Bank. In general, the President shall perform all
duties incident to the office of President, and such other duties as from time
to time may be prescribed by the Board or the Chairman. In the absence of the
Chairman, the President shall preside at meetings of stockholders and of the
Board. The President shall have the same power to sign for the Bank as is
prescribed in these By-laws for the Chairman.
Section 4.06. Vice Chairman of the Board. The Vice Chairman of the Board,
or if there be more than one, then each of them, shall, subject to the direction
and control of the Board and the Chairman, participate in the supervision of the
policies and operations of the Bank, and shall have such other duties as may be
prescribed from time to time by the Board or the Chairman. In the absence of the
Chairman and the President, a Vice Chairman, as designated by the Chairman or
the Board, shall preside at meetings of the stockholders and of the Board. Each
Vice Chairman shall have the same power to sign for the Bank as is prescribed in
these By-laws for the Chairman.
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Section 4.07. Chief Financial Officer. The Chief Financial Officer shall
have such powers and perform such duties as the Board, the Chairman, the
President, or a Vice Chairman of the Board may from time to time prescribe,
which duties may include, without limitation, responsibility for strategic
planning, corporate finance, control, tax and auditing activities, and shall
perform such other duties as may be prescribed by these By-laws.
Section 4.08. Controller. The Controller shall exercise general supervision
of the accounting departments of the Bank. He shall be responsible to the Chief
Financial Officer and shall render reports from time to time relating to the
general financial condition of the Bank. He shall render such other reports and
perform such other duties as from time to time may be prescribed by the Chief
Financial Officer, a Vice Chairman of the Board, the President or the Chairman.
Section 4.09. Secretary. The Secretary shall:
(a) record all the proceedings of the meetings of the stockholders, the
Board and the Executive Committee in one or more books kept for that purpose;
(b) see that all notices are duly given in accordance with the provisions
of these By-laws or as required by law;
(c) be custodian of the seal of the Bank; and he may see that such seal or
a facsimile thereof is affixed to any documents the execution of which on behalf
of the Bank is duly authorized and may attest such seal when so affixed; and
(d) in general, perform all duties incident to the office of Secretary and
such other duties as from time to time may be prescribed by the Board and the
Chairman.
Section 4.10. General Auditor. The General Auditor shall exercise general
supervision of the Auditing Division. He shall audit the affairs of the Bank and
its subsidiaries, including appraisal of the soundness and adequacy of internal
controls and operating procedures and shall ascertain the extent of compliance
with policies and procedures of the Bank. He shall be responsible to the Board
and shall make such audits and prepare such regular reports as the Board, its
Examining Committee or the Chairman may, from time to time, require or as in his
judgment are necessary in the performance of his duties.
Section 4.11. Powers and Duties of Other Officers. The powers and duties of
all other officers of the Bank shall be those usually pertaining to their
respective offices, subject to the direction and control of the Board and as
otherwise provided in these By-laws.
Section 4.12. Fidelity Bonds. The Board, in its discretion, may require any
or all officers, agents, clerks and employees of the Bank to give bonds covering
the faithful performance of their duties or may obtain insurance covering the
same, in either case in form and amount approved by the Board, the premiums
thereon to be paid by the Bank.
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ARTICLE V
Corporate Seal
The corporate seal of the Bank shall be in the form of a circle and shall
bear the full name of the Bank and the words "Corporate Seal New York" together
with the logo of The Chase Manhattan Corporation.
ARTICLE VI
Fiscal Year
The fiscal year of the Bank shall be the calendar year.
ARTICLE VII
Indemnification
Section 7.01. Right to Indemnification. The Bank shall to the fullest
extent permitted by applicable law as then in effect indemnify any person (the
"Indemnitee") who was or is involved in any manner (including, without
limitation, as a party or a witness), or is threatened to be made so involved,
in any threatened, pending or completed investigation, claim, action, suit or
proceeding, whether civil, administrative or investigative (including, without
limitation, any action, suit or proceeding by or in the right of the Bank to
procure a judgment in its favor) (a "Proceeding") by reason of the fact that he
is or was a director, officer, employee or agent of the Bank, or is or was
serving at the request of the Bank as a director, officer or employee or agent
of another corporation, partnership, joint venture, trust or other enterprise
against all expenses (including attorney's fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection with
such Proceeding. Such indemnification shall be a contract right and shall
include the right to receive payment in advance of any expenses incurred by the
Indemnitee in connection with such Proceeding, consistent with the provisions of
applicable law as then in effect.
Section 7.02. Contracts and Funding. The Bank may enter into contracts with
any director, officer, employee or agent of the Bank in furtherance of the
provisions of this Article VII and may create a trust fund, grant a security
interest or use other means (including, without limitation, a letter of credit)
to ensure the payment of such amounts as may be necessary to effect
indemnification as provided in this Article VII.
Section 7.03. Employee Benefit Plans. For purposes of this Article VII,
references to "other enterprises" shall include employee benefit plans;
references to "fines" shall include any excise taxes assessed on a person with
respect to any employee benefit plan; and references to "serving at the request
of the Bank" shall include any service as a director, officer, employee, or
agent of the Bank which imposes duties on, or involves services by, such
director, officer, employee, or agent with respect to an employee benefit plan,
its participants, or beneficiaries; and a person who acted in good faith and in
a manner he reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan shall be deemed to have acted in a
manner not opposed to the best interests of a corporation.
Section 7.04. Indemnification Not Exclusive Right. The right of
indemnification and advancement of expenses provided in this Article VII shall
not be exclusive of any other rights to which a person seeking indemnification
may otherwise be entitled, under any statute, by-law, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office. The provisions of this Article VII shall inure to the benefit of the
heirs and legal representatives of any person entitled to indemnity under this
Article
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VII and shall be applicable to Proceedings commenced or continuing after
the adoption of this Article VII whether arising from acts or omissions
occurring before or after such adoption.
Section 7.05. Advancement of Expenses; Procedures. In furtherance, but not
in limitation, of the foregoing provisions, the following procedures and
remedies shall apply with respect to advancement of expenses and the right to
indemnification under this Article VII:
(a) Advancement of Expenses. All reasonable expenses incurred by or on
behalf of the Indemnitee in connection with any Proceeding shall be advanced to
the Indemnitee by the Bank within twenty (20) days after the receipt by the Bank
of a statement or statements from the Indemnitee requesting such advance or
advances from time to time, whether prior to or after final disposition of such
Proceeding. Such statement or statements shall reasonably evidence the expenses
incurred by the Indemnitee and, if required by law at the time of such advance,
shall include or be accompanied by an undertaking by or on behalf of the
Indemnitee to repay the amounts advanced if, and to the extent, it should
ultimately be determined that the Indemnitee is not entitled to be indemnified
against such expenses.
(b) Written Request for Indemnification. To obtain indemnification under
this Article VII, an Indemnitee shall submit to the Secretary of the Bank a
written request, including such documentation and information as is reasonably
available to the Indemnitee and reasonably necessary to determine whether and to
what extent the Indemnitee is entitled to indemnification (the "Supporting
Documentation"). The determination of the Indemnitee's entitlement to
indemnification shall be made within a reasonable time after receipt by the Bank
of the written request for indemnification together with the Supporting
Documentation. The Secretary of the Bank shall, promptly upon receipt of such a
request for indemnification, advise the Board in writing that the Indemnitee has
requested indemnification.
(c) Procedure for Determination. The Indemnitee's entitlement to
indemnification under this Article VII shall be determined (i) by the Board by a
majority vote of a quorum (as defined in Article II of these By-laws) consisting
of directors who were not parties to such action, suit or proceeding, or (ii) if
such quorum is not obtainable, or, even if obtainable, a quorum of disinterested
directors so directs, by independent legal counsel in a written opinion, or
(iii) by the stockholders, but only if a majority of the disinterested
directors, if they constitute a quorum of the Board, presents the issue of
entitlement to indemnification to the stockholders for their determination.
ARTICLE VIII
By-laws
Section 8.01. Inspection. A copy of the By-laws shall at all times be kept
in a convenient place at the principal office of the Bank, and shall be open for
inspection by stockholders during banking hours.
Section 8.02. Amendments. Except as otherwise specifically provided by
statute, these By-laws may be added to, amended, altered or repealed at any
meeting of the Board by vote of a majority of the entire Board, provided that
written notice of any such proposed action shall be given to each director prior
to such meeting, or that notice of such addition, amendment, alteration or
repeal shall have been given at the preceding meeting of the Board.
Section 8.03. Construction. The masculine gender, where appearing in these
By-laws, shall be deemed to include the feminine gender.
7
<PAGE>
OH&S DRAFT
9/14/97
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
a National Banking Association
THE CHASE MANHATTAN BANK,
a New York Banking Corporation,
as Sellers,
THE CIT GROUP/SALES FINANCING, INC.,
a Delaware Corporation
as Servicer,
and
CHASE MANHATTAN RV OWNER TRUST 1997-A,
as Issuer
===============================
SALE AND SERVICING AGREEMENT
Dated as of September 1, 1997
===============================
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TABLE OF CONTENTS
<TABLE>
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ARTICLE I
DEFINITIONS.............................................. 1
SECTION 1.1. Definitions................................................................. 1
SECTION 1.2. Usage of Terms.............................................................. 30
SECTION 1.3. Methods of Allocating Payments on
Receivables; Allocations............................................... 30
ARTICLE II
CONVEYANCE OF RECEIVABLES....................................... 31
SECTION 2.1. Conveyance of Receivables................................................... 31
SECTION 2.2. Closing..................................................................... 32
ARTICLE III
THE RECEIVABLES............................................... 32
SECTION 3.1. Representations and Warranties of the
Sellers; Conditions Relating to the
Receivables............................................................ 32
SECTION 3.2. Repurchase Upon Breach or Failure of a
Condition.............................................................. 36
SECTION 3.3. Custody of Receivable Files................................................. 37
SECTION 3.4. Duties of Servicer as Custodian............................................. 37
SECTION 3.5. Instructions; Authority to Act.............................................. 39
SECTION 3.6. Effective Period and Termination............................................ 39
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES.............................. 40
SECTION 4.1. Duties of Servicer.......................................................... 40
SECTION 4.2. Collection of Receivable Payments........................................... 42
SECTION 4.3. Realization Upon Receivables................................................ 43
SECTION 4.4. Maintenance of Security Interests in
Financed Vehicles. ................................................... 44
SECTION 4.5. Covenants of Servicer....................................................... 45
SECTION 4.6. Purchase of Receivables Upon Breach......................................... 46
SECTION 4.7. Servicing Fee............................................................... 46
SECTION 4.8. Monthly Report.............................................................. 47
SECTION 4.9. Annual Statement as to Compliance........................................... 47
SECTION 4.10. Annual Report of Accountants................................................ 48
SECTION 4.11. Access by Holders to Certain
Documentation and Information Regarding
Receivables............................................................ 48
SECTION 4.12. Reports to Holders and the Rating
Agencies............................................................... 48
</TABLE>
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SECTION 4.13. Reports to the Securities and Exchange
Commission............................................................. 49
SECTION 4.14. Maintenance of Fidelity Bond................................................ 49
SECTION 4.15. Satisfaction of Receivable.................................................. 49
ARTICLE V
ACCOUNTS; DISTRIBUTIONS;
STATEMENTS TO NOTEHOLDERS AND THE CERTIFICATEHOLDERS........................ 50
SECTION 5.1. Establishment of Accounts................................................... 50
Section 5.2. Collections; Applications................................................... 51
SECTION 5.3. Monthly Advances............................................................ 53
SECTION 5.4. Additional Deposits......................................................... 54
SECTION 5.5. Distributions............................................................... 54
SECTION 5.6. Reserve Account............................................................. 56
SECTION 5.7. Net Deposits................................................................ 58
SECTION 5.8. Statements to Certificateholders and
Noteholders............................................................ 58
ARTICLE VI
THE SELLERS.............................................. 60
SECTION 6.1. Representations of Sellers.................................................. 60
SECTION 6.2. Liability of Sellers; Indemnities........................................... 61
SECTION 6.3. Merger or Consolidation of Sellers.......................................... 63
SECTION 6.4. Limitation on Liability of Sellers and
Others................................................................. 63
SECTION 6.5. Sellers May Own Notes and Certificates...................................... 63
ARTICLE VII
THE SERVICER; REPRESENTATIONS AND INDEMNITIES............................. 63
SECTION 7.1. Representations of the Servicer............................................. 63
SECTION 7.2. Liability of Servicer, Indemnities.......................................... 65
SECTION 7.3. Merger or Consolidation of Servicer......................................... 66
SECTION 7.4. Limitation on Liability of Servicer and
Others................................................................. 66
SECTION 7.5. Servicer Not To Resign...................................................... 67
SECTION 7.6. Assignment of Servicing..................................................... 67
SECTION 7.7. Insurance................................................................... 67
SECTION 7.8. Indemnity by Issuer......................................................... 67
SECTION 7.9. Servicer May Own Notes and Certificates..................................... 68
ARTICLE VIII
EVENTS OF SERVICING TERMINATION.................................... 68
SECTION 8.1. Events of Servicing Termination............................................. 68
SECTION 8.2. Appointment of Successor.................................................... 71
SECTION 8.3. Notification to Noteholders and
Certificateholders..................................................... 71
SECTION 8.4. Waiver of Past Defaults..................................................... 71
</TABLE>
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<S> <C> <C>
ARTICLE IX
TERMINATION.............................................. 72
SECTION 9.1. Optional Purchase of All Receivables;
Trust Termination...................................................... 72
ARTICLE X
MISCELLANEOUS PROVISIONS........................................... 74
SECTION 10.1. Amendment................................................................... 74
SECTION 10.2. Protection of Title to Owner Trust
Estate................................................................. 75
SECTION 10.3. Governing Law............................................................... 77
SECTION 10.4. Notices..................................................................... 77
SECTION 10.5. Severability of Provisions.................................................. 78
SECTION 10.6. Assignment.................................................................. 78
SECTION 10.7. Certificates and Notes Nonassessable and
Fully Paid............................................................. 78
SECTION 10.8. Third-Party Beneficiaries................................................... 78
SECTION 10.9. Assignment to Indenture Trustee............................................. 79
SECTION 10.10. Limitation of Liability of Owner Trustee
and Indenture Trustee.................................................. 79
SECTION 10.11. Power-of-Attorney........................................................... 79
</TABLE>
SCHEDULES
Schedule A-1 - List of Chase Receivables
Schedule A-2 - List of Chase USA Receivables
Schedule B - Location of Receivable Files
Schedule C - Allocation of Notes and Certificates
Schedule D - Allocation of Fees and Expenses to
Servicer
EXHIBITS
Exhibit A - Form of Servicer's Certificate
Exhibit B - Form of Monthly Report
Exhibit C - Form of Statement to Certificateholders
and Noteholders
Exhibit D - Form of Amended and Restated Servicing
Agreement
iii
<PAGE>
Sale and Servicing Agreement, dated as of September 1, 1997
(as amended, supplemented or otherwise modified and in effect from time to time,
this "Agreement") among CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION, a
national banking association ("Chase USA") and THE CHASE MANHATTAN BANK, a New
York banking corporation ("Chase," and collectively with Chase USA and their
respective successors hereunder, the "Sellers"), THE CIT GROUP/SALES FINANCING,
INC. ("CITSF"), as Servicer (together with any successor hereunder, the
"Servicer") and CHASE MANHATTAN RV OWNER TRUST 1997-A, as issuer (the "Issuer").
W I T N E S S E T H :
In consideration of the premises and of the mutual agreements
herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. Whenever used in this Agreement,
the following words and phrases, unless the context otherwise requires, shall
have the following meanings:
"Accrued Interest" on a Receivable, as of any date of
determination, means that amount of interest accrued on the Principal Balance at
the related Contract Rate but not paid by or on behalf of the Obligor.
"Accounts" means, collectively, the Collection Account,
the Reserve Account, the Paid-Ahead Account and the Note Distribution Account.
"Actual Principal Balance" means, as of the close of business
on the last day of a Collection Period, (a) with respect to a Precomputed
Receivable, the sum of (i) the Principal Balance thereof as of such day and (ii)
the portion of all Scheduled Payments on such Receivable due and unpaid prior to
such day allocable to principal using the actuarial method.
"Administration Agreements" mean collectively, the CITSF
Administration Agreement and the Chase Administration Agreement.
"Administrators" means each of the Chase Administrator
and the CITSF Administrator.
"Administrative Fees" means late payment fees, extension fees
and transfer of equity and assumption fees with respect to the Receivables.
"Affiliate" means, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For purposes of this
<PAGE>
definition, "control" when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing. A Person shall not be deemed to be an Affiliate of
any Person solely because such other Person has the contractual right or
obligation to manage such Person unless such other Person controls such Person
through equity ownership or otherwise.
"Aggregate Losses" has the meaning specified in the
Servicing Agreement.
"Aggregate Net Losses" means, for a Distribution Date, the
amount equal to (i) the aggregate Actual Principal Balance of all Receivables
that became Liquidated Receivables during the related Collection Period minus
(ii) the Net Liquidation Proceeds allocable to principal collected during such
Collection Period with respect to any Liquidated Receivables and minus (iii) any
recoveries collected during such Collection Period on Receivables deemed to be
Liquidated Receivables during prior Collection Periods.
"Agreement" means this Sale and Servicing Agreement, dated as
of September 1, 1997, among the Issuer, the Sellers and the Servicer, as the
same may be amended and supplemented from time to time.
"Amount Financed" in respect of a Receivable means the amount
advanced under the Receivable toward the purchase price of the Financed Vehicle
and related costs.
"Andrews" shall mean Andrews Record Management, Inc.
"Applied Paid-Ahead Amount" means, with respect to any
Precomputed Receivable and any Collection Period for which the amount actually
paid is less than the Scheduled Payment due during such Collection Period, the
Deferred Paid-Ahead Amount with respect to such Precomputed Receivable to the
extent of such shortfall; provided that if such Precomputed Receivable becomes a
Liquidated Receivable during such Collection Period, the Applied Paid-Ahead
Amount with respect to such Collection Period shall equal such Receivable's then
outstanding Deferred Paid-Ahead Amount, if any.
"Authenticating Agent" has the meaning specified in Section
2.13 of the Indenture and shall initially be the corporate trust office of Chase
and its successors and assigns in such capacity.
"Authorized Officer" means any officer of the Owner Trustee,
Indenture Trustee or Servicer who is authorized to act on behalf of the Owner
Trustee, Indenture Trustee or Servicer, as applicable, and who is identified as
such on the list of
2
<PAGE>
authorized officers delivered by each such party on the Closing Date.
"Available Amount" means, on any Distribution Date, an amount
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 Receivables in the related Collection Period (including Net Liquidation
Proceeds, any recoveries on Liquidated Receivables and any Applied Paid-Ahead
Amounts), (ii) the Repurchase Amounts for any Receivable repurchased by either
Seller or purchased by the Servicer and the Optional Purchase Amount, if
applicable, and (iii) any Monthly Advances made by the Servicer (with respect to
(ii) and (iii) above,to the extent such Repurchase Amounts, the Optional
Purchase Amount or Monthly Advances are paid on or before 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 Receivables): (i) any amounts incorrectly deposited in
the Collection Account, (ii) Investment Earnings on the funds in the Collection
Account, (iii) payments on the Receivables not transferred to the Issuer
(including, without limitation, Excluded Administrative Fees, Excluded
Paid-Ahead Amounts and Excluded Forced-Placed Insurance Premiums) and (iv) any
other amounts, if any, permitted to be withdrawn from the Collection Account by
the Servicer (or to be retained by the Servicer from Collections on the
Receivables) pursuant to this Agreement.
"Available Reserve Account Amount" means, for each
Distribution Date, an amount equal to the lesser of (i) the amount on deposit in
the Reserve Account and (ii) the Specified Reserve Account Balance for such
Distribution Date.
"Average Annual Balance" means, for any calendar year or
partial calendar year, the quotient obtained by dividing (x) the Pool Balance as
of the end of each month of such calendar year or partial calendar year, as the
case may be, by (y) twelve (12) or the number of months constituting such
partial calendar year with respect to any partial calendar year.
"Average Delinquency Percentage" means for any Distribution
Date, the average of the Delinquency Percentages for such Distribution Date and
the preceding two (2) Distribution Dates.
"Average Net Loss Ratio" means for any Distribution Date, the
average of the Net Loss Ratios for such Distribution Date and the preceding two
(2) Distribution Dates.
"Basic Documents" means this Agreement, the Certificate of
Trust, the Indenture, the Depository Agreements, the Trust Agreement, the
Administration Agreements and other documents and certificates delivered in
connection therewith.
"Benefit Plan" has the meaning specified in Section
11.12 of the Trust Agreement.
3
<PAGE>
"Book-Entry Certificates" means the Certificates, the
ownership and transfers of which shall be made through book entries by a
Clearing Agency or Foreign Clearing Agency as described in Section 3.10 of the
Trust Agreement.
"Book-Entry Notes" means the Notes, ownership and transfers of
which shall be made through book entries by a Clearing Agency or Foreign
Clearing Agency as described in Section 2.10 of the Indenture.
"Bulk Purchase Receivables" means those Receivables purchased
from an unaffiliated finance company pursuant to a bulk purchase and not
originated in accordance with Chase's, Chase USA's or any of their Affiliates'
or predecessors' underwriting criteria.
"Business Day" means a day, other than a Saturday or a Sunday,
on which the Indenture Trustee and banks located in New York, New York,
Wilmington, Delaware and Minneapolis, Minnesota are open for the purpose of
conducting a commercial banking business.
"Business Trust Statute" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as amended from time to time.
"Capital Accounts" has the meaning specified in
Section 5.7 of the Trust Agreement.
"Cedel" means Centrale de Livraison de Valeurs
Mobilieres, S.A.
"Certificate" means a certificate evidencing the beneficial
interest of a Certificateholder in the Owner Trust Estate, substantially in the
form of Exhibit A to the Trust Agreement.
"Certificate Balance" means an amount equal to $44,895,285.54
as of the Closing Date and, thereafter, shall be an amount equal to such initial
Certificate Balance, reduced by all amounts allocable to principal previously
distributed to Certificateholders. The Certificate Balance shall also be reduced
on any Distribution Date by the excess, if any, of (i) the sum of (A) the
Certificate Balance and (B) the outstanding principal amount of the Notes (in
each case after giving effect to amounts in respect of principal to be deposited
in the Certificate Distribution Account and the Note Distribution Account on
such Distribution Date), over (ii) the Pool Balance as of the close of business
on the last day of the preceding Collection Period. Thereafter, the Certificate
Balance shall be increased on any Distribution Date to the extent that any
portion of the Available Amount on such Distribution Date is available to pay
the existing Certificateholders' Principal Carryover Shortfall, but not by more
than the aggregate reductions in the Certificate Balance set forth in the
preceding sentence.
4
<PAGE>
"Certificate Depository Agreement" means the agreement among
the Issuer, the Owner Trustee, Chase, as agent for The Depository Trust Company
and The Depository Trust Company, as the initial Clearing Agency, dated as of
the Closing Date, relating to the Certificates, as the same may be amended and
supplemented from time to time.
"Certificate Distribution Account" has the meaning
specified in Section 5.1 of the Trust Agreement.
"Certificate Final Scheduled Distribution Date" means the
August 2017 Distribution Date on which the outstanding principal amount, if any,
of the Certificates is payable.
"Certificate of Trust" means the Certificate of Trust in the
form of Exhibit B to the Trust Agreement filed for the Issuer pursuant to
Section 3810(a) of the Business Trust Statute.
"Certificate Owner" means, with respect to a Book-Entry
Certificate, the Person who is the owner of beneficial interests in such
Book-Entry Certificate, as reflected on the books of the Clearing Agency or
Foreign Clearing Agency or on the books of a direct or indirect Clearing Agency
Participant.
"Certificate Pool Factor" as of the close of business on a
Distribution Date means an eight-digit decimal figure equal to the remaining
Certificate Balance (after giving effect to distributions made on such date) as
of such Distribution Date divided by the initial Certificate Balance as of the
Closing Date. The Certificate Pool Factor will be 1.00000000 as of the Cutoff
Date; thereafter, the Certificate Pool Factor will decline to reflect reductions
in the Certificate Balance.
"Certificate Rate" means [___]% per annum.
"Certificate Register" and "Certificate Registrar" means the
register maintained and the registrar appointed pursuant to Section 3.4 of the
Trust Agreement.
"Certificateholder" means the Person in whose name a
Certificate is registered in the Certificate Register, except that, solely for
the purpose of giving any consent, request, waiver or demand pursuant to any of
the Basic Documents, the interest evidenced by any Certificate registered in the
name of either Seller, the Servicer or any Person controlling, controlled by, or
under common control with, either Seller or the Servicer shall not be taken into
account in determining whether the requisite percentage necessary to effect any
such consent, request or waiver shall have been obtained; provided, however,
that in determining whether the Owner Trustee shall be protected in relying upon
any such consent, request, waiver or demand, only Certificates that an
Authorized Officer of the Owner Trustee knows to be so owned shall be so
disregarded.
5
<PAGE>
"Certificateholders' Distributable Amount" means for any
Distribution Date, the sum of the Certificateholders' Principal Distributable
Amount and the Certificateholders' Interest Distributable Amount.
"Certificateholders' Interest Carryover Shortfall" means, (a)
for the initial Distribution Date, zero, and (b) for any other Distribution
Date, the excess of the Certificateholders' Interest Distributable Amount for
the preceding Distribution Date, over the amount in respect of interest that was
actually deposited in the Certificate Distribution Account on such preceding
Distribution Date, plus interest on such excess, to the extent permitted by law,
at the Certificate Rate from and including such preceding Distribution Date, to,
but excluding, the current Distribution Date.
"Certificateholders' Interest Distributable Amount" means,
for any Distribution Date, the sum of the Certificateholders' Monthly Interest
Distributable Amount for such Distribution Date and the Certificateholders'
Interest Carryover Shortfall for such Distribution Date.
"Certificateholders' Monthly Interest Distributable Amount"
means, for any Distribution Date, one month's interest (or, in the case of the
first Distribution Date, interest accrued from and including the Closing Date
to, but excluding, such Distribution Date) at the Certificate Rate on the
Certificate Balance on the immediately preceding Distribution Date, after giving
effect to all distributions of principal to the Certificateholders on or prior
to such Distribution Date (or, in the case of the first Distribution Date, the
Certificate Balance on the Closing Date). Interest shall be computed on the
basis of a 360-day year of twelve 30-day months for purposes of this definition.
"Certificateholders' Monthly Principal Distributable Amount"
means, for any Distribution Date prior to the Distribution Date on which the
Notes have been paid in full, zero; and for any Distribution Date commencing on
or after the Distribution Date on which the Notes have been paid in full, 100%
of the Principal Distribution Amount for such Distribution Date (less the
portion of the Principal Distribution Amount required on the first such
Distribution Date to pay the Notes in full).
"Certificateholders' Principal Carryover Shortfall" means for
any Distribution Date, the sum of (a) the excess of (i) the Certificateholders'
Principal Distributable Amount for the preceding Distribution Date, over (ii)
the amount in respect of principal that was actually deposited in the
Certificate Distribution Account on such Distribution Date and (b) without
duplication of clause (a), the unreimbursed portion of the amount by which the
Certificate Balance has been reduced pursuant to the second sentence of the
definition thereof.
6
<PAGE>
"Certificateholders' Principal Distributable Amount" means,
for any Distribution Date, the sum of (i) the Certificateholders' Monthly
Principal Distributable Amount for such Distribution Date and (ii) the
Certificateholders' Principal Carryover Shortfall for such Distribution Date;
provided that the Certificateholders' Principal Distributable Amount shall not
exceed the Certificate Balance. In addition, on the Certificate Final Scheduled
Distribution Date, the principal required to be distributed to
Certificateholders will include the lesser of (a) any payments of principal due
and remaining unpaid on each Receivable owned by the Issuer as of the last day
of the immediately preceding Collection Period and (b) the amount necessary
(after giving effect to the other amounts to be deposited in the Certificate
Distribution Account on such Distribution Date and allocable to principal) to
reduce the Certificate Balance to zero, in either case after giving effect to
any required distribution of the Noteholders' Principal Distributable Amount to
the Note Distribution Account.
"CFAC" means Chase Financial Acceptance Corporation, a
Delaware corporation, and any successor thereto.
"CFHI" means Chase Financial Holdings, Inc., a Delaware
corporation, and any successor thereto.
"CFMC" means Chase Financial Management Corporation, an Ohio
corporation, and any successor thereto.
"Chase" means The Chase Manhattan Bank, a New York banking
corporation, and any successor thereto.
"Chase Administration Agreement" means the Chase
Administration Agreement dated as of September 1, 1997, among the Issuer, Chase
and the Indenture Trustee, as the same may be amended and supplemented from time
to time.
"Chase Administrator" means The Chase Manhattan Bank,
as administrator under the Chase Administration Agreement, and its successors
and assigns.
"Chase Financial Receivables" means those Chase USA
Receivables owned by CFAC or CFHI before being sold to Chase USA pursuant to the
Purchase and Sale Agreement.
"Chase Receivable" means a Receivable transferred by Chase to
the Issuer pursuant to Section 2.1.
"Chase USA" means Chase Manhattan Bank USA, National
Association, a national banking association, or any successor thereto.
"Chase USA Receivable" means a Receivable transferred by Chase
USA to the Issuer pursuant to Section 2.1.
7
<PAGE>
"CIT" means The CIT Group Holdings, Inc., a Delaware
corporation.
"CITSF" means The CIT Group/Sales Financing, Inc., a Delaware
corporation, and its successors in interest as permitted under the Basic
Documents.
"CITSF Administration Agreement" means the CITSF
Administration Agreement dated as of September 1, 1997, among the Issuer, CITSF
and the Indenture Trustee, as the same may be amended and supplemented from time
to time.
"CITSF Administrator" means CITSF, as administrator under the
CITSF Administration Agreement, and its successors and assigns.
"Class A-1 Interest Rate" means [___]% per annum.
"Class A-1 Notes" means $59,500,000.00 aggregate principal
amount of Class A-1 [___]% Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Class A-2 Interest Rate" means [___]% per annum.
"Class A-2 Notes" means $119,000,000.00 aggregate principal
amount of Class A-2 [___]% Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Class A-3 Interest Rate" means [___]% per annum.
"Class A-3 Notes" means $113,000,000.00 aggregate principal
amount of Class A-3 [___]% Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Class A-4 Interest Rate" means [___]% per annum.
"Class A-4 Notes" means $73,000,000.00 aggregate principal
amount of Class A-4 [___]% Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Class A-5 Interest Rate" means [___]% per annum.
"Class A-5 Notes" means $132,000,000.00 aggregate principal
amount of Class A-5 [___]% Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Class A-6 Interest Rate" means [___]% per annum.
"Class A-6 Notes" means $88,000,000.00 aggregate principal
amount of Class A-6 [___] Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Class A-7 Interest Rate" means [___]% per annum.
8
<PAGE>
"Class A-7 Notes" means $57,000,000.00 aggregate principal
amount of Class A-7 [___]% Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Class A-8 Interest Rate" means [___]% per annum.
"Class A-8 Notes" means $85,000,000.00 aggregate principal
amount of Class A-8 [___]% Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Class A-9 Interest Rate" means [___]% per annum.
"Class A-9 Notes" means $61,000,000.00 aggregate principal
amount of Class A-9 [___]% Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Class A-10 Interest Rate" means [___]% per annum.
"Class A-10 Notes" means $65,000,000.00 aggregate principal
amount of Class A-10 [___]% Asset Backed Notes, substantially in the form of
Exhibit B to the Indenture.
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act.
The initial Clearing Agency shall be The Depository Trust Company.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other person for whom from time to time a
Clearing Agency effects book-entry transfers of securities deposited with the
Clearing Agency (including a Foreign Clearing Agency).
"Closing Date" means September [ ], 1997.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Collection Account" has the meaning specified in
Section 5.1(a)(i).
"Collection Period" means each calendar month beginning with
September 1997 until Chase Manhattan RV Owner Trust 1997-A shall terminate
pursuant to Article IX of the Trust Agreement.
"Collections" means all collections in respect of
Receivables, including Net Liquidation Proceeds.
"Contract Rate" of a Receivable means the annual rate of
interest stated in such Receivable.
"Corporate Trust Office" shall mean the New York office of the
Indenture Trustee or the Wilmington, Delaware office of the Owner Trustee, as
applicable.
9
<PAGE>
"Cutoff Date" means September 1, 1997.
"Cutoff Date Pool Balance" shall be $897,395,285.54.
"Dealer" means the dealer which sold a Financed Vehicle and
which originated or assisted in the origination of the Dealer Receivable
relating to such Financed Vehicle under a Dealer Agreement.
"Dealer Agreement" means any agreement and, if applicable,
assignment under which Dealer Receivables were originated by or through a Dealer
and sold to an Originating Entity.
"Dealer Receivable" means a Receivable (other than a Bulk
Purchase Receivable) originated with the involvement of a Dealer.
"Default" means any occurrence that is, or with notice or the
lapse of time or both would become, an Event of Default.
"Deferred Paid-Ahead Amount" means, with respect to any
Collection Period and any Precomputed Receivable, the amount, if any, held by
the Servicer pursuant to Section 5.2(b) or in the Paid-Ahead Account with
respect to such Receivable.
"Definitive Notes" means Notes issued in certificated, fully
registered form as provided in Section 2.12 of the Indenture.
"Definitive Certificates" means Certificates issued in
certificated, fully registered form as provided in Section 3.12 of the Trust
Agreement.
"Delaware Trustee" has the meaning specified in
Section 10.1 of the Trust Agreement.
"Delinquency Percentage" means, for any Distribution Date, the
sum of the outstanding Principal Balances of all Receivables which were
60 days or more delinquent (including Receivables, which are not Liquidated
Receivables, relating to Financed Vehicles that have been repossessed), as of
the close of business on the last day of the Collection Period immediately
preceding such Distribution Date, determined in accordance with the Servicer's
normal practices, such sum expressed as a percentage of the Pool Balance as of
the close of business on the last day of such Collection Period.
"Delivery" when used with respect to Reserve Account
Property means:
(a)(i) with respect to "certificated securities"
within the meaning of Section 8-102(1)(a) of the Relevant UCC not held
by the initial Clearing Agency or other "instruments" within the
meaning of Section 9-105(1)(i) of
10
<PAGE>
the Relevant UCC, (A) physical delivery thereof to the Indenture
Trustee or its nominee or custodian endorsed to, or registered in the
name of, the Indenture Trustee or its nominee or custodian or endorsed
in blank, or, (B) with respect to a certificated security, possession
thereof by a financial intermediary (as defined in Section 8-313(4) of
the Relevant UCC) and the making by such financial intermediary of
entries on its books and records identifying such certificated
securities as belonging to the Indenture Trustee or its nominee or
custodian and the sending by such financial intermediary of a
confirmation of the purchase of such certificated security by the
Indenture Trustee or its nominee or custodian, or (ii) with respect to
"certificated securities" within the meaning of Section 8-102(4)(a) of
the Relevant UCC held by the initial Clearing Agency or by a "custodian
bank" within the meaning of Section 8-102(4) of the Relevant UCC (a
"Custodian Bank") or a nominee of either subject to the control of the
initial Clearing Agency, the delivery thereof to the initial Clearing
Agency or a Custodian Bank or a nominee of either subject to the
control of the initial Clearing Agency and in bearer form or endorsed
in blank by an appropriate person or registered on the books of the
issuer thereof in the name of the initial Clearing Agency or its
Custodian Bank or a nominee of either and the identification by
book-entry or otherwise on the records of the financial intermediary,
the sending of a confirmation by the financial intermediary of the
purchase by the Indenture Trustee or its nominee or custodian of such
securities and the making by such financial intermediary of entries on
its books and records identifying such certificated securities as
belonging to the Indenture Trustee or its nominee or custodian (all of
the foregoing, "Physical Property"), and such additional or alternative
procedures as may hereafter become appropriate to effect the complete
transfer of ownership of any such Reserve Account Property to the
Indenture Trustee or its nominee or custodian, consistent with changes
in applicable law or regulations or the interpretation thereof;
(b) with respect to any United States Securities
Entitlement that are maintained in the form of entries on the records
of the Federal Reserve System pursuant to Federal book-entry
regulations, the following procedures: entries on the records of a
member bank of the Federal Reserve System identifying such Reserve
Account Property as belonging to a Federal Reserve "depositary"
pursuant to applicable Federal regulations and the sending by such
depositary of written confirmation of the purchase of such Reserve
Account Property to the Indenture Trustee or its nominee or custodian;
the making by such depositary of entries in its books and records
identifying such Reserve Account Property as belonging to, or otherwise
subject to a security interest in favor of, the Indenture Trustee or
its nominee or custodian; and such additional or alternative procedures
as may hereafter become appropriate to effect
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transfer of ownership of any such Reserve Account Property to the
Indenture Trustee or its nominee or custodian consistent with changes
in applicable law or regulations or the interpretation thereof; and
(c) with respect to any item of Reserve Account
Property that is an uncertificated security under Article 8 (or VIII,
as applicable) of the Relevant UCC and that is not governed by clause
(b) above, registration on the books and records of the issuer thereof
in the name of the financial intermediary, the sending of a
confirmation by the financial intermediary of the purchase by the
Indenture Trustee or its nominee or custodian of such uncertificated
security, the making by such financial intermediary of entries on its
books and records identifying such uncertificated certificates as
belonging to the Indenture Trustee or its nominee or custodian; and
such additional or alternative procedures as may hereafter become
appropriate to effect transfer of ownership of any such Reserve Account
Property to the Indenture Trustee or its nominee or custodian
consistent with changes in applicable law or regulations or the
interpretation thereof.
"Deposit Date" means the Business Day immediately preceding
each Distribution Date.
"Depositor" means each Seller in its capacity as Depositor
under the Trust Agreement.
"Depositor Allocation Percentage" means, for purposes of
allocating payments and distributions to the Sellers in accordance with the
Basic Documents, 12.83% with respect to Chase USA and 87.17% with respect to
Chase.
"Depository Agreements" mean, collectively, the Certificate
Depository Agreement and the Note Depository Agreement.
"Determination Date" means the third Business Day prior
to a Distribution Date.
"Distribution Date" means, in the case of the first Collection
Period, October 15, 1997, and in the case of every Collection Period thereafter,
the 15th day of the following month, or if the 15th day is not a Business Day,
the next following Business Day, commencing with the first Distribution Date.
"Duff & Phelps" means Duff & Phelps Credit Rating Company and
its successors and assigns.
"Eligible Deposit Account" means (a) a separately identifiable
deposit account established in the deposit taking department of a Qualified
Institution, which, except in the case of the Reserve Account, may be Chase so
long as Chase is a
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Qualified Institution; or (b) a segregated identifiable trust account
established in the trust department of a Qualified Trust Institution, which
shall, except in the case of the Reserve Account, initially be Chase, and may be
maintained with Chase so long as Chase is a Qualified Trust Institution.
"Eligible Servicer" means CITSF, Chase, either Trustee or any
other Person qualified to act as Servicer of the Receivables under applicable
federal and state laws and regulations, which Person services not less than
$100,000,000 in outstanding principal amount of recreational vehicle or motor
vehicle installment sale contracts.
"ERISA" has the meaning specified in Section 11.12 of
the Trust Agreement.
"Euroclear Operator" means Morgan Guaranty Trust Company of
New York, Brussels, Belgium office, in its capacity as the operator of the
Euroclear system.
"Excluded Administrative Fees" means all Administrative Fees
incurred by the Obligors prior to August 18, 1997.
"Excluded Forced-Placed Insurance Premiums" means, with
respect to any Receivable, any forced-placed insurance premium not included in
such Receivable's Principal Balance as of the Cutoff Date.
"Excluded Precomputed Amounts" means, with respect to any
Precomputed Receivable, any Scheduled Payments due thereon prior to the Cutoff
Date.
"Executive Officer" means, with respect to any corporation or
bank, the Chief Executive Officer, Chief Operating Officer, Chief Financial
Officer, President, Executive Vice President, any Vice President, the Secretary
or the Treasurer of such corporation or bank, and with respect to any
partnership, any general partner thereof.
"Event of Default" means an event specified in Section 5.1 of
the Indenture.
"Event of Servicing Termination" means an event specified in
Section 8.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Expenses" has the meaning specified in Section 8.2 of the
Trust Agreement.
"Farm Credit Entitlement" means a "Security Entitlement" as
defined in 12 C.F.R. Section 615.5450.
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"FDIC" means the Federal Deposit Insurance Corporation or any
successor thereto.
"FHLBank Entitlement" means a "Security Entitlement" as
defined in 12 C.F.R. Section 912.1.
"FHLMC" means the Federal Home Loan Mortgage Corporation or
any successor thereto.
"Financed Vehicle" means, with respect to a Receivable, the
new or used Recreational Vehicle, together with all the accessions thereto,
securing an Obligor's indebtedness under such Receivable.
"Final Scheduled Maturity Date" means the last day of
the Collection Period immediately preceding the Certificate Final Scheduled
Distribution Date.
"FNMA" means the Federal National Mortgage Association or any
successor thereto.
"Foreign Clearing Agency" means, collectively, CEDEL and the
Euroclear Operator.
"Funding Corporation Entitlement" means a "Security
Entitlement" as defined in 12 C.F.R. Section 1511.1.
"Grant" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create, and grant a lien
upon and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to the Indenture. A Grant of the Trust Estate or of any
other agreement or instrument shall include all rights, powers and options (but
none of the obligations) of the Granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments and all other moneys payable thereunder, to
give and receive notices and other communications, to make waivers or other
agreements, to exercise all rights and options, to bring Proceedings in the name
of the Granting party or otherwise and generally to do and receive anything that
the Granting party is or may be entitled to do or receive thereunder or with
respect thereto.
"Holder" or "Holders" means, unless the context otherwise
requires, both Certificateholders and Noteholders.
"HUD Entitlement" means a "Security Entitlement" as defined
in 24 C.F.R. Section 81.2.
"Indemnified Parties" has the meaning specified in Section
8.2 of the Trust Agreement.
"Indenture" means the Indenture dated as of September 1, 1997,
between the Issuer and the Indenture Trustee, as the same may be amended and
supplemented from time to time.
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"Indenture Trustee" means, initially, Norwest Bank Minnesota,
National Association, as Indenture Trustee under the Indenture, or any
successor Indenture Trustee under the Indenture.
"Independent" means, when used with respect to any specified
Person, that the person (a) is in fact independent of the Issuer, any other
obligor upon the Notes, the Sellers and any Affiliate of any of the foregoing
persons, (b) does not have any direct financial interest or any material
indirect financial interest in the Issuer, any such other obligor, the Sellers
or any Affiliate of any of the foregoing Persons and (c) is not connected with
the Issuer, any such other obligor, the Sellers or any Affiliate of any of the
foregoing Persons as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions.
"Independent Certificate" means a certificate or opinion to be
delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.1 of the
Indenture, made by an Independent engineer, appraiser or other expert appointed
by the Issuer and approved by the Indenture Trustee in the exercise of
reasonable care, and such opinion or certificate shall state that the signer has
read the definition of "Independent" in this Agreement and that the signer is
Independent within the meaning thereof.
"Insolvency Event" means, for a specified Person, (a) the
filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of such Person or any substantial part of its property in an
involuntary case under any applicable Federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver
(including any receiver appointed under the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, as amended), liquidator, assignee,
custodian, trustee, sequestrator or similar official for such Person or for any
substantial part of its property, or ordering the winding-up or liquidation of
such Person's affairs, and such decree or order shall remain unstayed and in
effect for a period of 60 consecutive days; or (b) the commencement by such
Person of a voluntary case under any applicable Federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or the consent by
such Person to the entry of an order for relief in an involuntary case under any
such law, or the consent by such Person to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator
or similar official for such Person or for any substantial part of its property,
or the making by such Person of any general assignment for the benefit of
creditors, or the failure by such Person generally to pay its debts as such
debts become due, or the taking of action by such Person in furtherance of any
of the foregoing.
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"Insurance Policy" means, with respect to each Receivable, the
policy of physical damage and all other insurance covering the related Financed
Vehicle or the Obligor.
"Interest Accrual Period" means, with respect to any
Distribution Date, the period from and including the most recent Distribution
Date (or, in the case of the first Distribution Date, the Closing Date) on which
interest has been paid to but excluding the following Distribution Date.
"Interest Rate" means the rate of interest borne by the
Notes of any class.
"Investment Earnings" means, with respect to any Distribution
Date, the investment earnings (net of losses and investment expenses) on amounts
on deposit in the Collection Account and the Paid-Ahead Account.
"Issuer" means Chase Manhattan RV Owner Trust 1997-A, a
Delaware business trust, until a successor replaces it and, thereafter, means
such successor and, for purposes of any provision contained in the Indenture and
required by the TIA, each other obligor on the Notes.
"Issuer Order" and "Issuer Request" means a written order or
request signed in the name of the Issuer by any of its authorized officers and
delivered to the Indenture Trustee.
"Lien" means a security interest, lien, charge, pledge or
encumbrance of any kind other than tax liens, mechanics' liens or any other
liens that attach by operation of law.
"Liquidation Expenses" means all reasonable fees of third
parties, amounts advanced to satisfy taxes and tax liens and other expenses
incurred by the Servicer in the course of converting any defaulted Receivable
or Financed Vehicle into cash proceeds (including, without limitation, expenses
relating to recovery, repossession, transporting, repair, care, custody, control
and resale of such Financed Vehicle), but shall not include expenses customarily
deducted by third parties from sale proceeds in connection with sales or other
dispositions of recreational vehicles.
"Liquidated Receivable" means a defaulted Receivable as to
which the Servicer has recovered all amounts that its expects to recover either
by sale or disposition of the related Financed Vehicle or otherwise, but in any
event a Receivable shall be deemed to become a Liquidated Receivable no later
than the date on which the Servicer has received the net proceeds from the sale
or disposition of such Financed Vehicle.
"Loss" has the meaning specified in the Servicing Agreement.
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"Military Reservist Relief Act" means the California Military
Reservist Relief Act of 1991, as amended.
"Monthly Advance" means, with respect to any Distribution
Date, any payment made by the Servicer pursuant to Section 5.3 hereof.
"Monthly Report" has the meaning assigned in Section 4.8
hereof. The form of Monthly Report is attached as Exhibit B hereto.
"Moody's" means Moody's Investors Service, a division of Dun &
Bradstreet Corporation, and its successors and assigns.
"Net Liquidation Proceeds" means the monies collected by the
Servicer (from whatever source) during a Collection Period on a Liquidated
Receivable, net of (i) any payments required by law to be remitted to the
Obligor and (ii) other expenses customarily deducted by third parties from sales
proceeds in connection with sales or other dispositions of recreational
vehicles.
"Net Loss Ratio" means, for any Distribution Date, an amount,
expressed as a percentage, equal to (i) the Aggregate Net Losses for such
Distribution Date divided by (ii) the average of the Pool Balances on each of
the related Settlement Dates and the last day of the related Collection Period.
"New Financed Vehicle" means a Financed Vehicle the model year
of which is the year of origination of the related Receivable or a later year.
"Note" means a Class A-1 Note, a Class A-2 Note, a Class A-3
Note, a Class A-4 Note, a Class A-5 Note, a Class A-6 Note, a Class A-7 Note, a
Class A-8 Note, a Class A-9 Note or a Class A-10 Note.
"Note Depository Agreement" means the agreement among the
Issuer, the Indenture Trustee, Chase, as agent for The Depository Trust Company
and The Depository Trust Company, as the initial Clearing Agency, dated as of
the Closing Date, relating to the Notes, as the same may be amended or
supplemented from time to time or any similar agreement with any successor
Clearing Agency.
"Note Distribution Account" means the account designated as
such, established and maintained pursuant to Section 5.1(a)(ii).
"Note Final Scheduled Distribution Date" means for (a) the
Class A-1 Notes, the October 1998 Distribution Date, (b) the Class A-2 Notes,
the August 2000 Distribution Date, (c) the Class A-3 Notes, the February 2002
Distribution Date, (d) the Class A-4 Notes, December 2002 Distribution Date, (e)
the Class A-5 Notes, the November 2004 Distribution Date, (f) the Class A-6
Notes,
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the December 2005 Distribution Date, (g) the Class A-7 Notes, the October 2006
Distribution Date, (h) the Class A-8 Notes, the December 2007 Distribution Date,
(i) the Class A-9 Notes, the December 2008 Distribution Date and (j) the Class
A-10 Notes, the March 2010 Distribution Date.
"Note Owner" means, with respect to a Book-Entry Note, the
person who is the owner of beneficial interests in such Book-Entry Note, as
reflected on the books of the Clearing Agency or Foreign Clearing Agency, or on
the books of a direct or indirect Clearing Agency Participant.
"Note Pool Factor" for each class of Notes as of the close of
business on a Distribution Date means an eight-digit decimal figure equal to the
Outstanding Amount of such class of Notes divided by the original Outstanding
Amount of such class of Notes. The Note Pool Factor for each class of Notes will
be 1.00000000 as of the Cutoff Date; thereafter, the Note Pool Factor for each
class of Notes will decline to reflect reductions in the Outstanding Amount of
such class of Notes.
"Noteholder" means the Person in whose name a Note is
registered on the Note Register.
"Noteholders' Distributable Amount" means, for any
Distribution Date, the sum of the Noteholders' Principal
Distributable Amount and the Noteholders' Interest Distributable Amount for all
classes of Notes.
"Noteholders' Interest Carryover Shortfall" means, for any
Distribution Date for any class of Notes (other than initial Distribution Date),
the excess of (x) the Noteholders' Interest Distributable Amount for the
preceding Distribution Date for such class of Notes, over (y) the amount in
respect of interest that was actually deposited in the Note Distribution Account
on such preceding Distribution Date with respect to such class of Notes, plus
interest on the amount of interest due but not paid to Noteholders of such class
on the preceding Distribution Date, to the extent permitted by law, at the
applicable Interest Rate from such preceding Distribution Date through the
current Distribution Date.
"Noteholders' Interest Distributable Amount" means, for any
Distribution Date for any class of Notes, the sum of (x) the Noteholders'
Monthly Interest Distributable Amount for such Distribution Date for such class
of Notes and (y) the Noteholders' Interest Carryover Shortfall for such
Distribution Date for such class of Notes.
"Noteholders' Monthly Interest Distributable Amount" means,
for any Distribution Date for any class of Notes, one month's interest (or, in
the case of the first Distribution Date, interest accrued from and including the
Closing Date to but excluding such Distribution Date) at the related Interest
Rate on the Outstanding Amount of the Notes of such class on such
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Distribution Date (or, in the case of the first Distribution Date, on the
Closing Date). Interest for purposes of this definition (i) on the Class A-1
Notes shall be computed on the basis of a 360-day year for the actual number of
days elapsed and (ii) on the Notes of all other classes shall be computed on the
basis of a 360-day year of twelve 30-day months.
"Noteholders' Monthly Principal Distributable Amount" means,
for any Distribution Date prior to the Distribution Date on which the Notes have
been paid in full, 100% of the Principal Distribution Amount for such
Distribution Date; and for the Distribution Date on which the Notes are paid in
full, the portion of the Principal Distribution Amount for such Distribution
Date required to pay the Notes in full.
"Noteholders' Principal Carryover Shortfall" means for any
Distribution Date, the excess of (x) the Noteholders' Principal Distributable
Amount for the preceding Distribution Date over (y) the amount in respect of
principal that was actually deposited in the Note Distribution Account on such
Distribution Date.
"Noteholders' Principal Distributable Amount" means, for any
Distribution Date, the sum of (i) the Noteholders' Monthly Principal
Distributable Amount for such Distribution Date and (ii) the Noteholders'
Principal Carryover Shortfall for such Distribution Date; provided that the
Noteholders' Principal Distributable Amount shall not exceed the Outstanding
Amount of the Notes. In addition, on the Note Final Scheduled Distribution Date
of each class of Notes, the principal required to be deposited in the Note
Distribution Account will include the amount necessary (after giving effect to
the other amounts to be deposited in the Note Distribution Account on such
Distribution Date and allocable to principal) to reduce the Outstanding Amount
of such class of Notes to zero.
"Note Register" and "Note Registrar" have the meanings
specified in Section 2.4 of the Indenture.
"Obligor" on a Receivable means the purchaser or the
co-purchasers of the Financed Vehicle purchased in part or in whole by the
execution and delivery of such Receivable or any other Person who owes or may be
liable for payments under such Receivable.
"Officer's Certificate" means a certificate signed by the
chairman of the board, the president, the treasurer, the controller, any
executive or senior vice president or any vice president of a Seller or the
Servicer, as appropriate, meeting the requirements of Section 11.1 of the
Indenture.
"Opinion of Counsel" means a written opinion of counsel (who
may be counsel to a Seller or the Servicer) reasonably acceptable in form and
substance to the Indenture Trustee, meeting the requirements of Section 11.1 of
the Indenture (or in
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the case of an Opinion of Counsel delivered to the Owner Trustee, reasonably
acceptable in form and substance to the Owner Trustee).
"Optional Purchase Amount" means an aggregate of the
following amounts calculated for each Receivable (other than any
Liquidated Receivable) as of the close of business on the last day of
the Collection Period as of which the Servicer exercises its option to
purchase the Owner Trust Estate pursuant to Section 9.1(a): (i) its
Actual Principal Balance, plus (ii) one-month's interest on its Actual
Principal Balance as of the related Settlement Date accrued at a rate
equal to the greater of (A) the weighted average Contract Rate of the
Receivables (based on their Actual Principal Balances as of such
Settlement Date) and (B) the sum of the Certificate Rate and the
Servicing Fee Rate, minus (iii) all Collections of (or allocable to)
interest on each such Receivable received during such Collection Period
(including from any Applied Paid-Ahead Amounts or Repurchase Amounts) and
deposited into the Collection Account.
"Originating Entity" means, with respect to any Receivable,
other than a Bulk Purchase Receivable, the Affiliate of CFAC, Chase, Chase USA
or a predecessor of any of them who originated such Receivable, and, with
respect to a Bulk Purchase Receivable, the Person who originated such
Receivable.
"Outstanding" means, when used with respect to Notes, as of
the date of determination, all Notes theretofore authenticated and delivered
under the Indenture except:
(a) Notes theretofore canceled by the Note
Registrar or delivered to the Note Registrar for
cancellation;
(b) Notes or portions thereof the payment for which
money in the necessary amount has been theretofore deposited
with the Indenture Trustee or any Paying Agent in trust for
the Holders of such Notes (provided that if such Notes are to
be redeemed, notice of such redemption has been duly given
pursuant to the Indenture or provision therefor, satisfactory
to the Indenture Trustee, has been made); and
(c) Notes in exchange for or in lieu of other Notes
which have been authenticated and delivered pursuant to the
Indenture unless proof satisfactory to the Indenture Trustee
is presented that any such Notes are held by a bona fide
purchaser;
provided that in determining whether the Holders of the requisite Outstanding
Amount of the Notes have given any request, demand, authorization, direction,
notice, consent or waiver hereunder or under any Basic Document, Notes owned by
the Issuer, any other obligor upon the Notes, either Seller, the Servicer or any
Affiliate of any of the foregoing Persons shall be disregarded and deemed not to
be Outstanding, except that, in determining whether the Indenture Trustee shall
be protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Notes that an Authorized Officer of the
Indenture Trustee either actually knows to be so owned or has received written
notice that such Note is so owned shall be so disregarded. Notes so owned that
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Indenture Trustee the pledgee's right so
to act with respect to such Notes and that the pledgee is not the Issuer, any
other obligor upon the Notes, a Seller, the Servicer or any Affiliate of the
foregoing Persons.
"Outstanding Amount" means, when used with respect to
Notes, as of any date of determination, the aggregate principal
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amount of all Notes, or a class of Notes, as applicable, Outstanding as of such
date.
"Owner Trust Estate" means all right, title and interest of
the Issuer in and to the property and rights assigned to the Issuer pursuant to
Article II of this Agreement, all funds on deposit from time to time in the
Trust Accounts (other than the Note Distribution Account) and all other property
of Issuer from time to time, including any rights of the Owner Trustee and the
Issuer pursuant to this Agreement.
"Owner Trustee" means Wilmington Trust Company, a Delaware
banking corporation, not in its individual capacity but solely as owner trustee
under the Trust Agreement, and any successor Owner Trustee thereunder.
"Paid-Ahead Account" means the account designated as such,
established and maintained pursuant to Section 5.1(a)(iii).
"Paid-Ahead Amount" means, with respect to any Collection
Period and a Precomputed Receivable, any amount collected on such
Precomputed Receivable in excess of the sum of (i) the Scheduled Payment due on
such Precomputed Receivable during such Collection Period and (ii) any past due
Scheduled Payments from prior Collection Periods received during such Collection
Period but not representing a Principal Prepayment in full of such Receivable.
"Paying Agent" means: (a) when used in the Indenture or
otherwise with respect to the Notes, the Indenture Trustee or any other Person
that meets the eligibility standards for the Indenture Trustee specified in
Section 6.11 of the Indenture and is authorized by the Indenture Trustee to make
the payments to and distributions from the Collection Account and the Note
Distribution Account, including payment of principal of or interest on the Notes
on behalf of the Issuer; and (b) when used in the Trust Agreement or otherwise
with respect to the Certificates, the Owner Trustee or any other paying agent or
co-paying agent appointed pursuant to Section 3.9 of the Trust Agreement, and in
the case of the Indenture with respect to the Notes, and the Trust Agreement
with respect to the Certificates, such Paying Agent shall initially be the
corporate trust office of Chase.
"Payment Shortfall" means (i) with respect to any Simple
Interest Receivable and any Collection Period, the excess of (A) the product of
(1) one-twelfth of the Contract Rate of such Receivable and (2) the Principal
Balance of such Receivable as of the related Settlement Date (or, in the case of
the first Collection Period, as of the Cutoff Date) over (B) the amount of
interest, if any, collected on such Receivable during the related Collection
Period and (ii) with respect to any Precomputed Receivable and any Collection
Period, the excess of (A) the Scheduled Payment due on such Precomputed
Receivable during the related Collection Period over (B) the amount with respect
to
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such payment collected on such Receivable (including any Applied Paid-Ahead
Amounts with respect to such Collection Period).
"Permitted Investments" means, at any time, any one or more of
the following obligations, securities (certificated or uncertificated) or
instruments (excluding any security with the "r" symbol attached to its rating):
(i) obligations of the United States of America or
any agency thereof; provided such obligations are backed by
the full faith and credit of the United States of America;
(ii) general obligations of or obligations
guaranteed as to the timely payment of interest and principal
by any state of the United States of America or the District
of Columbia then rated "A-1+" or "AAA" by Standard & Poor's,
"D-1+" by Duff & Phelps (if rated by Duff & Phelps) and P-1+
or Aaa by Moody's;
(iii) commercial paper which is then rated P-1 by
Moody's, "D-1+" by Duff & Phelps (if rated by Duff & Phelps)
and "A-1+" by Standard & Poor's;
(iv) certificates of deposit, demand or time
deposits, federal funds or banker's acceptances issued by any
depository institution or trust company (including the Owner
Trustee acting in its commercial banking capacity)
incorporated under the laws of the United States or of any
state thereof or incorporated under the laws of a foreign
jurisdiction with a branch or agency located in the United
States of America and subject to supervision and examination
by federal or state banking authorities which short term
unsecured deposit obligations of such depository institution
or trust company are then rated P-1 by Moody's, "D-1+" by Duff
& Phelps (if rated by Duff & Phelps) and "A-1+" by Standard &
Poor's;
(v) demand or time deposits of, or certificates of
deposit issued by, any bank, trust company, savings bank or
other savings institution so long as such deposits or
certificates of deposit are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements issued by
any bank, insurance company or other corporation the short
term unsecured debt or deposits of which are rated P-1 by
Moody's, "D-1+" by Duff & Phelps (if rated by Duff & Phelps)
and "A-1+" by Standard & Poor's or the long-term unsecured
debt of which are rated Aaa by Moody's and "AAA" by Standard &
Poor's;
(vii) repurchase obligations with respect to any
security described in clauses (i) or (ii) herein or any
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other security issued or guaranteed by the FHLMC, FNMA or any
other agency or instrumentality of the United States of
America which is backed by the full faith and credit of the
United States of America, in either case entered into with a
federal agency or a depository institution or trust company
(acting as principal) described in (iv) above;
(viii) investments in money market funds, which funds
(A) are not subject to any sales, load or other similar
charge; and (B) are rated at least "AAAM" or "AAAM-G" by
Standard & Poor's, "D-1+" by Duff & Phelps (if rated by Duff &
Phelps) and Aaa by Moody's;
(ix) such other investments where either (A) the
short-term unsecured debt or deposits of the obligor on such
investments are rated "A-1+" by Standard & Poor's, "D-1+" by
Duff & Phelps (if rated by Duff & Phelps) and P-1 by Moody's;
and
(x) any other obligation or security satisfying
the Rating Agency Condition;
Permitted Investments include money market mutual funds (so long as such fund
has the ratings specified in clause (viii) hereof), including, without
limitation, the VISTA U.S. Government Money Market Fund or any other fund for
which Chase, the Owner Trustee or an Affiliate thereof serves as an investment
advisor, administrator, shareholder servicing agent, and/or custodian or
subcustodian, notwithstanding that (i) Chase, Norwest Bank Minnesota, National
Association, Wilmington Trust Company or an Affiliate thereof charges and
collects fees and expenses from such funds for services rendered, (ii) Chase,
Norwest Bank Minnesota, National Association, Wilmington Trust Company or an
Affiliate thereof charges and collects fees and expenses for services rendered
pursuant to this Agreement, and (iii) services performed for such funds and
pursuant to this Agreement may converge at any time. The Indenture Trustee
specifically authorizes Chase, Norwest Bank Minnesota, National Association,
Wilmington Trust Company or an Affiliate thereof to charge and collect all fees
and expenses from such funds for services rendered to such funds (but not to
exceed investment earnings), in addition to any fees and expenses Chase, Norwest
Bank Minnesota, National Association, or Wilmington Trust Company, as
applicable, may charge and collect for services rendered pursuant to this
Agreement.
"Person" means a legal person, including any individual,
corporation, limited liability company, estate, partnership, joint venture,
association, joint stock company, trust, unincorporated organization, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
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"Physical Property" has the meaning specified in the
definition of "Delivery" above.
"Pool Balance" as of any date of determination means the
aggregate Principal Balance of the Receivables, calculated as of the close of
business on such date.
"Precomputed Receivable" means (i) any Receivable under
which the portion of a payment allocable to earned interest (which may be
referred to in the related Receivable as an add-on finance charge) and the
portion allocable to the Amount Financed is determined according to the sum of
periodic balances or the sum of monthly balances or any equivalent method or
(ii)any monthly actuarial Receivables.
"Predecessor Note" means, with respect to any particular Note,
every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purpose of this definition, any
Note authenticated and delivered under Section 2.5 of the Indenture in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same
debt as the mutilated, lost, destroyed or stolen Note.
"Principal Balance" means, as of the close of business on the
last day of a Collection Period, (a) with respect to a Precomputed Receivable,
the Amount Financed minus the sum of (i) that portion of all Scheduled Payments
due on or prior to such day allocable to principal using the actuarial method,
(ii) any payment of the Repurchase Amount with respect to the Precomputed
Receivable allocable to principal using the actuarial method and (iii) any
Principal Prepayment applied to reduce the Principal Balance of the Precomputed
Receivable in full and (b) with respect to a Simple Interest Receivable, the
Amount Financed minus the sum of (i) the portion of all payments made by or on
behalf of the related Obligor on or prior to such day and allocable to principal
using the Simple Interest Method and (ii) any payment of the Repurchase Amount
with respect to the Simple Interest Receivable allocable to principal using the
Simple Interest Method, in each case without giving effect to any adjustments
due to bankruptcy or similar proceedings.
"Principal Distribution Amount" means, for each Distribution
Date, an amount equal to the sum of the following amounts with respect to the
related Collection Period, in each case calculated in accordance with the method
specified in each Receivable, (i) (A) all payments of principal (including all
Principal Prepayments applied during the related Collection Period as described
below) made on each Simple Interest Receivable during the related Collection
Period and (B) that portion of the Scheduled Payments due during such Collection
Period allocable to principal using the actuarial method with respect to each
Precomputed Receivable (or the Principal Balance thereof if such Precomputed
Receivable is prepaid in full during such Collection Period), (ii) the Principal
Balance of each
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Repurchased Receivable and (iii) the Principal Balance of each Receivable that
became a Liquidated Receivable during the related Collection Period; provided,
however, that (x) payments of principal (including Principal Prepayments) with
respect to a Repurchased Receivable received after the last day of the
Collection Period in which the Receivable became a Repurchased Receivable shall
not be included in the Principal Distribution Amount and (y) if a Liquidated
Receivable is purchased by a Seller or the Servicer pursuant to this Agreement
on the Deposit Date immediately following the Collection Period in which it
became a Liquidated Receivable, no amount will be included with respect to such
Receivable in the Principal Distribution Amount pursuant to clause (iii) above.
Principal Prepayments with respect to Simple Interest Receivables will be
treated as collections for the Collection Period in which they are received, and
Principal Prepayments with respect to Precomputed Receivables will be deposited
into the Paid-Ahead Account or retained by the Servicer pursuant to Section
5.2(b) and treated as collections for the Collection Period in which the related
Scheduled Payment was due.
"Principal Prepayment" means a payment or other recovery of
principal on a Receivable (including insurance proceeds and Net Liquidation
Proceeds applied to principal on a Receivable) which is received in advance of
its due date.
"Proceeding" means any suit in equity, action or law or
other judicial or administrative proceeding.
"Purchase and Sale Agreement" means the Purchase and Sale
Agreement, dated as of August 20, 1997, among CFAC, CFHI and Chase USA, as the
same may be amended and supplemented from time to time.
"Qualified Institution" means a depository institution
organized under the laws of the United States of America or any one of the
States thereof or incorporated under the laws of a foreign jurisdiction with a
branch or agency located in the United States of America or one of the States
thereof and subject to supervision and examination by federal or state banking
authorities which at all times has the Required Deposit Rating and, in the case
of any such institution organized under the laws of the United States of
America, whose deposits are insured by the FDIC.
"Qualified Trust Institution" means an institution organized
under the laws of the United States of America or any one of the States thereof
or incorporated under the laws of a foreign jurisdiction with a branch or agency
located in the United States of America or one of the States thereof and subject
to supervision and examination by federal or state banking authorities which at
all times (i) is authorized under such laws to act as a trustee or in any other
fiduciary capacity, (ii) has not less than one billion dollars in assets under
fiduciary management, and (iii) has a long term deposits rating of not less
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than "BBB-" by Standard & Poor's, "BBB-" by Duff & Phelps (if rated by Duff &
Phelps) and Baa3 by Moody's.
"Rating Agency" means any of Standard & Poor's, Moody's
or Duff & Phelps.
"Rating Agency Condition" means, with respect to any action or
event, that each Rating Agency shall have notified the Sellers, the Servicer,
the Indenture Trustee and the Owner Trustee, in writing, that such action or
event will not result in reduction or withdrawal of any then outstanding rating
of any outstanding Note or Certificate with respect to which it is the Rating
Agency.
"Receivable" means a retail installment sale contract or
purchase money promissory note or other promissory note and security agreement
executed by an Obligor in respect of a Financed Vehicle, and all proceeds
thereof and payments thereunder (other than (i) Excluded Precomputed Amounts,
(ii) Excluded Administrative Fees and (iii) Excluded Force-Placed Insurance
Premiums), which Receivable shall be identified on Schedule A-1 or Schedule A-2
to this Agreement.
"Receivable Files" means, the documents specified in Section
3.3, together with all other documents or records that the Servicer shall add to
such documents from time to time in accordance with its customary procedures.
"Receivables Pool" means the pool of Receivables
included in the Trust.
"Record Date" means, with respect to any Distribution Date,
the Business Day prior to such Distribution Date unless Definitive Notes or
Definitive Certificates are issued, in which case, Record Date, with respect to
such Definitive Notes or Definitive Certificates, as applicable, shall mean the
last day of the immediately preceding calendar month.
"Recreational Vehicle" means new or used motor homes, travel
trailers and other types of recreational vehicles.
"Relevant UCC" means the Uniform Commercial Code as in
effect in the applicable jurisdiction.
"Relief Act Reduction" shall mean the reduction of the rate of
interest payable on any Receivable to a rate below the Contract Rate pursuant to
the Soldiers' and Sailors' Civil Relief Act or the Military Reservist Relief
Act.
"Repurchase Amount" of a Repurchased Receivable (other than
a Receivable purchased by the Servicer pursuant to Section 9.1(a))means the sum
of, as of the last day of the Collection Period as of which the repurchase of
such Receivable is deemed to be effective, (i) its Actual Principal Balance
plus (ii) Accrued Interest thereonto such last day.
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"Repurchased Receivable" means a Receivable repurchased by a
Seller pursuant to Section 3.2 or purchased by the Servicer pursuant to Section
4.6 or 9.1(a).
"Required Deposit Rating" shall be a short-term certificate of
deposit rating from Moody's of P-1, from Duff & Phelps of "D-1" (if rated by
Duff & Phelps) and from Standard & Poor's of "A-1+," and a long-term unsecured
debt rating of not less than Aa3 by Moody's and "AA-" by Standard & Poor's.
"Reserve Account" means the account designated as such,
established and maintained pursuant to Section 5.6.
"Reserve Account Initial Deposit" means an amount equal
to $13,460,929.28.
"Reserve Account Property" means all amounts and investments
held from time to time in the Reserve Account (whether in the form of deposit
accounts, Physical Property, book-entry securities, uncertificated securities or
otherwise), including the Reserve Account Initial Deposit and all proceeds of
the foregoing.
"Reserve Account Transfer Amount" means, for any Distribution
Date, an amount equal to the lesser of (a) the Available Reserve Account Amount
for such Distribution Date and (b) the amount, if any, by which the sum of the
amounts set forth in clauses (i) through (v) of Section 5.5(c), exceeds the
Available Amount for such Distribution Date.
"Responsible Officer" means, (i) with respect to any Trustee,
any officer within the Corporate Trust Office of such Trustee, including any
Vice President, Assistant Vice President, Assistant Treasurer or Assistant
Secretary, and (ii) with respect to the Servicer, the President, any Vice
President, Assistant Vice President, Secretary, Assistant Secretary, or in the
case of clauses (i) and (ii), any other officer of such Person customarily
performing functions similar to those performed by any of the above designated
officers and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"Sale Proceeds" has the meaning specified in
Section 9.1(b).
"Sallie Mae Entitlement" means a "Security Entitlement"
as defined in 31 C.F.R. Section 354.1.
"Scheduled Payment" means, with respect to a Precomputed
Receivable, that portion of the payment required to be made by the Obligor
during each Collection Period sufficient to amortize the Principal Balance of
such Receivable under the related actuarial method over the term of the
Receivable and to provide interest at the related Contract Rate. When Scheduled
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Payment is used with reference to a Collection Period, it means the payment
which is due during such Collection Period.
"Schedule of Receivables" means, collectively,
Schedules A-1 and A-2 attached hereto.
"Securities Act" means the Securities Act of 1933, as
amended.
"Sellers" means collectively, Chase USA, in its capacity as
the seller of the Chase USA Receivables under this Agreement, and each successor
to Chase USA (in the same capacity) pursuant to Section 6.3 and Chase in its
capacity as the seller of the Chase Receivables under this Agreement, and each
successor to Chase (in the same capacity) pursuant to Section 6.3.
"Servicer" means CITSF in its capacity as servicer of the
Receivables under this Agreement, and each successor to The CIT Group/Sales
Financing, Inc. (in the same capacity) pursuant to Section 7.3.
"Servicer's Certificate" means a certificate, substantially in
the form of Exhibit A attached hereto, completed and executed by the Servicer by
its chairman of the board, the president, treasurer, controller or any
executive, senior vice president or vice president pursuant to Section 4.8.
"Servicer Payment" with respect to any Distribution Date,
means an amount equal to the sum of the reimbursement then due to the Servicer
for outstanding Monthly Advances pursuant to Section 5.3 and the Servicing Fee
for such Distribution Date (including any unpaid Servicing Fees for prior
Distribution Dates).
"Servicing Agreement" means the Servicing Agreement, dated May
9, 1997, as amended and restated as of September 15, 1997, and as such agreement
may be further amended, among the Sellers, CFHI, CFAC and the Servicer, a copy
of which is attached hereto as Exhibit D.
"Servicing Fee" with regard to a Collection Period means the
fee payable to the Servicer for services rendered during such Collection Period,
determined pursuant to Section 4.7.
"Servicing Fee Rate" means .50%.
"Servicing Officer" means any officer of the Servicer involved
in, or responsible for, the administration and servicing of Receivables whose
name appears on a list of servicing officers appearing in an Officers'
Certificate furnished to the Issuer by the Servicer, as the same may be amended
from time to time.
"Settlement Date" means, with respect to any Collection
Period, the last day of the Collection Period immediately
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preceding such Collection Period, and with respect to any Distribution Date, the
last day of the second Collection Period preceding the Collection Period in
which such Distribution Date occurs.
"Simple Interest Method" means the method of allocating a
fixed level payment to principal and interest, pursuant to which the portion of
such payment that is allocated to interest is equal to the product of the fixed
rate of interest multiplied by the unpaid principal balance multiplied by the
period of time elapsed since the preceding payment of interest was made and the
remainder of such payment is allocable to principal.
"Simple Interest Receivable" means any Receivable under which
the portion of a payment allocable to interest and the portion allocable to
principal is determined in accordance with the Simple Interest Method.
"Soldiers' and Sailors' Civil Relief Act" means the Soldiers'
and Sailors' Civil Relief Act of 1940, as amended.
"Specified Reserve Account Balance" means for each
Distribution Date an amount equal to 2.00% (except as described in the following
sentence) of the Pool Balance as of the related Settlement Date with respect to
such Distribution Date, but in any event not less than the lesser of (i)
$8,973,952.86 and (ii) such Pool Balance. Notwithstanding the foregoing, if for
any Distribution Date (commencing with the Distribution Date in December 1997)
(x) the Average Net Loss Ratio exceeds 1.75% or (y) the Average Delinquency
Percentage exceeds 2%, then the Specified Reserve Account Balance shall be 3%;
provided, that, the Specified Reserve Account Balance will revert back to the
amounts specified in the first sentence above if, for any three consecutive
Distribution Dates, clauses (x) and (y) above are not triggered. Upon written
notification to the Indenture Trustee by the Sellers, the Specified Reserve
Account Balance may be reduced to a lesser amount as determined by the Sellers,
so long as such reduction satisfies the Rating Agency Condition.
"Standard & Poor's" means Standard & Poor's Ratings Services,
and its successors and assigns.
"Treasury Entitlement" means a "Security Entitlement"
as defined in 31 C.F.R. Section 357.2.
"Treasury Regulations" means the treasury regulations
promulgated under the Code.
"Trust Accounts" means, collectively, the Certificate
Distribution Account, the Collection Account, the Note
Distribution Account, the Paid-Ahead Account and the Reserve Account.
"Trust Agreement" means the Amended and Restated Trust
Agreement dated as of September 1, 1997, among the Sellers and
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the Owner Trustee, as the same may be amended and supplemented from time to
time.
"Trust Estate" means all money, instruments, rights and other
property that are subject or intended to be subject to the lien and security
interest of the Indenture for the benefit of the Noteholders (including all
property and interests Granted to the Indenture Trustee), including all proceeds
thereof and the Reserve Account.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939 as in force on the date hereof, unless otherwise specifically provided.
"Trustees" means, collectively, the Indenture Trustee
and the Owner Trustee.
"United States Securities Entitlement" means a Treasury
Entitlement, a HUD Entitlement, a FHLBank Entitlement, a Funding
Corporation Entitlement, a Farm Credit Entitlement or a Sallie Mae Entitlement.
"Used Financed Vehicle" means a Financed Vehicle the model
year of which is earlier than the year of origination of the related Receivable.
SECTION 1.2. Usage of Terms. With respect to all terms in this
Agreement, the singular includes the plural and the plural the singular; words
importing any gender include the other gender; references to "writing" include
printing, typing, lithography, and other means of reproducing words in a visible
form; references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Agreement; references to
Persons include their permitted successors and assigns; and the term "including"
means "including without limitation." All references herein to Articles,
Sections, Subsections and Exhibits are references to Articles, Sections,
Subsections and Exhibits contained in or attached to this Agreement unless
otherwise specified, and each such Exhibit is part of the terms of this
Agreement.
SECTION 1.3. Methods of Allocating Payments on Receivables;
Allocations. All allocations of payments to principal and interest and
determinations of periodic charges and the like on the Simple Interest
Receivables shall be based on a year with the actual number of days in such year
and twelve months with the actual number of days in each such month. Allocations
of payments to principal and interest on the Precomputed Receivables shall be
based on the related add-on financed charge and related precomputed scheduled
payment calculated in accordance with the Precomputed Method set forth in the
related Receivable.
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Each payment on a Receivable shall be applied in the manner
described in Section 6.15 of the Servicing Agreement; provided, however, that
the Servicer shall apply any Net Liquidation Proceeds on any Liquidated
Receivable to pay Accrued Interest on such Receivable and then to reduce
the Actual Principal Balance of such Receivable before applying any such
amounts to any Excluded Forced-Placed Insurance Premiums or any other amounts
outstanding with respect to such Receivable.
ARTICLE II
CONVEYANCE OF RECEIVABLES
SECTION 2.1. Conveyance of Receivables. In consideration of
the Issuer's delivery of the Notes and the Certificates to and upon the order of
the Sellers (allocated between the Sellers in accordance with Schedule C
hereto), each Seller does hereby sell, transfer, assign, and otherwise convey to
the Issuer, without recourse (subject to each Seller's obligations herein):
(i) all right, title, and interest of such Seller
in, to and under the Chase USA Receivables listed in Schedule
A-1 hereto (in the case of Chase USA) and in, to and under the
Chase Receivables listed in Schedule A-2 hereto (in the case
of Chase), all proceeds thereof and (A) in the case of any
Simple Interest Receivables conveyed by it, all amounts and
monies received thereon on and after the Cutoff Date and (B)
in the case of any Precomputed Receivables conveyed by it, all
amounts and monies due thereon on and after the Cutoff Date
and any Deferred Paid-Ahead Amounts with respect thereto
(including in the case of such Seller proceeds of the
repurchase by such Seller of the related Receivables pursuant
to Section 3.2 or the purchase of Receivables by the Servicer
pursuant to Section 4.6 or 9.1), together with the interest
of such Seller in the security interests in the Financed
Vehicles granted by the Obligors pursuant to the Receivables
and in any repossessed Financed Vehicles;
(ii) all right, title and interest of such Seller
in any Net Liquidation Proceeds and in any Insurance
Policies;
(iii) all right, title and interest of such Seller
in any proceeds from Dealer repurchase obligations
relating to the Receivables; and
(iv) all proceeds (as defined in the Relevant UCC)
of the foregoing.
In connection with such sale, each Seller agrees to record and
file, at its own expense, financing statements with respect to the Receivables
conveyed by it for the sale of
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accounts and chattel paper meeting the requirements of applicable state law in
such manner and in such jurisdictions as are necessary to perfect the sale and
assignment of such Receivables to the Issuer. The Sellers shall deliver (or
cause to be delivered) to the Owner Trustee, with copies to the Servicer, filed
stamped copies of, or filing receipts for, any such financing statements.
It is the intention of each Seller and the Issuer that the
assignment and transfer herein contemplated constitute a sale of the
Receivables, conveying good title thereto free and clear of any liens and
encumbrances, from such Seller to the Issuer and that the Receivables conveyed
by it not be part of such Seller's estate in the event of an insolvency. In the
event that such conveyance is deemed to be a pledge to secure a loan, each
Seller hereby grants to the Issuer a first priority perfected security interest
in all of such Seller's right, title and interest in, to and under the items of
property listed in clauses (i) through (iii) above, and in all proceeds (as
defined in the Relevant UCC) of the foregoing, to secure the loan deemed to be
made in connection with such pledge and, in such event, this Agreement shall
constitute a security agreement under applicable law.
SECTION 2.2. Closing. The conveyance of the Receivables shall
take place at the offices of Orrick, Herrington & Sutcliffe LLP, 666 Fifth
Avenue, New York, New York on the Closing Date, simultaneously with the closing
of the transactions contemplated by the underwriting agreements related to the
Notes and the Certificates and the other Basic Documents. Upon the acceptance by
the Sellers of the Notes and the Certificates, the ownership of each Receivable
and the contents of the related Receivable File will be vested in the Issuer,
subject only to the lien of the Indenture.
ARTICLE III
THE RECEIVABLES
SECTION 3.1. Representations and Warranties of the Sellers;
Conditions Relating to the Receivables.
(a) Each Seller makes the following representations and
warranties as to the Receivables conveyed by it, on which (i) the Issuer shall
rely in acquiring such Receivables and (ii) the Servicer shall rely in acquiring
any Repurchased Receivables. Such representations and warranties shall speak as
of the Cutoff Date unless otherwise specified, but shall survive the sale,
transfer, and assignment of the Receivables to the Issuer and the pledge thereof
to the Indenture Trustee pursuant to the Indenture.
(i) Schedule of Receivables. The information set
forth in Schedules A-1 and A-2 hereto is true and
correct in all material respects, and the Receivables
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consist of all receivables owned by such Seller which meet the
selection criteria specified herein.
(ii) Good Title. Immediately prior to the transfer
and assignment of the Receivables conveyed by it to the Issuer
herein contemplated, such Seller had good and marketable title
to each such Receivable free and clear of all Liens and rights
of others; and, immediately upon the transfer thereof, the
Issuer has either (i) good and marketable title to each such
Receivable, free and clear of all Liens and rights of others,
other than the Lien of the Indenture Trustee under the
Indenture, and the transfer has been perfected under
applicable law or (ii) a first priority perfected security
interest in each such Receivable and the proceeds thereof.
(b) Each Receivable conveyed by such Seller hereunder
satisfies the following conditions on the Cutoff Date unless otherwise
specified, on which (i) the Issuer shall rely in acquiring such Receivables and
(ii) the Servicer shall rely in acquiring any Repurchased Receivables, and such
conditions shall survive the sale, transfer and assignment of the Receivables to
the Issuer and the pledge thereof to the Indenture Trustee pursuant to the
Indenture.
(i) Origination. Each such Receivable (A) was
originated by a Dealer and acquired by an Originating Entity from such
Dealer in the ordinary course of business, (B) was originated by an
Originating Entity directly or (C) was a Bulk Purchase Receivable, and
in each case was originated in one of the states of the United States
(or the District of Columbia);
(ii) Security. Each such Receivable is secured by
a Financed Vehicle;
(iii) Direct or Indirect Receivable. Each such
Receivable was originated (A) in the form of a retail installment sales
contract with a Dealer or a purchase money loan from an Originating
Entity through a Dealer located in one of the states of the United
States (or the District of Columbia) or (B) without the involvement of
a Dealer for the financing of a Financed Vehicle, and in each case was
fully and properly executed by the parties thereto;
(iv) Valid Transfer. (A) In the case of any such
Receivable originated with the involvement of a Dealer, if in the form
of a retail installment sales contract, such Receivable was purchased
by an Originating Entity from the originating Dealer and was validly
assigned by such Dealer to such Originating Entity and (B) in the case
of a Chase Financial Receivable, such Receivable was purchased by Chase
USA from CFAC or CFHI, and was validly assigned by CFAC or
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CFHI, as applicable, to Chase USA pursuant to the Purchase and Sale
Agreement;
(v) No Waivers. No provision of any such
Receivable has been waived, altered or modified in any
respect, except by instruments or documents contained in the
related Receivables File;
(vi) Binding Obligation. Each such Receivable is a
legal, valid and binding obligation of the related Obligor and is
enforceable in accordance with its terms subject to applicable
bankruptcy, insolvency, reorganization, liquidation and other similar
laws and equitable principles relating to or affecting the enforcement
of creditors' rights;
(vii) No Defenses. As of the Cutoff Date, such
Seller had no knowledge of any facts which would give rise
to any right of rescission, setoff, counterclaim or defense
or of the same being asserted or threatened with respect to
any such Receivable;
(viii) Insurance. The Obligor on each such
Receivable is required to maintain physical damage insurance
covering the related Financed Vehicle in accordance with its
terms;
(ix) Lawful Assignment. No such Receivable was
originated in or is subject to the laws of any jurisdiction whose laws
would prohibit (A) the transfer of such Receivable to the Issuer
pursuant to this Agreement, (B) the ownership of such Receivable by the
Issuer or (C) the pledge by the Issuer of such Receivable to the
Indenture Trustee;
(x) Compliance with Law. Each such Receivable
complies with all requirements of applicable federal, state
and local laws and regulations in all material respects;
(xi) Receivable in Force. No such Receivable has
been satisfied, subordinated in whole or in part or rescinded, and no
Financed Vehicle has been released from the security interest of such
Receivable in whole or in part;
(xii) Valid Security Interest. Each such Receivable
creates a valid and enforceable first priority security interest in
favor of the related Originating Entity in the Financed Vehicle covered
thereby, such security interest is assignable by the related
Originating Entity to such Seller and by such Seller to the Issuer, and
all necessary action with respect to such Receivable has been taken to
perfect the security interest in the related Financed Vehicle in favor
of the related Originating Entity;
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(xiii) Capacities of Parties. All parties to each
such Receivable had capacity to execute such Receivable;
(xiv) [Reserved];
(xv) No Defaults. As of the Cutoff Date, such Seller
had no knowledge that a default, breach, violation or event permitting
acceleration under any such Receivable existed; such Seller had no
knowledge that an event which with notice and the expiration of any
grace or cure period would constitute a default, breach, violation or
event permitting acceleration under such Receivable existed (except for
payment delinquencies permitted as described herein), and such Seller
has not waived any of the foregoing (except for payment delinquencies
permitted);
(xvi) No Liens. As of the Cutoff Date, such Seller
had no knowledge of any Liens or claims which have been filed for work,
labor or materials affecting a Financed Vehicle securing any such
Receivable, which are or may be liens prior to or equal or coordinate
with the security interest of such Receivable;
(xvii) Equal Installments. Each such Receivable is
a fully amortizing loan with interest at the stated Contract
Rate, provides for level payments over the term of such
Receivable and is either a Simple Interest Receivable or a
Precomputed Receivable;
(xviii) Enforceability. Each such Receivable contains
customary and enforceable provisions such as to render the rights and
remedies of the holder thereof adequate for realization against the
related collateral (except as may be limited by creditors' rights
generally);
(xix) Obligor Not a Governmental Entity. No
Obligor to any such Receivable is the United States of
America or any state or any agency, department,
instrumentality or political subdivision thereof;
(xx) Obligor Not a Relief Act Obligor. If the
Obligor to any such Receivable is in the military (including an Obligor
who is a member of the National Guard or is in the reserves) and such
Receivable is subject to the Soldiers' and Sailors' Civil Relief Act of
1940, or the Military Reservist Relief Act, such Obligor has not made a
claim to such Seller for a Relief Act Reduction;
(xxi) One Original. There is only one original
executed copy of each such Receivable, which, prior to the
execution of this Agreement, was delivered to the Servicer
on behalf of the Issuer;
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(xxii) Receivable is Chattel Paper. Each such
Receivable is "chattel paper" as defined in the New York and
Ohio Uniform Commercial Codes;
(xxiii) Obligor Not Subject to Bankruptcy
Proceedings. No Obligor of any such Receivable has been
identified on the computer files of such Seller as being in
bankruptcy proceedings as of the Cutoff Date;
(xxiv) No Overdue Payments. Each such Receivable
had no payment that was more than 60 days past due as of the
Cutoff Date;
(xxv) No Repossessions. Each such Receivable was
secured by a Financed Vehicle that, on the Cutoff Date, had
not been repossessed without reinstatement of such
Receivable; and
(xxvi) Maturity of Receivables. Each such
Receivable had a remaining maturity of not less than one
month nor greater than 236 months.
SECTION 3.2. Repurchase Upon Breach or Failure of a Condition.
Each Seller, the Servicer, the Indenture Trustee or the Owner Trustee, as the
case may be, shall inform the other parties in writing, upon the discovery by
such Seller, the Servicer or an Authorized Officer of the Indenture Trustee or
the Owner Trustee of either any breach of a Seller's representations and
warranties set forth in Section 3.1(a) or the failure of any Receivable to
satisfy any of the conditions set forth in Section 3.1(b) which materially
adversely affects the Holders' interest in the related Receivable. Unless the
breach or failed condition shall have been cured by the last day of the
Collection Period following the Collection Period in which such discovery
occurred (or, at the related Seller's option, the last day of the Collection
Period in which such discovery occurred or in which the related Seller received
notice of such breach) the Seller who conveyed such Receivable to the Issuer
shall repurchase such Receivable (together with any Deferred Paid-Ahead Amounts
thereon) the Holders' interest in which was materially adversely affected by the
breach or failed condition, as of such last day. In consideration of the
repurchase of a Receivable, any such Seller shall remit the Repurchase Amount of
such Receivable on the Deposit Date next succeeding such last day in the
manner specified in Section 5.4. The sole remedy of the Issuer, the Indenture
Trustee or the Holders with respect either to a breach of any Seller's
representations and warranties set forth in Section 3.1(a) or to a failure of
any of the conditions set forth in Section 3.1(b) shall be to require such
Seller to repurchase Receivables pursuant to this Section 3.2. The obligation of
the Sellers to repurchase under this Section 3.2 shall not be dependent upon the
actual knowledge of the related Seller of any
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breached representation or warranty. The Owner Trustee shall have no duty to
conduct any affirmative investigation as to the occurrence of any condition
requiring the repurchase of any Receivable pursuant to this Section 3.2 or the
eligibility of any Receivable for purposes of this Agreement. For administrative
convenience, if Chase is obligated pursuant to this Section 3.2 to repurchase a
Chase Receivable from the Issuer, Chase USA, at its option, may satisfy Chase's
obligation by repurchasing such Receivable upon the same terms as if Chase had
repurchased such Receivable.
SECTION 3.3. Custody of Receivable Files. To assure uniform
quality in servicing the Receivables and to reduce administrative costs, the
Issuer, upon the execution and delivery of this Agreement, agrees to appoint the
Servicer as initial custodian of the following documents or instruments (the
"Receivable Files") which are hereby constructively delivered to the Issuer with
respect to each Receivable:
(i) the original executed Receivable; and
(ii) any and all other documents or records that the
related Seller actually maintained in such file in accordance with its
customary procedures, relating to a Receivable, an Obligor or a
Financed Vehicle.
The Servicer hereby agrees to act as custodian and as agent
for the Issuer hereunder. The Servicer acknowledges that it holds the Receivable
Files actually delivered by the Sellers for the benefit of the Issuer. The
Issuer shall have no responsibility to monitor the Servicer's performance as
custodian and shall have no liability in connection with the Servicer's
performance of such duties hereunder.
SECTION 3.4. Duties of Servicer as Custodian.
(a) Safekeeping. The Servicer, in its capacity as custodian,
shall hold, or shall cause Andrews or another third-party custodian reasonably
acceptable to the Sellers to hold, the Receivable Files on behalf of the Issuer
for the use and benefit of the Issuer and maintain such accurate and complete
accounts, records and computer systems pertaining to the Receivables as shall
enable the Trustees to comply with their obligations pursuant to this Agreement
and the other Basic Documents.
As custodian, the Servicer shall have and perform the
following powers and duties or shall cause Andrews or such other third-party
custodian to:
(i) hold the Receivable Files on behalf of the
Issuer, maintain accurate records pertaining to each Receivable to
enable it to comply with the terms and conditions of this Agreement,
maintain a current inventory thereof, conduct annual physical
inspections of Receivable Files held by it under this Agreement and
certify to the
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Issuer annually that it continues to maintain possession of
such Receivable Files;
(ii) implement policies and procedures in writing
and signed by an appropriate officer of the Servicer, with respect to
persons authorized to have access to the Receivable Files on the
Servicer's or any third-party custodian's premises, and the receipting
for Receivable Files taken from their storage area by an employee of
the Servicer for purposes of servicing or any other purposes; and
(iii) attend to all details in connection with
maintaining custody of the Receivable Files on behalf of the Issuer.
In performing its duties under this Section 3.4, the Servicer
agrees to act with reasonable care, consistent with the same degree of skill and
care that it exercises with respect to similar contracts serviced by it for its
own account, except as otherwise set forth in the next succeeding paragraph. The
Servicer shall promptly report to the Issuer in writing any material failure by
it or any third-party custodian to hold the Receivable Files as herein provided
and shall promptly take appropriate action to remedy any such failure. In acting
as custodian of the Receivable Files, the Servicer agrees further not to assert
any beneficial ownership interests in the Receivables or the Receivable Files.
The Servicer agrees to indemnify the Issuer, the Sellers, the
Certificateholders, the Noteholders, the Owner Trustee and the Indenture Trustee
for any and all liabilities, obligations, losses, damages, payments, costs, or
expense of any kind whatsoever which may be imposed on, incurred by or asserted
against the Issuer, the Sellers, the Certificateholders, the Noteholders, the
Owner Trustee and the Indenture Trustee as the result of any act or omission by
the Servicer relating to the maintenance and custody of the Receivable Files;
provided, however, that the Servicer shall not be liable for any portion of any
such amount resulting from the negligence or willful misconduct of the Issuer,
the Sellers, the Certificateholders, the Noteholders, the Owner Trustee or the
Indenture Trustee.
Any original documents relating to the Receivables held by the
Servicer shall be maintained in fire-proof files, except those documents
held by Andrews or by another third-party custodian which does not offer
fire-proof storage. The Servicer shall exercise reasonable care in handling and
delivering the documents in its files relating to the Receivables. The Servicer
shall maintain the privacy of the Obligors in accordance with all applicable
governmental rules.
The Servicer shall retain the information on its computer
systems relating to the Receivables and other data and records (including,
without limitation, computerized records) relating directly to or maintained in
connection with the servicing of the Receivables at the address of the Servicer,
or upon thirty (30) days' advance notice to the Sellers, the Owner Trustee and
the Indenture Trustee at such other place where the servicing offices of the
Servicer are located and shall be readily separable from the other files or
property of the Servicer.
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(b) Maintenance of and Access to Records. The Servicer, in its
capacity as custodian, agrees to maintain the Receivable Files at its office in
the State of Oklahoma, or at such of its offices, or, at the Servicer's sole
expense, at the offices of Andrews or of any other third-party custodian
reasonably acceptable to the Sellers, as shall from time to time be identified
to the Issuer by written notice. The Servicer, in its capacity as custodian, may
temporarily move individual Receivable Files or any portion thereof without
notice as necessary to conduct collection and other servicing activities in
accordance with its customary practices and procedures, but shall promptly
return such Receivable File as soon as practicable after it is no longer needed
for such purpose.
The Servicer, in its capacity as custodian, shall make
available to either Seller, the Indenture Trustee or the Owner Trustee, or their
respective duly authorized representatives, attorneys or auditors, the
Receivable Files and the related accounts, records and computer systems
maintained by the Servicer at such times during normal business hours as either
Seller, the Indenture Trustee or Owner Trustee shall reasonably instruct which
do not unreasonably interfere with the Servicer's normal operations or customer
or employee relations.
(c) Release of Documents. (i) Upon written instruction from
the Indenture Trustee (or, if the Notes have been paid in full, from the Owner
Trustee), the Servicer shall release any document in the Receivable Files to the
Indenture Trustee or the Owner Trustee, as the case may be, its agent or its
designee at such place or places as such Person may reasonably designate as soon
as reasonably practicable to the extent it does not unreasonably interfere with
the Servicer's normal operations or customer or employee relations. The Servicer
shall not be responsible for any loss occasioned by the failure of the Owner
Trustee or Indenture Trustee, its agent or its designee to return any document
or any delay in doing so.
(ii) The Servicer shall release the Receivables Files
relating to Repurchased Receivables to a Seller or the Servicer, as applicable,
or their respective agents or designees notified to the Servicer in writing,
upon actual knowledge of a Responsible Officer of the Servicer or written
instructions from the Indenture Trustee that the Repurchase Amount or
Optional Purchase Amount has been deposited by such Seller or the Servicer
into the Collection Account, at such place or places as such Person may
reasonably designate as soon as reasonably practicable to the extent it does not
unreasonably interfere with the Servicer's normal operations or customer or
employee relations. The cost of any such release shall be borne by such
Seller or the Servicer, whichever is the purchaser.
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SECTION 3.5. Instructions; Authority to Act. The Servicer
shall be deemed to have received proper instructions with respect to the
Receivable Files upon its receipt of written instructions signed by an
Authorized Officer of the Indenture Trustee (or, if the Notes have been paid in
full, of the Owner Trustee). A certified copy of a by-law or of a resolution of
the Board of Directors of the Owner Trustee or the Indenture Trustee shall
constitute conclusive evidence of the authority of any such Authorized Officer
to act and shall be considered in full force and effect until receipt by the
Servicer of written notice to the contrary given by the Owner Trustee or the
Indenture Trustee.
SECTION 3.6. Effective Period and Termination. The
Servicer's appointment as custodian shall become effective as of the Cutoff Date
and shall continue in full force and effect until terminated pursuant to this
Section 3.6 or until this Agreement shall be terminated. If the Servicer shall
resign as Servicer under Section 7.5 or if all of the rights and obligations of
the Servicer shall have been terminated under Section 8.1, the appointment of
the Servicer as custodian may be terminated by the Indenture Trustee or by the
Noteholders representing not less than a majority of the aggregate Outstanding
Amount of the Notes (or, if there are no Notes outstanding, the
Certificateholders representing not less than a majority of the Certificate
Balance then outstanding), in the same manner as the Indenture Trustee or such
Holders may terminate the rights and obligations of the Servicer under Section
8.1. As soon as practicable after any termination of such appointment pursuant
to Section 7.5, the Servicer shall or shall instruct any third-party custodian
to, at the Servicer's expense, deliver the Receivable Files to the Issuer or the
Issuer's agent at such place or places as the Issuer may reasonably designate.
If the Servicer is terminated pursuant to Section 8.1, the Servicer shall
deliver (or caused to be delivered) the Receivable Files as pursuant to Section
8.1. Notwithstanding the termination of the Servicer as custodian, the Owner
Trustee agrees that upon any such termination, the Issuer shall provide, or
cause its agent to provide, access to the Receivable Files to the Servicer for
the purpose of carrying out its duties and responsibilities with respect to the
servicing of the Receivables hereunder.
ARTICLE IV
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 4.1. Duties of Servicer. (a) The Servicer, as agent
for the Issuer, shall manage, administer, service and make collections on the
Receivables (other than Repurchased Receivables) and perform or cause to be
performed all contractual and customary undertakings of the holder of the
Receivables to the Obligors. The Issuer, at the request of an Authorized
Officer of the Servicer, shall furnish the Servicer with any reasonable
documents or take any action reasonably requested,
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necessary or appropriate to enable the Servicer to carry out its servicing
duties hereunder.
(b) In managing, administering, servicing and making
collections on the Receivables pursuant to this Agreement, the Servicer shall
exercise the same degree of skill and care that the Servicer exercises with
respect to similar receivables serviced by the Servicer for its own account,
except as otherwise specified in Sections 3.1, 3.2 and 6.8 through 6.14
(inclusive) of the Servicing Agreement.
(c) The Servicer may enter into subservicing agreements with
one or more subservicers for the servicing and administration of any or all of
the Receivables. Unless such subservicer has been appointed by CITSF in its
capacity as Servicer and is an Affiliate of CITSF, (i) any such subservicer must
be an Eligible Servicer, and (ii) the appointment of any such subservicer shall
not be made without the prior written consent of the Sellers, which consent
shall not be unreasonably withheld.
References in this Agreement to actions taken, to be taken,
permitted to be taken, or restrictions on actions permitted to be taken, by the
Servicer in servicing the Receivables shall include actions taken, to be taken,
permitted to be taken, or restrictions on actions permitted to be taken, by a
subservicer on behalf of the Servicer. Each subservicing agreement will be upon
such terms and conditions as are not inconsistent with this Agreement and the
Servicing Agreement and the standard of care set forth herein and therein and as
the Servicer and the subservicer have agreed. All compensation payable to a
subservicer under a subservicing agreement shall be payable by the Servicer from
its servicing compensation or otherwise from its own funds, and none of the
Issuer, the Sellers, the Owner Trustee, the Indenture Trustee, the
Certificateholders or the Noteholders will have any liability to the subservicer
with respect thereto.
Notwithstanding any subservicing agreement or any of the
provisions of this Agreement relating to agreements or any arrangements between
the Servicer or a subservicer or any reference to actions taken through such
Persons or otherwise, the Servicer shall remain obligated and liable to the
Issuer, the Sellers, the Owner Trustee, the Indenture Trustee, the
Certificateholders and the Noteholders for the servicing and administering of
the Receivables and the other Trust Estate property in accordance with the
provisions of this Agreement without diminution of such obligation or liability
by virtue of such subservicing agreements.
Any subservicing agreement that may be entered into and any
other transactions or servicing arrangements relating to the Receivables and the
other Trust Estate property involving a subservicer in its capacity as such
shall be deemed to be between the subservicer and the Servicer alone, and the
Owner Trustee,
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the Indenture Trustee, the Certificateholders and the Noteholders shall not be
deemed parties thereto and shall have no claims, rights, obligations, duties or
liabilities with respect to the subservicer except as set forth in the next
succeeding paragraph.
Upon resignation or termination of the Servicer, the
successor Servicer may, with the prior written consent of the Sellers (which
consent may not be unreasonably withheld), thereupon assume all of the rights
and obligations of the outgoing Servicer under any existing subservicing
agreement. In such event, the successor Servicer shall be deemed to have
assumed all of the Servicer's interest therein and to have replaced the
outgoing Servicer as a party to each such subservicing agreement to the same
extent as if such subservicing agreement
had been assigned to the successor Servicer, except that the outgoing Servicer
shall not thereby be relieved of any liability or obligations on the part of the
outgoing Servicer as a party to each such subservicing agreement. The outgoing
Servicer shall, upon request of the Issuer, but at the expense of the outgoing
Servicer, deliver, or cause to be delivered, to the successor Servicer all
documents and records relating to each such subservicing agreement and the
Receivables and other Trust Estate property then being serviced thereunder and
an accounting of amounts collected and held by the subservicer and shall
otherwise use its best efforts to effect the orderly and efficient transfer of
any subservicing agreement to the successor Servicer. In the event that the
successor Servicer elects not to assume a subservicing agreement, the outgoing
Servicer, at its expense, shall cause the subservicer to deliver to the
successor Servicer all documents and records relating to the Receivables and the
other Trust Estate property being serviced thereunder and held by such
subservicer and all amounts held (or thereafter received) by such subservicer
(together with an accounting of such amounts) and shall otherwise use its best
efforts to effect the orderly and efficient transfer of servicing of the
Receivables and the other Trust Estate property being serviced by such
subservicer to the successor Servicer.
(d) The Servicer's duties shall include collection and posting
of all payments, responding to inquiries of Obligors or by federal, state or
local governmental authorities with respect to the Receivables, investigating
delinquencies, reporting federal income tax information to Obligors, monitoring
the collateral in cases of Obligor default and handling the repossession,
foreclosure or other liquidation of Financed Vehicles in appropriate instances,
filing and processing claims under insurance policies in accordance with its
customary practices, accounting for collections, furnishing monthly and annual
statements to the Issuer with respect to distributions, and making Monthly
Advances pursuant to Section 5.3 hereof.
The Servicer shall be authorized and empowered by the Issuer
to execute and deliver, on behalf of itself, the Issuer, the Owner Trustee, the
Indenture Trustee, the Certificateholders, the Noteholders, or any of them, any
and all instruments of
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satisfaction or cancellation, or of partial or full release or discharge, and
all other comparable instruments, with respect to the Receivables or with
respect to the Financed Vehicles.
Upon written request of the Servicer and receipt by the Issuer
of an Officer's Certificate setting forth the facts underlying such request, the
Issuer shall furnish the Servicer with any limited powers of attorney and other
documents necessary or appropriate to enable the Servicer to carry out its
duties hereunder, and the Issuer shall not be held liable for such actions of
the Servicer thereunder.
(e) Notwithstanding anything herein or in the Servicing
Agreement to the contrary, none of the Sellers or the Servicer shall be
obligated to purchase any Insurance Policy on behalf of any Obligor, verify if
any Insurance Policy required under a Receivable is being maintained by any
Obligor or be obligated to pursue remedies under any Receivable or applicable
law as a result of any failure of an Obligor to maintain any such Insurance
Policy.
SECTION 4.2. Collection of Receivable Payments. Subject to
Sections 3.1, 3.2 and 6.8 through 6.14 (inclusive) of the Servicing
Agreement, the Servicer shall make reasonable efforts, consistent with the
customary servicing procedures employed by the Servicer with respect to
Receivables owned or serviced by it, to collect all payments called for under
the terms and provisions of the Receivables as and when the same shall become
due, and in connection therewith shall follow such normal collection practices
and procedures as it follows with respect to comparable new or used recreational
vehicle installment sale contracts and promissory notes that it services for
itself. The Servicer shall not reduce or defer scheduled payments, extend any
Receivable or otherwise modify the terms of any Receivable; provided, however,
that, consistent with its customary servicing procedures but subject to Section
6.10 of the Servicing Agreement, the Servicer may, in its discretion, arrange
with an Obligor to defer, reschedule, extend or modify the payment schedule of
any Receivable for credit related reasons that would be acceptable to the
Servicer with respect to a comparable Receivable secured by a new or used
Recreational Vehicle that it services for itself so long as (i) the maturity of
such Receivable would not extend beyond the Final Scheduled Maturity Date and
(ii) if any such modification constitutes a refinancing, the proceeds of such
refinancing shall be used to pay the related Receivable in full. If, as a result
of deferring, rescheduling or extending of payments or any other modification,
such deferring, rescheduling, extension or modification breaches any of the
terms of the preceding sentence, then the Servicer shall be obligated to
purchase such Receivable pursuant to Section 4.6 hereof on the Deposit Date
immediately following the date on which it became aware or received written
notice from the Indenture Trustee or Owner Trustee of such failure. The Servicer
may, in accordance with its customary standards, policies and procedures, in its
discretion, waive any
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Administrative Fees that may be due or payable under any Receivable.
Notwithstanding anything to the contrary in the Servicing
Agreement, in connection with the settlement by the Servicer of a defaulted
Receivable, the Servicer may forgive a portion of such Receivable, if, in its
discretion, it believes that the acceptance of the settlement proceeds from the
related Obligor would result in the Issuer's receiving a greater amount of
Collections than the Net Liquidation Proceeds that would result from
repossessing and liquidating the related Financed Vehicle.
SECTION 4.3. Realization Upon Receivables. (a) The
Servicer will, consistent with customary servicing procedures and the terms of
this Agreement but subject to the terms of Sections 3.1 and 6.9 through 6.14
(inclusive) of the Servicing Agreement, act with respect to the Receivables in
such manner as it reasonably believes will maximize the receipt of principal and
interest on the Receivables and Net Liquidation Proceeds in respect of defaulted
Receivables; provided, however, that the Servicer shall not be obligated to take
any such action if the Servicer would thereby be required to incur Liquidation
Expenses in excess of the amounts set forth in Section 8.3 of the Servicing
Agreement and CFMC shall have failed to give its written consent to such
incurrence.
In the event that title to any Financed Vehicle is acquired in
foreclosure or by conveyance in lieu of foreclosure, the deed or certificate of
sale shall be issued to the Issuer, or, at its election, to its nominee on
behalf of the Issuer.
(b) The Servicer shall only be entitled to recover Liquidation
Expenses relating to a defaulted Receivable to the extent described in Section
8.3 of the Servicing Agreement. The Net Liquidation Proceeds realized in
connection with any such liquidation with respect to a defaulted Receivable
shall be deposited by the Servicer in the Collection Account in the manner
specified in Section 5.2 hereof. The foregoing shall be subject
to the provision that, in any case in which the Financed Vehicle shall have
suffered damage, the Servicer shall not expend funds in connection with the
repair or the repossession of such Financed Vehicle unless it shall determine in
its sole discretion that such repair and/or repossession will increase the Net
Liquidation Proceeds of the related Receivable.
(c) Subject to Section 6.13 of the Servicing Agreement, the
Servicer may sue to enforce or collect upon Receivables, including foreclosure
of any security interest in a Financed Vehicle, in its own name, if possible, or
as agent for
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the Issuer. If the Servicer elects to commence a legal proceeding to enforce a
Receivable or any insurance policy in respect thereof, the act of commencement
shall be deemed to be an automatic assignment of the Receivable to the Servicer
for purposes of collection only. If, however, in any enforcement suit or legal
proceeding it is held that the Servicer may not enforce a Receivable on the
ground that it is not a real party in interest or a holder entitled to enforce
the Receivable, the Issuer shall take such steps as the Servicer deems necessary
to enforce the Receivable, including bringing suit in its name or the names of
the Holders.
(d) The Servicer may grant to the Obligor on any Receivable
any rebate, refund or adjustment out of the Collection Account that the Servicer
in good faith believes is required because of a principal prepayment or a
principal prepayment of the entire Principal Balance of a Receivable in full.
The Servicer will not permit any rescission or cancellation of any Receivable,
except to the extent required by law or as set forth in this Agreement.
(e) The Servicer may enforce any due-on-sale clause in a
Receivable if such enforcement is called for under its then current servicing
policies for obligations similar to the Receivables, provided that such
enforcement is permitted by applicable law and will not adversely affect any
applicable insurance policy.
SECTION 4.4. Maintenance of Security Interests in Financed
Vehicles. (a) The Servicer shall take all actions that are necessary or
desirable to maintain continuous perfection and priority of the security
interest created by each Receivable in the related Financed Vehicle in favor of
the related Originating Entity, including, but not limited to, the notation on
certificates of title and the recording, filing and refiling of all financing
statements, continuation statements or other instruments. In addition, if the
Servicer discovers any deficiency in the priority or perfection of any such
security interest in a Financed Vehicle or any other defect in the documents
constituting a part of any Receivable which deficiency or defect can be
corrected, the Servicer shall use its best efforts to correct such deficiency or
defect.
(b) In the event that the assignment of the Receivable to the
Issuer is insufficient, without a notation on the related Financed Vehicle's
certificate of title, to grant to the Issuer a perfected security interest in
the related Financed Vehicle, the Sellers hereby agree to serve as the Issuer's
agent for the purpose of perfecting the security interest in such Financed
Vehicle and that the related Seller's listing as the secured party on the
certificate of title is in the capacity as agent of the Issuer.
(c) If the Servicer is unable to foreclose upon a Financed
Vehicle because the title document for such Financed
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Vehicle does not show the Issuer as the lienholder, the related Seller shall, at
its expense, take all necessary steps to apply for a replacement title document
showing the Issuer as the secured party.
(d) In order to facilitate the Servicer's actions, as
described in Section 4.4(b) hereof, each Seller will provide the Servicer with
any necessary power of attorney permitting it to retitle the Financed Vehicle
related to one of its Receivables. Each Seller hereby appoints the Issuer
(acting through the Owner Trustee or the Servicer) its attorney-in-fact to
endorse, as appropriate, the certificate of title relating to any Financed
Vehicle in order to cause a change in the registration of legal owner of the
Financed Vehicle to the Issuer at such time as such certificate of title is
endorsed and delivered to the Department of Motor Vehicles of the State of
California (or any other state department of motor vehicles) with appropriate
fees. Each Seller will provide the Issuer with any necessary power of attorney
for such purpose.
(e) If the Servicer is unable to retitle the Financed Vehicle,
in the event that the Servicer seeks to foreclose on a Financed Vehicle, then
each Seller, at its expense, will take all actions necessary to act with the
Servicer, to the extent permitted by law, to foreclose upon the Financed
Vehicle, including, as appropriate, the filing of any UCC-1 or UCC-2 financing
statements necessary to perfect the security interest in any Financed Vehicle.
SECTION 4.5. Covenants of Servicer. The Servicer hereby
makes the following covenants on which the Issuer shall rely in accepting the
Receivables:
(i) Security Interest to Remain in Force. The
Servicer shall not release a Financed Vehicle securing a Receivable
from the security interest granted by the Receivable except as
contemplated herein or in Section 6.8 of the Servicing Agreement, or as
required by the terms of such Receivable or applicable law;
(ii) No Impairment. The Servicer shall not impair
the rights of the Issuer in the Receivables or take any action
inconsistent with the Issuer's ownership of the Receivables, except
as expressly provided herein;
(iii) Amendments. The Servicer shall not increase the
number of payments under a Receivable, nor increase the principal
amount of such Receivable which is used to finance the purchase price
of the related Financed Vehicles, nor extend or forgive payments on a
Receivable, except as provided in Section 4.2 hereof and Sections 6.10
and 6.11 of the Servicing Agreement; and
(iv) Claims under Insurance Policies. Subject to
Section 4.1(e) herein, the Servicer shall file and process
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claims under any Insurance Policy covering a Receivable if the failure
to so file and process would impair the protection or benefit to be
afforded by such insurance policies.
SECTION 4.6. Purchase of Receivables Upon Breach. Each Seller,
the Servicer, the Indenture Trustee or the Owner Trustee, as the case may be,
shall inform the other parties promptly, in writing, upon the discovery by such
Seller, the Servicer or an Authorized Officer of the Indenture Trustee or the
Owner Trustee, as the case may be, of any breach by the Servicer of its
covenants under Sections 4.2 or 4.5 which materially adversely affects the
interest of the Holders in any Receivable (for this purpose, any breach of the
covenant set forth in Section 4.5(iii) shall be deemed to materially adversely
affect the interest of the Holders in a Receivable). Except as otherwise
specified in Section 4.2, unless the breach shall have been cured by the last
day of the Collection Period following the Collection Period in which such
discovery occurred, the Servicer shall purchase any Receivable (together with
any Deferred Paid-Ahead Amounts thereon) materially adversely affected by such
breach as of such last day. In consideration of the purchase of such Receivable,
the Servicer shall remit the Repurchase Amount on the Deposit Date next
succeeding such last day in the manner specified in Section 5.4. The sole
remedy of the Issuer, the Sellers, the Owner Trustee, the Indenture Trustee
or the Holders against the Servicer with respect to a breach pursuant to
Section 4.2 or 4.5 shall be to require the Servicer to purchase Receivables
pursuant to this Section 4.6. The Owner Trustee shall have no duty to conduct
any affirmative investigation as to the occurrence of any condition requiring
the repurchase of any Receivable pursuant to this Section 4.6 or the
eligibility of any Receivable for purposes of this Agreement.
SECTION 4.7. Servicing Fee. The Servicing Fee for a Collection
Period shall be payable on the related Distribution Date pursuant to Section 5.5
and shall equal the sum of (i) one-twelfth of the product of the Servicing Fee
Rate and the Pool Balance as of the related Settlement Date and (ii) any
Administrative Fees paid by the Obligors during the related Collection Period.
The Servicer shall be required to pay from its own account all
expenses incurred by it in connection with its activities hereunder (including
fees and disbursements of independent accountants and auditors, taxes imposed on
the Servicer and not indemnified pursuant to Section 6.2, and other costs
incurred in connection with administering and servicing the Receivables which
are not reimbursable hereunder or under the Servicing Agreement), the annual
fees as set forth in Schedule D hereto and those customary and reasonable
disbursements approved by the Servicer of the Administrators, the Owner
Trustee, the Indenture Trustee, the Paying Agent (including in its capacity
as) the Authenticating Agent, the Note Registrar and the Certificate
Registrar). The Servicer shall not be required to
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pay any United States federal, state and local income and franchise taxes, if
any, imposed on the Issuer or any Holder or any expenses in connection with
realizing upon Receivables under Section 4.3.
SECTION 4.8. Monthly Report. On or before each Determination
Date, the Servicer shall furnish a report (the "Monthly Report"), which shall be
in substantially the form of Exhibit B hereto (with such additional information
as the Servicer shall elect to include therein), to the Owner Trustee, the
Indenture Trustee, any Paying Agent (under the Indenture and the Trust
Agreement), the Sellers and the Rating Agencies. The determination by the
Servicer of the amount of the distributions to be made pursuant to Section 5.5
hereof shall, in the absence of obvious error, be presumptively deemed to be
correct for all purposes hereunder, and the Trustees and any Paying Agent shall
be protected in relying upon the same without any independent check or
verification. The Servicer shall also specify in the Monthly Report each
Receivable which a Seller or the Servicer is required to repurchase or purchase,
as applicable as of the last day of the related Collection Period and each
Receivable which the Servicer shall have determined to be a Liquidated
Receivable during such Collection Period. The Trustees and any Paying Agent
shall not be required to recompute, verify or recalculate information contained
in the Monthly Report.
Each Monthly Report shall be accompanied by a certificate of a
Servicing Officer substantially in the form of Exhibit A hereto, certifying the
accuracy of the Monthly Report and that no Event of Servicing Termination or
event that with notice or lapse of time or both would become an Event of
Servicing Termination has occurred, or if such event has occurred and is
continuing, specifying the event and its status.
In addition, the Servicer shall, on request of a Trustee,
furnish such Person such reasonably pertinent underlying data on the Receivables
as can be generated by the Servicer's existing data processing system without
undue modification or expense.
SECTION 4.9. Annual Statement as to Compliance. (a) The
Servicer shall deliver to the Trustees and the Sellers within 90 days after
the end of each calendar year commencing March 31, 1998, a certificate signed by
a Responsible Officer of the Servicer, stating that (i) a review of the
activities of the Servicer during the preceding calendar year of its performance
under this Agreement has been made under such officer's supervision and (ii) to
the best of such officer's knowledge, based on such review, the Servicer has
fulfilled all its obligations under this Agreement throughout such preceding
calendar year, or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer and the nature
and status thereof.
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(b) The Servicer shall deliver to the Trustees and the
Sellers, promptly after having obtained knowledge thereof, a certificate of a
Responsible Officer of the Servicer specifying any event which with the giving
of notice or lapse of time, or both, would become an Event of Servicing
Termination.
SECTION 4.10. Annual Report of Accountants. On or before
March 31 of each year, commencing March 31, 1998, the Servicer, at its expense,
shall cause a firm of independent public accountants which is a member of the
American Institute of Certified Public Accountants to furnish a statement which
opines on, at a minimum, the Servicer's compliance with the minimum servicing
standards set forth in the Uniform Single Attestation Program for Mortgage
Bankers (in accordance with the 1995 revisions thereto). Such examination and
report of independent public accountants will be prepared in accordance with the
requirements set forth in the Uniform Single Attestation Program for Mortgage
Bankers (in accordance with the 1995 revisions thereto). Copies of the annual
statement of accountants shall also be provided to the Sellers, the Rating
Agencies and the Trustees.
SECTION 4.11. Access by Holders to Certain Documentation and
Information Regarding Receivables. The Servicer shall provide to the Holders
access to the Receivable Files in such cases where the Holders shall be required
by applicable statutes or regulations to have access to such documentation.
Access by the Holders shall be afforded without charge, but only upon reasonable
request and during normal business hours which does not unreasonably interfere
with the Servicer's normal operations or customer or employee relations. Nothing
in this Section 4.11 shall affect the obligation of the Servicer to observe any
applicable law prohibiting disclosure of information regarding the Obligors, and
the failure of the Servicer to provide access to information as a result of such
obligation shall not constitute a breach of this Section 4.11.
SECTION 4.12. Reports to Holders and the Rating Agencies. (a)
The Indenture Trustee or the Owner Trustee, as applicable, shall provide to any
Holder who so requests in writing (addressed to the Corporate Trust Office of
such Trustee) a copy of any Servicer's Certificate described in Section 4.8, of
the annual statement described in Section 4.9, or of the annual report described
in Section 4.10. The Indenture Trustee or the Owner Trustee, as applicable, may
require the Holder to pay a reasonable sum to cover the cost of the Indenture
Trustee's or the Owner Trustee's complying with such request, as applicable.
The Indenture Trustee or the Owner Trustee, as applicable,
shall forward to the Rating Agencies the statement to Holders described in
Section 5.8 and any other reports it may receive pursuant to this Agreement to
(i) Standard & Poor's Ratings Services, Asset-Backed Surveillance Group, 25
Broadway, New York, New York 10004, (ii) Moody's Investors Service, ABS
Monitoring Dept., 99 Church Street, 4th Floor, New York, New York
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10007 and (iii) to Duff & Phelps Credit Rating Company, 17 State Street, 12th
Floor, New York, New York.
SECTION 4.13. Reports to the Securities and Exchange
Commission. The Issuer shall file or cause to be filed with the Commission any
periodic reports required to be filed under the provisions of the Exchange Act
and the rules and regulations of the Securities and Exchange Commission
thereunder.
SECTION 4.14. Maintenance of Fidelity Bond. The Servicer
shall, at its own cost and expense, during the term of its service as Servicer
maintain in force a fidelity bond in respect of its officers and employees. Such
fidelity bond shall protect against losses, including forgery, theft,
embezzlement and fraud and shall have such deductibles and be in such form and
amount as is generally customary among Persons which service a portfolio of
recreational vehicle installment sale contracts having an aggregate principal
amount of $100,000,000 or more and which are generally regarded as servicers
acceptable to institutional investors, but in no case shall such fidelity bond
be less than $5,000,000. Regardless of any provisions contained in this
Agreement which require the Servicer to maintain fidelity bond coverage, the
Servicer shall not be relieved of and from its accountability and responsibility
to the Issuer, the Sellers, the Holders and the Trustees for the proper
performance under this Agreement of the duties and obligations to be performed
hereunder by the Servicer.
SECTION 4.15. Satisfaction of Receivable. Upon payment in full
on any Receivable, the Servicer is authorized to execute an instrument in
satisfaction of such Receivable and to do such other acts and execute such other
documents as the Servicer deems necessary to discharge the Obligor thereunder
and eliminate the security interest in the Financed Vehicle related thereto. The
Servicer shall determine when a Receivable has been paid in full. The Servicer
shall process normal payoffs of Receivables by quoting amounts due, accepting
payoff amounts, stamping the original contracts relating to such Receivables
"Paid" and returning them to Obligors, and releasing liens as required. To the
extent that insufficient payments are received on a Receivable credited by the
Servicer as prepaid or paid in full and satisfied, the shortfall shall be paid
by the Servicer out of its own funds.
ARTICLE V
ACCOUNTS; DISTRIBUTIONS;
STATEMENTS TO NOTEHOLDERS AND THE CERTIFICATEHOLDERS
SECTION 5.1. Establishment of Accounts. (a) The Sellers shall
establish and maintain:
(i) For the benefit of the Noteholders and the
Certificateholders, in the name of the Indenture
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Trustee, an Eligible Deposit Account for the deposit of
Collections (the "Collection Account") bearing a designation
clearly indicating that the funds deposited therein are held
for the benefit of the Noteholders and the Certificateholders.
(ii) For the benefit of the Noteholders, in the name
of the Indenture Trustee, an Eligible Deposit Account for the
deposit of distributions to the Noteholders (the "Note
Distribution Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the
benefit of the Noteholders.
(iii) For the benefit of the Noteholders and the
Certificateholders, in the name of the Indenture Trustee, an
Eligible Account for deposit of Paid-Ahead Amounts (the
"Paid-Ahead Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the
benefit of the Noteholders and the Certificateholders.
Each Account shall be an Eligible Deposit Account established
initially at Chase.
(b) Should any depositary of an Account or of the Certificate
Distribution Account (including Chase (or an Affiliate thereof)) cease to be
either a Qualified Institution or a Qualified Trust Institution, as applicable,
then the Sellers shall cause the related Account to be moved to a Qualified
Institution or a Qualified Trust Institution, unless the Rating Agency Condition
is satisfied in connection with such depositary's ceasing to be a Qualified
Institution or a Qualified Trust Institution, as the case may be.
All amounts held in the Collection Account and the Paid-Ahead
Account shall be invested by the bank or trust company then maintaining the
account (at the written direction of the Sellers) in Permitted Investments that
mature not later than the Deposit Date next succeeding the date of investment
except, if the Collection Account or the Paid-Ahead Account is maintained with
the Indenture Trustee for investments on which the Indenture Trustee is the
obligor (including repurchase agreements on which the Indenture Trustee, in its
commercial capacity, is liable as principal), such investments may mature on the
next succeeding Distribution Date; provided, however, that once such amounts
have been invested by such bank or trust company, as applicable, in Permitted
Investments, such Permitted Investments must be held or maintained until they
mature on or before the dates described above. Amounts on deposit in the Note
Distribution Account shall not be invested. Investment Earnings on the
Collection Account and Paid-Ahead Account shall be paid to the Sellers in
accordance with their respective Deposit Allocation Percentages.
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(c) The Indenture Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Accounts and in all
proceeds thereof (excluding Investment Earnings) and all such funds,
investments, proceeds and income shall be part of the Owner Trust Estate. Except
as otherwise provided herein, the Accounts shall be under the sole dominion and
control of Indenture Trustee for the benefit of the Noteholders and the
Certificateholders, or the Noteholders, as the case may be.
Section 5.2. Collections; Applications.
(a) Deposits to the Collection Account and the Paid-Ahead
Account. Subject to Sections 5.2(b) and (c) hereof, the Servicer shall deposit
in the Collection Account, no later than two Business Days after the Closing
Date, any amounts representing payments received on the Receivables on or after
the Cutoff Date through and including the Closing Date (other than Paid-Ahead
Amounts). Subject to Sections 5.2(b) and (c) hereof, the Servicer shall deposit
in the Collection Account as promptly as practicable (not later than the second
Business Day) following the receipt thereof by the Servicer, all amounts
received in respect of the Receivables, including all loan payments from
Obligors, Net Liquidation Proceeds and insurance proceeds (other than Paid-Ahead
Amounts). Subject to Sections 5.2(b) and (c), the Servicer shall deposit in the
Paid-Ahead Account as promptly as practicable (not later than the second
Business Day) following the receipt thereof by the Servicer, all Paid-Ahead
Amounts received in respect of the Receivables. Subject to Section
5.2(b), the Servicer shall deposit $561,500.57, the aggregate amount of Deferred
Paid-Ahead Amounts with respect to the Receivables as of the Cutoff
Date, in to the Paid-Ahead Account.
(b) Monthly Deposits to Collection Account; Deposits to
Paid-Ahead Account other than Daily. Notwithstanding anything in this
Agreement to the contrary, for so long as, and only so long as,
(i) the Servicer or the direct or indirect parent
of the Servicer shall have and maintain a short-term debt
rating of at least "A-1" by Standard & Poor's, "D- 1" by Duff
& Phelps (if rated by Duff & Phelps) and either a short-term
debt rating of P-1 or a long-term debt rating of at least A2
by Moody's, or
(ii) the Servicer obtains a letter of credit, surety
bond or insurance policy (the "Servicer Letter of Credit")
under which demands for payment may be made to secure timely
remittance of monthly collections to the Collection Account
and the Paid-Ahead Account and the Trustees are provided with
a letter from each Rating Agency to the effect that the
utilization of such alternative remittance schedule and any
amendment required to be made to this Agreement in connection
therewith will not result in a qualification, reduction
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or withdrawal of its then-current rating of the Notes
or Certificates,
the Servicer may make the deposits to the Collection Account specified in
Section 5.2(a) hereof on a monthly basis, but not later than the Deposit Date
following the last day of the Collection Period within which such payments were
processed by the Servicer, in an amount equal to the net amount of such deposits
and payments which would have been made to the Collection Account during such
Collection Period but for the provisions of this Section 5.2(b), and the
Servicer may retain Paid-Ahead Amounts until any Applied Paid-Ahead Amounts
would otherwise be required to be withdrawn from the Paid-Ahead Account and
deposited in the Collection Account. In the event that the Servicer is permitted
to make remittances of Collections to the Collection Account and the Paid-Ahead
Account pursuant to Section 5.2(b)(ii) hereof, this Agreement may be modified,
to the extent necessary, without the consent of any Holder. The Servicer shall
notify the Trustees and the Sellers if the Servicer no longer complies with the
requirements set forth in clause (i) or (ii) above.
(c) Amounts Not Required to be Deposited. The Servicer
shall not be required to deposit in the Collection Account amounts relating to
the Receivables attributable to the following:
(i) Amounts received with respect to each
Receivable (or property acquired in respect thereof) which has
been repurchased by a Seller or purchased by the Servicer,
respectively, pursuant to this Agreement,
(ii) Investment Earnings on funds deposited in the
Collection Account or the Paid-Ahead Account (which amounts
shall be paid to the Sellers on each Distribution Date),
(iii) Amounts to be reimbursed to the Servicer in
respect of nonrecoverable Monthly Advances,
(iv) Net Liquidation Proceeds of any Liquidated
Receivable to the extent such proceeds exceed its Principal
Balance, and
(v) Amounts received with respect to Excluded
Administrative Fees, Excluded Forced-Placed Insurance
Premiums and Excluded Precomputed Amounts.
(d) Permitted Withdrawals from the Collection Account and the
Paid-Ahead Account. The Indenture Trustee, or the Paying Agent on behalf of the
Indenture Trustee, will, from time to time as provided herein, make withdrawals
from the Collection Account and Paid-Ahead Account of amounts deposited in said
Accounts pursuant to this Agreement that are attributable to the Receivables for
the following purposes:
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(i) to make payments and distributions in the
amounts and in the manner provided for in Section 5.5
hereof;
(ii) to pay to the Sellers or the Servicer with
respect to each Receivable or property acquired in respect
thereof that has been purchased pursuant to Section 3.2, 4.6,
or 9.1(a), all amounts received thereon and not required to be
distributed to Noteholders and Certificateholders; and
(iii) to withdraw any amount deposited in the
Collection Account that was not required to be deposited
therein.
Since, in connection with withdrawals pursuant to clause (ii) of this Section
5.2(d), the Servicer's entitlement thereto is limited to Collections or other
recoveries on the related Receivable, the Servicer shall keep and maintain
separate accounting, on a Receivable by Receivable basis, for the purpose of
justifying any withdrawal from the Collection Account or Paid-Ahead Account
pursuant to such clauses. The Servicer shall keep and maintain an accounting for
the purpose of justifying any withdrawal from the Collection Account or
Paid-Ahead Account pursuant to clause (iii) of this Section 5.2(d).
(e) Deferred Paid-Ahead Amounts on Repurchased Receivables.
With respect to any Repurchased Receivable, the Servicer shall forward to the
Seller or Servicer purchasing such Receivable any Deferred Paid-Ahead Amounts
with respect to such Repurchased Receivable (by withdrawing
such amounts from the Paid-Ahead Account or otherwise).
SECTION 5.3. Monthly Advances. With respect to each Receivable
as to which there has been a Payment Shortfall during the related Collection
Period (other than a Payment Shortfall arising from a Receivable which has been
prepaid in full or which has been subject to a Relief Act Reduction during the
related Collection Period), on each Deposit Date the Servicer shall make a
Monthly Advance but only to the extent that the Servicer, in its good faith
judgment, expects to recover such Monthly Advance from subsequent Collections on
such Receivable made by or on behalf of the Obligor (but only to the extent of
expected interest collections in the case of a Simple Interest Receivable) or
from Net Liquidation Proceeds or insurance proceeds with respect to such
Receivable. The Servicer shall be reimbursed for any Monthly Advance from
subsequent collections with respect to such Receivable. If the Servicer
determines in its good faith judgment that an unreimbursed Monthly Advance shall
not ultimately be recoverable from subsequent collections or that the related
Receivable will be sold pursuant to this Agreement, the
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Servicer shall be reimbursed for such Monthly Advance from collections on all
Receivables subject to and in the order of priority set forth in Section 5.5. In
determining whether a Monthly Advance is or will be nonrecoverable, the Servicer
need not take into account that it might receive any amounts in a deficiency
judgment against an Obligor. The Servicer shall not make a Monthly Advance in
respect of (i) the principal component of any scheduled payment on a Simple
Interest Receivable or (ii) a Payment Shortfall arising from a Receivable which
has been prepaid in full or which has been subject to a Relief Act Reduction
during the related Collection Period.
The Servicer shall deposit any such Monthly Advance into the
Collection Account in next-day funds or immediately available funds no later
than 12:00 noon, New York time, on the related Deposit Date.
SECTION 5.4. Additional Deposits. The Servicer, or the
Sellers, as the case may be, shall deposit into the Collection Account the
aggregate Repurchase Amount or the Optional Purchase Amount pursuant to
Sections 3.2, 4.6 and 9.1(a), as applicable. All remittances shall be made to
the Collection Account, in next-day funds or immediately available funds, no
later than 11:00 a.m., New York City time, on the Deposit Date.
SECTION 5.5. Distributions. (a) No later than 12:00 noon, New
York City time, on each Determination Date, the Servicer shall calculate the
following amounts with respect to the preceding Collection Period: (i) the
aggregate amount of Collections on the Receivables; (ii) the aggregate amount of
Monthly Advances to be remitted by the Servicer; (iii) the Paid-Ahead Amounts to
be received during the related Collection Period and Applied Paid-Ahead Amounts
allocable to such Collection Period and withdrawn from the Paid-Ahead Account;
(iv) the aggregate Repurchase Amounts of Receivables to be purchased by the
Sellers or the Servicer or the Optional Purchase Amount; (v) the aggregate
amount to be distributed as principal and interest on the Notes on the related
Distribution Date; (vi) the aggregate amount to be distributed as principal and
interest on the Certificates on the related Distribution Date; (vii) the
Servicer Payment; (viii) the amounts required to be withdrawn from the Reserve
Account for such Distribution Date in accordance with Sections 5.5(b) and 5.6
hereof; (ix) any amounts to be deposited into the Reserve Account pursuant to
Section 5.5(b) and 5.6 hereof, and (x) the aggregate amount of unreimbursed
Monthly Advances to be reimbursed to the Servicer.
(b) (i) On each Deposit Date, the Servicer shall instruct the
Indenture Trustee, in writing (based on the information contained in the Monthly
Report delivered on the related Determination Date pursuant to Section 4.8) to
withdraw from the Reserve Account and deposit in the Collection Account the
Reserve Account Transfer Amount (if any) for the related Distribution Date, and
the Indenture Trustee shall so withdraw
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and deposit the Reserve Account Transfer Amount for such Distribution Date.
(ii) On each Deposit Date, the Servicer shall
instruct the Indenture Trustee, or the Paying Agent on behalf
of the Indenture Trustee, in writing (based on the information
contained in the Monthly Report delivered on the related
Determination Date pursuant to Section 4.8) to withdraw from
the Paid-Ahead Account and deposit in the Collection Account
any Applied Paid-Ahead Amounts (if any) with respect to the
related Collection Period, and the Indenture Trustee or Paying
Agent shall so withdraw and deposit the Applied Paid-Ahead
Amounts for such Distribution Date.
(c) Not later than 11:00 a.m., New York City time, on each
Distribution Date, at the Servicer's direction, the Indenture Trustee, or the
Paying Agent on behalf of the Indenture Trustee, shall cause to be made the
following distributions, to the extent of the Available Amount then on deposit
in the Collection Account and amounts withdrawn from the Reserve Account and
deposited in the Collection Account by wire transfer of immediately available
funds, in the following order of priority and in the amounts set forth in the
Servicer's Certificate for such Distribution Date:
(i) to the Servicer, the Servicer Payment with
respect to such Distribution Date and all unpaid Servicing
Payments with respect to prior Distribution Dates, to the
extent such amounts are not deducted from the Servicer's
remittance to the Collection Account pursuant to Section 5.7;
(ii) to the Note Distribution Account, the
Noteholders' Interest Distributable Amount for all
classes of Notes;
(iii) except as set forth in Section 5.5(d), to
the Owner Trustee for deposit into the Certificate
Distribution Account, the Certificateholders' Interest
Distributable Amount;
(iv) except as set forth in Section 5.5(d), to
the Note Distribution Account, the Noteholders'
Principal Distributable Amount;
(v) except as set forth in Section 5.5(d), to
the Owner Trustee for deposit in the Certificate
Distribution Account, the Certificateholders' Principal
Distributable Amount; and
(vi) except as set forth in Section 5.5(d), to
the Reserve Account, any remaining portion of the Available
Amount.
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In the event that the Collection Account is maintained with an
institution other than the Indenture Trustee, the Servicer shall instruct and
cause such institution to make all deposits and distributions pursuant to this
Section 5.5(c) on the related Deposit Date.
(d) If the Notes have been declared immediately due and
payable as provided in Section 5.2 of the Indenture, any amounts remaining in
the Collection Account after the distributions described in clauses (i) and (ii)
of Section 5.5(c) shall be distributed as follows: (1) an amount equal to the
Outstanding Amount of the Notes shall be deposited in the Note Distribution
Account, and (2) any remaining amounts shall be applied pursuant to clauses
(iii), (v) and (vi) of Section 5.5(c).
SECTION 5.6. Reserve Account. (a) The Sellers shall establish
and maintain an Eligible Deposit Account (the "Reserve Account") at Norwest Bank
Minnesota, National Association in the name of the Indenture Trustee for the
benefit of the Noteholders and Certificateholders. Pursuant to Section 2.5 of
the Trust Agreement, on the Closing Date, the Owner Trustee shall cause
the Reserve Account Initial Deposit to be deposited into the Reserve Account.
(b) Should any sole depositary of the Reserve Account cease to
be either a Qualified Institution or a Qualified Trust Institution, the Sellers
shall cause the Reserve Account to be moved to a Qualified Institution or a
Qualified Trust Institution, as applicable, unless the Sellers provide the Owner
Trustee with a letter from the Rating Agencies to the effect that the Rating
Agency Condition shall be satisfied in connection with such depositary's ceasing
to be a Qualified Institution or a Qualified Trust Institution, as the case may
be.
All amounts held in the Reserve Account shall be invested by
the bank or trust company then maintaining the account (at the written direction
of the Sellers) in Permitted Investments that mature not later than the Deposit
Date next succeeding the date of investment except, if the Reserve Account is
maintained with the Indenture Trustee, for investments on which the Indenture
Trustee is the obligor (including repurchase agreements on which the Indenture
Trustee in its commercial capacity is liable as principal), which investments
may mature on the next succeeding Distribution Date; provided, however, that
amounts on deposit in the Reserve Account may be invested in Permitted
Investments that mature later than the next succeeding Deposit Date if the
Rating Agency Condition is satisfied.
(c) With respect to the Reserve Account Property:
(i) any Reserve Account Property that constitutes
Physical Property shall be delivered to the Indenture Trustee
in accordance with paragraph (a) of the definition of
"Delivery" and shall be held by the Indenture Trustee, pending
maturity or disposition;
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(ii) any Reserve Account Property that is a United
States Security Entitlement shall be delivered in accordance
with paragraph (b) of the definition of "Delivery" and shall
be maintained by the Indenture Trustee, pending maturity or
disposition; and
(iii) any Reserve Account Property that is an
"uncertificated security" under Article 8 (or VIII as
applicable) of the Relevant UCC and that is not governed by
clause (ii) above shall be delivered to the Indenture Trustee
in accordance with paragraph (c) of the definition of
"Delivery" and shall be maintained by the Indenture Trustee,
pending maturity or disposition.
The Indenture Trustee shall, at the expense of the Sellers, take such action as
is required to maintain the Indenture Trustee's security interest in any Reserve
Account Property; provided, however, that (x) the Indenture Trustee shall not be
required to prepare or file any financing statements or continuation statements
and (y) the Indenture Trustee may rely upon the written instructions of the
Sellers as to the method by which the security interest of the Indenture Trustee
may be perfected. Upon written request from the Indenture Trustee, the Sellers
shall provide such instructions and an opinion of counsel with respect to the
method of perfection of such security interest; provided, however, that the
Servicer shall not be obligated to deliver to the Indenture Trustee an opinion
of counsel with respect to the method of perfecting a security interest in any
Permitted Investment the method of perfecting an ownership interest in which was
described in that certain legal opinion of Dorsey & Whitney LLP, special local
counsel to the Indenture Trustee, dated September __, 1997, unless there has
been change in law or the interpretation thereof from the date of such opinion
with respect to the method of perfecting a security interest in such Permitted
Investment.
(d) On each Distribution Date, the Indenture Trustee shall
withdraw from the Reserve Account and pay first, to the Servicer, any amounts
due pursuant to Section 7.4(c) or Section 7.8, second, to the CITSF
Administrator, any amounts due pursuant to Section 21 of the CITSF
Administration Agreement, and third, to the Sellers, in accordance with their
respective Depositor Allocation Percentages, the excess, if any, of the amount
on deposit in the Reserve Account over the Specified Reserve Account Balance for
such Distribution Date (after giving effect to all deposits therein or
withdrawals therefrom on such Distribution Date). Upon any distribution to the
Servicer or the Sellers of amounts from the Reserve Account, the Holders shall
have no rights in, or claims, to, such amounts. Amounts properly distributed to
the Servicer, the CITSF Administrator or the Sellers from the Reserve Account
shall not be available under any circumstances to the Owner Trustee, and none
of the Servicer, the CITSF Administrator or the Sellers shall in any event
thereafter be required to refund any such distributed amounts.
(e) The Owner Trustee shall possess all right, title
and interest in all funds on deposit from time to time in the
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Reserve Account and in all proceeds thereof and all such funds, investments,
proceeds and income shall be part of the Owner Trust Estate. Except as otherwise
provided herein, the Reserve Account shall be under the sole dominion and
control of the Owner Trustee for the benefit of the Certificateholders.
SECTION 5.7. Net Deposits. As an administrative convenience,
the Servicer shall be permitted to make deposits of Collections, Monthly
Advances, and the aggregate Repurchase Amount of Receivables purchased by the
Servicer or any Optional Purchase Amount for, or with respect to, a Collection
Period net of distributions to be made to the Sellers (to the extent of
Investment Earnings and amounts received with respect to Excluded Precomputed
Amounts and Excluded Forced-Placed Insurance), or to the Servicer (including,
without limitation, the Servicer Payment, amounts received with respect to
Excluded Administrative Fees and amounts to be deducted in the definition of
"Available Amount"). The Servicer, however, shall account to the Owner Trustee
and the Indenture Trustee and to the Noteholders and the Certificateholders as
if all such deposits and distributions were made on an aggregate basis for each
type of payment or deposit. On each Distribution Date, the Servicer shall pay to
the Sellers directly any Investment Earnings on funds deposited in the
Collection Account and the Paid-Ahead Account, together with any amounts
received with respect to Excluded Forced-Place Insurance Premiums and Excluded
Precomputed Amounts.
SECTION 5.8. Statements to Certificateholders and Noteholders.
(a) On each Distribution Date, the Servicer shall provide to the Indenture
Trustee (for the Indenture Trustee to forward to each Noteholder of record
pursuant to the Indenture) and to the Owner Trustee (for the Owner Trustee to
forward to each Certificateholder of record pursuant to the Trust Agreement) a
statement prepared by the Servicer, substantially in the form of Exhibit B (or
such other form that is acceptable to the Indenture Trustee, the Owner Trustee
and the Servicer), with a copy to the Rating Agencies and the Sellers. Each such
statement to be delivered to Noteholders shall include (to the extent
applicable), among other things, the following information as to the Notes with
respect to such Distribution Date or the period since the previous Distribution
Date, as applicable, and each such statement to be delivered to
Certificateholders shall include (to the extent applicable) the following
information as to the Certificates with respect to such Distribution Date or the
period since the previous Distribution Date, as applicable:
(i) the amount of the distribution allocable to
principal with respect to each class of Notes and to the
Certificate Balance of the Certificates and the derivation of
such amounts;
(ii) the amount of the distribution allocable to
interest on or with respect to each class of Notes and
the Certificates;
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(iii) the amount of the Servicing Fee paid, the
amount of Monthly Advances being reimbursed to the Servicer in
respect of the related Collection Period, and the total
Servicer Payment;
(iv) the Pool Balance as of the close of business
on the last day of the preceding Collection Period;
(v) the Outstanding Amount and the Note Pool Factor
for each class of Notes, and the Certificate Balance and the
Certificate Pool Factor for the Certificates, in each case
after giving effect to all payments reported under clause (i)
above on such date;
(vi) the amount of the Aggregate Net Losses, if any,
for the preceding Collection Period and the derivation of such
amount, the amount of Aggregate Losses for the year to date
and, with respect to the January Distribution Date for each
year, the Average Annual Balance for the preceding year;
(vii) the Noteholders' Interest Carryover Shortfall
for all classes of Notes, the Noteholders' Principal Carryover
Shortfall, the Certificateholders' Interest Carryover
Shortfall and the Certificateholders' Principal Carryover
Shortfall, if any, in each case as applicable to each class of
Notes and Certificates and the change in such amounts from the
preceding statement;
(viii) the aggregate Repurchase Amounts with respect
to the Receivables, if any, that were repurchased by either
Seller or purchased by the Servicer with respect to such
Collection Period;
(ix) the balance of the Reserve Account as of such
date, after giving effect to changes therein on such date, the
Specified Reserve Account Balance on such date and the
components of calculating any such required balance;
(x) the amount of Monthly Advances included in
the Available Amount; and
(xi) the balance of the Paid-Ahead Account as of
such date, after giving effect to any changes therein on such
date.
Each amount set forth pursuant to subclauses (i), (ii) and (iii) with
respect to the Notes or the Certificates shall be expressed as a dollar amount
per $1,000 of the initial principal balance of such Notes or the initial
certificate balance of the Certificates, as applicable.
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ARTICLE VI
THE SELLERS
SECTION 6.1. Representations of Sellers. Each Seller makes
the following representations as to itself on which the Issuer shall rely in
acquiring the Receivables. The representations shall speak as of the execution
and delivery of this Agreement, and shall survive the sale of the Receivables to
the Issuer and pledge thereof to the Indenture Trustee pursuant to the
Indenture.
(i) Organization and Good Standing. Such Seller has
been duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization, with
power and authority to own its properties and to conduct its
business as such properties are currently owned and such
business is presently conducted, and had at all relevant
times, and has, power, authority, and legal right to acquire
and own the Receivables transferred by it to the Issuer.
(ii) Power and Authority. Such Seller has the power
and authority to execute and deliver this Agreement and the
other Basic Documents to which it is a party and to carry out
their respective terms, such Seller has full power and
authority to sell and assign the property to be sold and
assigned to the Issuer by it as the Owner Trust Estate and has
duly authorized such sale and assignment to the Issuer by all
necessary corporate action; and the execution, delivery, and
performance of this Agreement and the other Basic Documents to
which it is a party has been duly authorized by such Seller by
all necessary action.
(iii) Valid Sale; Binding Obligations. This Agreement
effects a valid sale, transfer, and assignment of the
Receivables transferred by such Seller to the Issuer,
enforceable against creditors of and purchasers from such
Seller; this Agreement and each of the other Basic Documents
to which it is a party constitutes a legal, valid, and binding
obligation of such Seller enforceable in accordance with its
terms, except as enforceability may be limited by 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.
(iv) No Violation. The consummation of the
transactions contemplated by this Agreement and the
other Basic Documents and the fulfillment of the terms
hereof and thereof do not conflict with, result in any
breach of any of the terms and provisions of, nor
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constitute (with or without notice or lapse of time) a default
under, the charter or bylaws of such Seller, or conflict with
or breach any of the material terms or provisions of, or
constitute (with or without notice or lapse of time) a default
under, any indenture, agreement, or other instrument to which
such Seller is a party or by which it is bound; nor 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; nor violate any law or, to the
best knowledge of such Seller, any order, rule, or regulation
applicable to such Seller of any court or of any federal or
state regulatory body, administrative agency, or other
governmental instrumentality having jurisdiction over such
Seller or its properties.
(v) No Proceedings. There are no proceedings or
investigations pending, or, to the best knowledge of such
Seller, threatened, before any court, regulatory body,
administrative agency, or other governmental instrumentality
having jurisdiction over such Seller or its properties: (a)
asserting the invalidity of this Agreement, any other Basic
Document, the Notes or the Certificates, (b) seeking to
prevent the issuance of the Notes or the Certificates or the
consummation of any of the transactions contemplated by this
Agreement or any other Basic Document, (c) seeking any
determination or ruling that might materially adversely affect
the performance by such Seller of its obligations under, or
the validity or enforceability of, this Agreement, any other
Basic Document, the Notes or the Certificates, or (d) relating
to such Seller and which might adversely affect the federal or
state income tax attributes of the Notes or the Certificates.
SECTION 6.2. Liability of Sellers; Indemnities; Payment of
Fees. Each Seller shall be liable in accordance herewith only to the extent of
the obligations specifically undertaken by such Seller in such capacity under
this Agreement and shall have no other obligations or liabilities hereunder.
Notwithstanding Section 15.1 of the Servicing Agreement, the Sellers acknowledge
that the indemnities in Section 10.2 of the Servicing Agreement shall survive
the execution of this Agreement.
The Sellers shall indemnify, defend and hold harmless the
Issuer, the Servicer, the CITSF Administrator, the Owner Trustee and the
Indenture Trustee from and against any taxes that may at any time be asserted
against any such Person with respect to, and as of the date of, the sale of the
Receivables to the Issuer or the issuance and original sale of the Notes and the
Certificates, including any sales, gross receipts, general corporation, tangible
or intangible personal property, privilege, or license taxes (but not including
any taxes asserted with respect to ownership of the Receivables or
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federal or other income taxes, including franchise taxes measured by net
income), arising out of the transactions contemplated by this Agreement and the
other Basic Documents, and costs and expenses in defending against the same.
Subject to Section 6.4 hereof, each Seller shall indemnify,
defend, and hold harmless the Issuer, the Servicer, the CITSF Administrator,
the Owner Trustee and the Indenture Trustee from and against any loss, liability
or expense incurred by reason of (i) such Seller's wilful misfeasance, bad
faith, or negligence in the performance of its duties hereunder, or by reason of
reckless disregard of the obligations and duties hereunder and (ii) such
Seller's violation of federal or state securities laws in connection with the
registration of the sale of the Notes and the Certificates.
The Sellers agree to pay, and shall indemnify, defend, and
hold harmless the Owner Trustee, the Indenture Trustee, the Issuer, the
Servicer, the CITSF Administrator, the Certificateholders and the Noteholders
from and against, any taxes that may at any time be asserted with respect to
the transfer of the Receivables to the Issuer, including, without limitation,
any sales, gross receipts, personal or real property, privilege or license
taxes (but not including any federal, state or other taxes arising out of the
creation of the Issuer and the issuance of the Notes and Certificates or
distributions with respect thereto) and costs, expenses and reasonable counsel
fees in defending against the same.
The Sellers shall indemnify, defend, and hold harmless from
and against, and pay to the Trustees all reasonable costs, expenses, losses,
claims, damages, and liabilities arising out of or incurred in connection with
the acceptance or performance of the trusts and duties herein contained in
accordance with the terms and conditions herein and in the Indenture and the
Trust Agreement, as the case may be, except to the extent that such costs,
expense, loss, claim, damage or liability: (a) shall be due to the willful
misfeasance, gross negligence or bad faith of such Trustee; (b) relates to any
tax other than the taxes with respect to which the Sellers shall be required to
indemnify such Trustee pursuant to this Agreement; (c) shall arise from such
Trustee's breach of any of its representations or warranties set forth in the
Trust Agreement or the Indenture, as applicable; (d) shall be one as to which
the Servicer is required to indemnify such Trustee.
Indemnification under this Section 6.2 shall include
reasonable fees and expenses of counsel and expenses of litigation. If such
Seller shall have made any indemnity payments to the Issuer, the Servicer, the
Owner Trustee or the Indenture Trustee, respectively, pursuant to this Section
6.2 and the Issuer, the Servicer, the Owner Trustee or the Indenture Trustee,
respectively, thereafter shall collect any of such amounts from others, the
Issuer, the Servicer, the Owner Trustee or the Indenture Trustee, respectively,
shall repay such amounts to such Seller, without interest. The indemnities under
this
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Section 6.2 shall survive the resignation or removal of an indemnitee, or the
termination of the Trust Agreement and this Agreement.
The Sellers shall pay the disbursements of the Issuer, the
Administrators, the Owner Trustee, the Indenture Trustee, the Paying Agent, the
Authenticating Agent, the Note Registrar and the Certificate Registrar to the
extent not payable by the Servicer pursuant to Section 4.7, including, without
limitation, the fees and disbursements of counsel to the Owner Trustee and the
Indenture Trustee.
SECTION 6.3. Merger or Consolidation of Sellers. Any
corporation or other entity (i) into which either of the Sellers may be merged
or consolidated, (ii) which may result from any merger, conversion, or
consolidation to which either of the Sellers shall be a party, or (iii) which
may succeed to all or substantially all of the business of either of the
Sellers, shall be bound to perform every obligation of such Seller under this
Agreement, shall be the successor to such Seller hereunder without the execution
or filing of any document or any further act by any of the parties to this
Agreement. Such Seller shall give prompt written notice of any merger or
consolidation to the Issuer, the Owner Trustee, the Indenture Trustee, the
Servicer and the Rating Agencies.
SECTION 6.4. Limitation on Liability of Sellers and Others.
Each Seller and any director, officer, employee or agent of such Seller may rely
in good faith on the advice of counsel or on any document of any kind, prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder or under any other Basic Documents. No Seller shall be under
any obligation under this Agreement to appear in, prosecute, or defend any legal
action that shall be unrelated to its obligations under this Agreement or any
other Basic Document, and that in its opinion may involve it in any expense or
liability.
SECTION 6.5. Sellers May Own Notes and Certificates. Each
Seller or any of its Affiliates may in its individual or any other capacity
become the owner or pledgee of Notes or Certificates with the same rights as it
would have if it were not a Seller or an Affiliate thereof, except as otherwise
provided in the definition of "Outstanding" specified in Section 1.1. Notes or
Certificates so owned by or pledged to a Seller or any Affiliate thereof shall
have an equal and proportionate benefit under the provisions of this Agreement,
without preference, priority, or distinction as among all of the Notes or
Certificates, as applicable.
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ARTICLE VII
THE SERVICER; REPRESENTATIONS AND INDEMNITIES
SECTION 7.1. Representations of the Servicer.
The Servicer hereby makes the following representations on
which the Owner Trustee and the Indenture Trustee on behalf of the Issuer shall
rely in accepting the Receivables in trust and authenticating the Certificates
and the Notes, respectively. The representations are made as of the execution
and delivery of this Agreement (or as of a date another Person becomes Servicer
pursuant to Section 7.3 or Section 8.2), and shall survive the sale of the
Receivables to the Issuer.
(i) Organization and Good Standing. The Servicer is
a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization and has the
corporate power to own its assets and to transact the business in which
it is currently engaged. The Servicer is duly qualified to do business
as a foreign corporation and is in good standing in each jurisdiction
in which the character of the business transacted by it or properties
owned or leased by it requires such qualification and in which the
failure so to qualify would have a material adverse effect on the
business, properties, assets, or condition (financial or other) of the
Servicer or on the Notes, the Certificates or the transactions
contemplated by this Agreement.
(ii) Authorization; Binding Obligations. The
Servicer has the power and authority to make, execute, deliver and
perform this Agreement and all of the transactions contemplated under
this Agreement, and has taken all necessary corporate action to
authorize the execution, delivery and performance of this Agreement.
When executed and delivered, this Agreement will constitute the legal,
valid and binding obligation of the Servicer enforceable in accordance
with its terms, except as enforcement of such terms may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and by the availability of equitable
remedies.
(iii) No Consent Required. The Servicer is not
required to obtain the consent of any other party or any consent,
license, approval or authorization from, or registration or declaration
with, any governmental authority, bureau or agency in connection with
the execution, delivery, performance, validity or enforceability of
this Agreement the failure of which so to obtain would have a material
adverse effect on the business, properties, assets or condition
(financial or otherwise) of the Servicer or on the Notes, the
Certificates or the transactions contemplated by this Agreement.
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(iv) No Violations. The execution, delivery and
performance of this Agreement by the Servicer will not violate any
provision of any existing law or regulation or any order or decree of
any court or the Articles of Incorporation or Bylaws of the Servicer,
or constitute a material breach of any mortgage, indenture, contract or
other agreement to which the Servicer is a party or by which the
Servicer may be bound.
(v) Litigation. No litigation or administrative
proceeding of or before any court, tribunal or governmental body is
currently pending, or to the knowledge of the Servicer threatened,
against the Servicer or any of its properties or with respect to this
Agreement, the Notes or the Certificates which, if adversely
determined, would in the opinion of the Servicer have a material
adverse effect on the transactions contemplated by this Agreement.
SECTION 7.2. Liability of Servicer, Indemnities.
The Servicer shall be liable in accordance herewith only to
the extent of the obligations specifically undertaken by the Servicer under the
Basic Documents and (except as set forth in the Servicing Agreement) shall have
no other obligations or liabilities hereunder. Notwithstanding Section 15.1 of
the Servicing Agreement, the Servicer acknowledges that the indemnities in
Section 10.1 of the Servicing Agreement shall survive the execution of this
Agreement.
(i) Subject to Section 7.4(a) hereof, the Servicer
shall defend and indemnify the Owner Trustee, the Indenture Trustee,
the Issuer, the Sellers, the Chase Administrator, the
Certificateholders and the Noteholders against any and all costs,
expenses, losses, damages, claims and liabilities arising out of or
resulting from any negligent action taken, or negligently failed to be
taken, by the Servicer with respect to any Financed Vehicle, to the
extent such loss is not reimbursed pursuant to any Insurance Policy or
any fidelity bond.
(ii) Subject to Section 7.4(a) hereof, the Servicer
shall indemnify, defend, and hold harmless the Owner Trustee, the
Indenture Trustee, the Issuer, the Sellers, the Chase Administrator,
the Certificateholders and the Noteholders from and against all costs,
expenses, losses, claims, damages, and liabilities to the extent that
such cost, expense, loss, claim, damage, or liability arose out of, or
was imposed upon such Persons, through the willful misfeasance,
negligence, or bad faith of the Servicer in the performance of its
duties under this Agreement or by reason of reckless disregard of its
obligations and duties under this Agreement.
Indemnification under this Section 7.2 shall include
reasonable fees and expenses of counsel in any litigation
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appointed by the Servicer and reasonably satisfactory to the indemnitee,
provided that the Servicer shall only be required to pay the fees and expenses
of one counsel in any single litigation (or related proceedings) for all
indemnities; provided, however, if in the written opinion of counsel reasonably
satisfactory to the Servicer, the interests of an indemnitee and the Servicer
conflict such that the Servicer and such indemnitee may not both be represented
by such counsel, upon ten days prior written notice to the Servicer, such
indemnitee may hire one other counsel and the indemnification under this Section
7.2 shall also include the reasonable fees and expenses of such other counsel.
If the Servicer shall have made any indemnity payments, pursuant to this Section
7.2 and the recipient thereafter collects any of such amounts from others, the
recipient shall promptly repay such amounts to the Servicer without interest.
The indemnities under this Section 7.2 shall survive the resignation or removal
of an indemnitee, or the termination of the Trust Agreement and this Agreement.
SECTION 7.3. Merger or Consolidation of Servicer.
Any Person into which the Servicer may be merged or
consolidated, or any corporation or other entity resulting from any merger,
conversion or consolidation to which the Servicer shall be a party, or any
Person succeeding to the business of the Servicer (which Person assumes the
obligations of the Servicer), shall be the successor of the Servicer hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding;
provided, however, that the successor or surviving Person to the Servicer shall
satisfy the criteria set forth in the definition of an Eligible Servicer. The
Servicer shall promptly notify each Rating Agency of any such merger to which it
is a party.
SECTION 7.4. Limitation on Liability of Servicer and
Others.
(a) Neither the Servicer, nor any of the shareholders,
Affiliates, directors, officers, employees or agents of the Servicer, shall be
under any liability to the Issuer or the Holders for any action taken or for
refraining from the taking of any action in good faith pursuant to this
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Servicer or any such Person against any liability which
otherwise would be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of duties or by reason or reckless disregard of
obligations and duties hereunder.
(b) The Servicer and any director, officer, employee or agent
of the Servicer may rely in good faith on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
hereunder.
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(c) Except as arises from its duties as Servicer hereunder,
the Servicer shall not be under any obligation to appear in, prosecute or defend
any legal action which arises under this Agreement and which in its opinion may
involve it in any expenses or liability; provided; however, that the Servicer
may in its discretion undertake any such action which it may deem necessary or
desirable in respect of this Agreement and the rights and duties of the parties
hereto. In such event, the legal expenses and costs of such action and any
liability resulting therefrom shall be expenses, costs and liabilities of the
Issuer payable only from the amounts distributable to the Sellers pursuant to
Section 5.6(d) and Section 9.1(b).
SECTION 7.5. Servicer Not To Resign. The Servicer shall not
resign from its obligations and duties under this Agreement except upon
determination that the performance of its duties shall no longer be permissible
under applicable law, compliance with which could not be realized without
material adverse impact on the Servicer's financial condition. Notice of any
such determination permitting the resignation of the Servicer shall be
communicated to the Sellers, the Trustees and the Rating Agencies at the
earliest practicable time (and, if such communication is not in writing, shall
be confirmed in writing at the earliest practicable time) and any such
determination permitting the resignation of the Servicer shall be evidenced by
an Opinion of Counsel to such effect delivered to the Sellers and the Trustees.
No such resignation shall become effective until a successor Servicer shall have
assumed the responsibilities and obligations of the Servicer in accordance with
Section 8.2 hereof.
SECTION 7.6. Assignment of Servicing.
The Servicer may sell, transfer, assign or convey its rights
as Servicer to any of its Affiliates (in the case of CITSF) or to any Eligible
Servicer, upon written notice to the Sellers, the Trustees and the Rating
Agencies, without the consent of the Holders or the Trustees, provided that,
with respect to assignment to a Servicer which is not an Affiliate of CITSF, the
Rating Agency Condition is satisfied and the Servicer and the Trustees receive
the prior written consent of the Sellers (which consent shall not be
unreasonably withheld).
SECTION 7.7. Insurance.
The Servicer, or any affiliate of the Servicer, may, to the
extent permitted by law (i) enter into agreements with one or more insurers or
other Persons pursuant to which the Servicer or such affiliate will earn
commissions and fees in connection with any insurance policy purchased by an
Obligor including, without limitation, any physical damage insurance policy, or
any other insurance policy whatsoever, and (ii) in connection with the foregoing
or otherwise, to solicit, or permit and assist any insurer, any agent thereof or
any other Person (other than a lender which is not also an insurer) to solicit
(including,
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without limitation, providing such insurer or agent a list of Obligors including
name, address or other information) any Obligor.
SECTION 7.8. Indemnity by Issuer. The Issuer shall indemnify,
defend, and hold harmless from and against, and pay to the Servicer all
reasonable costs, expenses, losses, claims, damages, and liabilities arising out
of or incurred in connection with the acceptance or performance of the duties
herein contained in accordance with the terms and conditions herein and in the
Administration Agreements, except to the extent that such costs, expense, loss,
claim, damage or liability: (a) shall be due to the willful misfeasance,
negligence or bad faith of the Servicer; (b) relates to any tax other than the
taxes with respect to which the Servicer shall be otherwise indemnified pursuant
to this Agreement; (c) shall arise from the Servicer's breach of any of its
representations, warranties or covenants set forth herein and in the
Administration Agreements; (d) shall be one as to which the Sellers are required
to indemnify the Servicer or (e) shall be amounts payable by (and not
reimbursable to) the Servicer pursuant to this Agreement and the Administration
Agreements. Any amounts due the Servicer pursuant to this Section 7.8 shall be
payable only to the Servicer pursuant to Section 5.6(d) or 9.1(b).
SECTION 7.9. Servicer May Own Notes and Certificates. The
Servicer or any of its Affiliates may in its individual or any other capacity
become the owner or pledgee of Notes or Certificates with the same rights as it
would have if it were not the Servicer or an Affiliate thereof, except as
otherwise provided in the definition of "Outstanding" specified in Section 1.1.
Notes or Certificates so owned by or pledged to the Servicer or any Affiliate
thereof shall have an equal and proportionate benefit under the provisions of
this Agreement, without preference, priority, or distinction as among all of the
Notes or Certificates, as applicable.
ARTICLE VIII
EVENTS OF SERVICING TERMINATION
SECTION 8.1. Events of Servicing Termination. Any one of the
following events which shall occur and be continuing shall constitute an event
of servicing termination hereunder (each, an "Event of Servicing Termination"):
(i) Any failure by the Servicer to deliver to the
Owner Trustee or the Indenture Trustee the Servicer's
Certificate for the related Collection Period, or any failure
by the Servicer to deliver to the Owner Trustee or the
Indenture Trustee, for deposit in any Trust Account, any
proceeds or payments required to be so delivered under the
terms of the Certificates or the Notes or this Agreement (or,
in the case of a payment or deposit to be made not later than
the Deposit Date,
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the failure to make such payment or deposit on such Deposit
Date), which failure continues unremedied for a period of five
Business Days after (A) discovery by the Servicer or (B)
receipt of written notice (1) to the Servicer by the Indenture
Trustee or the Owner Trustee or (2) to the Indenture Trustee
or the Owner Trustee, as applicable, and the Servicer by the
Noteholders representing not less than 25% of the Outstanding
Amount of the Notes (or, if the Notes have been paid in full,
by Certificateholders representing not less than 25% of the
Certificate Balance then outstanding);
(ii) Failure on the part of the Servicer to duly
observe or perform in any material respect any other covenant
or agreement of the Servicer set forth in this Agreement,
which failure shall (a) materially adversely affect the rights
of the Issuer or the Holders, and (b) continue unremedied for
a period of 60 days after the date on which written notice of
such failure, requiring the same to be remedied, shall have
been given (1) to the Servicer by the Indenture Trustee or the
Owner Trustee, or (2) to the Indenture Trustee or the Owner
Trustee, as applicable, and the Servicer by the Noteholders
representing not less than 25% of the Outstanding Amount of
the Notes (or, if the Notes have been paid in full, by
Certificateholders representing not less than 25% of the
Certificate Balance then outstanding);
(iii) A court or other governmental authority having
jurisdiction in the premises shall have entered a decree or
order for relief in respect of the Servicer in an involuntary
case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian, trustee,
sequestrator (or similar official) of the Servicer, as the
case may be, or for any substantial liquidation of its
affairs, and such order remains undischarged and unstayed for
at least 60 days; or
(iv) The Servicer shall have commenced a voluntary
case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or shall have
consented to the entry of an order for relief in an
involuntary case under any such law, or shall have consented
to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian or sequestrator (or
other similar official) of the Servicer or for any substantial
part of its property, or shall have made any general
assignment for the benefit of its creditors, or shall have
failed to, or admitted in writing its inability to, pay its
debts as they become due, or shall have taken any corporate
action in furtherance of the foregoing.
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Upon the occurrence of any Event of Servicing Termination as
described above, and in each and every case and for so long as such Event of
Servicing Termination shall not have been remedied, either the Indenture Trustee
or the Noteholders representing not less than a majority of the Outstanding
Amount of the Notes (or, if the Notes have been paid in full and the Indenture
has been discharged in accordance with its terms, by the Owner Trustee or the
Certificateholders representing not less than a majority of the Certificate
Balance then outstanding), by notice given in writing to the Servicer (and to
the Indenture Trustee or the Owner Trustee, as applicable, if given by Holders)
may terminate all of the rights and obligations of the Servicer under this
Agreement. In addition, the Sellers may terminate all rights and obligations of
the Servicer hereunder at any time after a calendar year, or in the case of
1997, the last four months of such year, during which Aggregate Losses on the
Receivables exceed 0.80% of the Average Annual Balance for such calendar year
or, in the case of 1997, partial calendar year; provided, however, that such
termination of the Servicer shall not be effective unless Chase, Chase USA or
another party satisfying the Rating Agency Condition assumes the Servicer's
servicing obligations and duties under this Agreement. If the Sellers do not
exercise their right to terminate the Servicer as a result of Aggregate Losses
exceeding such threshold by giving written notice of termination to the
Servicer, within six months after the end of any calendar year, they will be
deemed to have waived their right to terminate the Servicer based on this
paragraph with respect to such calendar year (but such waiver shall not affect
the Sellers' right to terminate the Servicer if the Aggregate Losses on the
Receivables exceed the amount specified above in a subsequent calendar year).
On or after the receipt by the Servicer of such written notice
and the appointment of Chase pursuant to Section 8.2, all responsibilities,
duties and liabilities of the Servicer under this Agreement, whether with
respect to the Certificates, the Notes or the Receivables or otherwise, shall
pass to and be vested in Chase pursuant to Section 8.2; and, without limitation,
the Indenture Trustee or the Owner Trustee shall be hereby authorized and
empowered to execute and deliver, on behalf of the predecessor Servicer, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, whether to complete the transfer and
endorsement of the Receivable Files, or otherwise. In connection with such
termination, the predecessor Servicer shall, upon request of Chase, deliver to
Chase, at predecessor Servicer's expense, all data and records (including,
without limitation, computerized records) created or used for the servicing of
the Receivables and all Collections then held by the predecessor Servicer for
deposit or thereafter received by the predecessor Servicer with respect to a
Receivable. In addition to delivering such data, records and monies, the
predecessor Servicer shall, at predecessor Servicer's expense, use reasonable
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efforts to effect the orderly and efficient transfer of the servicing of the
Receivables to Chase, including, without limitation, directing the Obligors to
remit all payments in respect of the Receivables to an account or address
designated by Chase. In connection with any termination pursuant to the
penultimate sentence of the immediately preceding paragraph, the
Servicer shall pay the expense of any servicing systems conversion
required as a result of such termination, including, but not limited to,
the expenses of formatting all information into a format acceptable to
the successor Servicer. The Servicer shall be entitled to receive any other
amounts which are payable to the Servicer under this Agreement (including
amounts payable to it with respect to the period ending on the date of the
termination of the Servicer hereunder), on the Distribution Date relating to
the Collection Period in which the Servicer was terminated (or if funds are
not sufficient therefor, on each subsequent Distribution Date until paid in
full). The Indenture Trustee and the Owner Trustee shall give written notice
of any termination of the Servicer to their related Holders, and the
Indenture Trustee shall give such notice to the Rating Agencies. Neither
Chase nor any successor Servicer shall be deemed to be in default hereunder
by reason of its failure to make, or any delay in making, any distribution
hereunder or any portion thereof which was caused by (i) the failure of the
predecessor Servicer to deliver, or any delay in delivering cash, documents
or records to it, or (ii) restrictions imposed by any regulatory authority
having jurisdiction over the predecessor Servicer.
SECTION 8.2. Appointment of Successor. Upon the Servicer's
receipt of notice of termination pursuant to Section 8.1 or resignation pursuant
to Section 7.5, Chase shall be the successor in all respects to the Servicer in
its capacity as Servicer under this Agreement, and shall be subject to all the
responsibilities, duties and liabilities arising thereafter relating thereto
placed on the Servicer by the terms and provisions of this Agreement. As
compensation therefor, Chase shall be entitled to such compensation (whether
payable out of the Collection Account or otherwise) as the Servicer would have
been entitled to under this Agreement if no such notice of termination or
resignation had been given. Notwithstanding the above, if Chase shall be
unwilling so to act, or shall be legally unable so to act, the Sellers shall
appoint, or petition a court of competent jurisdiction to appoint any Eligible
Servicer, as successor Servicer under this Agreement, provided, that the
appointment of any such successor Servicer is required to satisfy the Rating
Agency Condition. In connection with such appointment, the Sellers may make such
arrangements for the compensation of such successor Servicer out of payments on
Receivables as they and such successor Servicer shall agree; provided, however,
that no such compensation shall be in excess of that permitted the Servicer
under this Agreement. The Sellers and such successor Servicer shall take such
action, consistent with this Agreement, as shall be necessary to effectuate any
such succession. Unless Chase shall be prohibited by law from so acting, Chase
shall not be relieved of its duties as successor Servicer under this Section 8.2
until the newly appointed successor Servicer shall have assumed the
responsibilities and obligations of the Servicer under this Agreement.
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SECTION 8.3. Notification to Noteholders and
Certificateholders. Upon any Event of Servicing Termination, or appointment of a
successor Servicer pursuant to this Article VIII, the Owner Trustee shall give
prompt written notice thereof to Certificateholders and the Indenture Trustee
shall give prompt written notice thereof to the Noteholders, at their respective
addresses of record, and to the Rating Agencies.
SECTION 8.4. Waiver of Past Defaults. The Noteholders
representing at least a majority of the Outstanding Amount of the Notes (or, the
Certificateholders representing not less than a majority of the Certificate
Balance then outstanding, in the case of any Event of Servicing Termination that
does not adversely affect the Indenture Trustee or the Noteholders) may, on
behalf of all such Holders, waive any default by the Servicer in the performance
of its obligations hereunder and its consequences, except a default in the
failure to make any required deposits to or payments from any of the Trust
Accounts in accordance with this Agreement. Upon any such waiver of a past
default, such default shall cease to exist, and any Event of Servicing
Termination arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent or
other default or impair any right consequent thereon except to the extent
expressly so waived; provided, however, that the Indenture Trustee or the
Owner Trustee shall only be required to give such notice if a Responsible
Officer thereof has actual knowledge of the related event.
ARTICLE IX
TERMINATION
SECTION 9.1. Optional Purchase of All Receivables; Trust
Termination. (a) Subsequent to the last day of any Collection Period as of which
the Pool Balance shall be equal to or less than 5% of the Cutoff Date Pool
Balance, the Servicer shall have the option to purchase the Owner Trust Estate
(including the rights of the Trust to any Liquidated Receivables and any
Deferred Paid-Ahead Amounts, but excluding the Collection Account, the Reserve
Account, the Certificate Distribution Account and the Note Distribution Account)
by depositing the Optional Purchase Amount on the Deposit Date subsequent
to any such last day. The effective date of such purchase shall be the last day
of the Collection Period preceding such Deposit Date. To exercise such option,
the Servicer shall notify the Indenture Trustee, the Owner Trustee, the Sellers,
the Note Registrar and the Certificate Registrar in writing, no later than the
25th day of the Collection Period preceding such Deposit Date, shall pay the
aggregate Optional Purchase Amount and shall succeed to all interests in, to and
under such portion of the Owner Trust Estate. The payment shall be made in the
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manner specified in Section 5.4, and shall be distributed pursuant to Section
5.5; provided, that, in no event shall the amount so deposited, when added to
the amounts on deposit in the Collection Account on such date and available for
distribution to Securityholders on the related Distribution Date, be less than
the amount required to pay all accrued and unpaid interest on the Notes, the
Outstanding Amount of the Notes, accrued and unpaid interest on the Certificates
and the Certificate Balance, after giving effect to the Servicer Payment.
(b) Upon any sale of the assets of the Issuer pursuant to
Article V of the Indenture, the Servicer shall instruct the Indenture Trustee in
writing to deposit the proceeds from such sale after all payments and reserves
therefrom (including the expenses of such sale) have been made (the "Sale
Proceeds") in the Collection Account. On the Distribution Date on which the Sale
Proceeds are deposited in the Collection Account (or, if such proceeds are not
so deposited on a Distribution Date, on the Distribution Date immediately
following such deposit), the Servicer shall instruct the Indenture Trustee in
writing to make, and the Indenture Trustee shall make, the following deposits
and distributions (after the application on such Distribution Date of the
Available Amount pursuant to Section 5.5) from the Sale Proceeds and any funds
remaining on deposit in the Reserve Account (including the proceeds of any sale
of investments therein):
(i) to the Note Distribution Account, any portion
of the Noteholders' Interest Distributable Amount not
otherwise deposited into the Note Distribution Account on such
Distribution Date;
(ii) to the Note Distribution Account, the
Outstanding Amount of the Notes (after giving effect to the
reduction in the Outstanding Amount of the Notes resulting
from the deposits made in the Note Distribution Account on
such Distribution Date);
(iii) to the Certificate Distribution Account, any
portion of the Certificateholders' Interest Distributable
Amount not otherwise deposited into the Certificate
Distribution Account on such Distribution Date;
(iv) to the Certificate Distribution Account, the
Certificate Balance and any Certificateholders' Principal
Carryover Shortfall (after giving effect to the reduction in
the Certificate Balance resulting from the deposits made in
the Certificate Distribution Account on such Distribution
Date);
(v) to the Servicer, any amounts payable to the
Servicer pursuant to Section 7.4(c) or 7.8 and to the
CITSF Administrator; and
(vi) any amounts payable to the CITSF
Administrator pursant to Section 21 of the CITSF
Administration Agreement.
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Any Sale Proceeds remaining after the deposits described above
shall be paid to the Sellers in accordance with their respective Depositor
Allocation Percentages.
(c) Notice of any termination of the Issuer shall be given by
the Servicer to the Sellers, the Owner Trustee, the Indenture Trustee and the
Rating Agencies as soon as practicable after the Servicer has received notice
thereof. The Owner Trustee and the Indenture Trustee shall give written notice
of termination to each Noteholder and Certificateholder of record, as
applicable.
(d) Following the satisfaction and discharge of the Indenture
and the payment in full of the principal of and interest on the Notes, the
Certificateholders shall succeed to the rights of the Noteholders hereunder and
the Owner Trustee shall succeed to the rights of, and assume the obligations of,
the Indenture Trustee pursuant to this Agreement.
(e) After the payment to the Indenture Trustee, the Owner
Trustee, the Holders and the Servicer of all amounts required to be paid under
this Agreement, the Indenture and the Trust Agreement, any amounts on deposit in
the Reserve Account, the Paid-Ahead Account (except as provided in Section
9.1(a)) or the Collection Account shall be paid to the Sellers in accordance
with their respective Depositor Allocation Percentages, and any other assets
remaining in the Owner Trust Estate shall be distributed to the Sellers in
accordance with their respective Depositor Allocation Percentages.
(f) Promptly after any repurchase of a Receivable by a Seller
pursuant to Section 3.2 hereof, purchase of a Receivable by the Servicer
pursuant to Section 4.6 hereof or purchase of a portion of the Owner Trust
Estate by the Servicer pursuant to Section 9.1(a) hereof, the Owner Trustee, the
Issuer and the Indenture Trustee shall execute such documents as are presented
to it by such Seller or the Servicer and are reasonably necessary to convey such
Repurchased Receivable to such Seller or the Servicer (and, the case of Section
9.1 to convey to the Servicer such portion of the Owner Trust Estate), and
transfer all right, title and interest in and to such Repurchased Receivable
and the Receivables Files related thereto (and in the case of Section 9.1, the
remaining Owner Trust Estate including any Paid-Ahead Amounts and any other
payments in respect of such Receivable or the related Financed Vehicle received
after the effective date of such purchase or repurchase) the payment of the
Repurchase Amount or the Optional Purchase Amount.
ARTICLE X
MISCELLANEOUS PROVISIONS
SECTION 10.1. Amendment. This Agreement may be amended by
the Sellers, the Servicer and the Issuer, with the prior consent of the
Indenture Trustee and the Owner Trustee and prior notice to the Rating Agencies
but without prior notice to
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or the consent of any of the Holders, (i) to cure any ambiguity, to correct or
supplement any provisions in this Agreement which may be inconsistent with any
other provisions herein, to evidence a succession to the Servicer or a Seller
pursuant to this Agreement or to add any other provisions with respect to
matters or questions arising under this Agreement that shall not be inconsistent
with the provisions of this Agreement; provided, however, that such action shall
not, as evidenced by an Officer's Certificate and/or an Opinion of Counsel
reasonably acceptable and delivered to the Owner Trustee and the Indenture
Trustee, materially adversely affect the interests of the Issuer or any of the
Holders provided, further, that the Servicer shall deliver written notice of
such changes to each Rating Agency prior to the execution of any such amendment,
or (ii) to effect a transfer or assignment in compliance with Section 10.6(a) of
this Agreement. Notwithstanding the foregoing, no amendment modifying the
provisions of Section 5.5 shall become effective without satisfaction of the
Rating Agency Condition.
This Agreement may also be amended from time to time by the
Sellers, the Servicer, the Issuer, the Owner Trustee and the Indenture Trustee,
with the consent of the Certificateholders representing at least a majority of
the Certificate Balance then outstanding and the consent of the Noteholders
representing at least a majority of the Outstanding Amount of the Notes, for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Agreement, or of modifying in any manner the rights of
the Noteholders or the Certificateholders (including effecting a transfer or
assignment in compliance with Section 10.6(a) of this Agreement); provided,
however, that no such amendment, except with the consent of Noteholders
representing 100% of the Outstanding Amount or Certificateholders representing
100% of the Certificate Balance then outstanding, as applicable, shall (a)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on the Receivables, or distributions that
shall be required to be made for the benefit of any Certificateholder or
Noteholder, or (b) reduce the aforesaid percentage of the Certificate Balance of
the Certificates or the Outstanding Amount of the Notes required to consent to
any such amendment.
Promptly after the execution of any amendment or consent
referred to in this Section 10.1, the Owner Trustee shall furnish a copy of such
amendment or consent to the Indenture Trustee and each Certificateholder and to
the Rating Agencies.
It shall not be necessary for the consent of the Indenture
Trustee, the Certificateholders or the Noteholders pursuant to this Section 10.1
to approve the particular form of any proposed amendment or consent, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders or Noteholders shall
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be subject to such reasonable requirements as the Indenture Trustee or the Owner
Trustee may prescribe.
Prior to the execution of any amendment to this Agreement, the
Indenture Trustee and the Owner Trustee shall be entitled to receive and rely
upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement. The Indenture Trustee and the Owner
Trustee shall not be obligated to enter into any such amendment which affects
the Indenture Trustee's and the Owner Trustee's own rights, duties or immunities
under this Agreement.
Satisfaction of the Rating Agency Condition is required prior
to the execution of any amendment to this Agreement, other than an amendment
permitted pursuant to clause (i) of the first paragraph of this Section 10.1.
The Issuer hereby agrees not to enter into an
indenture or supplemental indenture for the purpose of amending the
Indenture without the prior written consent of the CITSF Administrator.
The Sellers hereby agree not to amend the Trust Agreement without the
prior written consent of the CITSF Administrator.
SECTION 10.2. Protection of Title to Owner Trust Estate.
(a) After the Closing Date, the Servicer, pursuant to the
power-of-attorney granted by the Sellers pursuant to Section 10.11, shall
execute and file such financing statements and cause to be executed and filed
such continuation statements, all in such manner and in such places as may be
required by law fully to preserve, maintain, and protect the interests of the
Issuer and the Indenture Trustee in the related Receivables and in the proceeds
thereof. The Servicer shall deliver (or cause to be delivered) to the Owner
Trustee and the Indenture Trustee, with copies to the Sellers, file-stamped
copies of, or filing receipts for, any document filed as provided above, as soon
as available following such filing.
(b) Neither of the Sellers shall change its name, identity, or
corporate structure in any manner that would, could, or might make any financing
statement or continuation statement filed by it or by the Servicer in accordance
with paragraph (a) above seriously misleading within the meaning of Section
9-402(7) (or any comparable section) of the Relevant UCC, unless it shall have
given the Owner Trustee, the Indenture Trustee and the Servicer at least 30 days
prior written notice thereof.
(c) Each Seller shall give the Owner Trustee, the Indenture
Trustee and the Servicer 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 Relevant UCC would require the filing of any
amendment of any previously filed financing or continuation statement or of any
new financing statement. The Servicer shall at all times maintain each office
from which it shall service Receivables, and its principal executive office,
within the United States of America.
(d) The Servicer shall maintain accounts and records
as to each Receivable accurately and in sufficient detail to
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permit (i) the reader thereof to know at any time the status of such Receivable,
including payments and recoveries made and payments owing (and the nature of
each) and (ii) reconciliation between payments or recoveries on (or with respect
to) each Receivable and the amounts from time to time deposited in the
Collection Account in respect of such Receivable.
(e) The Servicer shall maintain its computer systems so that,
from and after the time of sale under this Agreement of the Receivables to the
Issuer, the Servicer's master computer records (including archives) that shall
refer to a Receivable indicate clearly, by numerical code or otherwise, that
such Receivable is owned by the Issuer and has been pledged to the Indenture
Trustee. Indication of the Issuer's and Indenture Trustee's interest in a
Receivable shall be deleted from or modified on the Servicer's computer systems
when, and only when, the Receivable shall have been paid in full, repurchased or
assigned pursuant hereto.
(f) If at any time either of the Sellers or the Servicer shall
propose to sell, grant a security interest in, or otherwise transfer any
interest in a new or used recreational vehicle receivable to any prospective
purchaser, creditor, or other transferee, such Seller or the Servicer, as the
case may be, shall give to such prospective purchaser, creditor, or other
transferee computer tapes, records, or print-outs (including any restored from
archives) that, if they shall refer in any manner whatsoever to any Receivable,
shall indicate clearly that such Receivable has been sold and is owned by the
Issuer and has been pledged to the Indenture Trustee.
(g) The Servicer shall permit either Seller, the Indenture
Trustee and the Owner Trustee and their respective agents upon reasonable notice
at any time during normal business hours which does not unreasonably interfere
with the Servicer's normal operations or customer or employee relations to
inspect, audit, and make copies of and abstracts from the Servicer's records
regarding the Receivables.
(h) Upon request, the Servicer shall furnish to the Owner
Trustee or the Indenture Trustee, within five Business Days, a list of all
Receivables by contract number and name of Obligor then held by the Issuer,
together with a reconciliation of such list to the Schedules of Receivables and
to each of the Servicer Certificates indicating removal of Receivables from the
Owner Trust Estate.
(i) The Sellers shall deliver to the Owner Trustee and the
Indenture Trustee upon the execution and delivery of this Agreement, an Opinion
of Counsel stating that, in the opinion of such counsel, all financing
statements and continuation statements have been executed and filed that are
necessary fully to preserve and protect the interest of the Issuer and the
Indenture Trustee in the Receivables, and reciting the details of such filings.
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(j) The Servicer shall deliver to the Owner Trustee and
Indenture Trustee on or before March 31 of each year, commencing with March 31,
1998, an Opinion of Counsel, dated as of such date, either (a) stating that, in
the opinion of such counsel, all financing statements and continuation
statements have been executed and filed that are necessary fully to preserve and
protect the interest of the Issuer and the Indenture Trustee in the Receivables,
and reciting the details of such filings or referring to prior opinions of
Counsel in which such details are given, or (b) stating that, in the opinion of
such counsel, no such action shall be necessary to preserve and protect such
interest. Notwithstanding the provisions of Section 10.4, such Opinion of
Counsel may be sent by regular non-certified mail, and such mailed opinion shall
be deemed delivered when so mailed.
(k) The Sellers shall, to the extent required by applicable
law, cause the Certificates and the Notes to be registered with the Securities
and Exchange Commission pursuant to Section 12(b) or Section 12(g) of the
Exchange Act within the time periods specified in such sections.
(l) For the purpose of facilitating the execution of this
Agreement and for other purposes, this Agreement may be executed simultaneously
in any number of counterparts, each of which counterparts shall be deemed to be
an original, and all of which counterparts shall constitute but one and the same
instrument.
SECTION 10.3. Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York without
reference to its conflict of laws provisions, and the obligations, rights,
remedies of the parties hereunder shall be determined in accordance with such
laws.
SECTION 10.4. Notices. All demands, notices, and
communications under this Agreement shall be in writing, personally delivered or
mailed by certified mail, return receipt requested, and shall be deemed to have
been duly given upon receipt (a) in the case of (i) Chase USA, to Chase
Manhattan Bank USA, National Association, 802 Delaware Avenue, Wilmington,
Delaware 19801, Attention:_____________________ and (ii) in the case of Chase,
The Chase Manhattan Bank, 270 Park Avenue, New York, New York 10017, Attention:
_____________, or at such other address as shall be designated by either of the
Sellers in a written notice to the Indenture Trustee, (b) in the case of the
Servicer, The CIT Group/Sales Financing, Inc., 650 CIT Drive, Livingston, New
Jersey 07039, Attn: President, with a copy to: The CIT Group/Sales Financing,
Inc., 715 South Metropolitan Avenue, Suite 150, Oklahoma City, Oklahoma
73108-2090, Attn: Senior Vice President, or at such other address as shall be
designated by the Servicer in a written notice to the Indenture Trustee, (c) in
the case of the Indenture Trustee, at Sixth Street and Marquette Avenue,
Minneapolis, Minnesota 55479-0070, Attention: Corporate Trust Office, and, (d)
in the case of the Issuer and the Owner Trustee, at c/o Wilmington Trust
Company,
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Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001,
Attention: Corporate Trust Administration. Any notice required or permitted to
be mailed to a Holder shall be given by first class mail, postage prepaid, at
the address of record of such Holder. Any notice to a Holder so mailed within
the time prescribed in this Agreement shall be conclusively presumed to have
been duly given, whether or not the Holder shall receive such notice.
SECTION 10.5. Severability of Provisions. If any one
or more of the covenants, agreements, provisions, or terms of this Agreement
shall be for any reason whatsoever held invalid, then such covenants,
agreements, provisions, or terms 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 of the Certificates or of the Notes or the rights of the Holders
thereof.
SECTION 10.6. Assignment. Notwithstanding anything to the
contrary contained herein, except as provided in Sections 6.3, 7.3, 7.5, 7.6 and
8.2 and subject to the terms of the Servicing Agreement, neither of the Sellers
nor the Servicer may assign all, or a portion of, its rights, obligations and
duties under this Agreement unless such transfer or assignment satisfies the
Rating Agency Condition. In the event of a transfer or assignment pursuant to
this Section 10.6, the Rating Agencies shall be provided with notice of such
transfer or assignment.
SECTION 10.7. Certificates and Notes Nonassessable and Fully
Paid. The interests represented by the Certificates and Notes shall be
nonassessable for any losses or expenses of the Issuer or for any reason
whatsoever, and, upon authentication thereof by the Indenture Trustee and the
Owner Trustee pursuant to the Trust Agreement and the Indenture, respectively,
each Certificate and Note shall be deemed fully paid.
SECTION 10.8. Third-Party Beneficiaries. This Agreement
inures to the benefit of and is binding upon the parties hereto, and their
respective successors and permitted assigns. The Administrators, the Owner
Trustee, individually and on behalf of the Certificateholders, and the Indenture
Trustee, individually and on behalf of the Noteholders are third-party
beneficiaries to this Agreement and are entitled to the rights and benefits
hereunder and may enforce the provisions hereof as it were a party hereto.
Except as otherwise provided in this Agreement, no other person will have any
right or obligation hereunder.
SECTION 10.9. Assignment to Indenture Trustee. Each Seller
hereby acknowledges and consents to any mortgage, pledge, assignment and grant
of a security interest by the Issuer to the Indenture Trustee pursuant to the
Indenture for the benefit of the Noteholders of all right, title and interest of
the Issuer in, to and under the Receivables and the other property
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constituting the Owner Trust Estate and/or the assignment of any or all of the
Issuer's rights and obligations hereunder to the Indenture Trustee.
SECTION 10.10. Limitation of Liability of Owner Trustee and
Indenture Trustee. (a) Notwithstanding anything contained herein to the
contrary, this Agreement has been countersigned by Wilmington Trust Company not
in its individual capacity but solely in its capacity as Owner Trustee of the
Issuer, and in no event shall Wilmington Trust Company in its individual
capacity or, except as expressly provided in the Trust Agreement, as beneficial
owner of the Issuer, have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any of
the certificates, notices or agreements delivered pursuant hereto, as to all of
which recourse shall be had solely to the assets of the Issuer. For all purposes
of this Agreement, in the performance of its duties or obligations hereunder or
in the performance of any duties or obligations of the Issuer hereunder, the
Owner Trustee shall be subject to, and entitled to the benefits of, the terms
and provisions of Articles VI, VII and VIII of the Trust Agreement.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been acknowledged and accepted by Norwest Bank Minnesota, National
Association not in its individual capacity but solely as Indenture Trustee, and
in no event shall Norwest Bank Minnesota, National Association have any
liability for the representations, warranties, covenants, agreements or other
obligations of the Issuer hereunder or in any of the certificates, notices or
agreements delivered pursuant hereto, as to all of which recourse shall be had
solely to the assets of the Issuer.
SECTION 10.11. Power-of-Attorney. Each of the Sellers do
hereby make, constitute and appoint the CITSF, as Servicer hereunder, and any
successor Servicer hereunder, as its attorney-in-fact to execute on behalf of
such Seller any of the financing statements and continuation statements required
to be executed by the Servicer pursuant to Section 10.2 or other documents or
financing statements required to be executed or filed in order to realize on a
Financed Vehicle or to comply with the Servicer's obligations under Section 4.4
hereof.
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IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed by their respective officers as of the day and year first above
written.
CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION,
as Seller
By:
-------------------------------------
Name:
Title:
THE CHASE MANHATTAN BANK,
as Seller
By:
-------------------------------------
Name:
Title:
THE CIT GROUP/SALES FINANCING, INC.,
as Servicer
By:
-------------------------------------
Name:
Title:
CHASE MANHATTAN RV OWNER TRUST,
1997-A,
as Issuer
By: WILMINGTON TRUST COMPANY,
not in its individual
capacity but solely as
Owner Trustee on behalf
of the Issuer
By:
-------------------------------------
Name:
Title:
<PAGE>
Acknowledged and Accepted:
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
not in its individual capacity,
but solely in its capacity
as Indenture Trustee
By:
-------------------------------------
Name:
Title:
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SCHEDULE A-1
LIST OF CHASE USA RECEIVABLES
Delivered to the Owner Trustee and the Indenture Trustee
on the Closing Date.
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SCHEDULE A-2
LIST OF CHASE RECEIVABLES
Delivered to the Owner Trustee and the Indenture Trustee
on the Closing Date.
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SCHEDULE B
LOCATION OF RECEIVABLE FILES
[TO BE PROVIDED]
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SCHEDULE C
ALLOCATION OF NOTES AND CERTIFICATES
Chase Chase USA
----- ---------
Class A-1
Class A-2
Class A-3
Class A-4
Class A-5
Class A-6
Class A-7
Class A-8
Class A-9
Class A-10
87
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SCHEDULE D
ALLOCATION OF FEES AND EXPENSES TO SERVICER
88
<PAGE>
EXHIBIT A
[FORM OF SERVICER'S CERTIFICATE]
<PAGE>
EXHIBIT B
[FORM OF MONTHLY REPORT]
<PAGE>
EXHIBIT C
[FORM OF STATEMENT TO
CERTIFICATEHOLDERS AND NOTEHOLDERS]
<PAGE>
EXHIBIT D
FORM OF AMENDED AND RESTATED
SERVICING AGREEMENT
C-2
<PAGE>
OH&S DRAFT
9/17/97
- -------------------------------------------------------------------------------
CHASE MANHATTAN RV OWNER TRUST 1997-A
Class A-1 [____]% Asset Backed Notes
Class A-2 [____]% Asset Backed Notes
Class A-3 [____]% Asset Backed Notes
Class A-4 [____]% Asset Backed Notes
Class A-5 [____]% Asset Backed Notes
Class A-6 [____]% Asset Backed Notes
Class A-7 [____]% Asset Backed Notes
Class A-8 [____]% Asset Backed Notes
Class A-9 [____]% Asset Backed Notes
Class A-10 [____]% Asset Backed Notes
INDENTURE
Dated as of September 1, 1997
Norwest Bank Minnesota, National Association
as Indenture Trustee
- -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions............................................... 2
SECTION 1.2 Incorporation by Reference of Trust
Indenture Act........................................... 2
SECTION 1.3 Usage of Terms............................................ 3
SECTION 1.4 Calculations of Interest.................................. 3
ARTICLE II
THE NOTES
SECTION 2.1 Form...................................................... 3
SECTION 2.2 Execution, Authentication and Delivery.................... 4
SECTION 2.3 Temporary Notes........................................... 4
SECTION 2.4 Registration of Transfer and Exchange..................... 5
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen
Notes................................................... 7
SECTION 2.6 Persons Deemed Owner...................................... 8
SECTION 2.7 Payment of Principal and Interest;
Defaulted Interest...................................... 8
SECTION 2.8 Cancellation.............................................. 10
SECTION 2.9 Release of Collateral..................................... 10
SECTION 2.10 Book-Entry Notes.......................................... 10
SECTION 2.11 Notices to Clearing Agency................................ 11
SECTION 2.12 Definitive Notes.......................................... 11
SECTION 2.13 Authenticating Agent...................................... 12
SECTION 2.14 Appointment of Paying Agent............................... 13
ARTICLE III
COVENANTS
SECTION 3.1 Payment of Principal and Interest......................... 15
SECTION 3.2 Maintenance of Office or Agency........................... 15
SECTION 3.3 Money for Payments To Be Held in Trust.................... 16
SECTION 3.4 Existence................................................. 17
SECTION 3.5 Protection of Trust Estate................................ 17
SECTION 3.6 Opinions as to Trust Estate............................... 17
SECTION 3.7 Performance of Obligations; Servicing of
Receivables............................................. 18
SECTION 3.8 Negative Covenants........................................ 19
SECTION 3.9 Annual Statement as to Compliance......................... 20
SECTION 3.10 The Issuer May Consolidate, Etc. Only on
Certain Terms........................................... 20
SECTION 3.11 Successor or Transferee................................... 22
SECTION 3.12 No Other Business......................................... 22
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SECTION 3.13 No Borrowing.............................................. 22
SECTION 3.14 Servicer's Obligations.................................... 23
SECTION 3.15 Guarantees, Loans, Advances and Other
Liabilities............................................. 23
SECTION 3.16 Capital Expenditures...................................... 23
SECTION 3.17 Restricted Payments....................................... 23
SECTION 3.18 Notice of Events of Default............................... 23
SECTION 3.19 Further Instruments and Acts.............................. 23
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 Satisfaction and Discharge of Indenture................... 24
SECTION 4.2 Application of Trust Money................................ 25
SECTION 4.3 Repayment of Moneys Held by Paying
Agent................................................... 25
SECTION 4.4 Duration of the Position of the
Indenture Trustee for the Benefit of
Certificateholders...................................... 25
ARTICLE V
REMEDIES
SECTION 5.1 Events of Default......................................... 26
SECTION 5.2 Acceleration of Maturity; Rescission and
Annulment............................................... 27
SECTION 5.3 Collection of Indebtedness and Suits for
Enforcement by the Indenture Trustee.................... 27
SECTION 5.4 Remedies; Priorities...................................... 29
SECTION 5.5 Optional Preservation of the
Receivables............................................. 30
SECTION 5.6 Limitation of Suits....................................... 31
SECTION 5.7 Unconditional Rights of Noteholders To
Receive Principal and Interest.......................... 32
SECTION 5.8 Restoration of Rights and Remedies........................ 32
SECTION 5.9 Rights and Remedies Cumulative............................ 32
SECTION 5.10 Delay or Omission Not a Waiver............................ 32
SECTION 5.11 Control by Noteholders.................................... 32
SECTION 5.12 Waiver of Past Defaults................................... 33
SECTION 5.13 Undertaking for Costs..................................... 33
SECTION 5.14 Waiver of Stay or Extension Laws.......................... 34
SECTION 5.15 Action on Notes........................................... 34
SECTION 5.16 Performance and Enforcement of Certain
Obligations............................................. 34
ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1 Duties of the Indenture Trustee........................... 35
SECTION 6.2 Rights of the Indenture Trustee........................... 37
SECTION 6.3 Individual Rights of the Indenture
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Trustee................................................. 38
SECTION 6.4 The Indenture Trustee's Disclaimer........................ 38
SECTION 6.5 Notice of Defaults........................................ 38
SECTION 6.6 Reports by the Indenture Trustee to
Holders................................................. 38
SECTION 6.7 Compensation and Indemnity................................ 39
SECTION 6.8 Replacement of the Indenture Trustee...................... 39
SECTION 6.9 Successor Indenture Trustee by Merger..................... 40
SECTION 6.10 Appointment of Co-Indenture Trustee or
Separate Indenture Trustee.............................. 41
SECTION 6.11 Eligibility; Disqualification............................. 42
SECTION 6.12 Preferential Collection of Claims
Against the Issuer...................................... 42
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 The Issuer To Furnish the Indenture
Trustee Names and Addresses of the
Noteholders............................................. 43
SECTION 7.2 Preservation of Information;
Communications to the Noteholders....................... 43
SECTION 7.3 Reports by the Issuer..................................... 43
SECTION 7.4 Reports by the Indenture Trustee.......................... 44
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 Collection of Money....................................... 44
SECTION 8.2 Accounts.................................................. 44
SECTION 8.3 General Provisions Regarding Accounts..................... 46
SECTION 8.4 Release of Trust Estate................................... 47
SECTION 8.5 Opinion of Counsel........................................ 47
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent
of Noteholders.......................................... 48
SECTION 9.2 Supplemental Indentures with Consent of
the Noteholders......................................... 49
SECTION 9.3 Effect of Supplemental Indenture.......................... 51
SECTION 9.4 Conformity with Trust Indenture Act....................... 51
SECTION 9.5 Reference in Notes to Supplemental
Indentures.............................................. 51
SECTION 9.6 Execution of Supplemental Indentures...................... 51
ARTICLE X
[Reserved]
iii
<PAGE>
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Compliance Certificates and Opinions,
etc..................................................... 52
SECTION 11.2 Form of Documents Delivered to the
Indenture Trustee....................................... 54
SECTION 11.3 Actions of Noteholders.................................... 55
SECTION 11.4 Notices, etc., to the Indenture Trustee,
the Issuer, and Rating Agencies......................... 55
SECTION 11.5 Notices to Noteholders; Waiver............................ 56
SECTION 11.6 Alternate Payment and Notice Provisions................... 57
SECTION 11.7 Conflict with Trust Indenture Act......................... 57
SECTION 11.8 Effect of Headings and Table of
Contents................................................ 57
SECTION 11.9 Successors and Assigns.................................... 57
SECTION 11.10 Separability.............................................. 57
SECTION 11.11 Benefits of Indenture..................................... 57
SECTION 11.12 Legal Holidays............................................ 57
SECTION 11.13 GOVERNING LAW............................................. 58
SECTION 11.14 Counterparts.............................................. 58
SECTION 11.15 Recording of Indenture.................................... 58
SECTION 11.16 Trust Obligation.......................................... 58
SECTION 11.17 No Petition............................................... 58
SECTION 11.18 Inspection................................................ 59
Exhibit A - Schedule of Receivables
Exhibit B - Form of Note
iv
<PAGE>
CROSS REFERENCE TABLE(1)
TIA Section Indenture Section
310 (a)(1).................................................. 6.11
(a)(2).................................................. 6.11
(a)(3).................................................. 6.10
(a)(4).................................................. N.A.(2)
(a)(5).................................................. 6.11
(b) ............................................... 6.8;
............................................... 6.11
(c) ............................................... N.A.
311 (a) ............................................... 6.12
(b) ............................................... 6.12
(c) ............................................... N.A.
312 (a) ............................................... 7.1;
............................................... 7.2
(b) ............................................... 7.2
(c) ............................................... 7.2
313 (a) ............................................... 7.4
(b)(1).................................................. 7.4
(b)(2).................................................. 7.4
(c) ............................................... 7.4
(d) ............................................... 7.3
314 (a) ............................................... 7.3
(b) ............................................... 3.6
(c)(1).................................................. 11.1
(c)(2).................................................. 11.1
(c)(3).................................................. 11.1
(d) ............................................... 11.1
(e) ............................................... 11.1
(f) ............................................... N.A.
315 (a) ............................................... 6.1
(b) ............................................... 6.5;
............................................... 11.5
(c) ............................................... 6.1
(d) ............................................... 6.1
(e) ............................................... 5.13
316 (a) (last sentence)..................................... 1.1
(a)(1)(A)............................................... 5.11
(a)(1)(B)............................................... 5.12
(a)(2).................................................. N.A.
(b) ............................................... 5.7
(c) ............................................... N.A.
317 (a)(1).................................................. 5.3
(a)(2).................................................. 5.3
(b) ............................................... 3.3
- --------
(1) Note: This Cross Reference Table shall not, for any purpose,
be deemed to be part of this Indenture.
(2) N.A. means Not Applicable.
v
<PAGE>
CROSS REFERENCE TABLE(3)
TIA Section Indenture Section
318 (a) ............................................... 11.7
- --------
(3) Note: This Cross Reference Table shall not, for any purpose,
be deemed to be part of this Indenture.
vi
<PAGE>
INDENTURE dated as of September 1, 1997, between CHASE MANHATTAN RV
OWNER TRUST 1997-A, a Delaware business trust (the "Issuer"), and NORWEST BANK
MINNESOTA, NATIONAL ASSOCIATION, a national banking association, solely as
trustee and not in its individual capacity (the "Indenture Trustee").
Each party agrees as follows for the benefit of the other party and for
the equal and ratable benefit of the Holders of the Issuer's Class A-1 [____]%
Asset Backed Notes (the "Class A-1 Notes"), Class A-2 [____]% Asset Backed Notes
(the "Class A-2 Notes"), Class A-3 [____]% Asset Backed Notes (the "Class A-3
Notes"), Class A-4 [____]% Asset Backed Notes (the "Class A-4 Notes"), Class A-5
[____]% Asset Backed Notes (the "Class A-5 Notes"), Class A-6 [____]% Asset
Backed Notes (the "Class A-6 Notes"), Class A-7 [____]% Asset Backed Notes (the
"Class A-7 Notes"), Class A-8 [____]% Asset Backed Notes (the "Class A-8
Notes"), Class A-9 [____]% Asset Backed Notes (the "Class A-9 Notes") and Class
A-10 [____]% Asset Backed Notes (the "Class A- 10 Notes" and, together with 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, the Class A-6 Notes, the Class A-7 Notes, the Class A-8
Notes and the Class A-9 Notes, the "Notes"):
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee at the Closing Date,
as Indenture Trustee for the benefit of the Noteholders and (only to the extent
expressly provided herein) the Certificateholders, all of the Issuer's right,
title and interest in, to and under (a) the Receivables listed in Schedule A
hereto, all proceeds thereof and (i) with respect to the Simple Interest
Receivables, all amounts and monies received thereon after the Cutoff Date and
(ii) with respect to the Precomputed Receivables, all amounts and monies due
thereon on and after the Cutoff Date (including in the case of each Seller
proceeds of the repurchase by such Seller of the related Receivables pursuant to
Section 3.2 of the Sale and Servicing Agreement or the purchase of Receivables
by the Servicer pursuant to Section 4.6 or 9.1 of the Sale and Servicing
Agreement); (b) the security interests in the Financed Vehicles granted by the
Obligors pursuant to the Receivables and in any repossessed Financed Vehicles;
(c) Net Liquidation Proceeds and in any proceeds of any extended warranties,
theft and physical damage, credit life or credit disability policies relating to
the Financed Vehicles or the Obligors; (d) any proceeds from Dealer repurchase
obligations relating to the Receivables; (e) funds on deposit from time to time
in the Trust Accounts (including without limitation the Reserve Account and the
Paid-Ahead Account), and in all investments and proceeds thereof (other than all
investment income on funds on deposit in the Trust Accounts); (f) the Sale and
Servicing Agreement; and (g) all present and future claims, demands, causes and
choses in action in respect of any or all of the foregoing and all payments on
or under and all proceeds of
<PAGE>
every kind and nature whatsoever in respect of any or all of the foregoing,
including all proceeds of the conversion, voluntary or involuntary, into cash or
other liquid property, all cash proceeds, accounts, accounts receivable, notes,
drafts, contract rights, acceptances, chattel paper, checks, deposit accounts,
insurance proceeds, condemnation awards, rights to payment of any and every kind
and other forms of obligations and receivables, instruments and other property
which at any time constitute all or part of or are included in the proceeds of
any of the foregoing (collectively, the "Collateral").
The foregoing Grant is made in trust to secure the payment of principal
of and interest on, and any other amounts owing in respect of, the Notes,
equally and ratably without prejudice, priority or distinction except as set
forth herein, and to secure compliance with the provisions of this Indenture,
all as provided in this Indenture.
The Indenture Trustee, as trustee on behalf of the Holders of the
Notes, acknowledges such Grant, accepts the trusts under this Indenture in
accordance with the provisions of this Indenture and agrees to perform its
duties required in this Indenture to the best of its ability to the end that the
interests of the Holders of the Notes and (only to the extent expressly provided
herein) Holders of the Certificates may be adequately and effectively protected.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions. Capitalized terms are used in this Indenture
as defined in Section 1.1 to the Sale and Servicing Agreement dated as of
September 1, 1997, among the Issuer and CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION and THE CHASE MANHATTAN BANK, as Sellers and THE CIT GROUP/SALES
FINANCING, INC., as Servicer (the "Sale and Servicing Agreement").
SECTION 1.2 Incorporation by Reference of Trust Indenture Act. Whenever
this Indenture refers to a provision of the TIA, the provision is incorporated
by reference in and made a part of this Indenture. The following TIA terms used
in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
2
<PAGE>
"indenture trustee" or "institutional trustee" means the
Indenture Trustee.
"obligor" on the indenture securities means the Issuer and
any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule have
the meaning assigned to them by such definitions.
SECTION 1.3 Usage of Terms. With respect to all terms in this
Indenture, the singular includes the plural and the plural the singular; words
importing any gender include the other gender; references to "writing" include
printing, typing, lithography, and other means of reproducing words in a visible
form; references to agreements and other contractual instruments include all
subsequent amendments thereto or changes therein entered into in accordance with
their respective terms and not prohibited by this Indenture; references to
Persons include their permitted successors and assigns; and the term "including"
means "including without limitation." All references herein to Articles,
Sections, Subsections and Exhibits are references to Articles, Sections,
Subsections and Exhibits contained in or attached to this Indenture unless
otherwise specified, and each such Exhibit is part of the terms of this
Indenture.
SECTION 1.4 Calculations of Interest. All calculations of interest
made hereunder shall be made on the basis of a year of 360 days of twelve 30-day
months, other than the calculation of interest accrued on the Class A-1 Notes,
which will be calculated on the basis of a 360-day year based upon the actual
number of days elapsed during the related Interest Accrual Period.
ARTICLE II
THE NOTES
SECTION 2.1 Form. The Notes of each class, together with the Indenture
Trustee's certificate of authentication, shall be in substantially the form set
forth in Exhibit B, with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined to be
appropriate by the officers executing such Notes, as evidenced by their
execution of the Notes. Any portion of the text of any Note may be set forth on
the reverse thereof, with an appropriate reference thereto on the face of the
Note. Each Note shall be dated the date of its authentication. The Notes shall
be issuable as registered Notes in the minimum denomination of $1,000 and in
integral multiples thereof (except,
3
<PAGE>
if applicable, for one Note representing a residual portion of each class which
may be issued in a denomination other than an integral multiple of $1,000).
Notes bearing the manual or facsimile signature of individuals who were
at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the date of authentication and delivery of such Notes or did
not hold such offices at such date. No Note shall be entitled to any benefit
under this Indenture or be valid or obligatory for any purpose, unless there
appears on such Note a certificate of authentication substantially in the form
provided for herein executed by the Indenture Trustee by the manual signature of
one of its authorized signatories, and such certificate upon any Note shall be
conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder. The terms of the Notes set forth in
Exhibit B are part of the terms of this Indenture.
The Definitive Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without steel
engraved borders), all as determined by the officers executing such Notes, as
evidenced by their execution of such Notes.
SECTION 2.2 Execution, Authentication and Delivery. The Notes shall be
executed on behalf of the Issuer by any of its Authorized Officers or by any
other authorized signatory of the Issuer. The signature of any such Authorized
Officer on the Notes may be manual or facsimile.
The Indenture Trustee shall, upon written order of the Sellers,
authenticate and deliver Class A-1 Notes for original issue in an aggregate
principal amount of $59,500,000.00, Class A-2 Notes for original issue in an
aggregate principal amount of $119,000,000.00, Class A-3 Notes for original
issue in the aggregate principal amount of $113,000,000.00, Class A-4 Notes for
original issue in the aggregate principal amount of $73,000,000.00, Class A-5
Notes for original issue in an aggregate principal amount of $132,000,000.00,
Class A-6 Notes for original issue in an aggregate principal amount of
$88,000,000.00, Class A-7 Notes for original issue in the aggregate principal
amount of $57,000,000.00, Class A-8 Notes for original issue in the aggregate
principal amount of $85,000,000.00, Class A-9 Notes for original issue in the
aggregate principal amount of $61,000,000.00 and Class A-10 Notes for original
issue in the aggregate principal amount of $65,000,000.00. The respective
aggregate principal amount of Class A-1 Notes, Class A-2 Notes, Class A-3 Notes,
Class A-4 Notes, Class A-5 Notes, Class A-6 Notes, Class A-7 Notes, Class A-8
Notes, Class A-9 Notes and Class A-10 Notes outstanding at any time may not
exceed such amounts, except as provided in Section 2.5.
SECTION 2.3 Temporary Notes. Pending the preparation of Definitive
Notes, the Issuer may execute, and at the direction of
4
<PAGE>
the Issuer, the Indenture Trustee shall authenticate and deliver, temporary
Notes which are printed, lithographed, typewritten, mimeographed or otherwise
produced, of the tenor of the Definitive Notes in lieu of which they are issued
and with such variations not inconsistent with the terms of this Indenture as
the officers executing such Notes may determine, as evidenced by their execution
of such Notes.
If temporary Notes are issued, the Issuer will cause Definitive Notes
to be prepared without unreasonable delay. After the preparation of Definitive
Notes, the temporary Notes shall be exchangeable for Definitive Notes upon
surrender of the temporary Notes at the office or agency of the Issuer to be
maintained as provided in Section 3.2, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Notes, the Issuer shall
execute and the Indenture Trustee shall authenticate and deliver in exchange
therefor a like principal amount of Definitive Notes of authorized
denominations. Until so exchanged, the temporary Notes shall in all respects be
entitled to the same benefits under this Indenture as Definitive Notes.
SECTION 2.4 Registration of Transfer and Exchange. The Issuer shall
cause to be kept a register (the "Note Register") in which, subject to such
reasonable regulations as it may prescribe, the Note Registrar shall provide for
the registration of the Notes and the registration of transfers of the Notes.
Chase shall initially be "Note Registrar" for the purpose of registering Notes
and transfers of Notes as herein provided. In the event that, subsequent to the
date of issuance of the Notes, Chase notifies the Indenture Trustee that it is
unable to act as Note Registrar, the Indenture Trustee shall act, or the
Indenture Trustee shall, with the consent of the Issuer, appoint another bank or
trust company, having an office or agency located in The City of New York and
which agrees to act in accordance with the provisions of this Indenture
applicable to it, to act, as successor Note Registrar under this Indenture.
The Indenture Trustee may revoke such appointment and remove Chase as
Note Registrar if the Indenture Trustee determines in its sole discretion that
Chase failed to perform its obligations under this Indenture in any material
respect. Chase shall be permitted to resign as Note Registrar upon 30 days'
written notice to the Indenture Trustee, the Sellers and the Servicer; provided,
however, that such resignation shall not be effective and Chase shall continue
to perform its duties as Note Registrar until the Indenture Trustee has
appointed a successor Note Registrar with the consent of the Issuer.
If a Person other than the Indenture Trustee is appointed by the Issuer
as the Note Registrar, the Issuer will give the Indenture Trustee prompt written
notice of the appointment of such Note Registrar and of the location, and any
change in the location, of the Note Register, and the Indenture Trustee shall
have the right to inspect the Note Register at all reasonable times and to
5
<PAGE>
obtain copies thereof, and the Indenture Trustee shall have the right to
conclusively rely upon a certificate executed on behalf of the Note Registrar by
an Executive Officer thereof as to the names and addresses of the Noteholders
and the principal amounts and number of such Notes.
An institution succeeding to the corporate agency business of the Note
Registrar shall continue to be the Note Registrar without the execution or
filing of any paper or any further act on the part of the Indenture Trustee or
such Note Registrar.
The Note Registrar shall maintain in The City of New York an office or
offices or agency or agencies where Notes may be surrendered for registration of
transfer or exchange. The Note Registrar initially designates its corporate
trust office located at 450 West 33rd Street, New York, New York 10001-2697 as
its office for such purposes. The Note Registrar shall give prompt written
notice to the Indenture Trustee, the Sellers, the Servicer and to the
Noteholders of any change in the location of such office or agency.
Upon surrender for registration of transfer of any Note at the office
or agency of the Issuer to be maintained as provided in Section 3.2, if the
requirements of Section 8-401(1) of the Uniform Commercial Code are met, the
Issuer shall execute, the Indenture Trustee shall authenticate and (if the Note
Registrar is different than the Indenture Trustee, then the Note Registrar
shall) deliver to the Noteholder, in the name of the designated transferee or
transferees, one or more new Notes, in any authorized denominations, of the same
class and a like aggregate principal amount.
At the option of the Holder, the Notes may be exchanged for other Notes
in any authorized denominations, of the same class and a like aggregate
principal amount, upon surrender of the Notes to be exchanged at such office or
agency. Whenever any Notes are so surrendered for exchange, if the requirements
of Section 8-401(1) of the UCC are met, the Issuer shall execute and the
Indenture Trustee shall authenticate and (if the Note Registrar is different
than the Indenture Trustee, then the Note Registrar shall) deliver to the
Noteholder, the Notes which the Noteholder making the exchange is entitled to
receive.
All Notes issued upon any registration of transfer or exchange of the
Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall be (i) duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the Indenture Trustee duly
executed by, the Holder thereof or such Holder's attorney duly authorized in
writing, with
6
<PAGE>
such signature guaranteed by a commercial bank or trust company located, or
having a correspondent located, in the City of New York or the city in which the
Corporate Trust Office is located, or by a member firm of a national securities
exchange, and (ii) accompanied by such other documents as the Indenture Trustee
may require. Each Note surrendered for registration of transfer or exchange
shall be cancelled by the Note Registrar and disposed of by the Indenture
Trustee or Note Registrar in accordance with its customary practice.
No service charge shall be made to a Holder for any registration of
transfer or exchange of the Notes, but the Issuer may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Notes, other than
exchanges pursuant to Section 2.3 or 9.5 not involving any transfer.
The preceding provisions of this section notwithstanding, the Issuer
shall not be required to make, and the Note Registrar need not register,
transfers or exchanges of any Note for a period of 15 days preceding the due
date for any payment in full with respect to such Note.
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes. If (i) any
mutilated Note is surrendered to the Note Registrar, or the Note Registrar
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Note Registrar and the Indenture
Trustee such security or indemnity as may be required by them to hold the
Issuer, the Note Registrar and the Indenture Trustee harmless, then, in the
absence of notice to the Issuer, the Note Registrar or the Indenture Trustee
that such Note has been acquired by a bona fide purchaser, and provided that the
requirements of Section 8-405 of the UCC are met, the Issuer shall
execute and the Indenture Trustee shall authenticate and (if the Note Registrar
is different from the Indenture Trustee, the Note Registrar shall) deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a
replacement Note of like class, tenor and denomination; provided that if any
such destroyed, lost or stolen Note, but not a mutilated Note, shall
have become or within seven days shall be due and payable, or shall have been
called for redemption, instead of issuing a replacement Note, the Issuer may pay
such destroyed, lost or stolen Note when so due or payable without surrender
thereof. If, after the delivery of such replacement Note or payment of a
destroyed, lost or stolen Note pursuant to the proviso to the preceding
sentence, a bona fide purchaser of the original Note in lieu of which such
replacement Note was issued presents for payment such original Note, the Issuer,
the Note Registrar and the Indenture Trustee shall be entitled to recover such
replacement Note (or such payment) from the Person to whom it was delivered or
any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and shall be entitled to recover upon the security or indemnity
provided therefor to the extent of any
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loss, damage, cost or expense incurred by the Issuer, the Note Registrar or the
Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section, the
Issuer may require the payment by the Holder of such Note of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) connected therewith.
Every replacement Note issued pursuant to this Section 2.5 in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.6 Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee, the
Note Registrar and any agent of the Issuer, the Indenture Trustee or the Note
Registrar may treat the Person in whose name any Note is registered (as of the
day of determination) as the owner of such Note for the purpose of receiving
payments of principal of and interest, if any, on such Note and for all other
purposes whatsoever, whether or not such Note shall be overdue, and neither the
Issuer, the Indenture Trustee or the Note Registrar nor any agent of the Issuer,
the Indenture Trustee or the Note Registrar shall be bound by notice to the
contrary.
SECTION 2.7 Payment of Principal and Interest; Defaulted Interest.
(a) The Notes shall accrue interest at the following Interest Rates:
Note Interest Rate
Class A-1 _____%
Class A-2 _____%
Class A-3 _____%
Class A-4 _____%
Class A-5 _____%
Class A-6 _____%
Class A-7 _____%
Class A-8 _____%
Class A-9 _____%
Class A-10 _____%
and such interest shall be payable on each Distribution Date as specified
therein. Any installment of interest or principal, if
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any, payable on any Note which is punctually paid or duly provided for by the
Issuer on the applicable Distribution Date shall be paid to the Person in whose
name such Note (or one or more Predecessor Notes) is registered on the preceding
Record Date, by check mailed first-class, postage prepaid, to such Person's
address as it appears on the Note Register on such Record Date, except that,
unless Definitive Notes have been issued pursuant to Section 2.12, with respect
to the Notes registered on the Record Date in the name of the nominee of the
Clearing Agency (initially, such nominee to be Cede & Co.), payment will be made
by wire transfer in immediately available funds to the account designated by
such nominee, except for the final installment of principal payable with respect
to such Note on a Distribution Date or on a Note Final Scheduled Distribution
Date. The funds represented by any such checks returned undelivered shall be
held in accordance with Section 3.3.
(b) The principal of each Note shall be payable in installments no
later than 12 noon, New York City time, on each Distribution Date as provided in
the form of the Notes, set forth in Exhibit B. The outstanding principal amount
of the Notes, to the extent not previously paid, will be payable on the Note
Final Scheduled Distribution Date specified for such class in the table below.
Note Note Final Scheduled
Distribution Date
--------------------
Class A-1 Notes October 1998
Class A-2 Notes August 2000
Class A-3 Notes February 2002
Class A-4 Notes December 2002
Class A-5 Notes November 2004
Class A-6 Notes December 2005
Class A-7 Notes October 2006
Class A-8 Notes December 2007
Class A-9 Notes December 2008
Class A-10 Notes March 2010
Notwithstanding the foregoing, the entire unpaid principal amount of the Notes
shall be due and payable, if not previously paid, on the date on which an Event
of Default shall have occurred and be continuing, if the Indenture Trustee or
the Holders of the Notes representing not less than a majority of the
Outstanding Amount of the Notes have declared the Notes to be immediately due
and payable in the manner provided in Section 5.2. All principal payments on
each class of Notes shall be made pro rata to the Noteholders of such class
entitled thereto. The Indenture Trustee shall notify the Person in whose name a
Note is registered at the close of business on the Record Date preceding the
Distribution Date on which the Issuer expects that the final installment of
principal of and interest on such Note will be paid. Such notice shall be
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(i) transmitted by facsimile on such Record Date if Book-Entry Notes are
outstanding or (ii) mailed as provided in Section 10.2 not later than three
Business Days after such Record Date if Definitive Notes are outstanding and
shall specify that such final installment will be payable only upon presentation
and surrender of such Note and shall specify the place where such Note may be
presented and surrendered for payment of such installment.
SECTION 2.8 Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Note Registrar, be delivered to the Note Registrar and
shall be promptly cancelled by the Note Registrar. The Issuer may at any time
deliver to the Note Registrar for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever, and all Notes so delivered shall be promptly cancelled by the
Note Registrar. No Notes shall be authenticated in lieu of or in exchange for
any Notes cancelled as provided in this Section, except as expressly permitted
by this Indenture. All cancelled Notes may be held or disposed of by the Note
Registrar in accordance with its standard retention or disposal policy as in
effect at the time unless the Issuer shall direct that they be destroyed or
returned to it; provided that such direction is timely and the Notes have not
been previously disposed of by the Note Registrar.
SECTION 2.9 Release of Collateral. Subject to Section 11.1, the
Indenture Trustee shall release property from the lien of this Indenture only
upon request of the Issuer accompanied by an Officer's Certificate, an Opinion
of Counsel and Independent Certificates in accordance with the TIA ss.ss.314(c)
and 314(d)(1) or an Opinion of Counsel in lieu of such Independent Certificates
to the effect that the TIA does not require any such Independent Certificates.
SECTION 2.10 Book-Entry Notes. The Notes, upon original issuance, will
be issued in the form of typewritten Notes representing the Book-Entry Notes, to
be delivered to The Depository Trust Company (the initial Clearing Agency) by,
or on behalf of, the Issuer. Such Notes shall initially be registered on the
Note Register in the name of Cede & Co., the nominee of the initial Clearing
Agency, and no Note Owner will receive a Definitive Note representing such Note
Owner's interest in such Note, except as provided in Section 2.12. Unless and
until Definitive Notes have been issued to Note Owners pursuant to Section 2.12:
(a) the provisions of this Section shall be in full force and effect;
(b) the Note Registrar, the Paying Agent and the Indenture Trustee
shall be entitled to deal with the Clearing Agency for all purposes of this
Indenture (including the payment of principal of and interest on the Notes and
the giving of instructions or
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directions hereunder) as the sole Holder of the Notes, and shall
have no obligation to the Note Owners;
(c) to the extent that the provisions of this Section conflict
with any other provisions of this Indenture, the provisions of this Section
shall control;
(d) the rights of the Note Owners shall be exercised only through the
Clearing Agency (or to the extent the Note Owners are not Clearing Agency
Participants, through the Clearing Agency Participants through which such Note
Owners own Book-Entry Notes) and shall be limited to those established by law
and agreements among such Note Owners and the Clearing Agency and/or the
Clearing Agency Participants, and all references in this Indenture to actions by
the Noteholders shall refer to actions taken by the Clearing Agency upon
instructions from the Clearing Agency Participants, and all references in this
Indenture to distributions, notices, reports and statements to the Noteholders
shall refer to distributions, notices, reports and statements to the Clearing
Agency, as registered holder of the Notes, as the case may be, for distribution
to the Note Owners in accordance with the procedures of the Clearing Agency.
Pursuant to the Note Depository Agreement, unless and until Definitive Notes are
issued pursuant to Section 2.12, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive and
transmit payments of principal of and interest on the Notes to such Clearing
Agency Participants; and
(e) whenever this Indenture requires or permits actions to be taken
based upon instructions or directions of the Holders of the Notes evidencing a
specified percentage of the Outstanding Amount of the Notes, the Clearing Agency
shall be deemed to represent such percentage only to the extent that it has
received instructions to such effect from the Note Owners and/or Clearing Agency
Participants owning or representing, respectively, such required percentage of
the beneficial interest in the Notes and has delivered such instructions to the
Indenture Trustee.
SECTION 2.11 Notices to Clearing Agency. Whenever a notice or other
communication to the Noteholders is required under this Indenture, unless and
until Definitive Notes shall have been issued to the Note Owners pursuant to
Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to be given to the Holders of the Notes to the
Clearing Agency, and shall have no obligation to the Note Owners.
SECTION 2.12 Definitive Notes. If (a) the Sellers advise the Indenture
Trustee in writing that the Clearing Agency is no longer willing or able to
properly discharge its responsibilities with respect to the Notes, and the
Sellers are unable to locate a qualified successor, (b) the Sellers at their
option advise the Indenture Trustee in writing that they elect to terminate the
book-entry system through the Clearing Agency, or (c) after the occurrence of an
Event of Default or an Event of Servicing
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Termination, the Note Owners representing beneficial interests aggregating not
less than a majority of the Outstanding Amount of the Notes advise the Indenture
Trustee and the Clearing Agency through the Clearing Agency Participants in
writing, and if the Clearing Agency shall so notify the Indenture Trustee that
the continuation of a book-entry system through the Clearing Agency is no longer
in the best interests of the Note Owners, then the Clearing Agency shall notify
all the Note Owners of the occurrence of any such event and of the availability
of Definitive Notes to the Note Owners requesting the same. Upon surrender to
the Note Registrar of the typewritten Note or Notes representing the BookEntry
Notes by the Clearing Agency, accompanied by re-registration instructions, the
Issuer shall execute and the Indenture Trustee shall authenticate and (if the
Note Registrar is different than the Indenture Trustee, then the Note Registrar
shall) deliver the Definitive Notes in accordance with the instructions of the
Clearing Agency. None of the Issuer, the Note Registrar or the Indenture Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of the Definitive Notes, the Indenture Trustee shall recognize
the Holders of the Definitive Notes as the Noteholders.
SECTION 2.13 Authenticating Agent.
(a) The Indenture Trustee may appoint one or more authenticating
agents (each, an "Authenticating Agent") with respect to the Notes which shall
be authorized to act on behalf of the Indenture Trustee in authenticating the
Notes in connection with the issuance, delivery, registration of transfer,
exchange or repayment of the Notes. The Indenture Trustee hereby appoints Chase
as Authenticating Agent for the authentication of the Notes upon any
registration of transfer or exchange of such Notes. Whenever reference is made
in this Indenture to the authentication of the Notes by the Indenture Trustee or
the Indenture Trustee's certificate of authentication, such reference shall be
deemed to include authentication on behalf of the Indenture Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Indenture Trustee by an Authenticating Agent. Each Authenticating Agent,
other than Chase, shall be acceptable to the Issuer.
(b) Any institution succeeding to the corporate agency business of an
Authenticating Agent shall continue to be an Authenticating Agent without the
execution or filing of any paper or any further act on the part of the Indenture
Trustee or such Authenticating Agent.
(c) An Authenticating Agent may at any time resign by giving written
notice of resignation to the Indenture Trustee and the Issuer. The Indenture
Trustee may at any time terminate the agency of an Authenticating Agent by
giving notice of termination to such Authenticating Agent and to the Issuer.
Upon receiving such a notice of resignation or upon such a termination, or in
case at any
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time an Authenticating Agent shall cease to be acceptable to the Indenture
Trustee or the Issuer, the Indenture Trustee promptly may appoint a successor
Authenticating Agent with the consent of the Issuer. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless acceptable to the Issuer.
(d) The Servicer shall pay the Authenticating Agent from time to time
reasonable compensation for its services under this Section 2.13 pursuant to
Section 4.7 of the Sale and Servicing Agreement.
(e) The provisions of Sections 6.1, 6.2, 6.3, 6.4, 6.7 and 6.9 shall
be applicable, mutatis mutandis, to any Authenticating Agent.
(f) Pursuant to an appointment made under this Section 2.13, the Notes
may have endorsed thereon, in lieu of the Indenture Trustee's certificate of
authentication, an alternate certificate of authentication in substantially the
following form:
This is one of the Notes referred to in the within mentioned Indenture.
----------------------------------,
as Indenture Trustee
By:
--------------------------------
Authorized Officer
or
-----------------------------------
as Authenticating Agent
for the Indenture Trustee,
-----------------------------------
Authorized Officer
SECTION 2.14 Appointment of Paying Agent.
(a) The Indenture Trustee may appoint a Paying Agent with respect to
the Notes. The Indenture Trustee hereby appoints Chase as the initial Paying
Agent. The Paying Agent shall have the revocable power to withdraw funds from
the Accounts and make distributions to the Noteholders, the Servicer and the
Owner Trustee pursuant to Section 5.5 of the Sale and Servicing
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Agreement. The Indenture Trustee may revoke such power and remove the Paying
Agent if the Indenture Trustee determines in its sole discretion that the Paying
Agent shall have failed to perform its obligations under this Indenture in any
material respect or for other good cause. Chase shall be permitted to resign as
Paying Agent upon 30 days' written notice to the Sellers and the Indenture
Trustee. In the event that Chase shall no longer be the Paying Agent, the
Indenture Trustee shall appoint a successor to act as Paying Agent (which shall
be a bank or trust company and may be the Indenture Trustee) with the consent of
the Sellers, which consent shall not be unreasonably withheld. If at any time
the Indenture Trustee shall be acting as the Paying Agent, the provisions of
Sections 6.1, 6.3 and 6.4 shall apply, mutatis mutandis, to the Indenture
Trustee in its role as Paying Agent.
The Indenture Trustee will cause each Paying Agent other than itself
and Chase to execute and deliver to the Indenture Trustee an instrument in which
such Paying Agent shall agree with the Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions of
this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due
with respect to the Notes in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and pay such sums to such
Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by the
Issuer (or any other obligor upon the Notes) of which it has actual
knowledge in the making of any payment required to be made with respect
to the Notes;
(iii) at any time during the continuance of any such default,
upon the written request of the Indenture Trustee, forthwith pay to the
Indenture Trustee all sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith pay
to the Indenture Trustee all sums held by it in trust for the payment
of the Notes if at any time it ceases to meet the standards required to
be met by the Paying Agent at the time of its appointment; and
(v) comply with all requirements of the Code with respect
to the withholding from any payments made by it on any Notes of any
applicable withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith.
(b) Chase in its capacity as initial Paying Agent hereunder agrees
that it (i) will hold all sums held by it hereunder for
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payment to the Noteholders in trust for the benefit of the Noteholders entitled
thereto until such sums shall be paid to such Noteholders and (ii) shall comply
with all requirements of the Code regarding the withholding by the Indenture
Trustee of payments in respect of United States federal income taxes due from
Note Owners.
(c) An institution succeeding to the corporate agency business of the
Paying Agent shall continue to be the Paying Agent without the execution or
filing of any paper or any further act on the part of the Indenture Trustee or
such Paying Agent.
ARTICLE III
COVENANTS
SECTION 3.1 Payment of Principal and Interest. The Issuer will duly
and punctually pay the principal of and interest on the Notes in accordance with
the terms of the Notes and this Indenture. Without limiting the foregoing,
subject to Section 8.2(c), the Issuer will cause to be distributed all amounts
on deposit in the Note Distribution Account on a Distribution Date deposited
therein pursuant to the Sale and Servicing Agreement (i) for the benefit of the
Class A-1 Notes, to the Holders of the Class A-1 Notes, (ii) for the benefit of
the Class A-2 Notes, to the Holders of the Class A-2 Notes, (iii) for the
benefit of the Class A-3 Notes, to the Holders of the Class A-3 Notes, (iv) for
the benefit of the Class A-4 Notes, to the Holders of the Class A-4 Notes, (v)
for the benefit of the Class A-5 Notes, to the Holders of the Class A-5 Notes,
(vi) for the benefit of the Class A-6 Notes, to the Holders of the Class A-6
Notes, (vii) for the benefit of the Class A-7 Notes, to the Holders of the Class
A-7 Notes, (viii) for the benefit of the Class A-8 Notes, to the Holders of the
Class A-8 Notes, (ix) for the benefit of the Class A-9 Notes, to the Holders of
the Class A-9 Notes and (x) for the benefit of the Class A-10 Notes, to the
Holders of the Class A-10 Notes. Amounts properly withheld under the Code by any
Person from a payment to any Noteholder of interest and/or principal shall be
considered as having been paid by the Issuer to such Noteholder for all purposes
of this Indenture.
SECTION 3.2 Maintenance of Office or Agency. The Issuer will maintain
in The City of New York, an office or agency where Notes may be surrendered for
registration of transfer or exchange. The Issuer hereby initially appoints the
Note Registrar to serve as its agent for the foregoing purposes. The Issuer will
give prompt written notice to the Indenture Trustee of the location, and of any
change in the location, of any such office or agency. If at any time the Issuer
shall fail to maintain any such office or agency or shall fail to furnish the
Indenture Trustee with the address thereof, such surrenders, notices and demands
may be made or served at the Corporate Trust Office, and the Issuer hereby
appoints the
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Indenture Trustee as its agent to receive all such surrenders, notices and
demands.
SECTION 3.3 Money for Payments To Be Held in Trust. As provided in
Sections 8.2(a) and (b), all payments of amounts due and payable with respect
to any Notes that are to be made from amounts withdrawn from the Collection
Account and the Note Distribution Account pursuant to Section 8.2(c) shall be
made on behalf of the Issuer by the Indenture Trustee or by a Paying Agent, and
no amounts so withdrawn from the Collection Account and the Note Distribution
Account for payments on the Notes shall be paid over to the Issuer except as
provided in this Section 3.3.
On or before each Distribution Date, at the direction of the Servicer
in accordance with Section 5.5 of the Sale and Servicing Agreement, the
Indenture Trustee or the Paying Agent shall deposit in the Note Distribution
Account an aggregate sum sufficient to pay the amounts then becoming due under
the Notes, such sum to be held in trust for the benefit of the Persons entitled
thereto and (unless the Paying Agent is the Indenture Trustee or deposit was
made by the Indenture Trustee) shall promptly notify the Indenture Trustee of
its action or failure so to act.
The Issuer may, at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, direct
any Paying Agent to pay to the Indenture Trustee all sums held in trust by such
Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts
as those upon which the sums were held by such Paying Agent; and upon such a
payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Subject to applicable laws with respect to the escheat of funds, any
money held by the Indenture Trustee or any Paying Agent in trust for the payment
of any amount due with respect to any Note and remaining unclaimed for two years
after such amount has become due and payable shall be discharged from such trust
and be paid to the Issuer on its request; and the Holder of such Note shall
thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided that the Indenture Trustee or
such Paying Agent, before being required to make any such repayment, shall at
the expense of the Issuer cause to be published once, in a newspaper published
in the English language, customarily published on each Business Day and of
general circulation in The City of New York, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such publication, any unclaimed balance of such money
then remaining will be repaid to the Issuer. The Indenture Trustee shall also
adopt and employ, at the expense of the Issuer, any other reasonable means of
notification of such repayment (including, but not limited to, mailing notice of
such repayment to
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the Holders whose right to or interest in moneys due and payable but not claimed
is determinable from the records of the Indenture Trustee or of any Paying
Agent, at the last address of record for each such Holder).
SECTION 3.4 Existence. Except as otherwise permitted by the provisions
of Section 3.10, the Issuer will keep in full effect its existence, rights and
franchises as a business trust under the laws of the State of Delaware (unless
it becomes, or any successor to the Issuer hereunder is or becomes, organized
under the laws of any other state or of the United States of America, in which
case the Issuer will keep in full effect its existence, rights and franchises
under the laws of such other jurisdiction) and will obtain and preserve its
qualification to do business in each jurisdiction in which such qualification is
or shall be necessary to protect the validity and enforceability of this
Indenture, the Notes, the Collateral and each other instrument or agreement
included in the Trust Estate.
SECTION 3.5 Protection of Trust Estate. The Issuer will from time to
time prepare (or shall cause to be prepared), execute and deliver all such
supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:
(a) maintain or preserve the lien and security interest
(and the priority thereof) of this Indenture or carry out more
effectively the purposes hereof;
(b) perfect, publish notice of or protect the validity
of any Grant made or to be made by this Indenture;
(c) enforce the rights of the Indenture Trustee and the
Noteholders in any of the Collateral; or
(d) preserve and defend title to the Trust Estate and the
rights of the Indenture Trustee and the Noteholders in such Trust
Estate against the claims of all persons and parties.
The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to execute any financing statement, continuation statement or
other instrument required to be filed by the Indenture Trustee pursuant to this
Section.
SECTION 3.6 Opinions as to Trust Estate. (a) On the Closing Date, the
Issuer shall furnish to the Indenture Trustee an Opinion of Counsel either
stating that, in the opinion of such counsel, such action has been taken with
respect to the recording and filing of this Indenture, any indentures
supplemental hereto, and any other requisite documents, and with respect to the
execution and filing of any financing statements and continuation statements, as
are necessary to perfect and make effective the lien
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and security interest of this Indenture and reciting the details of such action,
or stating that, in the opinion of such counsel, no such action is necessary to
make such lien and security interest effective.
(b) On or before March 31 of each calendar year, commencing with March
31, 1998, the Issuer shall furnish to the Indenture Trustee an Opinion of
Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording, filing, re-recording and refiling of
this Indenture, any indentures supplemental hereto and any other requisite
documents and with respect to the execution and filing of any financing
statements and continuation statements as are necessary to maintain the
perfection of the lien and security interest created by this Indenture and
reciting the details of such action or stating that in the opinion of such
counsel no such action is necessary to maintain the perfection of such lien and
security interest. Such Opinion of Counsel shall also describe the recording,
filing, rerecording and refiling of this Indenture, any indentures supplemental
hereto and any other requisite documents and the execution and filing of any
financing statements and continuation statements that will, in the opinion of
such counsel, be required to maintain the perfection of the lien and security
interest of this Indenture until March 31 in the following calendar year.
SECTION 3.7 Performance of Obligations; Servicing of Receivables. (a)
The Issuer will not take any action and will use its best efforts not to permit
any action to be taken by others that would release any Person from any of such
Person's material covenants or obligations under any instrument or agreement
included in the Trust Estate or that would result in the amendment,
hypothecation, subordination, termination or discharge of, or impair the
validity or effectiveness of, any such instrument or agreement, except as
ordered by any bankruptcy or other court or as expressly provided in this
Indenture, any other Basic Documents or such other instrument or agreement.
(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officer's Certificate of
the Issuer shall be deemed to be action taken by the Issuer. Initially, the
Issuer has contracted with the Servicer and the Administrators to assist the
Issuer in performing its duties under this Indenture.
(c) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Indenture, the other Basic
Documents and in the instruments and agreements included in the Trust Estate,
including but not limited to preparing (or causing to be prepared) and filing
(or causing to be filed) all UCC financing statements and continuation
statements required to be filed by the terms of this Indenture and the Sale and
Servicing Agreement in accordance with and within the time periods provided for
herein and therein.
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(d) If the Issuer shall have knowledge of the occurrence of an Event
of Servicing Termination under the Sale and Servicing Agreement, the Issuer
shall promptly notify the Indenture Trustee and the Rating Agencies thereof in
accordance with Section 11.4, and shall specify in such notice the action, if
any, the Issuer is taking in respect of such default. If an Event of Servicing
Termination shall arise from the failure of the Servicer to perform any of its
duties or obligations under the Sale and Servicing Agreement with respect to the
Receivables, the Issuer shall take all reasonable steps available to it to
remedy such failure.
(e) Without derogating from the absolute nature of the assignment
granted to the Indenture Trustee under this Indenture or the rights of the
Indenture Trustee hereunder, the Issuer agrees that, unless such action is
specifically permitted hereunder or under the other Basic Documents, it will
not, without the prior written consent of the Indenture Trustee or the Holders
of at least a majority of Outstanding Amount of the Notes, amend, modify, waive,
supplement, terminate or surrender, or agree to any amendment, modification,
supplement, termination, waiver or surrender of, the terms of any Collateral or
the Basic Documents, or waive timely performance or observance by the Servicer
or the Sellers under the Sale and Servicing Agreement; provided that no such
amendment shall (i) increase or reduce in any manner the amount of, or
accelerate or delay the timing of, distributions that are required to be made
for the benefit of the Noteholders, or (ii) reduce the aforesaid percentage of
the Notes which are required to consent to any such amendment, without the
consent of the Holders of all the Outstanding Notes. If any such amendment,
modification, supplement or waiver shall be so consented to by the Indenture
Trustee or such Holders, the Issuer agrees, promptly following a request by the
Indenture Trustee to do so, to execute and deliver, in its own name and at its
own expense, such agreements, instruments, consents and other documents as the
Indenture Trustee may deem necessary or appropriate under the circumstances.
SECTION 3.8 Negative Covenants. So long as any Notes are Outstanding,
the Issuer shall not:
(a) except as expressly permitted by this Indenture or the
other Basic Documents, sell, transfer, exchange or otherwise dispose of
any of the properties or assets of the Issuer, including those included
in the Trust Estate, unless directed to do so by the Indenture Trustee;
(b) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than
amounts properly withheld from such payments under the Code) or assert
any claim against any present or former Noteholder by reason of the
payment of the taxes levied or assessed upon any part of the Trust
Estate; or
(c) (i) permit the validity or effectiveness of this
Indenture to be impaired, or permit the lien of this Indenture
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to be amended, hypothecated, subordinated, terminated or discharged, or
permit any Person to be released from any covenants or obligations with
respect to the Notes under this Indenture except as may be expressly
permitted hereby, (ii) permit any lien, charge, excise, claim, security
interest, mortgage or other encumbrance (other than the lien of this
Indenture) to be created on or extend to or otherwise arise upon or
burden the Trust Estate or any part thereof or any interest therein or
the proceeds thereof (other than tax liens, mechanics' liens and other
liens that arise by operation of law, in each case on a Financed
Vehicle and arising solely as a result of an action or omission of the
related Obligor) or (iii) permit the lien of this Indenture not to
constitute a valid first priority (other than with respect to any such
tax, mechanics' or other lien) security interest in the Trust Estate.
SECTION 3.9 Annual Statement as to Compliance. The Issuer will deliver
to the Indenture Trustee on or before March 31 of each year, commencing March
31, 1998, and otherwise in compliance with the requirements of TIA Section
314(a)(4), an Officer's Certificate stating, as to the Authorized Officer
signing such Officer's Certificate, that
(a) a review of the activities of the Issuer during such year
and of performance under this Indenture has been made under such
Authorized Officer's supervision; and
(b) to the best of such Authorized Officer's knowledge, based
on such review, the Issuer has complied with all conditions and
covenants in all material respects under this Indenture throughout such
year, or, if there has been a default in the compliance of any such
condition or covenant, specifying each such default known to such
Authorized Officer and the nature and status thereof.
SECTION 3.10 The Issuer May Consolidate, Etc. Only on Certain Terms.
(a) The Issuer shall not consolidate or merge with or into any other Person,
unless
(i) the Person (if other than the Issuer) formed by or
surviving such consolidation or merger shall be a Person organized and
existing under the laws of the United States of America or any State
thereof or the District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Indenture
Trustee, in form satisfactory to the Indenture Trustee, the due and
punctual payment of the principal of and interest on all the Notes and
the performance or observance of every agreement and covenant of this
Indenture on the part of the Issuer to be performed or observed, all as
provided herein;
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(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Indenture Trustee) to
the effect that such transaction will not have any material adverse tax
consequence to the Trust, any Noteholder or any Certificateholder;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture shall have been
taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officer's Certificate and an Opinion of Counsel each stating
that such consolidation or merger and such supplemental indenture
comply with this Section 3.10 and that all conditions precedent herein
provided for relating to such transaction have been complied with
(including any filing required by the Exchange Act).
(b) Except as otherwise expressly permitted by this Indenture or the
other Basic Documents, the Issuer shall not convey or transfer all or
substantially all of its properties or assets, including those included in the
Trust Estate, to any Person, unless
(i) the Person that acquires by conveyance or transfer the
properties and assets of the Issuer the conveyance or transfer of which
is hereby restricted shall (A) be a United States citizen or a Person
organized and existing under the laws of the United States of America
or any State thereof, (B) expressly assume, by an indenture
supplemental hereto, executed and delivered to the Indenture Trustee,
in form satisfactory to the Indenture Trustee, the due and punctual
payment of the principal of and interest on all the Notes and the
performance or observance of every agreement and covenant of this
Indenture on the part of the Issuer to be performed or observed, all as
provided herein, (C) expressly agree by means of such supplemental
indenture that all right, title and interest so conveyed or transferred
shall be subject and subordinate to the rights of the Holders of the
Notes, (D) unless otherwise provided in such supplemental indenture,
expressly agree to indemnify, defend and hold harmless the Issuer
against and from any loss, liability or expense arising under or
related to this Indenture and the Notes and (E) expressly agree by
means of such supplemental indenture that such Person (or if a group of
persons, then one specified Person) shall prepare (or cause to be
prepared) and make all filings with the Commission (and any other
appropriate Person) required by the Exchange Act in connection with the
Notes;
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(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Indenture Trustee) to
the effect that such transaction will not have any material adverse tax
consequence to the Trust, any Noteholder or any Certificateholder;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officers' Certificate and an Opinion of Counsel each stating
that such conveyance or transfer and such supplemental indenture comply
with this Section 3.10 and that all conditions precedent herein
provided for relating to such transaction have been complied with
(including any filing required by the Exchange Act).
SECTION 3.11 Successor or Transferee. (a) Upon any consolidation or
merger of the Issuer in accordance with Section 3.10(a), the Person formed by or
surviving such consolidation or merger (if other than the Issuer) shall succeed
to, and be substituted for, and may exercise every right and power of, the
Issuer under this Indenture with the same effect as if such Person had been
named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties of
the Issuer in accordance with Section 3.10(b), Chase Manhattan RV Owner Trust
1997-A will be released from every covenant and agreement of this Indenture to
be observed or performed on the part of the Issuer with respect to the Notes
immediately upon the delivery of written notice to the Indenture Trustee from
the Person acquiring such assets and properties stating that Chase Manhattan RV
Owner Trust 1997-A is to be so released.
SECTION 3.12 No Other Business. The Issuer shall not engage in any
business other than financing, purchasing, owning, selling and managing the
Receivables in the manner contemplated by this Indenture and the other Basic
Documents, issuing the Notes and the Certificates, making payments thereon, and
such other activities that are necessary, suitable or desirable to accomplish
the foregoing or are incidental to the purposes as set forth in Section 2.3 of
the Trust Agreement.
SECTION 3.13 No Borrowing. The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or
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indirectly, for any indebtedness except for money borrowed in respect of the
Notes or in accordance with the Basic Documents.
SECTION 3.14 Servicer's Obligations. The Issuer shall use its best
efforts to cause the Servicer to comply with the Sale and Servicing Agreement.
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities. Except
as contemplated by the Sale and Servicing Agreement or this Indenture, the
Issuer shall not make any loan or advance or credit to, or guarantee (directly
or indirectly or by an instrument having the effect of assuming another's
payment or performance on any obligation or capability of so doing or
otherwise), endorse or otherwise become contingently liable, directly or
indirectly, in connection with the obligations, stocks or dividends of, or own,
purchase, repurchase or acquire (or agree contingently to do so) any stock,
obligations, assets or securities of, or any other interest in, or make any
capital contribution to, any other Person.
SECTION 3.16 Capital Expenditures. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty) other than the purchase of the Receivables and
related property pursuant to the Sale and Servicing Agreement.
SECTION 3.17 Restricted Payments. The Issuer shall not, directly or
indirectly, (a) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial interest in the
Issuer or otherwise with respect to any ownership or equity interest or security
in or of the Issuer, (b) redeem, purchase, retire, or otherwise acquire for
value any such ownership or equity interest or security or (c) set aside or
otherwise segregate any amounts for any such purpose; provided that the Issuer
may make, or cause to be made, distributions to the Servicer, the Sellers, the
Owner Trustee, the Indenture Trustee and the Certificateholders as permitted by,
and to the extent funds are available for such purpose under, the Basic
Documents. The Issuer will not, directly or indirectly, make payments to or
distributions from the Collection Account or the Paid-Ahead Account except in
accordance with this Indenture and the other Basic Documents.
SECTION 3.18 Notice of Events of Default. The Issuer agrees to give
the Indenture Trustee and the Rating Agencies prompt written notice of each
Event of Default, any Event of Servicing Termination and each default on the
part of either Seller of its obligations under the Sale and Servicing Agreement.
SECTION 3.19 Further Instruments and Acts. Upon request of the
Indenture Trustee, the Issuer will execute and deliver such further instruments
and do such further acts as may be reasonably
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necessary or proper to carry out more effectively the purpose of this Indenture.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect with respect to the Notes except as to (a)
rights of registration of transfer and exchange, (b) substitution of mutilated,
destroyed, lost or stolen Notes, (c) rights of Noteholders to receive payments
of principal thereof and interest thereon, (d) Sections 3.2, 3.3, 3.4, 3.5, 3.8,
3.10, 3.12, 3.13, 3.15, 3.16 and 3.18, (e) the rights, obligations and
immunities of the Indenture Trustee hereunder (including the rights of the
Indenture Trustee under Section 6.7 and the obligations of the Indenture Trustee
under Sections 4.2 and 4.4) and (f) the rights of Noteholders as beneficiaries
hereof with respect to the property so deposited with the Indenture Trustee
payable to all or any of them, and the Indenture Trustee, on demand of and at
the expense of the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to the Notes, when
(i) either
(A) All Notes theretofore authenticated and delivered
(other than (1) the Notes that have been destroyed, lost or
stolen and that have been replaced or paid as provided in
Section 2.5 and (2) the Notes for which payment money has
theretofore been deposited in trust or segregated and held in
trust by the Issuer and thereafter repaid to the Issuer or
discharged from such trust, as provided in Section 3.3) have
been delivered to the Indenture Trustee for cancellation; or
(B) all Notes not theretofore delivered to the
Indenture Trustee for cancellation:
(1) have become due and payable,
(2) will become due and payable at their
respective Note Final Scheduled Distribution Dates
within one year, or
(3) are to be called for redemption within
one year under arrangements satisfactory to the
Indenture Trustee for the giving of notice of
redemption by the Indenture Trustee in the name, and
at the expense, of the Issuer,
and the Issuer, in the case of clauses (1), (2) or (3) of
Section 4.1(i)(B), has irrevocably deposited or caused to
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be irrevocably deposited with the Indenture Trustee cash or
direct obligations of or obligations guaranteed by the United
States of America (which will mature prior to the date such
amounts are payable), in trust for such purpose, in an amount
sufficient to pay and discharge the entire unpaid principal
and accrued interest on such Notes not theretofore delivered
to the Indenture Trustee for cancellation when due on their
respective Note Final Scheduled Distribution Dates;
(ii) the Issuer has paid or caused to be paid all other
sums payable hereunder by the Issuer; and
(iii) the Issuer has delivered to the Indenture Trustee an
Officer's Certificate, an Opinion of Counsel and (if required by the
TIA or the Indenture Trustee) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable requirements
of Section 11.1 and each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
SECTION 4.2 Application of Trust Money. All moneys deposited with the
Indenture Trustee pursuant to Section 4.1(i)(B) shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Holders of the particular Notes for the
payment of which such moneys have been deposited with the Indenture Trustee, of
all sums due and to become due thereon for principal and interest; but such
moneys need not be segregated from other funds except to the extent required
herein or in the Sale and Servicing Agreement or required by law.
SECTION 4.3 Repayment of Moneys Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to the Notes,
all moneys then held by any Paying Agent other than the Indenture Trustee under
the provisions of this Indenture with respect to such Notes shall, upon demand
of the Issuer, be paid to the Indenture Trustee to be held and applied according
to Section 3.3 and thereupon such Paying Agent shall be released from all
further liability with respect to such moneys.
SECTION 4.4 Duration of the Position of the Indenture Trustee for the
Benefit of Certificateholders. Notwithstanding (i) the earlier payment in full
of all principal and interest due to the Noteholders under the terms of the
Notes of each class, (ii) the cancellation of such Notes pursuant to Section 2.8
and (iii) the discharge of the Indenture Trustee's duties hereunder with respect
to such Notes, the Indenture Trustee shall continue to act in the capacity of
the Indenture Trustee hereunder for the benefit of the Certificateholders and
the Indenture Trustee, for the benefit of the Certificateholders, shall comply
with its obligations under Sections 5.1, 5.5, 5.6, 7.5, 8.1 and 8.2 of the
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Sale and Servicing Agreement, as appropriate, until such time as all
distributions in respect of the Certificate Balance and interest due to the
Certificateholders have been paid in full.
ARTICLE V
REMEDIES
SECTION 5.1 Events of Default. "Event of Default", wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(a) default in the payment of any interest on any Note
when the same becomes due and payable, and such default shall
continue for a period of five days;
(b) default in the payment of the principal of or any
installment of the principal of any Note when the same becomes
due and payable;
(c) default in the observance or performance of any covenant
or agreement of the Issuer made in this Indenture (other than a
covenant or agreement, a default in the observance or performance of
which is elsewhere in this Section specifically dealt with) which
default materially and adversely affects the rights of the Noteholders,
and which default shall continue or not be cured for a period of 30
days (or for such longer period, not in excess of 90 days, as may be
reasonably necessary to remedy such default; provided that such default
is capable of remedy within 90 days or less and the Servicer on behalf
of the Issuer delivers an Officer's Certificate to the Indenture
Trustee to the effect that the Issuer has commenced, or will promptly
commence and diligently pursue, all reasonable efforts to remedy such
default) after there shall have been given, by registered or certified
mail, to the Issuer by the Indenture Trustee or to the Issuer and the
Indenture Trustee by the Holders representing not less than 25% of the
Outstanding Amount of the Notes, a written notice specifying such
default and requiring it to be remedied and stating that such notice is
a "Notice of Default" hereunder; and
(d) an Insolvency Event shall have occurred for the Issuer.
The Issuer shall deliver to the Indenture Trustee, within five days
after the occurrence thereof, written notice in the form of an Officer's
Certificate of any event which with the giving of notice and the lapse of time
would become an Event of Default under clause
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(c), its status and what action the Issuer is taking or proposes to take with
respect thereto.
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment. If an
Event of Default shall occur and be continuing, then and in every such case the
Indenture Trustee or the Holders of the Notes representing not less than a
majority of the Outstanding Amount of the Notes may declare all the Notes to be
immediately due and payable, by a notice in writing to the Issuer (and to the
Indenture Trustee if given by the Noteholders), and upon any such declaration
the unpaid principal amount of such Notes, together with accrued and unpaid
interest thereon through the date of acceleration, shall become immediately due
and payable.
At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided, the
Holders of the Notes representing a majority of the Outstanding Amount of the
Notes, by written notice to the Issuer and the Indenture Trustee, may rescind
and annul such declaration and its consequences; provided, that, no such
rescission shall affect any subsequent default or impair any right consequent
thereto.
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by
the Indenture Trustee. (a) The Issuer covenants that if (i) default is made in
the payment of any interest on any Note when the same becomes due and payable,
and such default continues for a period of five days, or (ii) default is made in
the payment of the principal of or any installment of the principal of any Note
when the same becomes due and payable, the Issuer will, upon demand of the
Indenture Trustee, pay to it, for the benefit of the Holders of the Notes, the
whole amount then due and payable on such Notes for principal and interest, with
interest upon the overdue principal, and, to the extent payment at such rate of
interest shall be legally enforceable, upon overdue installments of interest, at
the rate borne by the Notes, and in addition thereto such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such amounts upon
such demand, the Indenture Trustee, in its own name and as trustee of an express
trust, may institute a proceeding for the collection of the sums so due and
unpaid, and may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Issuer or other obligor upon such Notes and collect
in the manner provided by law out of the property of the Issuer or other obligor
upon such Notes, wherever situated, the moneys adjudged or decreed to be
payable.
(c) If an Event of Default occurs and is continuing, the Indenture
Trustee may, as more particularly provided in Section
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5.4, in its discretion, proceed to protect and enforce its rights and the rights
of the Noteholders, by such appropriate proceedings as the Indenture Trustee
shall deem most effective to protect and enforce any such rights, whether for
the specific enforcement of any covenant or agreement in this Indenture or in
aid of the exercise of any power granted herein, or to enforce any other proper
remedy or legal or equitable right vested in the Indenture Trustee by this
Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or any
other obligor upon the Notes or any Person having or claiming an ownership
interest in the Trust Estate, proceedings under Title 11 of the United States
Code or any other applicable Federal or state bankruptcy, insolvency or other
similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other
obligor or Person, or in the case of any other comparable judicial proceedings
relative to the Issuer or other obligor upon the Notes, or to the creditors or
property of the Issuer or such other obligor, the Indenture Trustee,
irrespective of whether the principal of any Notes shall then be due and payable
as therein expressed or by declaration or otherwise and irrespective of whether
the Indenture Trustee shall have made any demand pursuant to the provisions of
this Section, shall be entitled and empowered, by intervention in such
proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount
of principal and interest owing and unpaid in respect of the Notes and
to file such other papers or documents as may be necessary or advisable
in order to have the claims of the Indenture Trustee (including any
claim for reasonable compensation to the Indenture Trustee and each
predecessor Indenture Trustee, and their respective agents, attorneys
and counsel, and for reimbursement of all expenses and liabilities
incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee, except as a result of negligence, bad
faith or willful misconduct) and of the Noteholders allowed in such
proceedings;
(ii) unless prohibited by applicable law and regulations, to
vote on behalf of the Holders of the Notes in any election of a
trustee, a standby trustee or person performing similar functions in
any such proceedings;
(iii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute all amounts
received with respect to the claims of the Noteholders and of the
Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have
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the claims of the Indenture Trustee or the Holders of the Notes allowed
in any judicial proceedings relative to the Issuer, its creditors and
its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such proceeding is hereby authorized by each of such Noteholders to make
payments to the Indenture Trustee, and, in the event that the Indenture Trustee
shall consent to the making of payments directly to such Noteholders, to pay to
the Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee except as a result of negligence or bad faith.
(e) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt on
behalf of any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar person.
(f) All rights of action and of asserting claims under this Indenture,
or under any of the Notes, may be enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any trial or other
proceedings relative thereto, and any such action or proceedings instituted by
the Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses,
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Holders of the Notes.
(g) In any proceedings brought by the Indenture Trustee (and also any
proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Holders of the Notes, and it shall not be necessary to
make any Noteholder a party to any such proceedings.
SECTION 5.4 Remedies; Priorities. (a) If an Event of Default shall
have occurred and be continuing and the Notes have been accelerated under
Section 5.2, the Indenture Trustee may do one or more of the following (subject
to Section 5.5):
(i) institute proceedings in its own name and as trustee of
an express trust for the collection of all amounts then payable on the Notes
or under this Indenture with respect thereto, whether by declaration or
otherwise, enforce any
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judgment obtained, and collect from the Issuer and any other obligor
upon such Notes moneys adjudged due;
(ii) institute proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect
to the Trust Estate;
(iii) exercise any remedies of a secured party under the UCC
and take any other appropriate action to protect and enforce the rights
and remedies of the Indenture Trustee and the Holders of the Notes; and
(iv) sell the Trust Estate or any portion thereof or rights
or interest therein, at one or more public or private sales called and
conducted in any manner permitted by law;
provided that the Indenture Trustee may not sell or otherwise liquidate
the Trust Estate following an Event of Default, unless (A) the Holders
of 100% of the Outstanding Amount of the Notes consent thereto, (B) the
proceeds of such sale or liquidation distributable to the Noteholders
and the Certificateholders are sufficient to discharge in full all
amounts then due and unpaid upon such Notes for principal and interest
and the Certificate Balance and accrued interest thereon, or (C)(1)
there has been an Event of Default described in Section 5.1(a) or (b),
(2) the Indenture Trustee determines that the Trust Estate will not
continue to provide sufficient funds for the payment of principal of
and interest on the Notes as they would have become due if the Notes
had not been declared due and payable, and (3) the Indenture Trustee
obtains the consent of Holders of 66-2/3% of the Outstanding Amount of
the Notes. In determining such sufficiency or insufficiency with
respect to clause (B) and (C), the Indenture Trustee may, but need not,
obtain and rely upon an opinion of an Independent investment banking or
accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Trust Estate for such
purpose.
(b) If the Indenture Trustee collects any money or property pursuant to
this Article V, it shall pay out such money or property (and other amounts
including amounts held on deposit in the Reserve Account and Paid-Ahead Account)
held as Collateral for the benefit of the Noteholders in the following order:
FIRST: to the Indenture Trustee for amounts due under
Section 6.7; and
SECOND: to the Collection Account for distribution
pursuant to Section 9.1(b) of the Sale and Servicing
Agreement.
SECTION 5.5 Optional Preservation of the Receivables. If the Notes
have been declared to be due and payable under Section
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5.2 following an Event of Default and such declaration and its consequences have
not been rescinded and annulled, the Indenture Trustee may, but need not, elect
to maintain possession of the Trust Estate. It is the desire of the parties
hereto and the Noteholders that there be at all times sufficient funds for the
payment of principal of and interest on the Notes, and the Indenture Trustee
shall take such desire into account when determining whether to maintain
possession of the Trust Estate. In determining whether to maintain possession of
the Trust Estate, the Indenture Trustee may, but need not, obtain and rely upon
an opinion of an Independent investment banking or accounting firm of national
reputation as to the feasibility of such proposed action and as to the
sufficiency of the Trust Estate for such purpose.
SECTION 5.6 Limitation of Suits. No Holder of any Note shall have any
right to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(a) such Holder has previously given written notice to
the Indenture Trustee of a continuing Event of Default;
(b) the Holders representing not less than 25% of the
Outstanding Amount of the Notes have made written request to the
Indenture Trustee to institute such proceeding in respect of such Event
of Default in its own name as the Indenture Trustee hereunder;
(c) such Holder or Holders have offered to the Indenture
Trustee indemnity reasonably satisfactory to it against the costs,
expenses and liabilities to be incurred in complying with such request;
(d) the Indenture Trustee for 60 days after its receipt
of such notice, request and offer of indemnity has failed to
institute such proceedings; and
(e) no direction inconsistent with such written request has
been given to the Indenture Trustee during such 60-day period by the
Holders representing not less than a majority of the Outstanding Amount
of the Notes;
it being understood and intended that no one or more Holders of the Notes shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of the Notes or to obtain or to seek to obtain priority or
preference over any other Holders or to enforce any right under this Indenture,
except in the manner herein provided.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of the
Notes, each representing less than a majority of the
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Outstanding Amount of the Notes, the Indenture Trustee in its sole discretion
may determine what action, if any, shall be taken, notwithstanding any other
provisions of this Indenture.
SECTION 5.7 Unconditional Rights of Noteholders To Receive Principal
and Interest. Notwithstanding any other provisions in this Indenture, the Holder
of any Note shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest, if any, on such Note on or
after the respective due dates thereof expressed in such Note or in this
Indenture and to institute suit for the enforcement of any such payment, and
such right shall not be impaired without the consent of such Holder.
SECTION 5.8 Restoration of Rights and Remedies. If the Indenture
Trustee or any Noteholder has instituted any Proceeding to enforce any right or
remedy under this Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as through no such proceeding had
been instituted.
SECTION 5.9 Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Indenture Trustee or to the Noteholders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 5.10 Delay or Omission Not a Waiver. No delay or Omission of
the Indenture Trustee or any Holder of any Note to exercise any right or remedy
accruing upon any Default or Event of Default shall impair any such right or
remedy or constitute a waiver of any such Default or Event of Default or an
acquiescence therein. Every right and remedy given by this Article V or by law
to the Indenture Trustee or to the Noteholders may be exercised from time to
time, and as often as may be deemed expedient, by the Indenture Trustee or by
the Noteholders, as the case may be.
SECTION 5.11 Control by Noteholders. The Holders of a majority of the
Outstanding Amount of the Notes shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Indenture
Trustee with respect to the Notes or exercising any trust or power conferred on
the Indenture Trustee; provided that
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(a) such direction shall not be in conflict with any rule of
law or with this Indenture;
(b) subject to the express terms of Section 5.4, any
direction to the Indenture Trustee to sell or liquidate the Trust
Estate shall be by the Holders of the Notes representing not less than
100% of the Outstanding Amount of the Notes;
(c) if the conditions set forth in Section 5.5 have been
satisfied and the Indenture Trustee elects to retain the Trust Estate
pursuant to such Section, then any direction to the Indenture Trustee
by Holders of the Notes representing less than 100% of the Outstanding
Amount of the Notes to sell or liquidate the Trust Estate shall be of
no force and effect;
(d) the Indenture Trustee may take any other action deemed
proper by the Indenture Trustee that is not inconsistent with such
direction; and
(e) such direction shall be in writing;
provided, further, that, subject to Section 6.1, the Indenture Trustee need not
take any action that it determines might involve it in liability or might
materially adversely affect the rights of any Noteholders not consenting to such
action.
SECTION 5.12 Waiver of Past Defaults. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.2, the
Holders of the Notes of not less than a majority of the Outstanding Amount of
the Notes may, on behalf of all such Holders, waive any past Default or Event of
Default and its consequences except a Default (a) in payment of principal of or
interest on any of the Notes or (b) in respect of a covenant or provision hereof
which cannot be modified or amended without the consent of the Holder of each
Note then outstanding. In the case of any such waiver, the Issuer, the Indenture
Trustee and the Holders of the Notes shall be restored to their former positions
and rights hereunder, respectively; but no such waiver shall extend to any
subsequent or other Default or impair any right consequent thereto.
Upon any such waiver, such Default shall cease to exist and be deemed
to have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or Event of Default or impair any right consequent thereto. The
Issuer shall give prompt written notice of any waiver to the Rating Agencies.
SECTION 5.13 Undertaking for Costs. All parties to this Indenture
agree, and each Holder of any Note by such Holder's acceptance thereof shall be
deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of
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any right or remedy under this Indenture, or in any suit against the Indenture
Trustee for any action taken, suffered or omitted by it as the Indenture
Trustee, the filing by any party litigant in such Proceeding of an undertaking
to pay the costs of such Proceeding, and that such court may in its discretion
assess reasonable costs, including reasonable attorneys' fees, against any party
litigant in such Proceeding, having due regard to the merits and good faith of
the claims or defenses made by such party litigant; but the provisions of this
Section shall not apply to (a) any suit instituted by the Indenture Trustee, (b)
any suit instituted by any Noteholder or group of Noteholders, in each case
holding in the aggregate more than 10% of the Outstanding Amount of the Notes,
or, (c) any suit instituted by any Noteholder for the enforcement of the payment
of principal of or interest on any Note on or after the respective due dates
expressed in such Note and in this Indenture.
SECTION 5.14 Waiver of Stay or Extension Laws. The Issuer covenants
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead or in any manner whatsoever, claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Indenture Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
SECTION 5.15 Action on Notes. The Indenture Trustee's right to seek
and recover judgment on the Notes or under this Indenture shall not be affected
by the seeking, obtaining or application of any other relief under or with
respect to this Indenture. Neither the lien of this Indenture nor any rights or
remedies of the Indenture Trustee or the Noteholders shall be impaired by the
recovery of any judgment by the Indenture Trustee against the Issuer or by the
levy of any execution under such judgment upon any portion of the Trust Estate
or upon any of the assets of the Issuer.
SECTION 5.16 Performance and Enforcement of Certain Obligations. (a)
Promptly following a request from the Indenture Trustee to do so, the Issuer
agrees to take all such lawful action as the Indenture Trustee may request to
compel or secure the performance and observance by the Sellers and the Servicer,
as applicable, of each of their respective obligations to the Issuer under or in
connection with the Sale and Servicing Agreement in accordance with the terms
thereof, and to exercise any and all rights, remedies, powers and privileges
lawfully available to the Issuer under or in connection with the Sale and
Servicing Agreement to the extent and in the manner directed by the Indenture
Trustee, including the transmission of notices of default on the part of either
Seller or the Servicer thereunder and the institution of
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legal or administrative actions or proceedings to compel or secure performance
by the Sellers or the Servicer of each of their respective obligations under the
Sale and Servicing Agreement.
(b) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and, at the direction (which direction shall be in
writing or by telephone (confirmed in writing promptly thereafter)) of the
Holders of 66-2/3% of the Outstanding Amount of the Notes shall, foreclose upon
its security interest in the Issuer's rights under the Sale and Servicing
Agreement and exercise all rights, remedies, powers, privileges and claims of
the Issuer against the Sellers or the Servicer under or in connection with the
Sale and Servicing Agreement, including the right or power to take any action to
compel or secure performance or observance by the Sellers or the Servicer of
each of their respective obligations to the Issuer thereunder and to give any
consent, request, notice, direction, approval, extension or waiver under the
Sale and Servicing Agreement, and any right of the Issuer to take such action
shall be suspended.
ARTICLE VI
THE INDENTURE TRUSTEE
SECTION 6.1 Duties of the Indenture Trustee. (a) The Indenture
Trustee, both prior to and after the occurrence of an Event of Default, shall
undertake to perform such duties and only such duties as are specifically set
forth in this Indenture and the Sale and Servicing Agreement. If an Event of
Default known to the Indenture Trustee has occurred and is continuing, the
Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and the Sale and Servicing Agreement and use the same degree of care
and skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
The Indenture Trustee, upon receipt of any resolutions, certificates,
statements, opinions, reports, documents, orders, or other instruments furnished
to the Indenture Trustee that shall be specifically required to be furnished
pursuant to any provision of this Indenture or the Sale and Servicing Agreement,
shall examine them to determine whether they conform to the requirements of this
Indenture or the Sale and Servicing Agreement; provided, however, that the
Indenture Trustee shall not be responsible for the accuracy or content of any
such resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by the Servicer to the Indenture Trustee pursuant to
this Indenture or the Sale and Servicing Agreement.
(b) No provision of this Indenture shall be construed to relieve the
Indenture Trustee from liability for its own negligent action, its own negligent
failure to act, or its own bad faith or wilful malfeasance; provided, however,
that:
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(i) prior to the occurrence of an Event of Default, and
after the curing of all such Events of Default, the Indenture Trustee
undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture and the Sale and Servicing
Agreement, and no implied covenants or obligations shall be read into
this Indenture or the Sale and Servicing Agreement against the
Indenture Trustee, and in the absence of bad faith on its part or
manifest error, the Indenture Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Indenture
Trustee and conforming to the requirements of this Indenture or the
Sale and Servicing Agreement; and
(ii) The Indenture Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer unless it is
proved that the Indenture Trustee was negligent in ascertaining the
pertinent facts nor shall the Indenture Trustee be liable with respect
to any action it takes or omits to take in good faith in accordance
with this Indenture or in accordance with a direction received by it
pursuant to Section 5.11.
(c) The Indenture Trustee shall not be liable for interest on any
money received by it except as the Indenture Trustee may agree in writing with
the Issuer.
(d) Money held in trust by the Indenture Trustee need not be
segregated from other funds except to the extent required by law or the terms of
this Indenture or the Sale and Servicing Agreement.
(e) No provision of this Indenture shall require the Indenture Trustee
to expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or indemnity satisfactory to it against such risk or liability is
not assured to it, and none of the provisions contained in this Indenture shall
in any event require the Indenture Trustee to perform, or be responsible for the
manner of performance of, any of the obligations of the Servicer (including its
obligations as custodian) under this Indenture except during such time, if any,
as the Indenture Trustee shall be the successor to, and be vested with the
rights, duties, powers and privileges of, the Servicer in accordance with the
terms of the Sale and Servicing Agreement.
(f) The Indenture Trustee shall not be charged with knowledge of an
Event of Default until such time as a Responsible Officer shall have actual
knowledge or have received written notice thereof.
(g) Except for actions expressly authorized by this Indenture or,
based upon an Opinion of Counsel, in the best interests of the
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Noteholders, the Indenture Trustee shall take no action reasonably likely to
impair the security interests created or existing under any Receivable or to
impair the value of any Receivable.
(h) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of the
TIA.
SECTION 6.2 Rights of the Indenture Trustee. (a) The Indenture Trustee
may conclusively rely on any document believed by it to be genuine and to have
been signed or presented by the proper person. The Indenture Trustee need not
investigate any fact or matter stated in the document.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Opinion of Counsel. The Indenture Trustee shall not be liable for any
action it takes, suffers or omits to take in good faith in reliance on the
Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Indenture Trustee shall
not be responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder. The Indenture Trustee shall have no duty to monitor
the performance of the Issuer.
(d) The Indenture Trustee shall not be personally liable for any action
it takes or omits to take in good faith which it believes to be authorized or
within its rights or powers; provided, that the Indenture Trustee's conduct does
not constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the written
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and protection
from liability in respect to any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the written advice or opinion of
such counsel. A copy of such written advice or Opinion of Counsel shall be
provided to the Sellers, the Servicer and the Rating Agencies.
(f) [Reserved].
(g) Prior to the occurrence of an Event of Default and after the curing
of all Events of Default that may have occurred, the Indenture Trustee shall not
be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond, or other paper or document, unless
requested in writing to do so by Holders of the Notes evidencing not less than
25% of the Outstanding Amount of the Notes; provided, however,
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that if the payment within a reasonable time to the Indenture Trustee of the
costs, expenses, or liabilities likely to be incurred by it in the making of
such investigation shall be, in the opinion of the Indenture Trustee, not
reasonably assured to the Indenture Trustee by the security afforded to it by
the terms of this Indenture, the Indenture Trustee may require reasonable
indemnity against such cost, expense, or liability or payment of such expenses
as a condition precedent to so proceeding. The reasonable expense of every such
examination shall be paid by the Issuer or by the Sellers at the direction of
the Issuer or, if paid by the Indenture Trustee, shall be reimbursed by the
Issuer or by the Sellers at the direction of the Issuer upon demand. Nothing in
this clause (g) shall affect the obligation of the Issuer or the Sellers to
observe any applicable law prohibiting disclosure of information regarding the
Obligors.
SECTION 6.3 Individual Rights of the Indenture Trustee. The Indenture
Trustee in its individual or any other capacity may become the owner or pledgee
of the Notes and may otherwise deal with the Issuer or its Affiliates with the
same rights it would have if it were not the Indenture Trustee. Any Paying
Agent, the Note Registrar, co-registrar or co-paying agent may do the same with
like rights. However, the Indenture Trustee must comply with Sections 6.11 and
6.12.
SECTION 6.4 The Indenture Trustee's Disclaimer. The Indenture Trustee
shall not be responsible for and makes no representation as to the validity or
adequacy of this Indenture or the Notes, shall not be accountable for the
Issuer's use of the proceeds from the Notes, and shall not be responsible for
any statement of the Issuer in the Indenture or in any document issued in
connection with the sale of the Notes or in the Notes other than the Indenture
Trustee's certificate of authentication.
SECTION 6.5 Notice of Defaults. If a Default occurs and is continuing
and if it is either actually known or written notice of the existence thereof
has been delivered to a Responsible Officer of the Indenture Trustee, the
Indenture Trustee shall mail to each Noteholder notice of the Default within 90
days after such knowledge or notice occurs. Except in the case of a Default in
accordance with the provisions of Section 313(c) of the TIA in payment of
principal of or interest on any Note (including payments pursuant to the
mandatory redemption provisions of such Note), the Indenture Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in
good faith determines that withholding the notice is in the interest of the
Noteholders.
SECTION 6.6 Reports by the Indenture Trustee to Holders. Within the
prescribed period of time for tax reporting purposes after the end of each
calendar year during the term of this Indenture, the Indenture Trustee shall
deliver to each Noteholder such information as may be reasonably required to
enable such Holder to prepare its United States federal, state and local income
or franchise tax returns for such calendar year.
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SECTION 6.7 Compensation and Indemnity. The Issuer shall cause the
Servicer pursuant to Section 4.7 of the Sale and Servicing Agreement to pay to
the Indenture Trustee from time to time reasonable compensation for its
services. The Indenture Trustee's compensation shall not be limited by any law
on compensation of a trustee of an express trust. The Issuer shall cause the
Servicer and the Sellers pursuant to Sections 4.7 and 6.2, respectively of the
Sale and Servicing Agreement the Sale and Servicing Agreement to reimburse the
Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by
it, including costs of collection, in addition to the compensation for its
services. Such expenses shall include the reasonable compensation and expenses,
disbursements and advances of the Indenture Trustee's agents, counsel,
accountants and experts. The Issuer shall cause the Sellers pursuant to the
Sale and Servicing Agreement to indemnify the Indenture Trustee against any
and all loss, liability or expense (including the fees of either in-house
counsel or outside counsel, but not both) incurred by it in connection with
the administration of this trust and the performance of its duties hereunder.
The Indenture Trustee shall notify the Issuer, the Servicer and the Sellers
promptly of any claim for which it may seek indemnity.
The Servicer's and the Sellers' payment obligations to the Indenture
Trustee pursuant to this Section shall survive the discharge of this Indenture.
When the Indenture Trustee incurs expenses after the occurrence of a Default
specified in Section 5.1(d) with respect to the Issuer, the expenses are
intended to constitute expenses of administration under Title 11 of the United
States Code or any other applicable federal or state bankruptcy, insolvency or
similar law.
SECTION 6.8 Replacement of the Indenture Trustee. (a) The Indenture
Trustee may give notice of its intent to resign at any time by so notifying the
Issuer and the Noteowners. The Holders of a majority in Outstanding Amount of
the Notes may remove the Indenture Trustee by so notifying the Indenture Trustee
and the Issuer may appoint a successor Indenture Trustee. Such resignation or
removal shall become effective as described below. The Issuer shall remove the
Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section 6.11;
(ii) the Indenture Trustee is adjudged bankrupt or insolvent;
(iii) a receiver or other public officer takes charge of
the Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes incapable of
acting.
(b) If the Indenture Trustee gives notice of its intent to resign or is
removed or if a vacancy exists in the office of the Indenture Trustee for any
reason (the Indenture Trustee in such
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event being referred to herein as the retiring Indenture Trustee), the Issuer
shall promptly appoint a successor Indenture Trustee.
(c) A successor Indenture Trustee shall deliver a written acceptance of
its appointment to the retiring Indenture Trustee and to the Issuer and
thereupon the resignation or removal of the Indenture Trustee shall become
effective, and the successor Indenture Trustee, without any further act, deed or
conveyance shall have all the rights, powers and duties of the Indenture Trustee
under this Indenture. The successor Indenture Trustee shall mail a notice of its
succession to Noteholders. The retiring Indenture Trustee shall promptly
transfer all property held by it as the Indenture Trustee to the successor
Indenture Trustee.
(d) If a successor Indenture Trustee does not take office within 60
days after the retiring Indenture Trustee gives notice of its intent to resign
or is removed, the retiring Indenture Trustee, the Issuer or the Holders of a
majority in Outstanding Amount of the Notes may petition any court of competent
jurisdiction for the appointment of a successor Indenture Trustee.
(e) If the Indenture Trustee fails to comply with Section 6.11, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Indenture Trustee and the appointment of a successor Indenture Trustee.
(f) Any resignation or removal of the Indenture Trustee and appointment
of a successor Indenture Trustee pursuant to any of the provisions of this
Section shall not become effective until acceptance of appointment by the
successor Indenture Trustee pursuant to Section 6.8(c) and payment of all fees
and expenses owed to the outgoing Indenture Trustee.
(g) Notwithstanding the resignation or removal of the Indenture Trustee
pursuant to this Section, the Issuer's, the Servicer's and the Sellers'
obligations under Section 6.7 shall continue for the benefit of the retiring
Indenture Trustee. The Indenture Trustee shall not be liable for the acts or
omissions of any successor Indenture Trustee.
SECTION 6.9 Successor Indenture Trustee by Merger. If the Indenture
Trustee consolidates with, merges or converts into, or transfers all or
substantially all its corporate trust business or assets to, another corporation
or banking association, the resulting, surviving or transferee corporation
without any further act shall be the successor Indenture Trustee. The Indenture
Trustee shall provide the Issuer and the Rating Agencies prior written notice of
any such transaction.
In case at the time such successor or successors by merger, conversion
or consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture any of the Notes shall have been authenticated but not delivered,
any such successor to the Indenture Trustee may adopt the certificate of
authentication of
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any predecessor Indenture Trustee, and deliver such Notes so authenticated; and
in case at that time any of the Notes shall not have been authenticated, any
successor Indenture Trustee may authenticate such Notes either in the name of
any predecessor Indenture Trustee hereunder or in the name of the successor
Indenture Trustee; and in all such cases such certificate of authentication
shall have the same full force as is provided anywhere in the Notes or in this
Indenture with respect to the certificate of authentication of the Indenture
Trustee.
SECTION 6.10 Appointment of Co-Indenture Trustee or Separate Indenture
Trustee. (a) Notwithstanding any other provisions of this Indenture, at any
time, for the purpose of meeting any legal requirement of any jurisdiction in
which any part of the Issuer may at the time be located, the Indenture Trustee
shall have the power and may execute and deliver all instruments to appoint one
or more Persons to act as a co-trustee or co-trustees, or separate trustee or
separate trustees, of all or any part of the Issuer, and to vest in such Person
or Persons, in such capacity and for the benefit of the Noteholders, such title
to the Issuer, or any part hereof, and, subject to the other provisions of this
Section, such power, duties, obligations, rights and trusts as the Indenture
Trustee may consider necessary or desirable. The Sellers will pay all reasonable
fees and expenses of any co-trustee or co-trustees or separate trustee or
separate trustees. The appointment of any separate trustee or co-trustee shall
not absolve the Indenture Trustee of its obligations under this Indenture. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as an Indenture Trustee under Section 6.11, and no notice to the
Noteholders of the appointment of any co-trustee or separate trustee shall be
required under Section 6.8.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Indenture Trustee shall be conferred or imposed upon
and exercised or performed by the Indenture Trustee and such separate
trustee or co-trustee jointly (it being understood that such separate
trustee or co-trustee is not authorized to act separately without the
Indenture Trustee joining in such act), except to the extent that under
any law of any jurisdiction in which any particular act or acts are to
be performed the Indenture Trustee shall be incompetent or unqualified
to perform such act or acts, in which event such rights, powers, duties
and obligations (including the holding of title to the Issuer or the
Trust Estate or any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such separate trustee or co-trustee,
but solely at the direction of the Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by
reason of any act or omission of any other trustee hereunder,
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including acts or omissions of predecessor or successor
trustees; and
(iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Indenture and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Indenture Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording
protection to, the Indenture Trustee. Every such instrument shall be filed with
the Indenture Trustee (with a copy given to the Issuer).
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect of
this Indenture on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 6.11 Eligibility; Disqualification. The Indenture Trustee shall
at all times satisfy the requirements of TIA ss.310(a). The Indenture Trustee
shall have a combined capital and surplus of at least $100,000,000 as of the
last day of the most recent fiscal quarter for such institution and shall be
subject to examination or supervision by federal or state authorities. The
long-term unsecured debt of the Indenture Trustee shall at all times be rated
not lower than "BBB-" by Standard & Poor's, "BBB-" by Duff & Phelps (if
rated by Duff & Phelps) and Baa3 by Moody's or such other ratings as are
acceptable to the Rating Agencies. The Indenture Trustee shall comply with TIA
ss.310(b), including the optional provision permitted by the second sentence of
TIA ss.310(b)(9); provided that there shall be excluded from the operation of
TIA ss.310(b)(1) any indenture or indentures under which other securities of the
Issuer are outstanding if the requirements for such exclusion set forth in the
TIA ss.310(b)(1) are met.
SECTION 6.12 Preferential Collection of Claims Against the Issuer. The
Indenture Trustee shall comply with TIA ss.311(a), excluding any creditor
relationship listed in TIA ss.311(b). An Indenture Trustee who has resigned or
been removed shall be subject to TIA ss.311(a) to the extent indicated therein.
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ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 The Issuer To Furnish the Indenture Trustee Names and
Addresses of the Noteholders. The Issuer will furnish or cause to be furnished
to the Indenture Trustee (a) not more than five days after each Record Date, a
list, in such form as the Indenture Trustee may reasonably require, of the names
and addresses of the Holders as of such Record Date and (b) at such other times
as the Indenture Trustee may request in writing, within 14 days after receipt by
the Issuer of any such request, a list of similar form and content as of a date
not more than 10 days prior to the time such list is furnished, provided that so
long as the Indenture Trustee is the Note Registrar, no such list shall be
required to be furnished.
SECTION 7.2 Preservation of Information; Communications to the
Noteholders. (a) The Indenture Trustee shall preserve, in as current a form as
is reasonably practicable, the names and addresses of the Noteholders contained
in the most recent list furnished to the Indenture Trustee as provided in
Section 7.1 and the names and addresses of the Noteholders received by the
Indenture Trustee in its capacity as the Note Registrar. The Indenture Trustee
may destroy any list furnished to it as provided in such Section 7.1 upon
receipt of a new list so furnished.
(b) The Noteholders may communicate pursuant to TIA ss.312(b) with
other Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuer, the Indenture Trustee and the Note Registrar shall
have the protection of TIA ss.312(c).
SECTION 7.3 Reports by the Issuer. (a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after
the Issuer is required to file the same with the Commission, copies of
the annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the Commission
may from time to time by rules and regulations prescribe) which the
Issuer may be required to file with the Commission pursuant to Section
13 or 15(d) of the Exchange Act;
(ii) file with the Indenture Trustee and the Commission in
accordance with rules and regulations prescribed from time to time by
the Commission such additional information, documents and reports with
respect to compliance by the Issuer with the conditions and covenants
of this Indenture as may be required from time to time by such rules
and regulations; and
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(iii) supply to the Indenture Trustee (and the Indenture
Trustee shall transmit by mail to all Noteholders described in TIA
ss.313(c)) such summaries of any information, documents and reports
required to be filed by the Issuer pursuant to clauses (i) and (ii) of
this Section 7.3(a) as may be required by rules and regulations
prescribed from time to time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year
of the Issuer shall end on December 31 of each year.
SECTION 7.4 Reports by the Indenture Trustee. If required by
TIAss.313(a), within 60 days after each March 31, beginning with March 31, 1998,
the Indenture Trustee shall mail to each Noteholder as required by TIAss.313(c)
a brief report dated as of such date that complies with TIAss.313(a). The
Indenture Trustee also shall comply with TIAss.313(b). A copy of each report at
the time of its mailing to Noteholders shall be filed by the Indenture Trustee
with the Commission and each stock exchange, if any, on which the Notes are
listed. The Issuer shall notify the Indenture Trustee if and when the Notes are
listed on any stock exchange. On each Distribution Date, the Indenture Trustee
shall include with each payment to each Noteholder a copy of the statement for
the related Collection Period provided to the Indenture Trustee pursuant to
Section 5.8 of the Sale and Servicing Agreement.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 Collection of Money. Except as otherwise provided herein,
the Indenture Trustee may demand payment or delivery of, and shall receive and
collect, directly and without intervention or assistance of any fiscal agent or
other intermediary, all money and other property payable to or receivable by the
Indenture Trustee pursuant to this Indenture. The Indenture Trustee shall apply
all such money received by it as provided in this Indenture and the Sale and
Servicing Agreement. Except as otherwise provided in this Indenture, if any
default occurs in the making of any payment or performance under any agreement
or instrument that is part of the Trust Estate, the Indenture Trustee may take
such action as may be appropriate to enforce such payment or performance,
including the institution and prosecution of appropriate proceedings. Any such
action shall be without prejudice to any right to claim a Default or Event of
Default under this Indenture and any right to proceed thereafter as provided in
Article V.
SECTION 8.2 Accounts. (a) On or prior to the Closing Date, the Issuer
shall cause the Sellers to establish and maintain, in the name of the Indenture
Trustee, for the benefit of the Noteholders and/or the Certificateholders, as
applicable, the
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Accounts as provided in Article V of the Sale and Servicing Agreement.
(b) Before each Distribution Date, the Servicer and the Sellers are
required to deposit the Available Amount with respect to the preceding
Collection Period in the Collection Account pursuant to Sections 5.2 and 5.4 of
the Sale and Servicing Agreement. On each Deposit Date, the Indenture Trustee
shall withdraw the Reserve Account Transfer Amount for the related Distribution
Date from the Reserve Account and deposit it in the Collection Account in
accordance with Section 5.5(b) of the Sale and Servicing Agreement. On or before
each Distribution Date, the Indenture Trustee or the Paying Agent on behalf of
the Indenture Trustee shall transfer the Noteholders' Distributable Amount for
such Distribution Date from the Collection Account to the Note Distribution
Account in accordance with Section 5.5(c) of the Sale and Servicing Agreement.
(c) Not later than 12:00 noon, New York City time, on each Distribution
Date, the Indenture Trustee or the Paying Agent on behalf of the Indenture
Trustee shall distribute all amounts on deposit in the Note Distribution Account
to Noteholders to the extent of amounts due and unpaid on the Notes for
principal and interest in the following amounts and in the following order of
priority:
(i) to accrued and unpaid interest on the Notes; provided
that if there are not sufficient funds in the Note Distribution Account
to pay the entire amount of accrued and unpaid interest then due on the
Notes, the amount in the Note Distribution Account shall be applied to
the payment of such interest on the Notes pro rata on the basis of the
total such interest due on the Notes;
(ii) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-1 Notes until the Outstanding Amount of the
Class A-1 Notes is reduced to zero;
(iii) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-2 Notes until the Outstanding Amount of the
Class A-2 Notes is reduced to zero;
(iv) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-3 Notes until the Outstanding Amount of the
Class A-3 Notes is reduced to zero;
(v) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-4 Notes until the Outstanding Amount of the
Class A-4 Notes is reduced to zero;
(vi) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-5 Notes until the Outstanding Amount of the
Class A-5 Notes is reduced to zero;
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(vii) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-6 Notes until the Outstanding Amount of the
Class A-6 Notes is reduced to zero;
(viii) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-7 Notes until the Outstanding Amount of the
Class A-7 Notes is reduced to zero;
(ix) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-8 Notes until the Outstanding Amount of the
Class A-8 Notes is reduced to zero;
(x) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-9 Notes until the Outstanding Amount of the
Class A-9 Notes is reduced to zero;
(xi) unless otherwise provided in clause (xii) below, to the
Holders of the Class A-10 Notes until the Outstanding Amount of the
Class A-10 Notes is reduced to zero; and
(xii) if the Notes have been declared immediately due and
payable as provided in Section 5.2, any amounts remaining in the Note
Distribution Account after the applications described in Section
8.2(c)(i) shall be applied to the repayment of principal on each of the
Notes pro rata on the basis of the respective unpaid principal amount
of each such Note.
SECTION 8.3 General Provisions Regarding Accounts. (a) In accordance
with Section 5.1(b) and Section 5.6(b) of the Sale and Servicing Agreement, all
funds in the Collection Account, the Reserve Account and the Paid-Ahead Account
shall be invested in Permitted Investments upon written direction of the
Sellers. All income or other gain from investments of moneys deposited in such
Accounts shall be paid as provided in the Sale and Servicing Agreement, and any
loss resulting from such investments shall be charged to such account. The
Sellers will not direct the Indenture Trustee to make any investment of any
funds or to sell any investment held in any of such Accounts unless the security
interest Granted and perfected in such account will continue to be perfected in
such investment or the proceeds of such sale, in either case without any further
action by any Person.
(b) Subject to Section 6.1(b), the Indenture Trustee shall not in any
way be held liable by reason of any insufficiency in any of the Accounts
resulting from any loss on any Permitted Investment included therein except for
losses attributable to the Indenture Trustee's failure to make payments on such
Permitted Investments issued by the Indenture Trustee, in its commercial
capacity as principal obligor and not as trustee, in accordance with their
terms.
(c) If (i) the Sellers shall have failed to give investment directions
for any funds on deposit in the Collection Account, as the case may be, to the
Indenture Trustee by 11:00 a.m., New York
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City time (or such other time as may be agreed by the Sellers and the Indenture
Trustee) on any Business Day, or (ii) a Default or Event of Default shall have
occurred and be continuing with respect to the Notes but the Notes shall not
have been declared due and payable pursuant to Section 5.2, or, if such Notes
shall have been declared due and payable following an Event of Default, amounts
collected or receivable from the Trust Estate are being applied in accordance
with Section 5.5 as if there had not been such a declaration, then the Indenture
Trustee shall, to the fullest extent practicable, invest and reinvest funds in
such Accounts in one or more Permitted Investments. The Indenture Trustee shall
not be liable for losses in respect of such investments in Permitted Investments
that comply with the requirements of the Basic Documents except for losses
attributable to the Indenture Trustee's failure to make payments on such
Permitted Investments issued by the Indenture Trustee, in its commercial
capacity as principal obligor and not as trustee, in accordance with their
terms.
SECTION 8.4 Release of Trust Estate. (a) Subject to the payment of its
fees and expenses pursuant to Section 6.7, the Indenture Trustee may, and when
required by the provisions of this Indenture shall, execute instruments to
release property from the lien of this Indenture, or convey the Indenture
Trustee's interest in the same, in a manner and under circumstances that are not
inconsistent with the provisions of this Indenture. No party relying upon an
instrument executed by the Indenture Trustee as provided in this Article VIII
shall be bound to ascertain the Indenture Trustee's authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
moneys.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding, and all sums due the Indenture Trustee pursuant to Section 6.7 have
been paid, release any remaining portion of the Trust Estate that secured the
Notes from the lien of this Indenture and release to the Issuer or any other
Person entitled thereto any funds then on deposit in the Note Distribution
Account. The Indenture Trustee shall (i) release any remaining portion of the
Trust Estate that secures the Certificates from the lien of this Indenture and
(ii) release to the Issuer or any other Person entitled thereto any funds then
on deposit in the Reserve Account, Paid-Ahead Account or the Collection Account
only to such time as (x) there are no Notes Outstanding, (y) all payments in
respect of Certificate Balance and interest due to the Certificateholders have
been paid in full and (z) all sums due to the Indenture Trustee pursuant to
Section 6.7 have been paid. The Indenture Trustee shall release property from
the lien of this Indenture pursuant to this Section 8.4(b) only upon receipt of
an Issuer Request accompanied by an Officer's Certificate, an Opinion of Counsel
and (if required by the TIA) Independent Certificates in accordance with TIA
ss.ss. 314(c) and 314(d)(1) meeting the applicable requirements of Section 11.1.
SECTION 8.5 Opinion of Counsel. The Indenture Trustee shall receive
at least seven days' notice when requested by the
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Issuer to take any action pursuant to Section 8.4(a), accompanied by copies of
any instruments involved, and the Indenture Trustee may also require as a
condition of such action, an Opinion of Counsel, in form and substance
satisfactory to the Indenture Trustee, stating the legal effect of any such
action, outlining the steps required to complete the same, and concluding that
all such action will not materially and adversely impair the security for the
Notes or the rights of the Noteholders; provided, however that such Opinion of
Counsel shall not be required to express an opinion as to the fair value of the
Trust Estate. Counsel rendering any such opinion may rely, without independent
investigation, on the accuracy and validity of any certificate or other
instrument delivered to the Indenture Trustee in connection with any such
action.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 9.1 Supplemental Indentures Without Consent of Noteholders. (a)
Without the consent of the Holders of any Notes but with prior notice to the
Rating Agencies by the Issuer, when authorized by an Issuer Request, the Issuer
and the Indenture Trustee at any time and from time to time, may enter into one
or more indentures supplemental hereto (which shall conform to the provisions of
the Trust Indenture Act as in force at the date of the execution thereof), in
form satisfactory to the Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property at
any time subject to the lien of this Indenture, or better to assure,
convey and confirm unto the Indenture Trustee any property subject or
required to be subjected to the lien of this Indenture, or to subject
to the lien of this Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein
and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the
benefit of the Holders of the Notes, or to surrender any right
or power herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to or with the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture which may be
inconsistent with any other provision herein or in any supplemental
indenture or to make any other provisions with respect to matters or
questions arising under this Indenture
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or in any supplemental indenture; provided that such action
shall not materially and adversely affect the interests of the
Holders of the Notes;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes
and to add to or change any of the provisions of this Indenture as
shall be necessary to facilitate the administration of the trusts
hereunder by more than one trustee, pursuant to the requirements of
Article VI;
(vii) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the TIA or under any similar
federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA; and
(viii) to effect the appointment of a successor Indenture
Trustee in accordance with Section 6.11(b).
The Indenture Trustee is hereby authorized to join in the execution of
any such supplemental indenture and to make any further appropriate agreements
and stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, may, also without the consent of any of the Holders of the Notes but with
prior notice to the Rating Agencies by the Issuer, as evidenced to the Indenture
Trustee, enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to, or changing in any manner or eliminating
any of the provisions of, this Indenture or of modifying in any manner the
rights of the Holders of the Notes under this Indenture; provided that such
action shall not, as evidenced by an Opinion of Counsel, materially and
adversely affect the interests of any Noteholder.
SECTION 9.2 Supplemental Indentures with Consent of the Noteholders.
The Issuer and the Indenture Trustee, when authorized by the Issuer, also may,
with prior notice to the Rating Agencies and with the consent of the Holders of
a majority of the Outstanding Amount of the Notes, by Act of such Holders
delivered to the Issuer and the Indenture Trustee, enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to, or
changing in any manner or eliminating any of the provisions of, this Indenture
or of modifying in any manner the rights of the Holders of the Notes under this
Indenture; provided that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Note affected thereby:
(i) change the date of payment of any installment of
principal of or interest on any Note, or reduce the principal amount
thereof or the interest rate thereon with respect
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thereto, change the provision of this Indenture relating to the
application of collections on, or the proceeds of the sale of, the
Trust Estate to payment of principal of or interest on the Notes, or
change any place of payment where, or the coin or currency in which,
any Note or the interest thereon is payable, or impair the right to
institute suit for the enforcement of the provisions of this Indenture
requiring the application of funds available therefor, as provided in
Article V, to the payment of any such amount due on the Notes on or
after the respective due dates thereof;
(ii) reduce the percentage of the Outstanding Amount of the
Notes, the consent of all the Holders of which is required for any such
supplemental indenture, or the consent of the Holders of which is
required for any waiver of compliance with certain provisions of this
Indenture or certain defaults hereunder and their consequences provided
for in this Indenture;
(iii) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding Amount of the
Notes required to direct the Indenture Trustee to sell or liquidate the
Trust Estate pursuant to Section 5.4;
(v) modify any provision of this Section except to increase
any percentage specified herein or to provide that certain additional
provisions of this Indenture or any of the other Basic Documents cannot
be modified or waived without the consent of the Holder of each
Outstanding Note affected thereby;
(vi) modify any of the provisions of this Indenture in such
manner as to affect the calculation of the amount of any payment of
interest or principal due on any Note on any Distribution Date
(including the calculation of any of the individual components of such
calculation) or to affect the rights of the Holders of the Notes to the
benefit of any provisions for the mandatory redemption of the Notes
contained herein; or
(vii) permit the creation of any Lien ranking prior to or on a
parity with the lien of this Indenture with respect to any part of the
Trust Estate or, except as otherwise permitted or contemplated herein
or in the Basic Documents, terminate the lien of this Indenture on any
property at any time subject hereto or deprive the Holder of any Note
of the security provided by the lien of this Indenture.
The Indenture Trustee may determine whether any Notes would be affected
by any supplemental indenture and any such determination shall be conclusive
upon the Holders of all Notes, whether theretofore or thereafter authenticated
and delivered hereunder.
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The Indenture Trustee shall not be liable for any such determination made in
good faith.
It shall not be necessary for any Noteholders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Noteholders shall approve the substance thereof.
Promptly after the execution by the Issuer and the Indenture Trustee of
any supplemental indenture pursuant to this Section, the Indenture Trustee shall
mail to the Holders of the Notes to which such amendment or supplemental
indenture relates a notice setting forth in general terms the substance of such
supplemental indenture. Any failure of the Indenture Trustee to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such supplemental indenture.
SECTION 9.3 Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and be deemed to be modified and amended in accordance therewith with
respect to the Notes affected thereby, and the respective rights, limitations of
rights, obligations, duties, liabilities and immunities under this Indenture of
the Indenture Trustee, the Issuer and the Holders of the Notes shall thereafter
be determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental indenture shall be an be deemed to be part of the terms and
conditions of this Indenture and the Notes affected thereby for any and all
purposes.
SECTION 9.4 Conformity with Trust Indenture Act. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article IX shall comply in all respects with the TIA.
SECTION 9.5 Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so require, new Notes so modified as to conform, in the opinion of
the Indenture Trustee and the Issuer, to any such supplemental indenture may be
prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
SECTION 9.6 Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article IX or the modifications thereby of the trusts created by this
Indenture the Indenture Trustee shall be entitled to receive, and (subject to
Section 6.1) shall be fully protected in relying upon, an Opinion
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of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Indenture Trustee may, but shall
not be obligated to, enter into any such supplemental indenture which affects
the Indenture Trustee's own rights, duties or immunities under this Indenture or
otherwise.
ARTICLE X
[Reserved]
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Compliance Certificates and Opinions, etc. (a) Upon any
application or request by the Issuer to the Indenture Trustee to take any action
under any provision of this Indenture, the Issuer shall furnish to the Indenture
Trustee (i) an Officer's Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with, (ii) an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, and
(iii) (if required by the TIA) an Independent Certificate from a firm of
certified public accountants or other experts meeting the applicable
requirements of this Section, except that, in the case of any such application
or request as to which the furnishing of such documents is specifically required
by any provision of this Indenture, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(i) a statement that each signatory of such certificate or
opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of each such signatory,
such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as to
whether such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory such condition or covenant has been complied with.
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(b) (i) Prior to the deposit of any Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the lien of this Indenture, the
Issuer shall, in addition to any obligation imposed in Section 11.1(a) or
elsewhere in this Indenture, furnish to the Indenture Trustee an Officer's
Certificate certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days of such deposit) to the Issuer
of the Collateral or other property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or stating the
opinion of any signer thereof as to the matters described in clause
(i), the Issuer shall also deliver to the Indenture Trustee an
Independent Certificate as to the same matters, if the fair value to
the Issuer of the securities to be so deposited and of all other such
securities made the basis of any such withdrawal or release since the
commencement of the then-current fiscal year of the Issuer, as set
forth in the certificates delivered pursuant to clause (i) and this
clause (ii), is 10% or more of the Outstanding Amount of the Notes, but
such a certificate need not be furnished with respect to any securities
so deposited, if the fair value thereof to the Issuer as set forth in
the related Officer's Certificate is less than $25,000 or less than one
percent of the Outstanding Amount of the Notes.
(iii) Other than with respect to the release of any
Repurchased Receivables or Liquidated Receivables, whenever any
property or securities are to be released from the lien of this
Indenture, the Issuer shall also furnish to the Indenture Trustee an
Officer's Certificate certifying or stating the opinion of each person
signing such certificate as to the fair value (within 90 days of such
release) of the property or securities proposed to be released and
stating that in the opinion of such person the proposed release will
not impair the security under this Indenture in contravention of the
provisions hereof.
(iv) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officer's Certificate certifying or stating the
opinion of any signer thereof as to the matters described in clause
(iii), the Issuer shall also furnish to the Indenture Trustee an
Independent Certificate as to the same matters if the fair value of the
property or securities and of all other property other than Repurchased
Receivables and Liquidated Receivables, or securities released from the
lien of this Indenture since the commencement of the then current
calendar year, as set forth in the certificates required by clause
(iii) and this clause (iv), equals 10% or more of the Outstanding
Amount of the Notes, but such certificate need not be furnished in the
case of any release of property or securities if the fair value thereof
as set
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forth in the related Officer's Certificate is less than $25,000 or less
than one percent of the then Outstanding Amount of the Notes.
(v) Notwithstanding Section 2.9 or any provision of this
Section, the Issuer may (A) collect, liquidate, sell or otherwise
dispose of the Receivables as and to the extent permitted or required
by the Basic Documents and (B) make cash payments out of the Trust
Accounts as and to the extent permitted or required by the Basic
Documents.
SECTION 11.2 Form of Documents Delivered to the Indenture Trustee. In
any case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person my certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may
be based, insofar as it relates to legal matters, upon a certificate to legal
matters, upon a certificate or opinion of, or representations by, counsel,
unless such officer knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to the matters
upon which his or her certificate or opinion is based are erroneous. Any such
certificate of an Authorized Officer or Opinion of Counsel may be based, insofar
as it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Servicer, either Seller or the
Issuer, stating that the information with respect to such factual matters is in
the possession of the Servicer, such Seller or the Issuer, unless such counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application,
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document (x) as a condition of the granting of such
application, or (y) as evidence of the Issuer's compliance with any term hereof,
it is intended that the truth and accuracy, at the time of the granting of such
application or at the effective date of such certificate or report (as the case
may be), of the facts and opinions stated in such document shall in each case be
conditions precedent to the right of the Issuer to have such application granted
or to the sufficiency
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of such certificate or report. The foregoing shall not, however, be construed to
affect the Indenture Trustee's right to rely upon the truth and accuracy of any
statement or opinion contained in any such document as provided in Article VI.
SECTION 11.3 Actions of Noteholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by the
Noteholders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Noteholders in person or by an agent
duly appointed in writing; and except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments are
delivered to the Indenture Trustee and, when required, to the Issuer or the
Servicer. Proof of execution of any such instrument or of a writing appointing
any such agent shall be sufficient for any purpose of this Indenture and
conclusive in favor of the Indenture Trustee, the Issuer and the Servicer, if
made in the manner provided in this Section 11.3.
(b) The fact and date of the execution by any Noteholder of any such
instrument or writing may be proved in any reasonable manner which the Indenture
Trustee deems sufficient.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Noteholder shall bind every Holder of every Note issued
upon the registration of transfer thereof or in exchange therefor or in lieu
thereof, in respect of anything done, or omitted to be done, by the Indenture
Trustee, the Issuer or the Servicer in reliance thereon, regardless of whether
notation of such action is made upon such Note.
(d) The Indenture Trustee may require such additional proof of any
matter referred to in this Section 11.3 as it shall deem necessary.
SECTION 11.4 Notices, etc., to the Indenture Trustee, the Issuer, and
Rating Agencies. Any request, demand, authorization, direction, notice, consent,
waiver or Act of Noteholders or other documents provided or permitted by this
Indenture to be made upon, given or furnished to or filed with:
(a) The Indenture Trustee by any Noteholder or by the Issuer
shall be sufficient for every purpose hereunder if personally delivered
or mailed certified mail, return receipt requested and shall be deemed
to have been duly given upon receipt by the Indenture Trustee at its
Corporate Trust Office, or
(b) The Issuer by the Indenture Trustee or any Noteholder
shall be sufficient for every purpose hereunder if personally delivered
or mailed certified mail, return receipt to the Issuer addressed to:
Chase Manhattan RV Owner Trust
55
<PAGE>
1997-A, in care of Wilmington Trust Company, 1100 North Market Street,
Wilmington, Delaware 19890, Attention: Corporate Trust Administration
or at any other address previously furnished in writing to the
Indenture Trustee by the Issuer. The Issuer shall promptly transmit any
notice received by it from the Noteholders to the Indenture Trustee.
Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, personally delivered
or mailed certified mail, return receipt requested to (i) in the case of
Moody's, at the following address: Moody's Investors Service, 99 Church Street,
New York, New York 10004, (ii) in the case of S&P, at the following address:
Standard & Poor's Ratings Service, 26 Broadway (15th Floor), New York, New York
10004, Attention of Asset Backed Surveillance Department or (iii) in the case of
Duff & Phelps, at the following address: Duff & Phelps Credit Rating Company, 17
State Street, 12th Floor, New York, New York 10004; or as to each of the
foregoing, at such other address as shall be designated by written notice to the
other parties.
SECTION 11.5 Notices to Noteholders; Waiver. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at his address as it appears on the Note Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Noteholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Noteholder shall affect the sufficiency of such notice with
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given.
Where this Indenture provides for notice in any manner, such notice may
be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to the Noteholders when such notice is required to
be given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Indenture Trustee shall be deemed to
be a sufficient giving of such notice.
Where this Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other
56
<PAGE>
right or obligations created hereunder, and shall not under any circumstance
constitute a Default or Event of Default.
SECTION 11.6 Alternate Payment and Notice Provisions. Notwithstanding
any provision of this Indenture or any of the Notes to the contrary, the Issuer
may enter into any agreement with any Holder of a Note providing for a method of
payment, or notice by the Indenture Trustee or any Paying Agent to such Holder
that is different from the methods provided for in this Indenture for such
payments or notices, provided that such methods are reasonable and consented to
by the Indenture Trustee (which consent shall not be unreasonably withheld). The
Issuer will furnish to the Indenture Trustee a copy of each such agreement, and
the Indenture Trustee will cause payments to be made and notices to be given in
accordance with such agreements.
SECTION 11.7 Conflict with Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with another provision hereof that is required to
be included in this indenture by any of the provisions of the TIA, such required
provision shall control.
The provisions of TIA ss.ss. 310 through 317 that impose duties on any
person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
SECTION 11.8 Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
SECTION 11.9 Successors and Assigns. All covenants and agreements in
this Indenture and the Notes by the Issuer shall bind its successors and
assigns. All agreements of the Indenture Trustee in this Indenture shall bind
its successors.
SECTION 11.10 Separability. In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not be affected or impaired
thereby.
SECTION 11.11 Benefits of Indenture. Nothing in this Indenture or in
the Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, and the Noteholders and (only to the
extent expressly provided herein) the Certificateholders, and any other party
secured hereunder, and any other person with an ownership interest in any part
of the Trust Estate, any benefit or any legal or equitable right, remedy or
claim under this Indenture.
SECTION 11.12 Legal Holidays. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this
57
<PAGE>
Indenture) payment need not be made on such date, but may be made on the next
succeeding Business Day with the same force and effect as if made on the date on
which nominally due, and no interest shall accrue for the period from and after
any such nominal date.
SECTION 11.13 GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.14 Counterparts. This Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 11.15 Recording of Indenture. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense accompanied by an Opinion of Counsel
(which may be counsel to the Indenture Trustee or any other counsel reasonably
acceptable to the Indenture Trustee) to the effect that such recording is
necessary either for the protection of the Noteholders or any other person
secured hereunder or for the enforcement of any right or remedy granted to the
Indenture Trustee under this Indenture or to satisfy any provision of the TIA.
SECTION 11.16 Trust Obligation. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director, employee or agent of the Indenture
Trustee or the Owner Trustee in its individual capacity, except as any such
Person may have expressly agreed (it being understood that the Indenture Trustee
and the Owner Trustee have no such obligations in their individual capacity) and
except that any such partner, owner or beneficiary shall be fully liable, to the
extent provided by applicable law, for any unpaid consideration for stock,
unpaid capital contribution or failure to pay any installment or call owing to
such entity. For all purposes of this Indenture, in the performance of any
duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of
Articles VI, VII and VIII of the Trust Agreement.
SECTION 11.17 No Petition. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time institute against the Issuer or join in any
institution against the Issuer of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or other proceedings under any United
58
<PAGE>
States Federal or state bankruptcy or similar law in connection with any
obligations relating to the Notes, this Indenture or any of the other Basic
Documents.
SECTION 11.18 Inspection. The Issuer agrees that, on reasonable prior
notice, it will permit any representative of the Indenture Trustee, during the
Issuer's normal business hours, to examine all the books of account, records,
reports, and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees and independent certified public accountants, all at such
reasonable times and as often as may be reasonably requested. The Indenture
Trustee shall and shall cause its representatives to hold in confidence all such
information except to the extent disclosure may be required by law (and all
reasonable applications for confidential treatment are unavailing) and except to
the extent that the Indenture Trustee may reasonably determine that such
disclosure is consistent with its Obligations hereunder.
IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused
this Indenture to be duly executed by their respective officers, thereunto duly
authorized, all as of the day and year first above written.
CHASE MANHATTAN RV
OWNER TRUST 1997-A
By: WILMINGTON TRUST COMPANY,
not in its individual
capacity but solely as
Owner Trustee
By:
----------------------------
Name:
Title:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Indenture Trustee
By:
----------------------------
Name:
Title:
59
<PAGE>
EXHIBIT A
SCHEDULE OF RECEIVABLES
Delivered to the Owner Trustee and the Indenture Trustee on the Closing Date.
<PAGE>
EXHIBIT B
FORM OF NOTE
REGISTERED $________________(1)
No. R-______ CUSIP NO. [_________]
[UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.]
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
CHASE MANHATTAN RV OWNER TRUST 1997-A
[____]% CLASS A-[__] ASSET BACKED NOTES
Chase Manhattan RV Owner Trust 1997-A, a trust organized and
existing under the laws of the State of Delaware (including any successor, the
"Issuer"), for value received, hereby promises to pay to CEDE & CO., or its
registered assigns, the principal sum of DOLLARS
($ ), partially payable on each Distribution Date in an amount equal
to the result obtained by multiplying (i) a fraction, the numerator of which is
$__________ and the denominator of which is $[________] by (ii) the aggregate
amount, if any, payable from the Note Distribution Account in respect of
principal on the Class A-[__] Notes pursuant to Section 3.1 of the Indenture;
provided that the entire unpaid principal amount of this Note shall be due and
payable on the [________] Distribution Date. The Issuer will pay interest on
this Note at the rate per annum shown above, on each Distribution Date until the
principal of this Note is paid or made available for payment, on the principal
amount of this Note outstanding on the preceding Distribution Date (after giving
effect to all payments of principal made on the preceding Distribution Date),
subject to certain limitations contained in Sections 2.7, 3.1 and 8.2 of the
Indenture. Interest on this Note will accrue for each Distribution Date from the
most recent Distribution Date on which interest has been paid to but excluding
the then current Distribution Date or, if no interest has yet been paid, from
September __, 1997. Interest will be computed on the basis of a 360-day year
[based upon the actual number of days elapsed during the related Interest
Accrual Period] [of twelve 30-day months]. Such principal of and
<PAGE>
interest on this Note shall be paid in the manner specified in the Indenture.
The principal of and interest on this Note are payable in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts. All payments made by the
Issuer with respect to this Note shall be applied first to interest due and
payable on this Note as provided above and then to the unpaid principal of this
Note.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
Unless the certificate of authentication hereon has been executed by
the trustee whose name appears below by manual signature, this Note shall not be
entitled to any benefit under the Indenture referred to on the reverse hereof,
or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be
signed, manually or in facsimile, by its Authorized Officer.
Dated: __________, 199_
CHASE MANHATTAN RV OWNER TRUST
1997-A
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
under the Trust Agreement
By:
---------------------------------
Name:
Title:
B-2
<PAGE>
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the within
mentioned Indenture.
Dated: ________ __, 199_
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
not in its individual capacity
but solely as Indenture Trustee
By:
----------------------------
Authorized Signatory
B-3
<PAGE>
[REVERSE OF NOTE]
This Note is one of a duly authorized issue of Notes of the Issuer,
designated as its [____]% Class A-[__] Asset Backed Notes (herein called the
"Class A-[__] Notes" or the "Notes"), all issued under an Indenture dated as of
September 1, 1997 (such Indenture, as supplemented or amended, is herein called
the "Indenture"), between the Issuer and Norwest Bank Minnesota, National
Association, not in its individual capacity but solely as trustee (the
"Indenture Trustee", which term includes any successor Indenture Trustee under
the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Notes. The Notes are subject to all terms of the Indenture. All terms used
in this Note that are not otherwise defined herein and that are defined in the
Indenture shall have the meanings assigned to them in or pursuant to the
Indenture.
The Notes and the other Class A-[__] Notes are and will be secured by
the collateral pledged as security therefor as provided in the Indenture.
The Issuer shall pay interest on overdue installments of interest at
the Interest Rate applicable thereto to the extent lawful.
Each Holder or Note Owner, by acceptance of a Note, or, in the case of
a Note Owner, a beneficial interest in the Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under
this Indenture or any certificate or other writing delivered in connection
herewith or therewith, against (i) the Indenture Trustee or the Owner Trustee in
its individual capacity, (ii) any owner of a beneficial interest in the Issuer
or (iii) any partner, owner, beneficiary, agent, officer, director, employee or
agent of the Indenture Trustee or the Owner Trustee in its individual capacity,
any holder of a beneficial interest in the Owner Trustee or the Indenture
Trustee or of any successor or assign of the Indenture Trustee or the Owner
Trustee in its individual capacity, except as any such Person may have expressly
agreed (it being understood that the Indenture Trustee and the Owner Trustee
have no such obligations in their individual capacity) and except that any such
partner, owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.
It is the intent of the Sellers, the Noteholders and the Note Owners,
the Issuer, the Certificateholders and the Certificate Owners, that the Notes
will be classified as indebtedness of the Issuer for all United States tax
purposes. The Noteholders, by
<PAGE>
acceptance of a Note, agree to treat, and to take no action inconsistent with
the treatment of, the Notes as indebtedness of the Issuer for such tax purposes.
Each Noteholder or Note Owner, by acceptance of a Note, or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees that they
will not at any time institute against the Issuer or join in any institution
against the Issuer of, any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings, or other proceedings under any United States Federal
or State bankruptcy or similar law in connection with any obligations relating
to the Notes, this Indenture or any of the other Basic Documents.
This Note and the Indenture shall be construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
and thereunder shall be determined in accordance with such laws.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, neither Chase Manhattan Bank USA, National
Association nor The Chase Manhattan Bank, in its individual capacity, nor any
owner of a beneficial interest in the Issuer, nor any of their respective
partners, beneficiaries, agents, officers, directors, employees, successors or
assigns shall be personally liable for, nor shall recourse be had to any of them
for, the payment of principal of or interest on, or performance of, or omission
to perform, any of the covenants, obligations or indemnifications contained in
this Note or the Indenture, it being expressly understood that said covenants,
obligations and indemnifications have been made by the Indenture Trustee for the
sole purposes of binding the interests of the Indenture Trustee in the assets of
the Issuer. The Holder of this Note by the acceptance hereof agrees that, except
as expressly provided in the Basic Documents, in the case of an Event of Default
under the Indenture, the Holder shall have no claim against any of the foregoing
for any deficiency, loss or claim therefrom; provided that nothing contained
herein shall be taken to prevent recourse to, and enforcement against, the
assets of the Issuer for any and all liabilities, obligations and undertakings
contained in the Indenture or in this Note.
<PAGE>
ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee
- -------------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
- -------------------------------------------------------------------------------
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints , attorney, to transfer said Note on the books kept for
registration thereof, with full power of substitution in the premises.
Dated: ****/
--------------------- ------------------------------------
Signature Guaranteed:
- --------
****/ NOTE: The signature to this assignment must correspond with the name
of the registered owner as it appears on the face of the within Note in
every particular without alteration, enlargement or any change
whatsoever.
<PAGE>
(1) Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
<PAGE>
CERTIFICATE OF TRUST
OF
CHASE MANHATTAN RV OWNER TRUST 1997-A
THIS Certificate of Trust of Chase Manhattan RV Owner Trust 1997-A (the
"Trust"), dated as of July __, 1997, is being duly executed and filed by
Wilmington Trust Company, a Delaware banking corporation, as trustee, to form a
business trust under the Delaware Business Trust Act (12 Del. C. ss.3801 et
seq.).
1. Name. The name of the business trust formed hereby is Chase Manhattan RV
Owner Trust 1997-A.
2. Delaware Trustee. The name and business address of the trustee of the
Trust in the State of Delaware is Wilmington Trust Company, Rodney Square North,
1100 North Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate
Trust Administration.
3. Effective Date. This Certificate of Trust shall be effective as of the
date filed.
IN WITNESS WHEREOF, the undersigned, being the sole trustee of the Trust,
has executed this Certificate of Trust as of the date first-above written.
WILMINGTON TRUST COMPANY,
as trustee
By: /s/ Emmett R. Harmon
----------------------------
Name: Emmett R. Harmon
Title: Vice President
<PAGE>
OH&S DRAFT
9/17/97
================================================================================
CHASE MANHATTAN RV OWNER TRUST 1997-A
AMENDED AND RESTATED
TRUST AGREEMENT
among
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
and
THE CHASE MANHATTAN BANK,
as Depositors
and
WILMINGTON TRUST COMPANY,
as Owner Trustee
Dated as of September 1, 1997
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
SECTION 1.1 Capitalized Terms........................................... 1
ARTICLE II
ORGANIZATION
SECTION 2.1 Name........................................................ 2
SECTION 2.2 Office...................................................... 2
SECTION 2.3 Purposes and Powers......................................... 2
SECTION 2.4 Appointment of Owner Trustee................................ 3
SECTION 2.5 Initial Capital Contribution of Trust
Estate................................................. 3
SECTION 2.6 Declaration of Trust........................................ 3
SECTION 2.7 Title to Issuer Property.................................... 3
SECTION 2.8 Situs of Issuer............................................. 3
SECTION 2.9 Representations and Warranties of each
Depositor.............................................. 4
SECTION 2.10 Liability of Certificateholders............................. 4
SECTION 2.11 Guaranteed Payments/Gross Income
Allocations............................................ 4
SECTION 2.12 Deduction and Loss Allocations.............................. 5
SECTION 2.13 Special Allocations......................................... 6
SECTION 2.14 Amended and Restated Trust Agreement........................ 6
ARTICLE III
CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1 Initial Ownership........................................... 6
SECTION 3.2 The Certificates............................................ 6
SECTION 3.3 Execution, Authentication and Delivery
of Certificates........................................ 7
SECTION 3.4 Registration of Transfer and Exchange
of Certificates........................................ 7
SECTION 3.5 Mutilated, Destroyed, Lost or Stolen
Certificates........................................... 9
SECTION 3.6 Persons Deemed Certificateholders........................... 9
SECTION 3.7 Access to List of Certificateholders'
Names and Addresses.................................... 9
SECTION 3.8 Maintenance of Office or Agency............................. 10
SECTION 3.9 Appointment of Paying Agent................................. 10
SECTION 3.10 Book-Entry Certificates..................................... 11
SECTION 3.11 Notices to Clearing Agency.................................. 12
SECTION 3.12 Definitive Certificates..................................... 12
SECTION 3.13 Authenticating Agent........................................ 13
<PAGE>
SECTION 3.14 Actions of Certificateholders............................... 14
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1 Prior Notice to Certificateholders with
Respect to Certain Matters............................. 15
SECTION 4.2 Action by Certificateholders with
Respect to Certain Matters............................. 16
SECTION 4.3 Action by Certificateholders with
Respect to Bankruptcy.................................. 16
SECTION 4.4 Restrictions on Certificateholders'
Power.................................................. 16
SECTION 4.5 Majority Control............................................ 16
ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1 Establishment of Certificate
Distribution Account................................... 17
SECTION 5.2 Application of Funds in Certificate
Distribution Account................................... 17
SECTION 5.3 Method of Payment........................................... 18
SECTION 5.4 No Segregation of Monies; No Interest....................... 18
SECTION 5.5 Accounting and Reports to the
Noteholders, Certificateholders, the
Internal Revenue Service and Others.................... 19
SECTION 5.6 Signature on Returns; Tax Matters
Partner................................................ 19
SECTION 5.7 Capital Accounts............................................ 19
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1 General Authority........................................... 20
SECTION 6.2 General Duties.............................................. 21
SECTION 6.3 Action upon Instruction..................................... 21
SECTION 6.4 No Duties Except as Specified in this
Agreement or in Instructions........................... 22
SECTION 6.5 No Action Except under Specified
Documents or Instructions.............................. 22
SECTION 6.6 Restrictions................................................ 22
SECTION 6.7 Doing Business in Other Jurisdictions....................... 23
ARTICLE VII
CONCERNING OWNER TRUSTEE
SECTION 7.1 Acceptance of Trusts and Duties............................. 23
SECTION 7.2 Furnishing of Documents..................................... 25
SECTION 7.3 Representations and Warranties.............................. 25
ii
<PAGE>
SECTION 7.4 Reliance; Advice of Counsel................................. 26
SECTION 7.5 Not Acting in Individual Capacity........................... 27
SECTION 7.6 Owner Trustee May Own Certificates and
Notes.................................................. 27
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
SECTION 8.1 Owner Trustee's Fees and Expenses........................... 27
SECTION 8.2 Indemnification............................................. 28
SECTION 8.3 Payments to Owner Trustee................................... 28
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1 Termination of Trust Agreement.............................. 29
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
SECTION 10.1 Eligibility Requirements for Owner
Trustee................................................ 30
SECTION 10.2 Resignation or Removal of Owner
Trustee................................................ 31
SECTION 10.3 Successor Owner Trustee..................................... 31
SECTION 10.4 Merger or Consolidation of Owner
Trustee................................................ 32
SECTION 10.5 Appointment of Co-Trustee or Separate
Trustee................................................ 32
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Supplements and Amendments.................................. 34
SECTION 11.2 No Legal Title to Owner Trust Estate in
Certificateholders..................................... 35
SECTION 11.3 Limitations on Rights of Others............................. 35
SECTION 11.4 Notices..................................................... 35
SECTION 11.5 Severability................................................ 36
SECTION 11.6 Separate Counterparts....................................... 36
SECTION 11.7 Successors and Assigns...................................... 36
SECTION 11.8 No Recourse................................................. 36
SECTION 11.9 [Reserved].................................................. 36
SECTION 11.10 Headings.................................................... 37
SECTION 11.11 GOVERNING LAW............................................... 37
SECTION 11.12 Certificate Transfer Restrictions........................... 37
iii
<PAGE>
EXHIBITS
Exhibit A - Form of Certificate
Exhibit B - Form of Certificate of Trust
iv
<PAGE>
AMENDED AND RESTATED TRUST AGREEMENT dated as of September 1, 1997
between CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION ("Chase USA"), a
national banking association, and THE CHASE MANHATTAN BANK ("Chase"), a New
York banking corporation (each, in such capacity, a "Depositor" and together
the "Depositors"), and Wilmington Trust Company, a Delaware banking
corporation, as the owner trustee (the "Owner Trustee").
ARTICLE I
DEFINITIONS
SECTION 1.1 Capitalized Terms. Capitalized terms are used in this
Agreement as defined in Section 1.1 to the Sale and Servicing Agreement among
the trust established by this Agreement and Chase USA and Chase, as Sellers,
and The CIT Group/Sales Financing, Inc., as Servicer, dated as of September 1,
1997, as the same may be amended and supplemented from time to time (the "Sale
and Servicing Agreement").
(a) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(b) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement or in any such certificate or other
document to the extent not defined, shall have the respective meanings given to
them under generally accepted accounting principles. To the extent that the
definitions of accounting terms in this Agreement or in any such certificate or
other document are inconsistent with the meanings of such terms under generally
accepted accounting principles, the definitions contained in this Agreement or
in any such certificate or other document shall control.
(c) The words "hereof," "herein," "hereunder," and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Section and Exhibit
references contained in this Agreement are references to Sections and Exhibits
in or to this Agreement unless otherwise specified; and the term "including"
shall mean "including without limitation."
(d) The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.
(e) All calculations of the amount of interest accrued on the
Certificates shall be made on the basis of a 360-day year consisting of twelve
30-day months.
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ARTICLE II
ORGANIZATION
SECTION 2.1 Name. The trust created hereby shall be known as "Chase
Manhattan RV Owner Trust 1997-A" (hereinafter, the "Issuer") in which name the
Owner Trustee may conduct the business of such trust, make and execute
contracts and other instruments on behalf of such trust and sue and be sued.
SECTION 2.2 Office. The office of the Issuer shall be in care of the
Owner Trustee at the Corporate Trust Office or at such other address as the
Owner Trustee may designate by written notice to the Certificateholders and the
Depositors.
SECTION 2.3 Purposes and Powers. The purpose of the Issuer is, and the
Issuer shall have the power and authority, to engage in the following
activities:
(a) to issue the Notes pursuant to the Indenture and
the Certificates pursuant to this Agreement, and to sell,
transfer or exchange the Notes and the Certificates;
(b) to acquire the property and assets set forth in the
Sale and Servicing Agreement from the Depositors pursuant to the terms
thereof, to make payments or distributions on the Notes and
Certificates, to make deposits to and withdrawals from the Reserve
Account and other accounts established under this Agreement and the
Sale and Servicing Agreement;
(c) to assign, grant, transfer, pledge, mortgage and convey
the Trust Estate pursuant to the Indenture and to hold, manage and
distribute to the Certificateholders pursuant to the terms of the Sale
and Servicing Agreement any portion of the Trust Estate released from
the Lien of, and remitted to the Issuer pursuant to, the Indenture;
(d) to enter into and perform its obligations under the
Basic Documents to which it is a party;
(e) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish
the foregoing or are incidental thereto or connected therewith; and
(f) subject to compliance with the Basic Documents, to
engage in such other activities as may be required in connection with
conservation of the Owner Trust Estate and the making of distributions
to the Certificateholders and the Noteholders.
Issuer is hereby authorized to engage in the foregoing activities.
Issuer shall not engage in any activity other than in connection
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with the foregoing or other than as required or authorized by the terms of this
Agreement or the other Basic Documents.
SECTION 2.4 Appointment of Owner Trustee. The Depositors hereby
appoint the Owner Trustee as trustee of the Issuer effective as of the date
hereof, to have all the rights, powers and duties set forth herein.
SECTION 2.5 Initial Capital Contribution of Trust Estate. The
Depositors hereby sell, assign, transfer, convey and set over to the Owner
Trustee, as of the date hereof, the Reserve Account Initial Deposit. The Owner
Trustee hereby acknowledges receipt in trust from the Depositors, as of the
date hereof, of the foregoing contribution, which shall constitute the initial
Owner Trust Estate and shall be deposited in the Reserve Account pursuant to
Section 5.6(a) of the Sale and Servicing Agreement. The Depositors shall pay
the organizational expenses of the Issuer as they may arise or shall, upon the
request of the Owner Trustee, promptly reimburse the Owner Trustee for any such
expenses paid by the Owner Trustee.
SECTION 2.6 Declaration of Trust. The Owner Trustee hereby declares
that it will hold the Owner Trust Estate in trust upon and subject to the
conditions set forth herein for the use and benefit of the Certificateholders,
subject to the obligations of the Issuer under the Basic Documents. It is the
intention of the parties hereto that the Issuer constitute a business trust
under the Business Trust Statute and that this Agreement constitute the
governing instrument of such business trust. It is the intention of the parties
hereto that, solely for United States income and franchise tax purposes, the
Issuer shall be treated as a partnership. The parties agree that, unless
otherwise required by appropriate tax authorities, the Issuer will file or
cause to be filed annual or other necessary returns, reports and other forms
consistent with the characterization of the Issuer as a partnership for such
tax purposes. Effective as of the date hereof, the Owner Trustee shall have all
rights, powers and duties set forth herein and to the extent not inconsistent
herewith, in the Business Trust Statute with respect to accomplishing the
purposes of the Issuer. The Owner Trustee shall file the Certificate of Trust
with the Secretary of State of Delaware.
SECTION 2.7 Title to Issuer Property. Legal title to all the Owner
Trust Estate shall be vested at all times in the Issuer as a separate legal
entity except where applicable law in any jurisdiction requires title to any
part of the Owner Trust Estate to be vested in a trustee or trustees, in which
case the title shall be deemed to be vested in the Owner Trustee, a co-trustee
and/or a separate trustee, as the case may be.
SECTION 2.8 Situs of Issuer. The Issuer will be located and
administered in the State of Delaware. All bank accounts maintained by the
Owner Trustee on behalf of the Issuer shall be located in the State of Delaware
or the State of New York. Payments will be received by the Issuer only in
Delaware or New
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York, and payments will be made by the Issuer only from Delaware or New York.
The only office of the Issuer will be at its office in Delaware.
SECTION 2.9 Representations and Warranties of each Depositor. Each
Depositor hereby represents and warrants to the Owner Trustee that:
(i) Such Depositor (i) has been duly organized and is
validly existing and in good standing under the laws of the
jurisdiction of its organization, and (ii) has power and authority to
own its properties and to conduct its business as such properties are
currently owned and such business is presently conducted, and had at
all relevant times, and has, power, authority and legal right to
acquire and own the Receivables transferred by it to the Issuer.
(ii) Such Depositor has the power and authority to execute
and deliver this Agreement and to carry out its terms; such Depositor
has full power and authority to sell and assign the property to be
sold and assigned to and deposited with the Issuer by it, and such
Depositor has duly authorized such sale and assignment and deposit to
the Issuer by all necessary action; and the execution, delivery and
performance of this Agreement has been duly authorized by such
Depositor by all necessary action.
(iii) The consummation of the transactions contemplated by
this Agreement and the other Basic Documents and the fulfillment of
the terms hereof, do not conflict with, result in any breach of any of
the terms and provisions of, or constitute (with or without notice or
lapse of time) a default under, the articles of association or
charter, as the case may be, or bylaws of such Depositor, or conflict
with or breach any of the material terms or provisions of or
constitute (with or without notice or lapse of time) a default under
any indenture, agreement or other instrument to which such Depositor
is a party or by which it is bound; nor 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; nor
violate any law or, to the best of such Depositor's knowledge, any
order, rule or regulation applicable to such Depositor of any court or
of any Federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over such
Depositor or its properties.
SECTION 2.10 Liability of Certificateholders. No Certificateholder
shall have any personal liability for any liability or obligation of the
Issuer.
SECTION 2.11 Guaranteed Payments/Gross Income Allocations. (a)
Inasmuch as the Certificateholders' Interest Distributable Amount is determined
and paid hereunder without
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regard to the income of the Issuer, the Issuer shall treat payments of such
amounts as "guaranteed payments" within the meaning of Section 707(c) of the
Code. Consequently, Certificateholders will have ordinary income equal to their
allocable share of the Certificateholders' Interest Distributable Amount, the
Issuer will have an equivalent deduction for United States federal income tax
purposes and no amount of the gross income of the Issuer shall be allocable to
the Certificateholders (and there will be no corresponding increase in a
Certificateholders's Capital Account under Section 5.7). In the event that any
taxing authority does not respect such tax treatment, the gross income of the
Issuer for any calendar month as determined for United States federal income
tax purposes shall be allocated, after giving effect to special allocations set
forth in Section 2.12 of this Agreement and for purposes of maintaining Capital
Accounts under Section 5.7 of this Agreement as follows:
(1) first, among the Certificateholders as of the close of
the last day of such calendar month, in proportion to their ownership
of the principal amount of Certificates on such date, an amount of
gross income equal to the amount of interest that accrues in such
calendar month on the Certificates in accordance with their terms,
including interest accruing thereon at the Certificate Rate monthly
and interest on amounts previously due under the Certificates and not
yet paid as provided therein; and
(2) the balance of gross income, if any, allocated to the
Depositors in accordance with their respective Depositor Allocation
Percentages.
If the gross income of the Issuer for any month is insufficient for the
allocations described in clause (1) above, subsequent items of gross income
shall first be allocated to make up such shortfall before being allocated as
provided in clause (2).
(b) In the event the initial issue price of the Certificates differs
from their initial principal amount, there shall be specially allocated to the
Certificateholders the portion, if any, of the offset for premium (in the case
the issue price of the Certificates exceeds their principal amount) or market
discount income (in the case the principal amount of the Certificates exceeds
their issue price) on the Receivables accruing for a calendar month that is
attributable to such difference.
SECTION 2.12 Deduction and Loss Allocations. (a) All items of
deduction and loss of the Issuer shall be allocated to the Depositors in
accordance with their respective Depositor Allocation Percentages.
(b) To the extent that an allocation of the gross amount of deductions
and losses to the Depositors pursuant to Section 2.12(a) above would cause the
Capital Accounts of the Depositors to be reduced below zero, such excess
deductions and losses shall be
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allocated to the Certificateholders on a pro rata basis until each of their
Capital Accounts has been reduced to zero. If any amount of gross deduction or
loss has not been allocated pursuant to the preceding sentence because all of
the Certificateholders' Capital Accounts have been reduced to zero, the amount
of such remaining unallocated deductions or losses shall be allocated to the
Depositors in accordance with their respective Depositor Allocation
Percentages.
(c) If any deductions or losses have been allocated to the
Certificateholders under Section 2.12(b) above, an amount of gross income shall
be allocated to such Certificateholders under this Section 2.12(c) in
subsequent taxable years sufficient to offset the amount of any deductions or
losses previously allocated to such Certificateholders under Section 2.12(b)
above and, thereafter, allocations of gross income and deductions shall be made
in accordance with Sections 2.11 and 2.12(a) of this Agreement.
SECTION 2.13 Special Allocations. In the event any Certificateholder
unexpectedly receives any adjustments, allocations or distributions described
in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of
Issuer income and gain shall be specially allocated to such Certificateholder
in an amount and manner sufficient to eliminate, to the extent required by the
Treasury Regulations, the deficit, if any, in the balance of the Capital
Account of such Certificateholder as quickly as possible. This Section 2.13 is
intended to comply with the qualified income offset provision in Section
1.704-1(b)(2)(ii)(d) of the Treasury Regulations.
SECTION 2.14 Amended and Restated Trust Agreement. This Agreement
amends and restates in its entirety the Trust Agreement dated as of July 17,
1997 among the Depositors and the Owner Trustee.
ARTICLE III
CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1 Initial Ownership. Upon the formation of the Issuer by the
contribution by the Depositors pursuant to Section 2.5 and until the issuance
of the Certificates, the Depositors shall be the sole beneficiaries of the
Trust.
SECTION 3.2 The Certificates. The Certificates shall be issued in
denominations of $1,000 and integral multiples thereof; provided that one
Certificate may be issued that includes any residual portion of the initial
Certificate Balance in a denomination other than an integral multiple of
$1,000. Upon initial issuance, the Certificates shall each be in the form of
Exhibit A, which is incorporated by reference, and shall be issued as provided
in Section 3.10 in an aggregate principal amount equal to the Certificate
Balance. The Certificates shall be executed on
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behalf of the Issuer by manual or facsimile signature of an Authorized Officer
or other authorized signatory of the Owner Trustee. Certificates bearing the
manual or facsimile signatures of individuals who were, at the time when such
signatures shall have been affixed, authorized to sign on behalf of the Issuer,
shall be validly issued and entitled to the benefit of this Agreement,
notwithstanding that such individuals or any of them shall have ceased to be so
authorized prior to the authentication and delivery of such Certificates or did
not hold such offices at the date of authentication and delivery of such
Certificates. No Certificate shall entitle the Holder to any benefit under this
Agreement, or shall be valid for any purpose, unless there shall appear on such
Certificate a certificate of authentication substantially in the form set forth
in Exhibit A, executed by the Owner Trustee or Chase, as the Owner Trustee's
authentication agent, by manual or facsimile signature; such authentication
shall constitute conclusive evidence that such Certificate shall have been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication. A transferee of a Certificate shall become a
Certificateholder, and shall be entitled to the rights and subject to the
obligations of a Certificateholder hereunder, upon due registration of such
Certificate in such transferee's name pursuant to Section 3.4.
SECTION 3.3 Execution, Authentication and Delivery of Certificates.
Concurrently with the transfer of the Receivables to the Issuer pursuant to the
Sale and Servicing Agreement, the Owner Trustee shall cause the Certificates in
an aggregate principal amount equal to the initial Certificate Balance to be
executed on behalf of the Issuer, authenticated and delivered to or upon the
written order of each Depositor signed by its chairman of the board, its
president or any vice president, without further action by such Depositor, in
authorized denominations.
SECTION 3.4 Registration of Transfer and Exchange of Certificates. The
Owner Trustee shall cause to be kept at the office or agency to be maintained
pursuant to Section 3.8 by a certificate registrar (the "Certificate
Registrar"), a register (the "Certificate Register") in which, subject to such
reasonable regulations as it may prescribe, the Certificate Registrar shall
provide for the registration of Certificates and of transfers and exchanges of
Certificates as herein provided. Chase shall be the initial Certificate
Registrar. In the event that, subsequent to the date of issuance of the
Certificates, Chase notifies the Owner Trustee that it is unable to act as the
Certificate Registrar, the Owner Trustee shall act, or the Owner Trustee shall,
with the consent of each Depositor, appoint another bank or trust company,
having an office or agency located in The City of New York and which agrees to
act in accordance with the provisions of this Agreement applicable to it, to
act, as successor Certificate Registrar under this Agreement.
The Owner Trustee may revoke such appointment and remove Chase as the
Certificate Registrar if the Owner Trustee determines in its
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sole discretion that Chase failed to perform its obligations under this
Agreement in any material respect. Chase shall be permitted to resign as the
Certificate Registrar upon 30 days' written notice to the Owner Trustee, each
Depositor and the Issuer; provided, however, that such resignation shall not be
effective and Chase shall continue to perform its duties as the Certificate
Registrar until the Owner Trustee has appointed a successor Certificate
Registrar with the consent of each Depositor.
An institution succeeding to the corporate agency business of the
Certificate Registrar shall continue to be the Certificate Registrar without
the execution or filing of any paper or any further act on the part of the
Owner Trustee or such Certificate Registrar.
Upon surrender for registration of transfer of any Certificate at the
office or agency maintained pursuant to Section 3.8, the Owner Trustee shall
execute, authenticate and (if the Certificate Registrar is different than the
Owner Trustee, then the Certificate Registrar shall) deliver (or shall cause
Chase as its authenticating agent to authenticate and deliver), in the name of
the designated transferee or transferees, one or more new Certificates in
authorized denominations of a like class and aggregate face amount dated the
date of authentication by the Owner Trustee or any authenticating agent. At the
option of a Holder, Certificates may be exchanged for other Certificates of the
same class in authorized denominations of a like aggregate amount upon
surrender of the Certificates to be exchanged at the office or agency
maintained pursuant to Section 3.8.
Whenever any Certificate is surrendered for exchange, the Owner
Trustee shall execute, authenticate and (if the Certificate Registrar is
different than the Owner Trustee, then the Certificate Registrar shall) deliver
the Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer
in form satisfactory to the Owner Trustee and the Certificate Registrar duly
executed by the Holder, which signature on such assignment must be guaranteed
by a member of the New York Stock Exchange or a commercial bank or trust
company.
Each Certificate surrendered for registration of transfer or exchange
shall be canceled and subsequently disposed of by the Owner Trustee or
Certificate Registrar in accordance with its customary practice.
No service charge shall be made for any registration of transfer or
exchange of Certificates, but the Owner Trustee or the Certificate Registrar
may require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer or exchange of
Certificates.
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SECTION 3.5 Mutilated, Destroyed, Lost or Stolen Certificates. If (a)
any mutilated Certificate shall be surrendered to the Certificate Registrar, of
if the Certificate Registrar shall receive evidence to its satisfaction of the
destruction, loss or theft of any Certificate and (b) there shall be delivered
to the Certificate Registrar and the Owner Trustee such security or indemnity
as may be required by them to save each of them harmless, then in the absence
of notice that such Certificate shall have been acquired by a bona fide
purchaser, the Owner Trustee on behalf of Issuer shall execute and the Owner
Trustee, or Chase, as the Owner Trustee's authenticating agent, shall
authenticate and (if the Certificate Registrar is different from the Owner
Trustee, then the Certificate Registrar shall) deliver, in exchange for or in
lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like class, tenor and denomination. If, after delivery of such
replacement Certificate, a bona fide purchaser of the original Certificate in
lieu of which such replacement Certificate was issued presents for payment such
original Certificate, the Owner Trustee or the Certificate Registrar shall be
entitled to recover such replacement Certificate from such Person to whom such
replacement Certificate was delivered or any assignee of such Person, except a
bona fide purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Owner Trustee or the Certificate Registrar in connection
therewith. In connection with the issuance of any new Certificate under this
Section 3.5, the Owner Trustee or the Certificate Registrar may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith. Any duplicate Certificate issued
pursuant to this Section shall constitute conclusive evidence of an ownership
interest in Issuer, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time. The provisions of this
Section 3.5 are exclusive and shall preclude (to the extent lawful) all other
rights and remedies with respect to the replacement of mutilated, destroyed,
lost or stolen Certificates.
SECTION 3.6 Persons Deemed Certificateholders. Prior to due
presentation of a Certificate for registration of transfer, the Owner Trustee
or the Certificate Registrar may treat the Person in whose name any Certificate
shall be registered in the Certificate Register as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section 5.2
and for all other purposes whatsoever, and neither the Owner Trustee nor the
Certificate Registrar shall be bound by any notice to the contrary.
SECTION 3.7 Access to List of Certificateholders' Names and Addresses.
The Certificate Registrar shall furnish or cause to be furnished to the
Servicer and the Depositors (and to the Owner Trustee, if the Owner Trustee is
not the Certificate Registrar) within 15 days after receipt by the Certificate
Registrar of a request therefor from the Servicer or the Depositors (or the
Owner Trustee) in writing, a list, in such form as the Servicer or the
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Depositors (or the Owner Trustee) may reasonably require, of the names and
addresses of the Certificateholders as of the most recent Record Date. If, at
such time, if any, as Definitive Certificates have been issued, if three or
more Certificateholders or one or more Certificateholders representing not less
than 25% of the Certificate Balance then outstanding apply in writing to the
Certificate Registrar, and such application states that the applicants desire
to communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates and such application is accompanied by
a copy of the communication that such applicants propose to transmit, then the
Certificate Registrar shall, within five Business Days after the receipt of
such application, afford such applicants access during normal business hours to
the current list of Certificateholders. Each Holder, by receiving and holding a
Certificate, shall be deemed to have agreed to hold none of the Depositors, the
Certificate Registrar, the Servicer or the Owner Trustee accountable by reason
of the disclosure of its name and address, regardless of the source from which
such information was derived.
SECTION 3.8 Maintenance of Office or Agency. The Owner Trustee shall
maintain in The City of New York, an office or offices or agency or agencies
where Certificates may be surrendered for registration of transfer or exchange.
The Owner Trustee initially designates the offices of The Chase Manhattan Bank
located at 450 West 33rd Street, New York, New York 10001-2697 as its office
for such purposes. The Owner Trustee shall give prompt written notice to each
Depositor, the Servicer and to the Certificateholders of any change in the
location of the Certificate Register or any such office or agency.
SECTION 3.9 Appointment of Paying Agent. The Owner Trustee may appoint
a Paying Agent with respect to the Certificates. The Owner Trustee hereby
appoints Chase as the initial Paying Agent. The Paying Agent shall have the
revocable power to withdraw funds from the Certificate Distribution Account,
make distributions to Certificateholders from the Certificate Distribution
Account pursuant to Section 5.2 and shall report the amounts of such
distributions to the Owner Trustee. The Owner Trustee may revoke such power and
remove the Paying Agent if the Owner Trustee determines in its sole discretion
that the Paying Agent shall have failed to perform its obligations under this
Agreement in any material respect or for other good cause. The Paying Agent
shall be permitted to resign upon 30 days' written notice to the Owner Trustee
and the Servicer. In the event that Chase shall no longer be the Paying Agent,
the Owner Trustee shall appoint a successor to act as Paying Agent (which shall
be a bank or trust company and may be the Owner Trustee), with the consent of
each Depositor (which consent shall not be unreasonably withheld). The Owner
Trustee shall cause such successor Paying Agent or any additional Paying Agent
appointed by the Owner Trustee (unless it is the Owner Trustee) to execute and
deliver to the Owner Trustee an instrument in which such successor Paying Agent
or additional Paying Agent shall agree with the Owner Trustee that as Paying
Agent, such
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successor Paying Agent or additional Paying Agent will hold all sums, if any,
held by it for payment to the Certificateholders in trust for the benefit of
the Certificateholders entitled thereto until such sums shall be paid to such
Certificateholders. The Paying Agent shall return all unclaimed funds to the
Owner Trustee and upon the removal of a Paying Agent, such Paying Agent shall
also return all funds in its possession to the Owner Trustee. The provisions of
Sections 7.1, 7.3, 7.4, 7.6, 8.1 and 8.2 shall apply to the Owner Trustee also
in its role as Paying Agent, for so long as the Owner Trustee shall act as
Paying Agent and, to the extent applicable, to any other paying agent appointed
hereunder. Any reference in this Agreement to the Paying Agent shall include
any co-paying agent unless the context requires otherwise.
SECTION 3.10 Book-Entry Certificates. The Certificates, upon original
issuance, will be issued in the form of a typewritten Certificate or
Certificates representing Book-Entry Certificates, to be delivered to The
Depository Trust Company, the initial Clearing Agency, by or on behalf of the
Issuer. Such Book-Entry Certificate or Certificates shall initially be
registered on the Certificate Register in the name of Cede & Co., the nominee
of the initial Clearing Agency, and no beneficial owner (other than Chase
Securities Inc.) will receive a definitive Certificate representing such
beneficial owner's interest in such Certificate, except as provided in Section
3.12. Unless and until Definitive Certificates have been issued to beneficial
owners pursuant to Section 3.12:
(a) the provisions of this Section 3.10 shall be in
full force and effect;
(b) the Certificate Registrar, the Paying Agent and the
Owner Trustee shall be entitled to deal with the Clearing Agency and
the Clearing Agency Participants for all purposes of this Agreement
relating to the Book-Entry Certificates (including the payment of
principal of and interest on the Book-Entry Certificates and the
giving of instructions or directions to Certificate Owners of
Book-Entry Certificates) as the sole Holder of Book-Entry Certificates
and shall have no obligations to Certificate Owners thereof;
(c) to the extent that the provisions of this Section
conflict with any other provisions of this Agreement, the provisions
of this Section shall control;
(d) the rights of Certificate Owners of the Book-Entry
Certificates shall be exercised only through the Clearing Agency (or
to the extent Certificateholders are not Clearing Agency Participants,
through the Clearing Agency Participants through which such
Certificateholders own Book-Entry Certificates), and shall be limited
to those established by law and agreements among such Certificate
Owners and the Clearing Agency and/or Clearing Agency Participants,
and all references in this Agreement to actions by Certificateholders
shall refer to actions taken by the Clearing Agency upon in-
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structions from the Clearing Agency Participants, and all references
in this Agreement to distributions, notices, reports and statements to
Certificateholders shall refer to distributions, notices, reports and
statements to the Clearing Agency, as registered holder of the
Certificates, as the case may be, for distribution to
Certificateholders in accordance with the procedures of the Clearing
Agency. Pursuant to the Certificate Depository Agreement, unless and
until Definitive Certificates are issued pursuant to Section 3.12, the
initial Clearing Agency will make book-entry transfers among Clearing
Agency Participants and receive and transmit payments of principal of
and interest on the Book-Entry Certificates to such Clearing Agency
Participants; and
(e) whenever this Agreement requires or permits actions to
be taken based upon instructions or directions of the
Certificateholders evidencing a specified percentage of the
Certificate Balance, the Clearing Agency shall be deemed to represent
such percentage only to the extent that it has received instructions
to such effect from Certificate Owners and/or Clearing Agency
Participants owning or representing, respectively, such required
percentage of the beneficial interest in the Book-Entry Certificates
and has delivered such instructions to the Owner Trustee.
SECTION 3.11 Notices to Clearing Agency. Whenever a notice or other
communication to Certificateholders is required under this Agreement, unless
and until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 3.12, the Owner Trustee and the Paying Agent shall give all
such notices and communications specified herein to be given to
Certificateholders to the Clearing Agency, and shall have no obligations to
Certificate Owners.
SECTION 3.12 Definitive Certificates. If (a) the Depositors advise the
Owner Trustee in writing that the Clearing Agency is no longer willing or able
to properly discharge its responsibilities with respect to the Certificates,
and the Depositors are unable to locate a qualified successor, (b) the
Depositors at their option elect to terminate the book-entry system through the
Clearing Agency, or (c) after the occurrence of an Event of Servicing
Termination or Event of Default, Certificate Owners of the Certificates
representing beneficial interests aggregating not less than a majority of the
Certificate Balance then outstanding advise the Clearing Agency through the
Clearing Agency Participants, and the Owner Trustee, in writing, and if the
Clearing Agency shall so notify the Owner Trustee, that the continuation of a
book-entry system through the Clearing Agency is no longer in the best
interests of Certificate Owners, then the Owner Trustee shall notify the
Clearing Agency of the occurrence of any such event, which shall be responsible
to notify the Certificate Owners of the occurrence of such event and of the
availability of the Definitive Certificates to Certificate Owners requesting
the same. Upon surrender to the Certificate Registrar of the typewritten
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Certificate or Certificates representing the Book-Entry Certificates by the
Clearing Agency, accompanied by re-registration instructions, the Owner Trustee
shall execute, authenticate, or cause to be authenticated, and (if the
Certificate Registrar is different than the Owner Trustee, then the Certificate
Registrar shall) deliver the Definitive Certificates in accordance with the
instructions of the Clearing Agency. Neither the Certificate Registrar nor the
Owner Trustee shall be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Certificates, all references
herein to obligations imposed upon or to be performed by the Clearing Agency
shall be deemed to be imposed upon and performed by the Certificate Registrar,
to the extent applicable with respect to such Definitive Certificates, and the
Owner Trustee and the Paying Agent shall recognize the Holders of the
Definitive Certificates as Certificateholders. The Definitive Certificates
shall be printed, lithographed or engraved or may be produced in any other
matter as is reasonably acceptable to the Owner Trustee, as evidenced by its
execution thereof.
SECTION 3.13 Authenticating Agent.
(a) The Owner Trustee may appoint one or more authenticating agents
with respect to the Certificates which shall be authorized to act on behalf of
the Owner Trustee in authenticating the Certificates in connection with the
issuance, delivery, registration of transfer, exchange or repayment of the
Certificates. The Owner Trustee hereby appoints Chase as Authenticating Agent
for the authentication of Certificates upon any registration of transfer or
exchange of such Certificates. Whenever reference is made in this Agreement to
the authentication of Certificates by the Owner Trustee or the Owner Trustee's
certificate of authentication, such reference shall be deemed to include
authentication on behalf of the Owner Trustee by an authenticating agent and a
certificate of authentication executed on behalf of the Owner Trustee by an
authenticating agent. Each authenticating agent (other than Chase) shall be
subject to acceptance by each Depositor.
(b) Any institution succeeding to the corporate agency business of an
authenticating agent shall continue to be an authenticating agent without the
execution or filing of any paper or any further act on the part of the Owner
Trustee or such authenticating agent.
(c) An authenticating agent may at any time resign by giving written
notice of resignation to the Owner Trustee and each Depositor. The Owner
Trustee may at any time terminate the agency of an authenticating agent by
giving notice of termination to such authenticating agent and to each
Depositor. Upon receiving such a notice of resignation or upon such a
termination, or in case at any time an authenticating agent shall cease to be
acceptable to the Owner Trustee or either of the Depositors, the Owner Trustee
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promptly may appoint a successor authenticating agent with the consent of each
Depositor. Any successor authenticating agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers and
duties of its predecessor hereunder, with like effect as if originally named as
an authenticating agent.
(d) The Servicer shall pay the authenticating agent from time to time
reasonable compensation for its services under this Section 3.13.
(e) The provisions of Sections 7.1, 7.3, 7.4, 7.6, 8.1 and 8.2 shall
be applicable to any authenticating agent.
(f) Pursuant to an appointment made under this Section 3.13, the
Certificates may have endorsed thereon, in lieu of the Owner Trustee's
certificate of authentication, an alternate certificate of authentication in
substantially the following form:
This is one of the Certificates referred to in the within mentioned
Agreement.
___________________________________,
as Owner Trustee
By: ___________________________________
Authorized Officer
or
___________________________________
as Authenticating Agent
for the Owner Trustee,
___________________________________
Authorized Officer
SECTION 3.14 Actions of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by the
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or
by agent duly appointed in writing; and except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Owner Trustee and, when required, to the
Depositors or the Servicer. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this
Agreement and conclusive in favor of the Owner Trustee, the Depositors and the
Servicer, if made in the manner provided in this Section 3.14.
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(b) The fact and date of the execution by any Certificateholder of any
such instrument or writing may be proved in any reasonable manner which the
Owner Trustee deems sufficient.
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other act by a Certificateholder shall bind every Holder of every
Certificate issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof, in respect of anything done, or omitted to be
done, by the Owner Trustee, the Depositors or the Servicer in reliance thereon,
regardless of whether notation of such action is made upon such Certificate.
(d) The Owner Trustee may require such additional proof of any matter
referred to in this Section 3.14 as it shall deem necessary.
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
SECTION 4.1 Prior Notice to Certificateholders with Respect to Certain
Matters. With respect to the following matters, the Owner Trustee shall not
take action unless at least 30 days before the taking of such action, the Owner
Trustee shall have notified the Certificateholders in writing of the proposed
action and the Certificateholders shall not have notified the Owner Trustee in
writing prior to the 30th day after such notice is given that such
Certificateholders have withheld consent or provided alternative direction:
(a) the initiation of any material claim or lawsuit by the
Issuer (except claims or lawsuits brought in connection with the
collection of the Receivables) and the compromise of any material
action, claim or lawsuit brought by or against the Issuer (except with
respect to the aforementioned claims or lawsuits for collection of the
Receivables);
(b) the election by the Issuer to file an amendment to the
Certificate of Trust (unless such amendment is required to be filed
under the Business Trust Statute);
(c) the amendment of the Indenture by a supplemental
indenture in circumstances where the consent of any Noteholder
is required;
(d) the amendment of the Indenture by a supplemental
indenture in circumstances where the consent of any Noteholder is not
required and such amendment materially adversely affects the interest
of the Certificateholders;
(e) the amendment, change or modification of the Sale
and Servicing Agreement, except to any amendment where the
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consent of any Certificateholder is not required under the
terms of the Sale and Servicing Agreement; or
(f) the appointment pursuant to the Indenture of a successor
Indenture Trustee or the consent to the assignment by the Note
Registrar, the Paying Agent, the Indenture Trustee or the Certificate
Registrar of its obligations under the Indenture or this Agreement, as
applicable.
The Owner Trustee shall notify the Certificateholders in writing of any
appointment of a successor Paying Agent, Authenticating Agent or Certificate
Registrar within five Business Days thereof.
SECTION 4.2 Action by Certificateholders with Respect to Certain
Matters. The Owner Trustee shall not have the power, except upon the direction
of Certificateholders, to (a) remove the Servicer under the Sale and Servicing
Agreement pursuant to Article VIII thereof, (b) remove either Administrator
under an Administration Agreement pursuant to Section 8 thereof or (c) except
as expressly provided in the Basic Documents, sell the Receivables or any
interest therein after the termination of the Indenture. The Owner Trustee
shall take the actions referred to in the preceding sentence only upon written
instructions signed by the Certificateholders.
SECTION 4.3 Action by Certificateholders with Respect to Bankruptcy.
The Owner Trustee shall not have the power to commence a voluntary proceeding
in bankruptcy relating to the Issuer without the unanimous prior approval of
all Certificateholders unless the Owner Trustee reasonably believes that the
Issuer is insolvent.
SECTION 4.4 Restrictions on Certificateholders' Power. The
Certificateholders shall not direct the Owner Trustee to take or refrain from
taking any action if such action or inaction (i) would be contrary to any
obligation of the Issuer or the Owner Trustee under this Agreement or any of
the other Basic Documents or (ii) would be contrary to Section 2.3, nor shall
the Owner Trustee be obligated to follow any such direction, if given.
SECTION 4.5 Majority Control. Except as expressly provided herein, any
action that may be taken by the Certificateholders under this Agreement may be
taken by the Certificateholders representing not less than a majority of the
Certificate Balance then outstanding. Except as expressly provided herein, any
written notice of the Certificateholders delivered pursuant to this Agreement
shall be effective if signed by the Certificateholders representing not less
than a majority of the Certificate Balance then outstanding at the time of the
delivery of such notice.
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ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1 Establishment of Certificate Distribution Account. The
Owner Trustee, for the benefit of Certificateholders, shall establish and
maintain in the name of the Issuer an Eligible Deposit Account (the
"Certificate Distribution Account"), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Certificateholders. Except as otherwise provided herein, the Certificate
Distribution Account shall be under the sole dominion and control of the Owner
Trustee for the benefit of the Certificateholders.
The Owner Trustee shall possess all right, title and interest in all
funds on deposit from time to time in the Certificate Distribution Account and
in all proceeds thereof. If, at any time, the Certificate Distribution Account
ceases to be an Eligible Deposit Account, the Owner Trustee shall establish a
new Certificate Distribution Account as an Eligible Deposit Account in
accordance with Section 5.1(b) of the Sale and Servicing Agreement, and the
Owner Trustee shall transfer any cash and/or any investments to such new
Certificate Distribution Account.
Amounts on deposit in the Certificate Distribution Account shall not
be invested.
SECTION 5.2 Application of Funds in Certificate Distribution Account.
(a) Not later than 12:00 noon, New York City time, on each Distribution Date,
the Owner Trustee or the Paying Agent on behalf of the Owner Trustee will,
based on the information contained in the Servicer's Certificate delivered on
the related Determination Date pursuant to Section 4.8 of the Sale and
Servicing Agreement, distribute to Certificateholders, to the extent of the
funds available, amounts deposited in the Certificate Distribution Account
pursuant to Sections 5.5 and 5.6 of the Sale and Servicing Agreement on such
Distribution Date in the following order of priority:
(i) first, to the Certificateholders, on a pro rata
basis, an amount equal to the Certificateholders' Interest
Distributable Amount; and
(ii) second, to the Certificateholders, on a pro rata basis,
an amount equal to the Certificateholders' Principal Distributable
Amount.
(b) On each Distribution Date, the Owner Trustee shall send, or cause
to be sent, to each Certificateholder the statement provided to the Owner
Trustee by the Servicer pursuant to Section 5.8 of the Sale and Servicing
Agreement on such Distribution Date.
(c) In the event that any withholding tax is imposed on the
Issuer's payment (or allocations of income) to a Certificateholder,
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such tax shall reduce the amount otherwise distributable to the
Certificateholder in accordance with this Section. Each of the Owner Trustee
and the Paying Agent is hereby authorized and directed to retain from amounts
otherwise distributable to the Certificateholders sufficient funds for the
payment of any tax that is legally owed by the Issuer (but such authorization
shall not prevent the Owner Trustee from contesting any such tax in appropriate
proceedings, and withholding payment of such tax, if permitted by law, pending
the outcome of such proceedings). The amount of any withholding tax imposed
with respect to a Certificateholder shall be treated as cash distributed to
such Certificateholder at the time it is withheld by the Issuer and remitted to
the appropriate taxing authority. The Owner Trustee or the Paying Agent, on its
behalf, intends to withhold United States withholding taxes from any amounts
allocable or distributed to nonUnited States Certificateholders at a rate of
35% for non-United States Certificateholders that are classified as
corporations for United States federal income tax purposes and at a rate of
39.6% for all other non-United States Certificateholders. In the event that a
Certificateholder wishes to apply for a refund of any such withholding tax, the
Owner Trustee and the Paying Agent shall reasonably cooperate with such
Certificateholder in making such claim so long as such Certificateholder agrees
to reimburse the Owner Trustee and the Paying Agent for any out-of-pocket
expenses incurred.
SECTION 5.3 Method of Payment. Subject to Section 9.1(c),
distributions required to be made to Certificateholders on any Distribution
Date shall be made to each Certificateholder of record on the preceding Record
Date either (a) by wire transfer, in immediately available funds, to the
account of such Holder at a bank or other entity having appropriate facilities
therefor, if such Certificateholder shall have provided to the Certificate
Registrar appropriate written instructions at least five Business Days prior to
such Distribution Date and such Holder's Certificates in the aggregate evidence
a denomination of not less than $1,000,000 or (b) by check mailed to such
Certificateholder at the address of such Holder appearing in the Certificate
Register; provided that, unless Definitive Certificates have been issued
pursuant to Section 3.12, with respect to Certificates registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such nominee
to be Cede & Co.), distributions will be made by wire transfer in immediately
available funds to the account designated by such nominee.
SECTION 5.4 No Segregation of Monies; No Interest. Subject to Sections
5.1 and 5.2, monies received by the Owner Trustee or any Paying Agent hereunder
need not be segregated in any manner except to the extent required by law and
may be deposited under such general conditions as may be prescribed by law, and
neither the Owner Trustee nor any Paying Agent shall be liable for any interest
thereon.
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SECTION 5.5 Accounting and Reports to the Noteholders,
Certificateholders, the Internal Revenue Service and Others. The Owner Trustee
shall (a) maintain (or cause to be maintained) the books of the Issuer on a
calendar year basis on the accrual method of accounting, (b) deliver (or cause
to be delivered) to each Certificateholder, as may be required by the Code and
applicable Treasury Regulations, such information as may be required (including
Schedule K-1) to enable each Certificateholder to prepare its Federal and state
income tax returns, (c) prepare, or cause to be prepared, and file, or cause to
be filed, such tax returns relating to the Issuer (including a partnership
information return, Form 1065), and make such elections as may from time to
time be required or appropriate under any applicable state or Federal statute
or rule or regulation thereunder so as to maintain the Trust's characterization
as a partnership for Federal income tax purposes and (d) collect or cause to be
collected any withholding tax as described in and in accordance with Section
5.2(c) with respect to income or distributions to Certificateholders. Chase
shall sign all tax information returns filed pursuant to this Section 5.5 and
any other returns as may be required by law. The Owner Trustee shall elect
under Section 1278 of the Code to include in income currently any market
discount that accrues with respect to the Receivables. The Owner Trustee shall
not make the election provided under Section 754 of the Code.
SECTION 5.6 Signature on Returns; Tax Matters Partner. Notwithstanding
the provisions of Section 5.5, Chase shall sign on behalf of the Issuer the tax
returns of the Issuer, unless applicable law requires the Owner Trustee to sign
such documents, in which case such documents shall be signed by the Owner
Trustee at the written direction of Chase.
Chase shall be the "tax matters partner" of the Issuer pursuant to the
Code.
SECTION 5.7 Capital Accounts. The Issuer shall maintain accounts
("Capital Accounts") with respect to each Certificateholder and each Depositor
(each an "Owner"). For this purpose, Capital Accounts shall be maintained in
accordance with the following provisions:
(a) Each Owner's Capital Account shall be increased by the
Capital Contributions (as defined below) of such Owner, such Owner's
distributive share of gross income (if any) and any items in the
nature of income or gain that are allocated to such Owner pursuant to
Section 2.11, 2.12(b) or 2.13.
(b) Each Owner's Capital Account shall be reduced by any
amount distributed to such Owner (including, in the case of each
Depositor, any amount released or otherwise distributed to each
Depositor from the Reserve Account under Section 5.6 of the Sale and
Servicing Agreement) and any items in the nature of deductions or
losses that are allocated to such Owner pursuant to Section 2.12 or
2.13.
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(c) In the event all or a portion of a Certificate is
transferred in accordance with the terms of this Agreement, the
transferee shall succeed to the Capital Account of the transferor to
the extent it related to such Certificate or a portion thereof.
"Capital Contribution" means the amount of any cash contributed to the
Issuer by an Owner (including any amounts deemed to be contributed in
connection with the original issuance of the Certificates), including, in the
case of each Depositor, the amount of any Receivables deemed to have been
contributed by such Depositor (with such amount for Receivables intended to
reflect the amount of the Receivables and monies due thereon or with respect
thereto, including accrued but unpaid interest and finance charges, conveyed to
the Issuer by the Depositors on the Closing Date under Article II of the Sale
and Servicing Agreement). The foregoing provisions and the other provisions of
this Agreement relating to the maintenance of Capital Accounts are intended to
comply with section 1.704-l(b) of the Treasury Regulations and shall be
interpreted in a manner consistent therewith.
ARTICLE VI
AUTHORITY AND DUTIES OF OWNER TRUSTEE
SECTION 6.1 General Authority. The Owner Trustee is authorized and
directed to execute and deliver the Basic Documents to which the Issuer is
named as a party and each certificate or other document attached as an exhibit
to or contemplated by the Basic Documents to which the Issuer is named as a
party and any amendment thereto, in each case, in such form as the Depositors
shall approve as evidenced conclusively by the Owner Trustee's execution
thereof, and, on behalf of the Issuer at the written direction of the
Depositors, to direct the Indenture Trustee to authenticate and deliver Class
A-1 Notes in the aggregate principal amount of $59,500,000.00, Class A-2 Notes
in the aggregate principal amount of $119,000,000.00, Class A-3 Notes in the
aggregate principal amount of $113,000,000.00, Class A-4 Notes in the aggregate
principal amount of $73,000,000.00, Class A-5 Notes in the aggregate principal
amount of $132,000,000.00, Class A-6 Notes in the aggregate principal amount of
$88,000,000.00, Class A- 7 Notes in the aggregate principal amount of
$57,000,000.00, Class A-8 Notes in the aggregate principal amount of
$85,000,000.00, Class A-9 Notes in the aggregate principal amount of
$61,000,000.00 and Class A-10 Notes in the aggregate principal amount of
$65,000,000.00. In addition to the foregoing, the Owner Trustee is authorized,
but shall not be obligated, to take all actions required of the Issuer pursuant
to the Basic Documents. The Owner Trustee is further authorized from time to
time to take such action as an Administrator or the Depositors recommend or
direct in writing with respect to the Basic Documents.
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SECTION 6.2 General Duties. It shall be the duty of the Owner Trustee
to discharge (or cause to be discharged) all of its responsibilities pursuant
to the terms of this Agreement and the other Basic Documents and to administer
the Issuer in the interest of Certificateholders, subject to the Basic
Documents and in accordance with the provisions of this Agreement.
Notwithstanding the foregoing, the Owner Trustee shall be deemed to have
discharged its duties and responsibilities hereunder and under the Basic
Documents to the extent the Administrators have agreed in the Administration
Agreements to perform any act or to discharge any duty of the Owner Trustee or
the Issuer hereunder or under any other Basic Document, and the Owner Trustee
shall not be liable for the default or failure of an Administrator to carry out
its obligations under the related Administration Agreement.
SECTION 6.3 Action upon Instruction. (a) Subject to Article IV, the
Certificateholders may, by written instruction, direct the Owner Trustee in the
management of the Issuer. Such direction may be exercised at any time by
written instruction of the Certificateholders pursuant to Section 4.5.
(b) Notwithstanding the foregoing, the Owner Trustee shall not be
required to take any action hereunder or under any other Basic Document if the
Owner Trustee shall reasonably determine, or shall have been advised by counsel
in writing, that such action is likely to result in personal liability to the
Owner Trustee (in such capacity or individually), is contrary to the terms of
this Agreement or any other Basic Document or is contrary to law.
(c) Whenever the Owner Trustee is unable to decide between alternative
courses of action permitted or required by the terms of this Agreement or any
other Basic Document or is unsure as to the application of any provision of
this Agreement or any Basic Document, or if any such provision is ambiguous as
to its application, or is, or appears to be, in conflict with any other
applicable provision, or in the event that this Agreement permits any
determination by the Owner Trustee or is silent or is incomplete as to the
course of action that the Owner Trustee is required to take with respect to a
particular set of facts, the Owner Trustee may give notice (in such form as
shall be appropriate under the circumstances) to the Certificateholders
requesting instruction as to the course of action to be adopted, and to the
extent the Owner Trustee acts in good faith in accordance with any written
instruction of the Certificateholders received, the Owner Trustee shall not be
liable on account of such action to any Person. If the Owner Trustee shall not
have received appropriate instruction within ten days of such notice (or within
such shorter period of time as reasonably may be specified in such notice or
may be necessary under the circumstances) it may, but shall be under no duty
to, take or refrain from taking such action, not inconsistent with this
Agreement or the other Basic Documents, as it shall deem to be in the best
interests of the Certificateholders, and shall have no liability to any Person
for such action or inaction.
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SECTION 6.4 No Duties Except as Specified in this Agreement or in
Instructions. The Owner Trustee shall undertake to perform such duties and only
such duties as are specifically set forth in this Agreement and the other Basic
Documents, and no implied covenants or obligations shall be read into this
Agreement or the other Basic Documents. The Owner Trustee shall not have any
duty or obligation to manage, make any payment with respect to, register,
record, sell, dispose of, or otherwise deal with the Owner Trust Estate, or to
otherwise take or refrain from taking any action under, or in connection with,
any document contemplated hereby to which the Owner Trustee is a party, except
as expressly provided by the terms of this Agreement or in any document or
written instruction received by the Owner Trustee pursuant to Section 6.3; and
no implied duties or obligations shall be read into this Agreement or any Basic
Document against the Owner Trustee. The Owner Trustee shall have no
responsibility for filing any financing or continuation statement in any public
office at any time or to otherwise perfect or maintain the perfection of any
security interest or lien granted to it hereunder or to prepare or file any
Commission filing for the Issuer or to record this Agreement or any other Basic
Document. The Owner Trustee nevertheless agrees that it will, at its own cost
and expense, promptly take all action as may be necessary to discharge any
Liens on any part of the Owner Trust Estate that result from actions by, or
claims against, the Owner Trustee, in its individual capacity, that are not
related to the ownership or the administration of the Owner Trust Estate.
SECTION 6.5 No Action Except under Specified Documents or
Instructions. The Owner Trustee shall not manage, control, use, sell, dispose
of or otherwise deal with any part of the Owner Trust Estate except (i) in
accordance with the powers granted to and the authority conferred upon the
Owner Trustee pursuant to this Agreement, (ii) in accordance with the Basic
Documents, and (iii) in accordance with any document or instruction delivered
to the Owner Trustee pursuant to Section 6.3.
SECTION 6.6 Restrictions. The Owner Trustee shall not (a) take any
action that is inconsistent with the purposes of the Issuer set forth in
Section 2.3 or (b) take any action or amend this Agreement in any manner that,
to the best knowledge of the Owner Trustee, would result in the Issuer's
becoming taxable as a corporation for United States federal income tax
purposes. The Owner Trustee and the Depositors agree that no election to treat
the Issuer other than as a partnership for United States federal income tax
purposes or any relevant state tax purposes shall be made by or on behalf of
the Issuer. The Certificateholders shall not direct the Owner Trustee to take
action that would violate the provisions of this Section.
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SECTION 6.7 Doing Business in Other Jurisdictions. (a) Notwithstanding
anything contained herein to the contrary, the Owner Trustee shall not be
required to take any action in any jurisdiction other than in the State of
Delaware, other than as set forth in the last sentence of this Section 6.7, if
the taking of such action will (i) require the consent or approval or
authorization or order of or the giving of notice to, or the registration with
or the taking of any other action in respect of, any state or other
governmental authority or agency of any jurisdiction other than the State of
Delaware; (ii) result in any fee, tax or other governmental charge under the
laws of any jurisdiction or any political subdivisions thereof in existence on
the date hereof other than the State of Delaware becoming payable by the Owner
Trustee; or (iii) subject the Owner Trustee to personal jurisdiction in any
jurisdiction other than the State of Delaware for causes of action arising from
acts unrelated to the consummation of the transactions by the Owner Trustee, as
the case may be, contemplated hereby. The Owner Trustee shall be entitled to
obtain advice of counsel (which advice shall be an expense of the Depositors)
to determine whether any action required to be taken pursuant to this Agreement
results in the consequences described in clauses (i), (ii) and (iii) of the
preceding sentence. In the event that said counsel advises the Owner Trustee
that such action will result in such consequences, the Owner Trustee will
appoint an additional trustee pursuant to Section 10.5 to proceed with such
action.
ARTICLE VII
CONCERNING OWNER TRUSTEE
SECTION 7.1 Acceptance of Trusts and Duties. The Owner Trustee accepts
the trusts hereby created and agrees to perform its duties hereunder with
respect to such trusts but only upon the terms of this Agreement. The Owner
Trustee also agrees to disburse all moneys actually received by it constituting
part of the Owner Trust Estate upon the terms of the other Basic Documents and
this Agreement. The Owner Trustee shall not be answerable or accountable
hereunder or under any Basic Document under any circumstances, except (i) for
its own willful misconduct, bad faith or gross negligence or (ii) in the case
of the breach of any representation or warranty contained in Section 7.3
expressly made by the Owner Trustee. In particular, but not by way of
limitation (and subject to the exceptions set forth in the preceding sentence):
(a) The Owner Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer of the Owner
Trustee unless it is proved that the Owner Trustee was grossly
negligent in ascertaining the pertinent facts;
(b) The Owner Trustee shall not be liable with respect
to any action it takes or omits to take in good faith in
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accordance with the instructions of the Certificateholders
given pursuant to Section 6.3;
(c) No provision of this Agreement or any other Basic
Document shall require the Owner Trustee to expend or risk funds or
otherwise incur any financial liability in its own performance of any
of its rights or powers hereunder or under any other Basic Document if
the Owner Trustee shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or
liability is not assured or provided to it;
(d) Under no circumstances shall the Owner Trustee be
liable for indebtedness evidenced by or arising under any of
the Basic Documents, including the principal of and interest
on the Notes;
(e) The Owner Trustee shall not be responsible for and makes
no representation as to the validity or adequacy of this Agreement or
for the due execution hereof by each Depositor or for the form,
character, genuineness, sufficiency, value or validity of any of the
Owner Trust Estate or for or in respect of the validity or sufficiency
of the Basic Documents, other than the certificate of authentication
on the Certificates, shall not be accountable for the use or
application by the Depositors of the proceeds from the Certificates,
and the Owner Trustee shall in no event assume or incur any liability,
duty or obligation to any Noteholder or to any Certificateholder,
other than as expressly provided for herein and in the Basic
Documents. The Owner Trustee shall at no time have any responsibility
or liability for or with respect to the legality, validity and
enforceability of any Receivable, or the perfection and priority of
any security interest created by any Receivable in any Financed
Vehicle or the maintenance of any such perfection and priority; or the
ability of the Owner Trust Estate to generate the payments to be
distributed to Certificateholders under this Agreement or the
Noteholders under the Indenture, including: the existence, condition
and ownership of any Financed Vehicle; the existence and
enforceability of any insurance thereon; the existence and contents of
any Receivable on any computer or other record thereof; the validity
of the assignment of any Receivable to the Issuer or of any
intervening assignment; the completeness of any Receivable; the
performance or enforcement of any Receivable; the compliance by each
Depositor or the Servicer with any warranty or representation made
under any Basic Document or in any related document or the accuracy of
any such warranty or representation or any action of the Indenture
Trustee, an Administrator or the Servicer or any subservicer taken in
the name of the Owner Trustee;
(f) The Owner Trustee shall not be liable for the
default or misconduct of the Indenture Trustee, the
Administrators or the Servicer under any of the Basic
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Documents or otherwise, and the Owner Trustee shall have no obligation
or liability to perform the obligations of the Issuer under this
Agreement or the Basic Documents that are required to be performed by
an Administrator under an Administration Agreement, the Indenture
Trustee under the Indenture or the Servicer under the Sale and
Servicing Agreement;
(g) The Owner Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Agreement,
or to institute, conduct or defend any litigation under this Agreement
or otherwise or in relation to this Agreement or any other Basic
Document, at the request, order or direction of any of the
Certificateholders, unless such Certificateholders have offered to the
Owner Trustee security or indemnity satisfactory to it against the
costs, expenses and liabilities that may be incurred by the Owner
Trustee therein or thereby. The right of the Owner Trustee to perform
any discretionary act enumerated in this Agreement or in any other
Basic Document shall not be construed as a duty, and the Owner Trustee
shall not be answerable for other than its negligence, bad faith or
willful misconduct in the performance of any such act; and
(h) The Owner Trustee, upon receipt of any resolutions,
certificates, statements, opinions, reports, documents, orders or
other instruments furnished to the Owner Trustee that shall be
specifically required to be furnished pursuant to any provision of
this Agreement or the other Basic Documents, shall examine them to
determine whether they conform to the requirements of this Agreement
or such other Basic Document; provided, however, that the Owner
Trustee shall not be responsible for the accuracy or content of any
such resolution, certificate, statement, opinion, report, document,
order or other instrument furnished to the Owner Trustee pursuant to
this Agreement or the other Basic Documents.
SECTION 7.2 Furnishing of Documents. The Owner Trustee shall furnish
to the Certificateholders promptly upon receipt of a written request therefor,
duplicates or copies of all reports, notices, requests, demands, certificates,
financial statements and any other instruments furnished to the Owner Trustee
under the Basic Documents.
SECTION 7.3 Representations and Warranties. The Owner Trustee hereby
represents and warrants to the Depositors, for the benefit of the
Certificateholders, that:
(a) It is a banking corporation duly organized and
validly existing in good standing under the laws of the State
of Delaware and having an office within the State of
Delaware. It has all requisite corporate power, authority and
legal right to execute, deliver and perform its obligations
under this Agreement.
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(b) It has taken all corporate action necessary to
authorize the execution and delivery by it of this Agreement,
and this Agreement will be executed and delivered by one of
its officers who is duly authorized to execute and deliver
this Agreement on its behalf.
(c) Neither the execution nor the delivery by it of
this Agreement, nor the consummation by it of the
transactions contemplated hereby nor compliance by it with
any of the terms or provisions hereof will contravene any
federal or Delaware law, governmental rule or regulation
governing the banking or trust powers of the Owner Trustee or
any judgment, writ, decree or order applicable to it, or
constitute any default under its charter documents or by-laws
or, with or without notice or lapse of time, any indenture,
mortgage, contract, agreement or instrument to which it is a
party or by which any of its properties may be bound.
(d) The execution, delivery and performance by the
Owner Trustee of this Agreement does not require the
authorization, consent, or approval of, the giving of notice
to, the filing or registration with, or the taking of any
other action in respect of, any governmental authority or
agency of the State of Delaware or the United States of
America regulating the corporate trust activities of the
Owner Trustee (other than the filing of the Certificate of
Trust with the Delaware Secretary of State).
(e) This Agreement has been duly authorized,
executed and delivered by the Owner Trustee and (assuming due
authorization, execution and delivery of this Agreement by
the Depositors) shall constitute the legal, valid, and
binding agreement of the Owner Trustee, enforceable in
accordance with its terms against the Owner Trustee, except
as such enforcement may be limited by bankruptcy, insolvency,
reorganization and other laws affecting the rights of
creditors generally, and by general principles of equity
regardless of whether enforcement is pursuant to a proceeding
in equity or at law.
SECTION 7.4 Reliance; Advice of Counsel. (a) The Owner Trustee shall
incur no liability to anyone in acting upon any signature, instrument, notice,
resolution, request, consent, order, certificate, report, opinion, bond or
other document or paper believed by it to be genuine and believed by it to be
signed by the proper party or parties. The Owner Trustee may accept a certified
copy of a resolution of the board of directors or other governing body of any
corporate party as conclusive evidence that such resolution has been duly
adopted by such body and that the same is in full force and effect. As to any
fact or matter the method of the determination of which is not specifically
prescribed herein,
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the Owner Trustee may for all purposes hereof rely on a certificate, signed by
the president or any vice president or by the treasurer, secretary or other
authorized officers of the relevant party, as to such fact or matter, and such
certificate shall constitute full protection to the Owner Trustee for any
action taken or omitted to be taken by it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in
the performance of its duties and obligations under this Agreement or the Basic
Documents, the Owner Trustee (i) may act directly or through its agents or
attorneys pursuant to agreements entered into with any of them, and the Owner
Trustee shall not be liable for the conduct or misconduct of such agents or
attorneys if such agents or attorneys shall have been selected by the Owner
Trustee with due care and (ii) may consult with counsel, accountants and other
skilled persons knowledgeable in the relevant area to be selected with
reasonable care and employed by it. The Owner Trustee shall not be liable for
anything done, suffered or omitted in good faith by it in accordance with the
written opinion or advice of any such counsel, accountants or other such
persons and not contrary to this Agreement or any Basic Document.
SECTION 7.5 Not Acting in Individual Capacity. Except as provided in
this Article VII, in accepting the trusts hereby created, Wilmington Trust
Company acts solely as the Owner Trustee hereunder and not in its individual
capacity, and all Persons having any claim against the Owner Trustee by reason
of the transactions contemplated by this Agreement or any Basic Document shall
look only to the Owner Trust Estate for payment or satisfaction thereof.
SECTION 7.6 Owner Trustee May Own Certificates and Notes. The Owner
Trustee in its individual or any other capacity may become the owner or pledgee
of the Certificates or the Notes and may deal with the Depositors, the
Indenture Trustee and the Servicer in banking transactions with the same rights
as it would have if it were not the Owner Trustee.
ARTICLE VIII
COMPENSATION OF OWNER TRUSTEE
SECTION 8.1 Owner Trustee's Fees and Expenses. In accordance with
Section 4.7 of the Sale and Servicing Agreement, the Owner Trustee shall
receive as compensation for its services hereunder such fees as have
been separately agreed upon before the date hereof between the Servicer
and the Owner Trustee, and the Owner Trustee shall be entitled to be
reimbursed in accordance with Sections 4.7 and 6.2, respectively, of the
Sale and Servicing Agreement by the Servicer and by the Sellers for its
other reasonable expenses hereunder, including the reasonable
compensation, expenses and disbursements of such agents,
representatives, experts and
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counsel as the Owner Trustee may employ in connection with the exercise and
performance of its rights and its duties hereunder except any such expenses as
may arise from its gross negligence, wilful misfeasance, or bad faith or that
is the responsibility of Certificateholders under this Agreement.
SECTION 8.2 Indemnification. The Depositors, jointly and severally,
shall be liable as primary obligors for, and shall indemnify the Owner Trustee
(in such capacity or individually) and its successors, assigns, agents and
servants (collectively, the "Indemnified Parties") from and against, any and
all liabilities, obligations, losses, damages, taxes, claims, actions and
suits, and any and all reasonable costs, expenses and disbursements (including
reasonable legal fees and expenses) of any kind and nature whatsoever
(collectively, "Expenses") which may at any time be imposed on, incurred by, or
asserted against the Owner Trustee or any Indemnified Party in any way relating
to or arising out of this Agreement, the other Basic Documents, the Owner Trust
Estate, the administration of the Owner Trust Estate or the action or inaction
of the Owner Trustee hereunder, except only that the Depositors shall not be
liable for or required to indemnify the Owner Trustee from and against Expenses
arising or resulting from any of the matters described in the third sentence of
Section 7.1. The indemnities contained in this Section shall survive the
resignation or termination of the Owner Trustee or the termination of this
Agreement. If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any Indemnified Party in respect of which indemnity may be sought pursuant to
this Section 8.2, such Indemnified Party shall promptly notify the Depositors
in writing, and the Depositors upon request of the Indemnified Party shall
retain counsel reasonably satisfactory to the Indemnified Party (or, with the
consent of the Depositors, counsel selected by the Indemnified Party acceptable
to the Depositors) to represent the Indemnified Party and any others the
Depositors may designate in such proceeding and shall pay the reasonable fees
and expenses of such counsel related to such proceeding. The Depositors shall
not be liable for any settlement of any claim or proceeding effected without
its written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the Depositors agree to indemnify any Indemnified
Party from and against any loss or liability by reason of such settlement or
judgment. The Depositors shall not, without the prior written consent of the
Indemnified Party, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Party is or could have been a
party and indemnity could have been sought hereunder by such Indemnified Party,
unless such settlement includes an unconditional release of such Indemnified
Party from all liability on claims that are the subject matter of such
proceeding.
SECTION 8.3 Payments to Owner Trustee. Any amounts paid to the Owner
Trustee pursuant to this Article VIII shall be deemed not to be a part of the
Owner Trust Estate immediately after such payment.
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ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1 Termination of Trust Agreement. (a) This Agreement (other
than Article VIII) and the Issuer shall terminate and be of no further force or
effect, on the Distribution Date next succeeding the month which is six months
after the final distribution by the Owner Trustee of all moneys or other
property or proceeds of the Owner Trust Estate in accordance with the terms of
the Indenture, the Sale and Servicing Agreement and Article V, including the
payment to the Certificateholders of all amounts required to be paid to them
pursuant to this Agreement; provided, however, that in no event shall the Trust
created by this Agreement continue beyond the expiration of 21 years from the
death of the last survivor of the descendants of Joseph P. Kennedy, the late
ambassador to the Court of St. James's, living on the date of this Agreement.
The bankruptcy, liquidation, dissolution, death or incapacity of any
Certificateholder or Certificate Owner shall not (x) operate to terminate this
Agreement or the Issuer, nor (y) entitle such Certificateholder's or
Certificate Owner's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of all
or any part of the Issuer or the Owner Trust Estate nor (z) otherwise affect
the rights, obligations and liabilities of the parties hereto.
(b) Except as provided in clause (a), neither any Depositor nor any
Certificateholder shall be entitled to revoke or terminate the Trust.
(c) Notice of any termination of the Issuer, specifying the
Distribution Date upon which the Certificateholders shall surrender their
Certificates to the Owner Trustee or the Paying Agent for payment of the final
distribution and cancellation, shall be given by the Owner Trustee by letter to
the Certificateholders mailed within five Business Days of receipt of notice of
such termination from the Servicer given pursuant to Section 9.1(c) of the Sale
and Servicing Agreement, stating (i) the Distribution Date upon or with respect
to which final payment of the Certificates shall be made upon or with respect
to which final payment of the Certificates shall be made upon presentation and
surrender of the Certificates at the office of the Owner Trustee or the Paying
Agent therein designated, (ii) the amount of any such final payment and (iii)
that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office of the Owner Trustee or the Paying Agent therein
specified. The Owner Trustee shall give such notice to the Certificate
Registrar (if other than the Owner Trustee) and the Paying Agent at the time
such notice is given to the Certificateholders. Upon presentation and surrender
of the Certificates, the Owner Trustee or the Paying Agent shall cause to
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be distributed to the Certificateholders amounts distributable on such
Distribution Date pursuant to Section 5.2.
If all of the Certificateholders shall not surrender their
Certificates for cancellation within six months after the date specified in the
above mentioned written notice, the Owner Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
one year after the second notice all the Certificates shall not have been
surrendered for cancellation, the Owner Trustee may take appropriate steps, or
may appoint an agent to take appropriate steps, to contact the remaining
Certificateholders concerning surrender of their Certificates, and the cost
thereof shall be paid out of the funds and other assets that shall remain
subject to this Agreement. Any funds remaining in the Owner Trust Estate after
exhaustion of such remedies shall be distributed, subject to applicable escheat
laws, by the Owner Trustee to the Depositors, allocated among them in
accordance with their respective Depositor Allocation Percentages.
(d) Any funds remaining in the Issuer after funds for final
distribution have been distributed or set aside for distribution shall be
distributed by the Owner Trustee to the Depositors, allocated among them in
accordance with their respective Depositor Allocation Percentages.
(e) Upon the winding up of the Issuer and its termination, the Owner
Trustee shall cause the Certificate of Trust to be canceled by filing a
certificate of cancellation with the Secretary of State in accordance with the
provisions of Section 3810 of the Business Trust Statute.
ARTICLE X
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
SECTION 10.1 Eligibility Requirements for Owner Trustee. The Owner
Trustee shall at all times be a corporation authorized to exercise corporate
trust powers; and having a combined capital and surplus of at least
$100,000,000 and subject to supervision or examination by Federal or state
authorities. If such corporation shall publish reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising
or examining authority, then for the purpose of this Section, the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. In case at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of this Section, the Owner Trustee shall resign
immediately in the manner and with the effect specified in Section 10.2. In
addition, at all times the Owner Trustee or a co-trustee
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shall be a person that satisfies the requirements of Section 3807(a) of the
Business Trust Statute (the "Delaware Trustee").
SECTION 10.2 Resignation or Removal of Owner Trustee. The Owner
Trustee may at any time resign and be discharged from the trusts hereby created
by giving written notice thereof to the Administrators and the Depositors. Upon
receiving such notice of resignation, the Depositors shall promptly appoint a
successor Owner Trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Owner Trustee and one copy to
the successor Owner Trustee. If no successor Owner Trustee shall have been so
appointed and have accepted appointment within 30 days after the giving of such
notice of resignation, the resigning Owner Trustee may petition any court of
competent jurisdiction for the appointment of a successor Owner Trustee.
If at any time the Owner Trustee shall cease to be eligible in
accordance with the provisions of Section 10.1 and shall fail to resign after
written request therefor by the Depositors, or if at any time the Owner Trustee
shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or
a receiver of the Owner Trustee or of its property shall be appointed, or any
public officer shall take charge or control of the Owner Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositors may remove the Owner Trustee. If the
Depositors shall remove the Owner Trustee under the authority of the
immediately preceding sentence, the Depositors shall promptly appoint a
successor Owner Trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the outgoing Owner Trustee so removed and one
copy of which shall be delivered to the successor Owner Trustee, and payment of
all fees owed to the outgoing Owner Trustee shall be made to the outgoing Owner
Trustee.
Any resignation or removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to any of the provisions of this Section shall
not become effective until acceptance of appointment by the successor Owner
Trustee pursuant to Section 10.3 and payment of all fees and expenses owed to
the outgoing Owner Trustee. The Depositors shall provide notice of such
resignation or removal of the Owner Trustee to the Administrators and each of
the Rating Agencies.
SECTION 10.3 Successor Owner Trustee. Any successor Owner Trustee
appointed pursuant to Section 10.2 shall execute, acknowledge and deliver to
the Depositors and to its predecessor Owner Trustee an instrument accepting
such appointment under this Agreement, and thereupon the resignation or removal
of the predecessor Owner Trustee shall become effective and such successor
Owner Trustee, without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
under this Agreement, with like effect as if originally named as the Owner
Trustee. The predecessor Owner Trustee shall upon payment of its fees and
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expenses deliver to the successor Owner Trustee all documents and statements
and monies held by it under this Agreement; and the Depositors and the
predecessor Owner Trustee shall execute and deliver such instruments and do
such other things as may reasonably be required for fully and certainly vesting
and confirming in the successor Owner Trustee all such rights, powers, duties
and obligations.
No successor Owner Trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor Owner Trustee
shall be eligible pursuant to Section 10.1.
Upon acceptance of appointment by a successor Owner Trustee pursuant
to this Section, (i) the Chase Administrator shall mail notice of the successor
of such Owner Trustee to all Certificateholders, the Trustee, the Noteholders
and the Rating Agencies and (ii) such successor Owner Trustee shall file an
amendment to the Certificate of Trust with the Secretary of State reflecting
the name and principal place of business of such successor Owner Trustee in the
State of Delaware. If the Chase Administrator shall fail to mail such notice
within 10 days after acceptance of appointment by the successor Owner Trustee,
the successor Owner Trustee shall cause such notice to be mailed at the expense
of the Chase Administrator.
SECTION 10.4 Merger or Consolidation of Owner Trustee. Any corporation
into which the Owner Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Owner Trustee shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Owner Trustee, shall be the successor of the Owner Trustee hereunder, provided
such corporation shall be eligible pursuant to Section 10.1, without the
execution or filing of any instrument or any further act on the part of any of
the parties hereto, anything herein to the contrary notwithstanding; provided
further that the Owner Trustee shall mail notice of such merger or
consolidation to the Rating Agencies.
SECTION 10.5 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Owner Trust Estate or any Financed Vehicle may at the time be located,
the Chase Administrator and the Owner Trustee acting jointly shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Owner Trustee to act as co-trustee, jointly with the
Owner Trustee, or separate trustee or separate trustees, of all or any part of
the Owner Trust Estate, and to vest in such Person, in such capacity, such
title to the Issuer, or any part thereof, and, subject to the other provisions
of this Section, such powers, duties, obligations, rights and trusts as the
Chase Administrator and the Owner Trustee may consider necessary or desirable.
If the Chase Administrator shall not have joined in
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such appointment within 15 days after the receipt by it of a request so to do,
the Owner Trustee alone shall have the power to make such appointment. If the
Delaware Trustee shall become incapable of acting, resign or be removed, unless
the Owner Trustee is qualified to act as the Delaware Trustee, a successor
co-trustee shall promptly be appointed in the manner specified in this Section
10.5 to act as the Delaware Trustee. No co-trustee or separate trustee under
this Agreement shall be required to meet the terms of eligibility as a
successor trustee pursuant to Section 10.1 and no notice of the appointment of
any co-trustee or separate trustee shall be required pursuant to Section 10.3.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Owner Trustee shall be conferred upon and exercised
or performed by the Owner Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Owner
Trustee joining in such act), except to the extent that under any law
of any jurisdiction in which any particular act or acts are to be
performed, the Owner Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties
and obligations (including the holding of title to the Issuer or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co-trustee, but solely at
the direction of the Owner Trustee;
(ii) no trustee under this Agreement shall be personally
liable by reason of any act or omission of any other trustee under
this Agreement; and
(iii) the Chase Administrator and the Owner Trustee acting
jointly may at any time accept the resignation of or remove any
separate trustee or co-trustee.
Any notice, request or other writing given to the Owner Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Owner Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Owner Trustee. Each such instrument shall be filed with the
Owner Trustee and a copy thereof given to the Depositors.
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Any separate trustee or co-trustee may at any time appoint the Owner
Trustee as its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Owner Trustee, to the extent permitted by law, without the appointment of a new
or successor trustee.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1 Supplements and Amendments. This Agreement may be amended
by the Depositors and the Owner Trustee, with prior written notice to the
Rating Agencies, without the consent of any of the Noteholders or the
Certificateholders, to cure any ambiguity or defect, to correct or supplement
any provisions in this Agreement or for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions in this
Agreement or of modifying in any manner the rights of the Noteholders or the
Certificateholders; provided that such action shall not, as evidenced by an
Opinion of Counsel, materially adversely affect the interests of any Noteholder
or Certificateholder; provided, further, that the Depositors shall deliver
written notice of such amendments to each Rating Agency prior to the execution
of any such amendment. Notwithstanding the foregoing, no amendment modifying
the provisions of Section 5.2 shall become effective without satisfaction of
the Rating Agency Condition.
This Agreement may also be amended from time to time by the Depositors
and the Owner Trustee, with prior written notice to the Rating Agencies, with
the consent of the Noteholders representing not less than a majority of the
Outstanding Amount of the Notes and, to the extent affected thereby, the
consent of the Certificateholders representing not less than a majority of the
Certificate Balance then outstanding for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this
Agreement or modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that no such amendment shall (a)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on the Receivables or distributions that
shall be required to be made for the benefit of any Noteholder or any
Certificateholder, or (b) reduce the aforesaid percentage of the Outstanding
Amount of the Notes and the Certificate Balance required to consent to any such
amendment without the consent of the Noteholders or the Certificateholders
representing 100% of the Outstanding Amount of the Notes or the
Certificateholders representing 100% of the Certificate Balance then
outstanding, as the case may be.
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Promptly after the execution of any amendment or consent, the Owner
Trustee shall furnish written notification of the substance of such amendment
or consent to each Certificateholder, the Indenture Trustee and each of the
Rating Agencies.
It shall not be necessary for the consent of Certificateholders or the
Noteholders pursuant to this Section to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent shall
approve the substance thereof. The manner of obtaining such consents (and any
other consents of the Certificateholders provided for in this Agreement or in
any other Basic Document) and of evidencing the authorization of the execution
thereof by the Certificateholders shall be subject to such reasonable
requirements as the Owner Trustee may prescribe.
Promptly after the execution of any amendment to the Certificate of
the Trust, the Owner Trustee shall cause the filing of such amendment with the
Secretary of State.
Prior to the execution of any amendment to this Agreement or the
Certificate of the Trust, the Owner Trustee shall be entitled to receive and
rely upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement. The Owner Trustee may, but shall not
be obligated to, enter into any such amendment which affects the Owner
Trustee's own rights, duties or immunities under this Agreement or otherwise.
SECTION 11.2 No Legal Title to Owner Trust Estate in
Certificateholders. The Certificateholders shall not have legal title to any
part of the Owner Trust Estate. The Certificateholders shall be entitled to
receive distributions with respect to their undivided ownership interest
therein only in accordance with Articles V and IX. No transfer, by operation of
law or otherwise, of any right, title or interest of the Certificateholders to
and in their ownership interest in the Owner Trust Estate shall operate to
terminate this Agreement or the trusts hereunder or entitle any transferee to
an accounting or to the transfer to it of legal title to any part of the Owner
Trust Estate.
SECTION 11.3 Limitations on Rights of Others. Except for Sections 2.7
and 2.10, the provisions of this Agreement are solely for the benefit of the
Owner Trustee, the Depositors, the Certificateholders and, to the extent
expressly provided herein, the Indenture Trustee and the Noteholders, and
nothing in this Agreement, whether express or implied, shall be construed to
give to any other Person any legal or equitable right, remedy or claim in the
Owner Trust Estate or under or in respect of this Agreement or any covenants,
conditions or provisions contained herein.
SECTION 11.4 Notices. (a) Unless otherwise expressly specified or
permitted by the terms hereof, all notices shall be in writing and shall be
deemed given upon receipt personally
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delivered, delivered by overnight courier or mailed certified mail, return
receipt requested and shall be deemed to have been duly given upon receipt, if
to the Owner Trustee, addressed to Wilmington Trust Company, Rodney Square
North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attn:
Corporate Trust Administration; if to the Depositors, addressed to, (i) Chase
Manhattan Bank USA, National Association, 802 Delaware Avenue, Wilmington,
Delaware 19801, Attention: _________________ and (ii) The Chase Manhattan Bank,
270 Park Avenue, New York, New York 10017, Attention: _________________, or, as
to each party, at such other address as shall be designated by such party in a
written notice to each other party.
(b) Any notice required or permitted to be given to a
Certificateholder shall be given by first-class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, regardless of whether the Certificateholder
receives such notice.
SECTION 11.5 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 11.6 Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 11.7 Successors and Assigns. All covenants and agreements
contained herein shall be binding upon, and inure to the benefit of, the
Depositors, the Owner Trustee and its successors and each Certificateholder and
its successors and permitted assigns, all as herein provided. Any request,
notice, direction, consent, waiver or other instrument or action by a
Certificateholder shall bind the successors and assigns of such
Certificateholder.
SECTION 11.8 No Recourse. Each Certificateholder by accepting a
Certificate acknowledges that such Certificateholder's Certificates represent
equity interests in the Issuer only and do not represent interests in or
obligations of the Depositors, the Servicer, the Owner Trustee, the Indenture
Trustee or any Affiliate thereof, and no recourse may be had against such
parties or their assets, except as may be expressly set forth or contemplated
in this Agreement, the Certificates or the other Basic Documents.
SECTION 11.9 [Reserved].
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SECTION 11.10 Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 11.11 GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAWS PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 11.12 Certificate Transfer Restrictions. (a) The Certificates
may not be acquired by or for the account of (i) an employee benefit plan (as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA")) which is subject to the provisions of Title I of ERISA,
(ii) a plan (as defined in Section 4975(e)(1) of the Code other than a
governmental or church plan described in Section 4975(g)(2) or (3) of the
Code), or (iii) any entity whose underlying assets include "plan assets" by
reason of any such plan's investment in the entity (excluding any investment
company that is registered under the Investment Company Act of 1940, as
amended) (each, a "Benefit Plan"). By accepting and holding a Certificate, the
Holder thereof shall be deemed to have represented and warranted that it is not
a Benefit Plan, and that no assets of a Benefit Plan were used to acquire the
Certificate. The foregoing restrictions shall not apply to acquisitions or
holdings of Certificates with assets of the general account of an insurance
company, to the extent that the acquisition or holding, respectively, of such
Certificates (i) is and will be permissible under Section 401(c) of ERISA and
final regulations thereunder or another exemption under ERISA and (ii) does not
and will not result in the contemplated operations of the Trust being treated
as non-exempt prohibited transactions.
(b) The Certificates may not be acquired by or for the account of an
individual or entity that is not a U.S. person as defined in Section
7701(a)(30) of the Code and any transfer of a Certificate to a person that is
not a U.S. Person shall be void. By accepting and holding a Certificate, the
Holder shall be deemed to have represented and warranted under penalties of
perjury that it (or, if it is acting as a nominee, the beneficial owner) is a
U.S. Person.
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IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed by their respective officers hereunto duly
authorized as of the day and year first above written.
WILMINGTON TRUST COMPANY,
as Owner Trustee
By: _____________________
Name:
Title:
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION,
as Depositor
By: ____________________
Name: Keith Schuck
Title: Vice President
THE CHASE MANHATTAN BANK,
as Depositor
By: _____________________
Name:
Title:
<PAGE>
EXHIBIT A
NUMBER $
R CUSIP NO. [________]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF (i) AN
EMPLOYEE BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")) WHICH IS SUBJECT TO THE
PROVISIONS OF TITLE I OF ERISA, (ii) A PLAN (AS DEFINED IN SECTION 4975(e)(1)
OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") OTHER THAN A PLAN
DESCRIBED IN SECTION 4975(g)(2) OR (3) OF THE CODE), OR (iii) ANY ENTITY WHOSE
UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF A PLAN'S INVESTMENT IN THE
ENTITY (EXCLUDING ANY INVESTMENT COMPANY THAT IS REGISTERED UNDER THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED). BY ACCEPTING AND HOLDING THIS
CERTIFICATE, THE HOLDER HEREOF AND THE CERTIFICATE OWNER SHALL EACH BE DEEMED
TO HAVE REPRESENTED AND WARRANTED THAT IT IS NOT SUCH A PLAN AND THAT NO ASSETS
OF SUCH A PLAN WERE USED TO ACQUIRE THIS CERTIFICATE. THE FOREGOING
RESTRICTIONS SHALL NOT APPLY TO ACQUISITIONS OR HOLDINGS OF CERTIFICATES WITH
ASSETS OF THE GENERAL ACCOUNT OF AN INSURANCE COMPANY, TO THE EXTENT THAT THE
ACQUISITION OR HOLDING, RESPECTIVELY, OF SUCH CERTIFICATES (i) IS AND WILL BE
PERMISSIBLE UNDER SECTION 401(c) OF ERISA AND FINAL REGULATIONS THEREUNDER OR
ANOTHER EXEMPTION UNDER ERISA AND (ii) DOES NOT AND WILL NOT RESULT IN THE
CONTEMPLATED OPERATIONS OF THE TRUST BEING TREATED AS NONEXEMPT PROHIBITED
TRANSACTIONS.
THE CERTIFICATES MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF AN
INDIVIDUAL OR ENTITY THAT IS NOT A U.S. PERSON AS DEFINED IN SECTION
7701(A)(30) OF THE CODE. BY ACCEPTING AND HOLDING A CERTIFICATE, THE HOLDER
SHALL BE DEEMED TO HAVE REPRESENTED AND WARRANTED THAT IT (OR, IF IT IS ACTING
AS A NOMINEE, THE BENEFICIAL OWNER) IS A U.S. PERSON.
THE PRINCIPAL OF THIS CERTIFICATE IS DISTRIBUTABLE IN INSTALLMENTS AS
SET FORTH IN THE TRUST AGREEMENT. ACCORDINGLY, THE OUTSTANDING PRINCIPAL OF
THIS CERTIFICATE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE
HEREOF.
<PAGE>
CHASE MANHATTAN RV OWNER TRUST 1997-A
[______%] ASSET BACKED CERTIFICATE
evidencing a beneficial ownership interest in certain distributions of the
Issuer, as defined below, the property of which includes a pool of retail
installment sales contracts or purchase money notes and security agreements
secured by new or used recreational vehicles and sold to the Issuer by Chase
Manhattan Bank USA, National Association, a national banking association, and
The Chase Manhattan Bank, a New York banking corporation.
(This Certificate does not represent an interest in or obligation of Chase
Manhattan Bank USA, National Association, The Chase Manhattan Bank or any of
their Affiliates, except to the extent described below.)
THIS CERTIFIES THAT __________ is the registered owner of
___________________________ nonassessable, fully-paid, beneficial ownership
interest in certain distributions of Chase Manhattan RV Owner Trust 1997-A (the
"Issuer") formed by Chase Manhattan Bank USA, National Association, a national
banking association, and The Chase Manhattan Bank, a New York banking
corporation (each, a "Depositor" and collectively, the "Depositors"). This
Certificate has a Certificate Rate of [______]% per annum.
A-2
<PAGE>
OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within mentioned
Trust Agreement.
________________________ _____________________________
or
as Owner Trustee as Owner Trustee
By:_____________________ By:__________________________
Authenticating Agent
A-3
<PAGE>
Issuer was created pursuant to a Certificate of Trust, filed with the
Delaware Secretary of State on July 17, 1997 and an original Trust Agreement,
dated as of July 18, 1997 and continued pursuant to an Amended and Restated
Trust Agreement dated as of September 1, 1997 (as amended and restated the
"Trust Agreement"), among the Depositors and Wilmington Trust Company, as owner
trustee (the "Owner Trustee"), a summary of certain of the pertinent provisions
of which is set forth below. To the extent not otherwise defined herein, the
capitalized terms used herein have the meanings assigned to them in Section 1.1
of the Sale and Servicing Agreement dated as of September 1, 1997, among the
Issuer and Chase Manhattan Bank USA, National Association and The Chase
Manhattan Bank, as Sellers and The CIT Group/Sales Financing, Inc., as
Servicer, as the same may be amended or supplemented from time to time (the
"Sale and Servicing Agreement").
This Certificate is one of the duly authorized Certificates of the
Issuer designated as "[______]% Asset Backed Certificates" (herein called the
"Certificates"). Issued under the Indenture dated as of September 1, 1997,
between the Issuer and Norwest Bank Minnesota, National Association, as
indenture trustee (the "Indenture"), are ten classes of Notes designated as
"Class A-1 [______]% Asset Backed Notes" (the "Class A-1 Notes"), "Class A-2
[______]% Asset Backed Notes" (the "Class A-2 Notes"), "Class A-3 [______]%
Asset Backed Notes" (the "Class A-3 Notes"), "Class A-4 [______]% Asset Backed
Notes" (the "Class A-4 Notes"), "Class A-5 [______]% Asset Backed Notes" (the
"Class A-5 Notes"), "Class A-6 [______]% Asset Backed Notes" (the "Class A-6
Notes"), "Class A-7 [______]% Asset Backed Notes" (the "Class A-7 Notes"),
"Class A-8 [______]% Asset Backed Notes" (the "Class A-8 Notes"), "Class A-9
[______]% Asset Backed Notes" (the "Class A-9 Notes") and "Class A-10
[______]% Asset Backed Notes" (the "Class A-10 Notes" and, together with 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, the Class A-6 Notes, the Class A-7 Notes, the Class A-8
Notes and the Class A-9 Notes, the "Notes"). This Certificate is issued under
and is subject to the terms, provisions and conditions of the Trust Agreement,
to which Trust Agreement the holder of this Certificate by virtue of the
acceptance hereof assents and by which such holder is bound.
The holder of this Certificate acknowledges and agrees that its rights
to receive distributions in respect of this Certificate are subordinated to the
rights of the Noteholders as described in the Sale and Servicing Agreement, the
Indenture and the Trust Agreement, as applicable.
It is the intent of each Depositor and the Certificateholders that,
for United States federal income tax purposes, the Issuer will be treated as a
partnership and the Depositors and the Certificateholders will be treated as
partners in that partnership. The Certificateholders by acceptance of a
Certificate, agree to treat, and to take no action inconsistent with the
treatment of,
A-4
<PAGE>
the Certificates for such tax purposes as equity (i.e., partnership
interests) in the Issuer.
Each Certificateholder, by its acceptance of a Certificate or a
beneficial interest in a Certificate, acknowledges and agrees that none of the
Depositors or the Owner Trustee is authorized to elect to treat the Issuer
other than as a partnership for United States federal income tax purposes or
any relevant state tax purposes. Each Certificateholder, by its acceptance of a
Certificate or a beneficial interest in a Certificate, agrees not to take any
actions (or direct the Owner Trustee to take such acts or actions) that would
violate such restriction.
The Certificates do not represent an obligation of, or an interest in,
any of the Depositors, the Servicer, the Owner Trustee, the Indenture Trustee
or their respective Affiliates, and no recourse may be had against such parties
or their assets, except as may be expressly set forth or contemplated herein or
in the Trust Agreement, the Indenture or the other Basic Documents.
This certificate may not be acquired by or for the account of (i) an
employee benefit plan (as defined in section 3(3) of the employee retirement
income security act of 1974, as amended ("ERISA")) which is subject to the
provisions of Title I of ERISA, (ii) a plan (as defined in Section 4975(e)(1)
of the Internal Revenue Code of 1986, as amended (the "Code") other than a plan
described in Section 4975(g)(2) or (3) of the Code), or (iii) any entity whose
underlying assets include "plan assets" by reason of a plan's investment in the
entity (excluding any investment company that is registered under the
Investment Company Act of 1940, as amended). By accepting and holding this
Certificate, the holder hereof and the Certificate Owner shall each be deemed
to have represented and warranted that it is not such a plan and that no assets
of such a plan were used to acquire this Certificate. The foregoing
restrictions shall not apply to acquisitions or holdings of Certificates with
assets of the general account of an insurance company, to the extent that the
acquisition or holding, respectively, of such Certificates (i) is and will be
permissible under Section 401(c) of ERISA and final regulations thereunder or
another exemption under ERISA and (ii) does not and will not result in the
contemplated operations of the Trust being treated as non-exempt prohibited
transactions.
The Certificates may not be acquired by or for the account of an
individual or entity that is not a U.S. Person as defined in Section
7701(A)(30) of the Code. By accepting and holding a Certificate, the Holder
shall be deemed to have represented and warranted that it (or, if it is acting
as a Nominee, the Beneficial Owner) is a U.S. Person.
Unless the certificate of authentication hereon shall have been
executed by an authorized officer of the Owner Trustee or the Authentication
Agent, by manual or facsimile signature, this Certificate shall not entitle the
holder hereof to any benefit
A-5
<PAGE>
under the Trust Agreement or the Sale and Servicing Agreement or be
valid for any purpose.
THIS CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED
IN ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Owner Trustee, on behalf of Issuer and not in
its individual capacity, has caused this Certificate to be duly executed.
CHASE MANHATTAN RV OWNER
TRUST 1997-A
By:_______________________________
not in its individual
capacity, but solely as
Owner Trustee
Dated: By:_______________________________
A-6
<PAGE>
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
(Please print or type name and address, including postal zip code, of assignee)
the Certificate mentioned herein, and all rights thereunder, hereby irrevocably
constituting and appointing
___________________________________________ as Attorney to transfer said
Certificate on the books of the Certificate Registrar, with full power of
substitution in the premises.
Dated:
___________________________________*
Signature Guaranteed:
___________________________________*
__________________
* NOTICE: The signature to this assignment must correspond with the name
of the registered owner as it appears on the face of the within
Certificate in every particular, without alteration, enlargement or
any change whatever. Such signature must be guaranteed by a member
firm of the New York Stock Exchange or a commercial bank or trust
company.
<PAGE>
EXHIBIT B
CERTIFICATE OF TRUST
<PAGE>
OH&S DRAFT
9/17/97
- --------------------------------------------------------------------------------
CHASE MANHATTAN RV OWNER TRUST 1997-A
Class A-1 [____]% Asset Backed NoteS
Class A-2 [____]% Asset Backed Notes
Class A-3 [____]% Asset Backed Notes
Class A-4 [____]% Asset Backed Notes
Class A-5 [____]% Asset Backed Notes
Class A-6 [____]% Asset Backed NoteS
Class A-7 [____]% Asset Backed Notes
Class A-8 [____]% Asset Backed Notes
Class A-9 [____]% Asset Backed Notes
Class A-10 [____]% Asset Backed Notes
------------------------------------
CHASE ADMINISTRATION AGREEMENT
Dated as of September 1, 1997
------------------------------------
The Chase Manhattan Bank
Chase Administrator
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
1. Duties of Chase Administrator................................................................. 2
2. Records....................................................................................... 7
3. Compensation.................................................................................. 7
4. Additional Information To Be Furnished to Issuer.............................................. 7
5. Independence of Chase Administrator........................................................... 7
6. No Joint Venture.............................................................................. 7
7. Other Activities of Chase Administrator....................................................... 8
8. Term of Agreement; Resignation and Removal of Chase
Administrator................................................................................. 8
9. Action upon Termination, Resignation or Removal............................................... 10
10. Notices....................................................................................... 10
11. Amendments.................................................................................... 11
12. Successors and Assigns........................................................................ 12
13. GOVERNING LAW................................................................................. 12
14. Headings...................................................................................... 12
15. Counterparts.................................................................................. 12
16. Severability.................................................................................. 12
17. Not Applicable to The Chase Manhattan Bank in Other
Capacities.................................................................................... 13
18. Limitation of Liability of Owner Trustee, Indenture
Trustee and Chase Administrator............................................................... 13
19. Third-Party Beneficiary....................................................................... 14
20. Nonpetition Covenants......................................................................... 14
21. Liability of Chase Administrator.............................................................. 14
</TABLE>
EXHIBIT A - Form of Power of Attorney
<PAGE>
CHASE ADMINISTRATION AGREEMENT, dated as of September 1, 1997, among
CHASE MANHATTAN RV OWNER TRUST 1997-A, a Delaware business trust (the "Issuer"),
THE CHASE MANHATTAN BANK, a New York banking corporation, as administrator (the
"Chase Administrator"), THE CIT GROUP/SALES FINANCING, INC. and NORWEST BANK
MINNESOTA, NATIONAL ASSOCIATION, a national banking association, not in its
individual capacity but solely as Indenture Trustee (the "Indenture Trustee").
W I T N E S S E T H :
WHEREAS the Issuer is issuing the Class A-1 [____]% Asset Backed Notes
(the "Class A-1 Notes"), the Class A-2 [____]% Asset Backed Notes (the "Class
A-2 Notes"), the Class A-3 [____]% Asset Backed Notes (the "Class A-3 Notes"),
the Class A-4 [____]% Asset Backed Notes (the "Class A-4 Notes"), the Class A-5
[____]% Asset Backed Notes (the "Class A-5 Notes"), the Class A-6 [____]% Asset
Backed Notes (the "Class A-6 Notes"), the Class A-7 [____]% Asset Backed Notes
(the "Class A-7 Notes"), the Class A-8 [____]% Asset Backed Notes (the "Class
A-8 Notes"), the Class A-9 [____]% Asset Backed Notes (the "Class A-9 Notes"),
and the Class A-10 [____]% Asset Backed Notes (the "Class A-10 Notes" and,
together with the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes,
Class A- 4 Notes, the Class A-5 Notes, the Class A-6 Notes, the Class A-7 Notes,
the Class A-8 Notes, and the Class A-9 Notes, the "Notes") pursuant to the
Indenture, dated as of September 1, 1997 (as amended, modified or supplemented
from time to time in accordance with the provisions thereof, the "Indenture"),
between the Issuer and the Indenture Trustee and the [____]% Asset Backed
Certificates (the "Certificates") pursuant to the Trust Agreement, dated as of
September 1, 1997 (as amended, modified or supplemented from time to time in
accordance with the provisions thereof, the "Trust Agreement"), among Chase USA
and Chase (as defined below), as Depositors, and Wilmington Trust Company, as
owner trustee (the "Owner Trustee").
WHEREAS the Issuer has entered into certain agreements in connection
with the issuance of the Notes and the Certificates, including (i) a Sale and
Servicing Agreement, dated as of September 1, 1997 (the "Sale and Servicing
Agreement") (capitalized terms used herein and not defined herein shall have the
meanings assigned such terms in the Sale and Servicing Agreement), among the
Issuer, Chase Manhattan Bank USA, N.A. ("Chase USA"), as a Seller, The Chase
Manhattan Bank ("Chase"), as a Seller and The CIT Group/Sales Financing, Inc.,
as Servicer, (ii) the Trust Agreement and (iii) the Indenture (the Sale and
Servicing Agreement, the Trust Agreement and the Indenture being hereinafter
referred to collectively as the "Related Agreements");
WHEREAS pursuant to the Related Agreements, the Issuer and the Owner
Trustee are required to perform certain duties in connection
<PAGE>
with (a) the Notes and the collateral pledged therefor pursuant to the Indenture
(the "Collateral") and (b) the Certificates;
WHEREAS the Issuer desires to have the Chase Administrator perform
certain of the duties of the Issuer and the Owner Trustee referred to herein,
and to provide such additional services consistent with the terms of this
Agreement and the Related Agreements as the Issuer may from time to time
request;
WHEREAS the Chase Administrator has the capacity to provide the
services required hereby and is willing to perform such services for the Issuer
and the Owner Trustee on the terms set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:
1. Duties of Chase Administrator. (a) Duties with Respect to the
Related Agreements. (i) Subsequent to the Closing Date, the Chase Administrator
shall take all appropriate action that it is the duty of the Issuer or the Owner
Trustee to take pursuant to the following provisions of the Indenture:
(A) the preparation of or obtaining of the documents and
instruments required for authentication of the Notes, if any, and
delivery of the same to the Indenture Trustee (Section 2.2);
(B) the duty to cause the Note Register to be kept and to give
the Indenture Trustee notice of any appointment of a new Note Registrar
and the location, or change in location, of the Note Register and the
office or offices where Notes may be surrendered for registration of
transfer or exchange (Section 2.4);
(C) the notification of Noteholders of the final
principal payment on their Notes (Section 2.7(b));
(D) the preparation of Definitive Notes and arranging
the delivery thereof (Section 2.12);
(E) the maintenance of an office or agency in the City of New
York and, if applicable, Luxembourg, for registration of transfer or
exchange of Notes (Section 3.2);
(F) the duty to cause newly appointed Paying Agents, if
any, to deliver to the Indenture Trustee the instrument
2
<PAGE>
specified in the Indenture regarding funds held in trust
(Section 2.14);
(G) the direction to Paying Agents to pay to the
Indenture Trustee all sums held in trust by such Paying Agents
(Section 3.3);
(H) the obtaining and preservation of the Issuer's
qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of the Indenture, the Notes, the Collateral and each
other instrument and agreement included in the Trust Estate (Section
3.4);
(I) the identification to the Indenture Trustee in an
Officers' Certificate of a Person with whom the Issuer has contracted
to perform its duties under the Indenture (Section 3.7(b));
(J) the notification of the Indenture Trustee and the Rating
Agencies of an Event of Servicing Termination pursuant to the Sale and
Servicing Agreement and, if such Event of Servicing Termination arises
from the failure of the Servicer to perform any of its duties under the
Sale and Servicing Agreement, the taking of all reasonable steps
available to remedy such failure (Section 3.7(d));
(K) the delivery of notice to the Indenture Trustee of each
Event of Default, Event of Servicing Termination and each default by
the Seller under the Sale and Servicing Agreement (Section 3.18);
(L) the taking of such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of the
Indenture or to compel or secure the performance and observance by the
Seller and the Servicer of their obligations under the Sale and
Servicing Agreement (Sections 3.19 and 5.16);
(M) provide the Indenture Trustee with the information
necessary to deliver to each Noteholder such information as may be
reasonably required to enable such Holder to prepare its United States
federal and state and local income or franchise tax returns (Section
6.6);
3
<PAGE>
(N) the preparation and delivery of notice to Noteholders of
the removal of the Indenture Trustee and the appointment of a successor
Indenture Trustee (Section 6.8);
(O) the preparation of any written instruments required to
confirm more fully the authority of any co-trustee or separate trustee
and any written instruments necessary in connection with the
resignation or removal of the Indenture Trustee or any co-trustee or
separate trustee (Sections 6.8 and 6.10);
(P) the furnishing of the Indenture Trustee with the names and
addresses of Noteholders during any period when the Indenture Trustee
is not the Note Registrar (Section 7.1);
(Q) the preparation and, after execution by the Issuer, the
filing with the Commission, any applicable state agencies and the
Indenture Trustee of documents required to be filed on a periodic basis
with, and summaries thereof as may be required by rules and regulations
prescribed by, the Commission and any applicable state agencies and the
transmission of such summaries, as necessary, to the Noteholders
(Section 7.3);
(R) the preparation of Issuer Orders and Issuer Requests and
the obtaining of Opinions of Counsel with respect to the execution of
supplemental indentures and the mailing to the Noteholders of notices
with respect to such supplemental indentures (Sections 9.1 and 9.2);
(S) the execution of new Notes conforming to any supplemental
indenture (Section 9.5);
(T) provide the Indenture Trustee with the form of notice
necessary to deliver the notification of Noteholders of redemption of
the Notes (Section 10.2);
(U) the preparation and delivery to the Noteholders and the
Indenture Trustee of any agreements with respect to alternate payment
and notice provisions (Section 11.6); and
(V) the recording of the Indenture, if applicable
(Section 11.15).
(b) Additional Duties. (i) In addition to the duties of the Chase
Administrator set forth above, the Chase Administrator shall perform such
calculations and shall prepare for execution by the Issuer or the Owner Trustee
or shall cause the preparation by other appropriate persons of all such
documents, reports, filings, instruments, certificates and opinions as it shall
be the duty of the Issuer or the Owner Trustee to prepare, file or deliver
4
<PAGE>
pursuant to the Related Agreements, and at the request of the Owner Trustee
shall take all appropriate action that it is the duty of the Issuer or the Owner
Trustee to take pursuant to the Related Agreements. Subject to Section 5 of this
Agreement, and in accordance with the directions of the Owner Trustee, the Chase
Administrator shall administer, perform or supervise the performance of such
other activities in connection with the Trust Estate (including the Related
Agreements) as are not covered by any of the foregoing provisions and as are
expressly requested by the Owner Trustee and are reasonably within the
capability of the Chase Administrator.
(ii) Notwithstanding anything in this Agreement or the Related
Agreements to the contrary, the Chase Administrator shall be responsible for
promptly notifying the Owner Trustee in the event that any withholding tax is
imposed on the Issuer's payments (or allocations of income) to a
"Certificateholder" as contemplated in Section 5.2(c) of the Trust Agreement
[upon actual knowledge thereof]. Any such notice shall specify the amount of any
withholding tax required to be withheld by the Owner Trustee pursuant to such
provision.
(iii) Notwithstanding anything in this Agreement or the Related
Agreements to the contrary, the Chase Administrator shall be responsible for
performance of the duties of the Owner Trustee and the Issuer set forth in
Sections 2.11, 2.12, 2.13 and 5.5(a), (b) and (c) and 5.7 of the Trust Agreement
with respect to, among other things, accounting and reports to
Certificateholders and the maintenance of Capital Accounts; provided, however,
that the Owner Trustee shall retain responsibility for the distribution of the
Schedule K-1s necessary to enable each Certificateholder to prepare its federal
and state income tax returns.
(iv) The Chase Administrator may satisfy its obligations with respect
to clauses (ii) and (iii) above by retaining, at the expense of the Chase
Administrator, a firm of independent public accountants (the "Accountants")
acceptable to the Owner Trustee which shall perform the obligations of the Chase
Administrator thereunder. In connection with paragraph (ii) above, the
Accountants will provide prior to October 15, 1997, a letter in form and
substance satisfactory to the Owner Trustee as to whether any tax withholding is
then required under Section 5.2(c) of the Trust Agreement and, if required, the
procedures to be followed with respect thereto to comply with the requirements
of the Code. The Chase Administrator shall cause the Accountants to update the
letter in each instance that any additional tax withholding is subsequently
required or any previously required tax withholding shall no longer be required.
(v) [Reserved.]
5
<PAGE>
(vi) The Chase Administrator shall perform the duties of the Chase
Administrator specified in Section 10.3 of the Trust Agreement required to be
performed in connection with the resignation or removal of the Owner Trustee,
the duties of the Chase Administrator specified in Section 10.5 of the Trust
Agreement required to be performed in connection with the appointment and
payment of co-Trustees, and any other duties expressly required to be performed
by the Chase Administrator under the Trust Agreement.
(vii) In carrying out the foregoing duties or any of its other
obligations under this Agreement, the Chase Administrator may enter into
transactions with or otherwise deal with any of its affiliates; provided,
however, that the terms of any such transactions or dealings shall be in
accordance with any directions received from the Issuer and shall be, in the
Chase Administrator's opinion, no less favorable to the Issuer than would be
available from unaffiliated parties.
(viii) It is the intention of the parties hereto that the Chase
Administrator shall, and the Chase Administrator hereby agrees to, execute on
behalf of the Issuer or the Owner Trustee all such documents, reports, filings,
instruments, certificates and opinions as it shall be the duty of the Issuer or
the Owner Trustee to prepare, file or deliver pursuant to the Basic Documents.
In furtherance thereof, the Owner Trustee shall, on behalf of itself and of the
Issuer, execute and deliver to the Chase Administrator, and to each successor
Chase Administrator appointed pursuant to the terms hereof, one or more powers
of attorney substantially in the form of Exhibit A hereto, appointing the Chase
Administrator the attorney-in-fact of the Owner Trustee and the Issuer for the
purpose of executing on behalf of the Owner Trustee and the Issuer all such
documents, reports, filings, instruments, certificates and opinions.
(c) Non-Ministerial Matters. (i) With respect to matters that in the
reasonable judgment of the Chase Administrator are non-ministerial, the Chase
Administrator shall not take any action unless within a reasonable time before
the taking of such action, the Chase Administrator shall have notified the Owner
Trustee of the proposed action and the Owner Trustee shall not have withheld
consent or provided an alternative direction. For the purpose of the preceding
sentence, "non-ministerial matters" shall include, without limitation:
(A) the initiation of any claim or lawsuit by the Issuer and
the compromise of any action, claim or lawsuit brought by or against
the Issuer (other than in connection with the collection of the
Receivables);
(B) the amendment, change or modification of the Related
Agreements;
6
<PAGE>
(C) the appointment of successor Indenture Trustees pursuant
to the Indenture, successor Paying Agents pursuant to the Amended and
Restated Trust Agreement or successor Chase Administrators or the
consent to the appointment of successor Note Registrars; and
(D) the removal of the Indenture Trustee.
(ii) Notwithstanding anything to the contrary in this Agreement, the
Chase Administrator shall not be obligated to, and shall not, (x) make any
payments to the Noteholders or Certificateholders under the Related Agreements,
(y) sell the Trust Estate pursuant to Section 5.4 of the Indenture or (z) take
any action that the Issuer directs the Chase Administrator not to take on its
behalf.
2. Records. The Chase Administrator shall maintain appropriate books of
account and records relating to services performed hereunder, which books of
account and records shall be accessible for inspection by the Issuer, the Owner
Trustee, the Indenture Trustee and each Seller at any time during normal
business hours.
3. Compensation. As compensation for the performance of the Chase
Administrator's obligations under this Agreement, the Chase Administrator shall
be paid by the Servicer as set forth in Schedule D to the Sale and Servicing
Agreement.
4. Additional Information To Be Furnished to Issuer. The Chase
Administrator shall furnish to the Issuer from time to time such additional
information regarding the Collateral as the Issuer shall reasonably request,
including notification of Noteholders pursuant to Section 1(C) hereof.
5. Independence of Chase Administrator. For all purposes of this
Agreement, the Chase Administrator shall be an independent contractor and shall
not be subject to the supervision of the Issuer or the Owner Trustee with
respect to the manner in which it accomplishes the performance of its
obligations hereunder. Unless expressly authorized by the Issuer or the Owner
Trustee, as the case may be, the Chase Administrator shall have no authority to
act for or represent the Issuer or the Owner Trustee in any way and shall not
otherwise be deemed an agent of the Issuer or the Owner Trustee.
6. No Joint Venture. Nothing contained in this Agreement shall (i)
constitute the Chase Administrator and either of the Issuer or the Owner Trustee
as members of any partnership, joint venture, association, syndicate,
unincorporated business or other separate entity or (ii) be construed to impose
any liability as such on any of them.
7
<PAGE>
7. Other Activities of Chase Administrator. (a) Nothing herein shall
prevent the Chase Administrator or its affiliates from engaging in other
businesses or, in its sole discretion, from acting in a similar capacity as an
administrator for any other person or entity even though such person or entity
may engage in business activities similar to those of the Issuer, the Owner
Trustee or the Indenture Trustee.
(b) The Chase Administrator and its affiliates may generally engage in
any kind of business with any person party to a Related Agreement, any of its
affiliates and any person who may do business with or own securities of any such
person or any of its affiliates, without any duty to account therefor to the
Issuer, the Owner Trustee or the Indenture Trustee.
8. Term of Agreement; Resignation and Removal of Chase Administrator.
(a) This Agreement shall continue in force until the dissolution of the Issuer,
upon which event this Agreement shall automatically terminate.
(b) Subject to Sections 8(e) and (f), the Chase Administrator may
resign its duties hereunder by providing the Issuer, the Servicer and the Owner
Trustee with at least 60 days' prior written notice.
(c) Subject to Sections 8(e) and (f), the Issuer may remove the Chase
Administrator without cause by providing the Chase Administrator with at least
60 days' prior written notice.
(d) Subject to Sections 8(e) and (f), at the sole option of the Issuer,
the Chase Administrator may be removed immediately upon written notice of
termination from the Issuer to the Chase Administrator if any of the following
events shall occur:
(i) the Chase Administrator shall default in the performance
of any of its duties under this Agreement and, after notice of such
default, shall not cure such default within ten days (or, if such
default cannot be cured in such time, shall not give within ten days
such assurance of cure as shall be reasonably satisfactory to the
Issuer);
(ii) a court having jurisdiction in the premises shall enter
a decree or order for relief, and such decree or order shall not have
been vacated within 60 days, in respect of the Chase Administrator in
any involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect or appoint a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official for the Chase Administrator or any substantial part of its
property or order the winding-up or liquidation of its affairs; or
8
<PAGE>
(iii) the Chase Administrator shall commence a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, shall consent to the entry of an order for relief
in an involuntary case under any such law, or shall consent to the
appointment of a receiver, liquidator, assignee, trustee, custodian,
sequestrator or similar official for the Chase Administrator or any
substantial part of its property, shall consent to the taking of
possession by any such official of any substantial part of its
property, shall make any general assignment for the benefit of
creditors or shall fail generally to pay its debts as they become due.
The Chase Administrator agrees that if any of the events specified in
clause (ii) or (iii) of this Section shall occur, it shall give written notice
thereof to the Issuer, the Owner Trustee and the Indenture Trustee within seven
days after the happening of such event.
(e) No resignation or removal of the Chase Administrator pursuant to
this Section shall be effective until (i) a successor Chase Administrator shall
have been appointed by the Issuer and (ii) such successor Chase Administrator
shall have agreed in writing to be bound by the terms of this Agreement in the
same manner as the Chase Administrator is bound hereunder.
(f) The appointment of any successor Chase Administrator shall be
effective only after receipt of written confirmation from each Rating Agency
that the proposed appointment will not result in the qualification, downgrading
or withdrawal of any rating assigned to the Notes and Certificates by such
Rating Agency.
(g) A successor Chase Administrator shall execute, acknowledge and
deliver a written acceptance of its appointment hereunder to the resigning Chase
Administrator and to the Issuer. Thereupon the resignation or removal of the
resigning Chase Administrator shall become effective, and the successor Chase
Administrator shall have all the rights, powers and duties of the Chase
Administrator under this Agreement. The successor Chase Administrator shall mail
a notice of its succession to the Noteholders and the Certificateholders. The
resigning Chase Administrator shall promptly transfer or cause to be transferred
all property and any related agreements, documents and statements held by it as
Chase Administrator to the successor Chase Administrator and the resigning Chase
Administrator shall execute and deliver such instruments and do other things as
may reasonably be required for fully and certainly vesting in the successor
Chase Administrator all rights, powers, duties and obligations hereunder.
(h) In no event shall a resigning Chase Administrator be liable for the
acts or omissions of any successor Chase Administrator hereunder.
9
<PAGE>
(i) In the exercise or administration of its duties hereunder and under
the Related Documents, the Chase Administrator may act directly or through its
agents or attorneys pursuant to agreements entered into with any of them, and
the Chase Administrator shall not be liable for the conduct or misconduct of
such agents or attorneys if such agents or attorneys shall have been selected by
the Chase Administrator with due care.
9. Action upon Termination, Resignation or Removal. Promptly upon the
effective date of termination of this Agreement pursuant to Section 8(a) or the
resignation or removal of the Chase Administrator pursuant to Section 8(b) or
(c), respectively, the Chase Administrator shall be entitled to be paid all fees
and reimbursable expenses accruing to it to the date of such termination,
resignation or removal. The Chase Administrator shall forthwith upon termination
pursuant to Section 8(a) deliver to the Issuer all property and documents of or
relating to the Collateral then in the custody of the Chase Administrator. In
the event of the resignation or removal of the Chase Administrator pursuant to
Section 8(b) or (c), respectively, the Chase Administrator shall cooperate with
the Issuer and take all reasonable steps requested to assist the Issuer in
making an orderly transfer of the duties of the Chase Administrator.
10. CITSF Administration Agreements. The Chase Administrator hereby
agrees to succeed to the responsibilities, duties and liabilities of the CITSF
Administrator under the CITSF Administration Agreement in accordance with
Section 8(e) thereto upon the termination of the CITSF Administrator pursuant to
Section 8(a)(ii) of the CITSF Administration Agreement.
11. Notices. Any notice, report or other communication given hereunder
shall be in writing and addressed as follows:
(a) if to the Issuer or the Owner Trustee, to
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attention: Corporate Trust Administration
with copies to:
(i) Chase Manhattan Bank USA, National Association
802 Delaware Avenue
Wilmington, Delaware 19801
Attention:
(ii) The Chase Manhattan Bank
270 Park Avenue
New York, New York 10017
Attention:
(iii) The CIT Group/Sales Financing, Inc.
650 CIT Drive
Livingston, New Jersey 07039
Attention: President
10
<PAGE>
(b) if to the Chase Administrator, to
The Chase Manhattan Bank
270 Park Avenue
New York, New York 10017
Attention:
(c) if to the Indenture Trustee, to
Norwest Bank Minnesota,
National Association
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479-0070
Attention: Asset-Backed Securities
(d) if to the Sellers, to
(i) Chase Manhattan Bank USA, National Association
802 Delaware Avenue
Wilmington, Delaware 19801
Attention:
(ii) The Chase Manhattan Bank
270 Park Avenue
New York, New York 10017
Attention:
or to such other address as any party shall have provided to the other parties
in writing. Any notice required to be in writing hereunder shall be deemed given
if such notice is mailed by certified mail, postage prepaid, or hand-delivered
to the address of such party as provided above, except that notices to the
Indenture Trustee are effective only upon receipt.
12. Amendments. This Agreement may be amended from time to time by a
written amendment duly executed and delivered by the Issuer, the Chase
Administrator and the Indenture Trustee, with the written consent of the Owner
Trustee and without the consent of the Noteholders and the Certificateholders,
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Noteholders or Certificateholders; provided that such
amendment will not, as evidenced by an Opinion of Counsel, materially adversely
affect the interest of any Noteholder or Certificateholder. This Agreement may
also be amended by the Issuer, the Chase Administrator and the Indenture Trustee
with the written consent of the Owner Trustee and the holders of Notes
representing a majority in the Outstanding Amount of the Notes and the holders
of Certificates representing a majority of the Certificate Balance then
outstanding for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the
11
<PAGE>
rights of Noteholders or the Certificateholders; provided, however, that no such
amendment may (i) increase or reduce in any manner the amount of, or accelerate
or delay the timing of, collections of payments on Receivables or distributions
that are required to be made for the benefit of the Noteholders or
Certificateholders or (ii) reduce the aforesaid percentage of the holders of
Notes and Certificates which are required to consent to any such amendment,
without the consent of the holders of all the outstanding Notes and
Certificates. Notwithstanding the foregoing, the Chase Administrator may not
amend this Agreement without the permission of each Seller, which permission
shall not be unreasonably withheld.
13. Successors and Assigns. This Agreement may not be assigned by the
Chase Administrator unless such assignment is previously consented to in writing
by the Issuer and the Owner Trustee and subject to receipt by the Owner Trustee
of written confirmation from each Rating Agency that such assignment will not
result in the qualification, downgrading or withdrawal of any rating assigned to
the Notes and Certificates by such Rating Agency in respect thereof. An
assignment with such consent and satisfaction, if accepted by the assignee,
shall bind the assignee hereunder in the same manner as the Chase Administrator
is bound hereunder. Notwithstanding the foregoing, this Agreement may be
assigned by the Chase Administrator without the consent of the Issuer or the
Owner Trustee to a corporation or other organization that is a successor (by
merger, consolidation or purchase of assets) to the Chase Administrator,
provided that such successor organization executes and delivers to the Issuer,
the Owner Trustee and the Indenture Trustee an agreement in which such
corporation or other organization agrees to be bound hereunder by the terms of
the assignment in the same manner as the Chase Administrator is bound hereunder.
Subject to the foregoing, this Agreement shall bind any successors or assigns of
the parties hereto.
14. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAWS PROVISIONS AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIESrepe 5
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
15. Headings. The section headings hereof have been inserted for
convenience of reference only and shall not be construed to affect the meaning,
construction or effect of this Agreement.
16. Counterparts. This Agreement may be executed in counterparts,
each of which when so executed shall together constitute but one and the same
agreement.
17. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition or unenforceability
12
<PAGE>
without invalidating the remaining provisions hereof and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
18. Not Applicable to Chase in Other Capacities. Nothing in this
Agreement shall affect any obligation Chase may have in any other capacity.
19. Limitation of Liability of Owner Trustee, Indenture Trustee and
Chase Administrator. (a) Notwithstanding anything contained herein to the
contrary, this instrument has been signed by Wilmington Trust Company not in its
individual capacity but solely in its capacity as Owner Trustee of the Issuer
and in no event shall Wilmington Trust Company in its individual capacity or any
beneficial owner of the Issuer have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer hereunder,
as to all of which recourse shall be had solely to the assets of the Issuer. For
all purposes of this Agreement, in the performance of any duties or obligations
of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to
the benefits of, the terms and provisions of Articles VI, VII and VIII of the
Trust Agreement.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been signed by Norwest Bank Minnesota, National Association, not
in its individual capacity but solely as Indenture Trustee, and in no event
shall Norwest Bank Minnesota, National Association have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the assets
of the Issuer.
(c) No recourse under any obligation, covenant or agreement of the
Issuer contained in this Agreement shall be had against any agent of the Issuer
(including the Chase Administrator) as such by the enforcement of any assessment
or by any legal or equitable proceeding, by virtue of any statute or otherwise;
it being expressly agreed and understood that this Agreement is solely an
obligation of the Issuer as a Delaware business trust, and that no personal
liability whatever shall attach to or be incurred by any agent of the Issuer
(including the Chase Administrator), as such, under or by reason of any of the
obligations, covenants or agreements of the Issuer contained in this Agreement,
or implied therefrom, and that any and all personal liability for breaches by
the Issuer of any such obligations, covenants or agreements, either at common
law or at equity, or by statute or constitution, of every such agent is hereby
expressly waived as a condition of and in consideration for the execution of
this Agreement.
13
<PAGE>
20. Third-Party Beneficiary. Each of the Sellers (to the extent
provided in Section 11) and the Owner Trustee is a third-party beneficiary to
this Agreement and is entitled to the rights and benefits hereunder and may
enforce the provisions hereof as if it were a party hereto.
21. Nonpetition Covenants. Notwithstanding any prior termination of
this Agreement, the Chase Administrator and the Indenture Trustee shall not,
prior to the date which is one year and one day after the termination of this
Agreement with respect to the Issuer, acquiesce, petition or otherwise invoke or
cause the Issuer to invoke the process of any court of government authority for
the purpose of commencing or sustaining a case against the Issuer under any
Federal or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Issuer or any substantial part of its property, or ordering the winding
up or liquidation of the affairs of the Issuer.
22. Liability of Chase Administrator. Notwithstanding any provision of
this Agreement, the Chase Administrator shall not have any obligations under
this Agreement other than those specifically set forth herein, and no implied
obligations of the Chase Administrator shall be read into this Agreement.
Neither the Chase Administrator nor any of its directors, officers, agents or
employees shall be liable for any action taken or omitted to be taken in good
faith by it or them under or in connection with this Agreement, except for its
or their own gross negligence or willful misconduct and in no event shall the
Chase Administrator be liable under or in connection with this Agreement for
indirect, special, or consequential losses or damages of any kind, including
lost profits, even if advised of the possibility thereof and regardless of the
form of action by which such losses or damages may be claimed. Without limiting
the foregoing, the Chase Administrator may (a) consult with legal counsel
(including counsel for the Issuer), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts and (b) shall incur no liability under or in respect of
this Agreement by acting upon any notice (including notice by telephone),
consent, certificate or other instrument or writing (which may be by facsimile)
believed by it to be genuine and signed or sent by the proper party or parties.
14
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first above written.
CHASE MANHATTAN RV OWNER TRUST
1997-A
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee,
By:
---------------------------------
Name:
Title:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual
capacity but solely as Indenture
Trustee,
By:
---------------------------------
Name: Marianna Stershic
Title: Assistant Vice President
THE CHASE MANHATTAN BANK,
as Chase Administrator,
By:
---------------------------------
Name:
Title:
THE CIT GROUP/SALES FINANCING, INC.
as Servicer,
By:
---------------------------------
Name:
Title:
15
<PAGE>
EXHIBIT A
[Form of Power of Attorney]
POWER OF ATTORNEY
STATE OF NEW YORK )
)
COUNTY OF NEW YORK )
KNOW ALL MEN BY THESE PRESENTS, that Wilmington Trust Company, a
Delaware banking corporation, not in its individual capacity but solely as owner
trustee ("Owner Trustee") for Chase Manhattan RV Owner Trust 1997-A ("Trust"),
does hereby make, constitute and appoint THE CHASE MANHATTAN BANK, as Chase
Administrator under the Administration Agreement (as defined below), and its
agents and attorneys, as Attorneys-in-Fact to execute on behalf of the Owner
Trustee or the Trust all such documents, reports, filings, instruments,
certificates and opinions as it shall be the duty of the Owner Trustee or the
Trust to prepare, file or deliver pursuant to the Related Documents (as defined
in the Administration Agreement), including, without limitation, to appear for
and represent the Owner Trustee and the Trust in connection with the
preparation, filing and audit of federal, state and local tax returns pertaining
to the Trust, and with full power to perform any and all acts associated with
such returns and audits that the Owner Trustee could perform, including without
limitation, the right to distribute and receive confidential information, defend
and assert positions in response to audits, initiate and defend litigation, and
to execute waivers of restriction on assessments of deficiencies, consents to
the extension of any statutory or regulatory time limit, and settlements. For
the purpose of this Power of Attorney, the term "Administration Agreement" means
the Administration Agreement, dated as of September 1, 1997, among the Trust,
The Chase Manhattan Bank, as Chase Administrator, The CIT Group/Sales Financing,
Inc. and Norwest Bank Minnesota, National Association, as Indenture Trustee, as
such may be amended from time to time.
All powers of attorney for this purpose heretofore filed or executed
by the Owner Trustee are hereby revoked.
EXECUTED this ____ day of _______, 199_.
WILMINGTON TRUST COMPANY,
not in its individual
capacity but solely as
Owner Trustee
By:
---------------------
Name:
Title:
16
<PAGE>
OH&S DRAFT
9/17/97
- --------------------------------------------------------------------------------
CHASE MANHATTAN RV OWNER TRUST 1997-A
Class A-1 [____]% Asset Backed NoteS
Class A-2 [____]% Asset Backed Notes
Class A-3 [____]% Asset Backed Notes
Class A-4 [____]% Asset Backed Notes
Class A-5 [____]% Asset Backed Notes
Class A-6 [____]% Asset Backed NoteS
Class A-7 [____]% Asset Backed Notes
Class A-8 [____]% Asset Backed Notes
Class A-9 [____]% Asset Backed Notes
Class A-10 [____]% Asset Backed Notes
------------------------------------
CITSF ADMINISTRATION AGREEMENT
Dated as of September 1, 1997
------------------------------------
The CIT GROUP/SALES FINANCING, INC., as
CITSF Administrator
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
1. Duties of CITSF Administrator................................................................. 2
2. Compensation.................................................................................. 3
3. Additional Information To Be Furnished to Issuer.............................................. 3
4. Independence of CITSF Administrator........................................................... 3
5. No Joint Venture.............................................................................. 3
6. Other Activities of CITSF Administrator....................................................... 3
7. Term of Agreement............................................................................. 4
8. Action upon Termination....................................................................... 5
9. Notices....................................................................................... 5
10. Amendments.................................................................................... 6
11. Successors and Assigns........................................................................ 7
12. GOVERNING LAW................................................................................. 7
13. Headings...................................................................................... 7
14. Counterparts.................................................................................. 7
15. Severability.................................................................................. 7
16. Not Applicable to The CIT Group/Sales Financing,
Inc. in Other Capacities...................................................................... 7
17. Limitation of Liability of Owner Trustee, Indenture
Trustee and CITSF Administrator............................................................... 8
18. Third-Party Beneficiary....................................................................... 8
19. Nonpetition Covenants......................................................................... 9
20. Liability of CITSF Administrator.............................................................. 9
21. Indemnity..................................................................................... 9
</TABLE>
EXHIBIT A - Form of Power of Attorney
<PAGE>
CITSF ADMINISTRATION AGREEMENT, dated as of September 1, 1997, among
CHASE MANHATTAN RV OWNER TRUST 1997-A, a Delaware business trust (the "Issuer"),
THE CIT GROUP/SALES FINANCING, INC., a Delaware corporation, as administrator
(the "CITSF Administrator"), and NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION, a
national banking association, not in its individual capacity but solely as
Indenture Trustee (the "Indenture Trustee").
W I T N E S S E T H :
WHEREAS the Issuer is issuing the Class A-1 [____]% Asset Backed Notes
(the "Class A-1 Notes"), the Class A-2 [____]% Asset Backed Notes (the "Class
A-2 Notes"), the Class A-3 [____]% Asset Backed Notes (the "Class A-3 Notes"),
the Class A-4 [____]% Asset Backed Notes (the "Class A-4 Notes"), the Class A-5
[____]% Asset Backed Notes (the "Class A-5 Notes"), the Class A-6 [____]% Asset
Backed Notes (the "Class A-6 Notes"), the Class A-7 [____]% Asset Backed Notes
(the "Class A-7 Notes"), the Class A-8 [____]% Asset Backed Notes (the "Class
A-8 Notes"), the Class A-9 [____]% Asset Backed Notes (the "Class A-9 Notes"),
and the Class A-10 [____]% Asset Backed Notes (the "Class A-10 Notes" and,
together with the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes,
Class A-4 Notes, the Class A-5 Notes, the Class A-6 Notes, the Class A-7 Notes,
the Class A-8 Notes and the Class A-9 Notes, the "Notes") pursuant to the
Indenture dated as of September 1, 1997 (as amended, modified or supplemented
from time to time in accordance with the provisions thereof, the "Indenture"),
between the Issuer and the Indenture Trustee and the [____]% Asset Backed
Certificates (the "Certificates") pursuant to the Trust Agreement dated as of
September 1, 1997 (as amended, modified or supplemented from time to time in
accordance with the provisions thereof, the "Trust Agreement") among Chase USA
and Chase (as defined below), as Depositors, and Wilmington Trust Company, as
owner trustee (the "Owner Trustee").
WHEREAS the Issuer has entered into certain agreements in connection
with the issuance of the Notes and the Certificates, including (i) a Sale and
Servicing Agreement dated as of September 1, 1997 (the "Sale and Servicing
Agreement") (capitalized terms used herein and not defined herein shall have the
meanings assigned such terms in the Sale and Servicing Agreement) among the
Issuer, Chase Manhattan Bank USA, N.A. ("Chase USA"), as a Seller, The Chase
Manhattan Bank ("Chase"), as a Seller, and The CIT Group/Sales Financing, Inc.,
as Servicer, (ii) the Trust Agreement and (iii) the Indenture (the Sale and
Servicing Agreement, the Trust Agreement and the Indenture being hereinafter
referred to collectively as the "Related Agreements");
WHEREAS pursuant to the Related Agreements, the Issuer and the Owner
Trustee are required to perform certain duties in connection with (a) the Notes
and the collateral pledged therefor pursuant to the Indenture (the "Collateral")
and (b) the Certificates;
<PAGE>
WHEREAS the Issuer desires to have the CITSF Administrator perform
certain of the duties of the Issuer and the Owner Trustee referred to herein,
and to provide such additional services consistent with the terms of this
Agreement and the Related Agreements as the Issuer may from time to time
request;
WHEREAS the CITSF Administrator has the capacity to provide the
services required hereby and is willing to perform such services for the Issuer
and the Owner Trustee on the terms set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:
1. Duties of CITSF Administrator. (a) Duties with Respect to the
Related Agreements. (i) Subsequent to the Closing Date and subject to the
cooperation of the Owner Trustee, to the extent such cooperation is necessary to
take any such action, the CITSF Administrator shall take all appropriate action
that it is the duty of the Issuer or the Owner Trustee to take pursuant to the
following provisions of the Indenture:
(A) the preparation, obtaining or filing of the
instruments, opinions and certificates and other documents
required for the release of collateral (Section 2.9);
(B) the preparation of all supplements, amendments, financing
statements, continuation statements, if any, instruments of further
assurance and other instruments, in accordance with Section 3.5 of
the Indenture, necessary to protect the Trust Estate (Section 3.5);
(C) the annual delivery of Opinions of Counsel, in accordance
with Section 3.6(b) of the Indenture, as to the Trust Estate, and the
annual delivery of the Officers' Certificate and certain other
statements, in accordance with Section 3.9 of the Indenture, as to
compliance with the Indenture (Sections 3.6 and 3.9);
(D) the preparation and obtaining of documents and
instruments required for the release of the Issuer from its
obligation under the Indenture (Section 3.11(b));
(E) the preparation of an Officers' Certificate and
the obtaining of the Opinion of Counsel and the Independent Certificate
relating thereto (Section 4.1);
(F) the compliance with any written directive of the Indenture
Trustee with respect to the sale of the Trust Estate in any manner
permitted by law if an Event of Default shall have occurred and be
continuing, to the extent the CITSF Administrator is the practicable
party to take such action and is indemnified for any losses and
expenses in connection therewith (Section 5.4);
<PAGE>
(G) the obtaining of an Officers' Certificate, Opinion of
Counsel and Independent Certificates, if necessary, for the release of
the Trust Estate as defined in the Indenture (Sections 8.4 and 8.5);
(H) the preparation of all Officers' Certificates, Opinions of
Counsel and Independent Certificates with respect to any requests by
the Issuer to the Indenture Trustee to take any action under the
Indenture (Section 11.1(a));
(I) the preparation and delivery of Officers' Certificates and
the obtaining of Independent Certificates, if necessary, for the
release of property from the lien of the Indenture (Section 11.1(b)).
(b) In furtherance of CITSF's obligations set forth in clause (B)
above, the Owner Trustee shall, on behalf of the Issuer, execute and
deliver to the CITSF Administrator, and to each successor CITSF
Administrator appointed pursuant to the terms hereof, one or more
powers of attorney substantially in the form of Exhibit A hereto,
appointing the CITSF Administrator the attorney-in-fact of the Issuer
for the purpose of executing on behalf of the Issuer all such
supplements, amendments, financing statements, continuation statements,
instruments of further assurance and other instruments.
2. Compensation. Compensation for the performance of the CITSF
Administrator's obligations under this Agreement shall be included in the
Servicing Fee.
3. Additional Information To Be Furnished to Issuer. The CITSF
Administrator shall furnish to the Issuer from time to time such additional
information regarding the Collateral as the Issuer shall reasonably request.
4. Independence of CITSF Administrator. For all purposes of this
Agreement, the CITSF Administrator shall be an independent contractor and shall
not be subject to the supervision of the Issuer or the Owner Trustee with
respect to the manner in which it accomplishes the performance of its
obligations hereunder. Unless expressly authorized by the Issuer or the Owner
Trustee, as the case may be, the CITSF Administrator shall have no authority to
act for or represent the Issuer or the Owner Trustee in any way and shall not
otherwise be deemed an agent of the Issuer or the Owner Trustee.
5. No Joint Venture. Nothing contained in this Agreement shall (i)
constitute the CITSF Administrator and either of the Issuer or the Owner Trustee
as members of any partnership, joint venture, association, syndicate,
unincorporated business or other separate entity or (ii) be construed to impose
any liability as such on any of them.
6. Other Activities of CITSF Administrator. (a) Nothing herein shall
prevent the CITSF Administrator or its affiliates from engaging in other
businesses or, in its sole discretion, from acting in a similar capacity as an
administrator for any other person or entity even though such person or entity
may engage in business activities similar to those of the Issuer, the Owner
Trustee or the Indenture Trustee.
(b) The CITSF Administrator and its affiliates may generally
engage in any kind of business with any person party to a Related
<PAGE>
Agreement, any of its affiliates and any person who may do business with or own
securities of any such person or any of its affiliates, without any duty to
account therefor to the Issuer, the Owner Trustee or the Indenture Trustee.
7. Term of Agreement. (a) This Agreement shall continue in force until
the earlier of (i) the dissolution of the Issuer or (ii) the termination of the
Servicer under the Sale and Servicing Agreement, upon which event this Agreement
shall automatically terminate.
(b) Subject to Sections 8(c) and (d), the Issuer may remove the CITSF
Administrator without cause by providing the CITSF Administrator with at least
60 days' prior written notice.
(c) No termination of the CITSF Administrator pursuant to this Section
shall be effective until (i) a successor CITSF Administrator shall have been
appointed by the Issuer and (ii) such successor CITSF Administrator shall have
agreed in writing to be bound by the terms of this Agreement in the same manner
as the CITSF Administrator is bound hereunder.
(d) The appointment of any successor CITSF Administrator shall be
effective only after receipt of written confirmation from each Rating Agency
that the proposed appointment will not result in the qualification, downgrading
or withdrawal of any rating assigned to the Notes and Certificates by such
Rating Agency.
(e) Upon the termination of the CITSF Administrator pursuant to Section
8(a)(ii), Chase shall be the successor in all respects to the CITSF
Administrator in its capacity as Administrator under this Agreement, and shall
be subject to all the responsibilities, duties and liabilities arising
thereafter relating thereto placed on the CITSF Administrator by the terms and
provisions of this Agreement. As compensation therefor, Chase shall be entitled
to reasonable compensation from the Servicer.
(f) A successor CITSF Administrator shall execute, acknowledge and
deliver a written acceptance of its appointment hereunder to the predecessor
CITSF Administrator and to the Issuer. Thereupon the termination of the
predecessor CITSF Administrator shall become effective, and the successor CITSF
Administrator shall have all the rights, powers and duties of the CITSF
Administrator under this Agreement. The successor CITSF Administrator shall mail
a notice of its succession to the Noteholders and the Certificateholders. The
predecessor CITSF Administrator shall promptly transfer or cause to be
transferred all property and any related agreements, documents and statements
held by it as CITSF Administrator to the successor CITSF Administrator and the
predecessor CITSF Administrator shall execute and deliver such instruments and
do other things as may reasonably be required for fully and certainly vesting in
the successor CITSF Administrator all rights, powers, duties and obligations
hereunder.
(g) In no event shall a predecessor CITSF Administrator be liable for
the acts or omissions of any successor CITSF Administrator hereunder.
(h) In the exercise or administration of its duties hereunder and under
the Related Documents, the CITSF Administrator may act directly or through its
agents or attorneys pursuant to agreements entered into with any of them, and
the CITSF Administrator shall not be liable for the conduct or misconduct of
such agents or attorneys if such agents or attorneys shall have been selected by
the CITSF Administrator with due care.
<PAGE>
8. Action upon Termination. Promptly upon the effective date of
termination of this Agreement pursuant to Section 8(a) or the removal of the
CITSF Administrator pursuant to Section 8(b), the CITSF Administrator
shall be entitled to be paid all fees and reimbursable expenses accruing to it
to the date of such termination, if any. The CITSF Administrator shall forthwith
upon termination pursuant to Section 8(a)(i) deliver to the Issuer all
property and documents of or relating to the Collateral then in the custody of
the CITSF Administrator. In the event of the termination or removal of the
CITSF Administrator pursuant to Section 8(a)(ii) or (b), respectively, the
CITSF Administrator shall cooperate with the Issuer and take all reasonable
steps requested to assist the Issuer in making an orderly transfer of the duties
of the CITSF Administrator.
9. Notices. Any notice, report or other communication given hereunder
shall be in writing and addressed as follows:
(a) if to the Issuer or the Owner Trustee, to
Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attention: Corporate Trust Administration
with copies to:
(i) Chase Manhattan Bank USA, National Association
802 Delaware Avenue
Wilmington, Delaware 19801
Attention:
(ii) The Chase Manhattan Bank
270 Park Avenue
New York, New York 10017
(iii) The CIT Group/Sales Financing, Inc.
650 CIT Drive
Livingston, New Jersey 07039
Attention: President
(b) if to the CITSF Administrator, to
The CIT Group/Sales Financing, Inc.
650 CIT Drive
Livingston, New Jersey 07039
Attention: President
<PAGE>
(c) if to the Indenture Trustee, to
Norwest Bank Minnesota,
National Association
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479-0070
Attention: Asset-Backed Securities
(d) if to the Sellers, to
(i) Chase Manhattan Bank USA, National Association
802 Delaware Avenue
Wilmington, Delaware 19801
Attention:
(ii) The Chase Manhattan Bank
270 Park Avenue
New York, New York 10017
Attention:
or to such other address as any party shall have provided to the other parties
in writing. Any notice required to be in writing hereunder shall be deemed given
if such notice is mailed by certified mail, postage prepaid, or hand-delivered
to the address of such party as provided above, except that notices to the
Indenture Trustee are effective only upon receipt.
10. Amendments. This Agreement may be amended from time to time by a
written amendment duly executed and delivered by the Issuer, the CITSF
Administrator and the Indenture Trustee, with the written consent of the Owner
Trustee and without the consent of the Noteholders and the Certificateholders,
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Noteholders or Certificateholders; provided that such
amendment will not, as evidenced by an Opinion of Counsel, materially adversely
affect the interest of any Noteholder or Certificateholder. This Agreement may
also be amended by the Issuer, the CITSF Administrator and the Indenture Trustee
with the written consent of the Owner Trustee and the holders of Notes
evidencing a majority in the Outstanding Amount of the Notes and the holders of
Certificates representing a majority of the Certificate Balance then outstanding
for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of Noteholders or the Certificateholders; provided, however,
that no such amendment may (i) increase or reduce in any manner the amount of,
or accelerate or delay the timing of, collections of payments on Receivables or
distributions that are required to be made for the benefit of the Noteholders or
Certificateholders or (ii) reduce the aforesaid percentage of the holders of
Notes and Certificates which are required to consent to any such amendment,
<PAGE>
without the consent of the holders of all the outstanding Notes and
Certificates. Notwithstanding the foregoing, the CITSF Administrator may not
amend this Agreement without the permission of each Seller, which permission
shall not be unreasonably withheld.
11. Successors and Assigns. This Agreement may not be assigned by the
CITSF Administrator unless such assignment is previously consented to in writing
by the Issuer, the Sellers and the Owner Trustee and subject to receipt by the
Owner Trustee of written confirmation from each Rating Agency that such
assignment will not result in the qualification, downgrading or withdrawal of
any rating assigned to the Notes and Certificates by such Rating Agency in
respect thereof. An assignment with such consent and satisfaction, if accepted
by the assignee, shall bind the assignee hereunder in the same manner as the
CITSF Administrator is bound hereunder. Notwithstanding the foregoing, this
Agreement may be assigned by the CITSF Administrator without the consent of the
Issuer or the Owner Trustee to a corporation or other organization that is a
successor (by merger, consolidation or purchase of assets) to the CITSF
Administrator, provided that such successor organization executes and delivers
to the Issuer, the Owner Trustee and the Indenture Trustee an agreement in which
such corporation or other organization agrees to be bound hereunder by the terms
of said assignment in the same manner as the CITSF Administrator is bound
hereunder. Subject to the foregoing, this Agreement shall bind any successors or
assigns of the parties hereto.
12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAWS
PROVISIONS AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
13. Headings. The section headings hereof have been inserted for
convenience of reference only and shall not be construed to affect the meaning,
construction or effect of this Agreement.
14. Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but one
and the same agreement.
15. Severability. Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.
<PAGE>
16. Not Applicable CITSF in Other Capacities. Nothing in this
Agreement shall affect any obligation CITSF may have in any other capacity.
17. Limitation of Liability of Owner Trustee, Indenture Trustee and
CITSF Administrator. (a) Notwithstanding anything contained herein to the
contrary, this instrument has been signed by Wilmington Trust Company not in its
individual capacity but solely in its capacity as Owner Trustee of the Issuer
and in no event shall Wilmington Trust Company in its individual capacity or any
beneficial owner of the Issuer have any liability for the representations,
warranties, covenants, agreements or other obligations of the Issuer hereunder,
as to all of which recourse shall be had solely to the assets of the Issuer. For
all purposes of this Agreement, in the performance of any duties or obligations
of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to
the benefits of, the terms and provisions of Articles VI, VII and VIII of the
Trust Agreement.
(b) Notwithstanding anything contained herein to the contrary, this
Agreement has been signed by Norwest Bank Minnesota, National Association, not
in its individual capacity but solely as Indenture Trustee, and in no event
shall Norwest Bank Minnesota, National Association have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the assets
of the Issuer.
(c) No recourse under any obligation, covenant or agreement of the
Issuer contained in this Agreement shall be had against the CITSF Administrator
as such by the enforcement of any assessment or by any legal or equitable
proceeding, by virtue of any statute or otherwise; it being expressly agreed and
understood that this Agreement is solely an obligation of the Issuer as a
Delaware business trust, and that no personal liability whatever shall attach to
or be incurred by the CITSF Administrator, as such, under or by reason of any of
the obligations, covenants or agreements of the Issuer contained in this
Agreement, or implied therefrom, and that any and all personal liability for
breaches by the Issuer of any such obligations, covenants or agreements, either
at common law or at equity, or by statute or constitution, of the CITSF
Administrator is hereby expressly waived as a condition of and in consideration
for the execution of this Agreement.
18. Third-Party Beneficiary. Each of the Sellers (to the extent
provided in Sections 8, 11 and 12) and the Owner Trustee is a third-party
beneficiary to this Agreement and is entitled to the rights and benefits
hereunder and may enforce the provisions hereof as if it were a party hereto.
<PAGE>
19. Nonpetition Covenants. Notwithstanding any prior termination of
this Agreement, the CITSF Administrator and the Indenture Trustee shall not,
prior to the date which is one year and one day after the termination of this
Agreement with respect to the Issuer, acquiesce, petition or otherwise invoke or
cause the Issuer to invoke the process of any court of government authority for
the purpose of commencing or sustaining a case against the Issuer under any
Federal or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Issuer or any substantial part of its property, or ordering the winding
up or liquidation of the affairs of the Issuer.
20. Liability of CITSF Administrator. Notwithstanding any provision of
this Agreement, the CITSF Administrator shall not have any obligations under
this Agreement other than those specifically set forth herein, and no implied
obligations of the CITSF Administrator shall be read into this Agreement.
Neither the CITSF Administrator nor any of its directors, officers, agents or
employees shall be liable for any action taken or omitted to be taken in good
faith by it or them under or in connection with this Agreement, except for its
or their own gross negligence or willful misconduct and in no event shall the
CITSF Administrator be liable under or in connection with this Agreement for
indirect, special, or consequential losses or damages of any kind, including
lost profits, even if advised of the possibility thereof and regardless of the
form of action by which such losses or damages may be claimed. Without limiting
the foregoing, the CITSF Administrator may (a) consult with legal counsel
(including counsel for the Issuer), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts and (b) shall incur no liability under or in respect of
this Agreement by acting upon any notice (including notice by telephone),
consent, certificate or other instrument or writing (which may be by facsimile)
believed by it to be genuine and signed or sent by the proper party or parties.
21. Indemnity. The CITSF Administrator shall indemnify, defend, and
hold harmless the Owner Trustee, the Indenture Trustee, the Issuer, the Sellers,
the Certificateholders and the Noteholders from and against all costs, expenses,
losses, claims, damages, and liabilities to the extent that such cost, expense,
loss, claim, damage, or liability arose out of, or was imposed upon such
Persons, through the willful misfeasance, gross negligence, or bad faith of the
CITSF Administrator in the performance of its duties under this Agreement or by
reason of reckless disregard of its obligations and duties under this Agreement.
Indemnification under this Section 21 shall include reasonable
fees and expenses of counsel in any litigation appointed by the CITSF
Administrator and reasonably satisfactory to the
<PAGE>
indemnitee; provided that the CITSF Administrator shall only be required to pay
the fees and expenses of one counsel in any single litigation (or related
proceedings) for all indemnities; provided, however, if in the written opinion
of counsel reasonably satisfactory to the CITSF Administrator, the interests of
an indemnitee and the CITSF Administrator conflict such that the CITSF
Administrator and such indemnitee may not both be represented by such counsel,
upon ten days prior written notice to the CITSF Administrator, such indemnitee
may hire one other counsel and the indemnification under this Section 21 shall
also include the reasonable fees and expenses of such other counsel. If the
CITSF Administrator shall have made any indemnity payments, pursuant to this
Section 21 and the recipient thereafter collects any of such amounts from
others, the recipient shall promptly repay such amounts to the CITSF
Administrator without interest. The indemnities under this Section 21 shall
survive the resignation or removal of an indemnitee, or the termination of the
Trust Agreement and this Agreement.
The Issuer shall indemnify, defend, and hold harmless from
and against, and pay to the CITSF Administrator all reasonable costs, expenses,
losses, claims, damages, and liabilities arising out of or incurred in
connection with the acceptance or performance of the duties herein contained in
accordance with the terms and conditions herein and in the Related Documents,
except to the extent that such costs, expense, loss, claim, damage or liability:
(i) shall be due to the willful misfeasance, gross negligence or bad faith of
the CITSF Administrator; (ii) relates to any tax other than the taxes with
respect to which the CITSF Administrator shall be otherwise indemnified pursuant
to this Agreement; (iii) breach of any of its covenants set forth in the Related
Documents; or (iv) shall be one as to which the CITSF Administrator is required
to indemnify the Issuer. Any amounts due the CITSF Administrator pursuant to
this Section 21 shall be payable only to the CITSF Administrator from the
Reserve Account pursuant to Section 5.6(d) and Section 9.1(b) of the Sale and
Servicing Agreement.
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first above written.
CHASE MANHATTAN RV OWNER TRUST
1997-A
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee,
By:
----------------------------------
Name:
Title:
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION,
not in its individual
capacity but solely as
Indenture Trustee,
By:
----------------------------------
Name: Marianna Stershic
Title: Assistant Vice-President
THE CIT GROUP/SALES FINANCING, INC.
as CITSF Administrator,
By:
----------------------------------
Name:
Title:
<PAGE>
EXHIBIT A
[Form of Power of Attorney]
POWER OF ATTORNEY
STATE OF NEW YORK )
)
COUNTY OF NEW YORK )
KNOW ALL MEN BY THESE PRESENTS, that Wilmington Trust Company, a
Delaware banking corporation, not in its individual capacity but solely as owner
trustee ("Owner Trustee") for Chase Manhattan RV Owner Trust 1997-A ("Trust"),
does hereby make, constitute and appoint THE CIT GROUP/SALES FINANCING, INC., as
CITSF Administrator under the Administration Agreement (as defined below), and
its agents and attorneys, as Attorneys-in-Fact to execute on behalf of the Owner
Trustee or the Trust all such supplements, amendments, financing statements,
continuation statements, instruments of further assurance and other instruments
as it shall be the duty of the Trust to prepare, file or deliver to protect the
Trust Estate (as defined in the Administration Agreement) pursuant to the
Indenture (as defined in the Administration Agreement). For the purpose of this
Power of Attorney, the term "Administration Agreement" means the CITSF
Administration Agreement, dated as of September 1, 1997, among the Trust, The
CIT Group/Sales Financing, Inc., as CITSF Administrator, and Norwest Bank
Minnesota, National Association, as Indenture Trustee, as such may be amended
from time to time.
All powers of attorney for this purpose heretofore filed or executed
by the Owner Trustee are hereby revoked.
EXECUTED this ____ day of _______, 199_.
WILMINGTON TRUST COMPANY,
not in its individual capacity but
solely as Owner Trustee
By:
----------------------------------
Name:
Title:
<PAGE>
(212) 455-2000
September 17, 1997
Chase Manhattan Bank USA, National Association
802 Delaware Avenue
Wilmington, Delaware 19801
The Chase Manhattan Bank
270 Park Avenue
New York, New York 10001
Ladies and Gentlemen:
We have acted as counsel to Chase Manhattan Bank USA, National
Association, a national banking association, and The Chase Manhattan Bank, a New
York banking corporation (collectively, the "Registrants"), in connection with
their filing with the Securities and Exchange Commission (the "Commission")
under the Securities Act of 1933, as amended, of a Registration Statement on
Form S-3 (the "Registration Statement"), registering (i) $44,895,285.54
aggregate amount of Asset Backed Certificates (the "Certificates") to be issued
by Chase Manhattan RV Owner Trust 1997- A (the "Trust"), a Delaware business
trust initially formed pursuant to a Trust Agreement dated as of July 18, 1997
among the Registrants and Wilmington Trust Company, as the owner trustee (the
"Owner Trustee"), to be amended and restated by a Trust Agreement to be dated as
of September 1, 1997 among the Registrants and the Owner Trustee, substantially
in the form filed as Exhibit 4.3(B) to the Registration Statement (the "Trust
Agreement"), (ii) $59,500,000 aggregate principal amount of Class A-1 Asset
Backed Notes (the "Class A-1 Notes"), (iii) $119,000,000 aggregate principal
amount of Class A-2 Asset Backed Notes (the "Class A-2 Notes"), (iv)
$113,000,000 aggregate principal amount of Class A-3 Asset Backed Notes (the
"Class A-3 Notes"), (v) $73,000,000 aggregate principal amount of Class A-4
Asset Backed Notes (the "Class A-4 Notes"), (vi) $132,000,000 aggregate
principal amount of Class A-5 Asset Backed
<PAGE>
Chase Manhattan Bank USA,
National Association -2- September 17, 1997
The Chase Manhattan Bank
Notes (the "Class A-5 Notes"), (vii) $88,000,000 aggregate principal amount of
Class A-6 Asset Backed Notes (the "Class A-6 Notes"), (viii) $57,000,000
aggregate principal amount of Class A-7 Asset Backed Notes (the "Class A-7 Asset
Backed Notes"), (ix) $85,000,000 aggregate principal amount of Class A-8
Notes (the Class A-8 Notes), (x) $61,000,000 aggregate principal amount of
Class A-9 Notes (the "Class A-9 Notes") and (xi) $65,000,000 aggregate
principal amount of Class A-10 Notes (the "Class A-10 Notes"; and together with
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, the Class A-6 Notes, the Class A-7 Notes, the Class
A-8 Notes and the Class A-9 Notes, the "Notes"), to be issued pursuant to an
Indenture to be dated as of September 1, 1997 between the Trust and Norwest Bank
Minnesota, National Association, as indenture trustee, substantially in the form
filed as Exhibit 4.2 to the Registration Statement (the "Indenture"). The
Certificates will be sold pursuant to the terms of a Certificate Underwriting
Agreement, among the Registrants and Chase Securities Inc., substantially in the
form filed as Exhibit 1.1(B) to the Registration Statement (the "Certificate
Underwriting Agreement"). The Notes will be sold pursuant to the terms of the
Note Underwriting Agreement, among the Registrants and the underwriters named in
Schedule I thereto, substantially in the form filed as Exhibit 1.1(A) to the
Registration Statement (the "Note Underwriting Agreement"). The Notes and the
Certificates are hereinafter collectively referred to as the "Offered
Securities."
In that connection, we have examined the Trust Agreement, the
Indenture, the Certificate Underwriting Agreement and the Note Underwriting
Agreement. In addition, we have examined and relied as to matters of fact upon,
originals or copies, certified or otherwise identified to our satisfaction, of
such corporate records, agreements, documents, and other instruments and such
certificates or comparable documents of public officials and of officers and
representatives of the Registrants, and have made such other and further
investigations, as we have deemed relevant and necessary as a basis for the
opinions hereinafter set forth.
In such examination, we have assumed the genuineness of all
signatures, the legal capacity of natural persons, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified or photostatic copies, and the
authenticity of the originals of such latter documents.
Based upon the foregoing, we are of the opinion that:
1. When the Trust Agreement has been duly authorized, executed
and delivered by the Registrants and the Owner Trustee, the Trust
Agreement will
<PAGE>
Chase Manhattan Bank USA,
National Association -3- September 17, 1997
The Chase Manhattan Bank
constitute a valid and legally binding obligation of the Registrants
enforceable against the Registrants in accordance with its terms.
2. When the issuance and terms of the Certificates have been duly
authorized by the Registrants, when the Certificates have been duly
executed and authenticated in accordance with the terms of the Trust
Agreement and when the Certificates have been delivered and sold in
accordance with the provisions of the Certificate Underwriting Agreement
as contemplated by the Registration Statement, upon payment of the
consideration therefor provided for therein, the Certificates will be
legally issued, fully paid and non-assessable and outstanding and
entitled to the benefits provided for by the Trust Agreement.
3. When the Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended, the issuance and terms of the Notes
have been duly authorized by the Registrants, when the Notes have been
duly executed and authenticated in accordance with the terms of the
Indenture, and when the Notes have been delivered and sold in accordance
with the provisions of the Note Underwriting Agreement as contemplated
by the Registration Statement, upon payment of the consideration
therefor provided for therein, the Notes will constitute valid and
legally binding obligations of the Trust, enforceable against the Trust
in accordance with their terms.
Our opinions are subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
We are members of the Bar of the State of New York, and we do not
express any opinion herein concerning any law other than the law of the State of
New York and the Federal law of the United States.
<PAGE>
Chase Manhattan Bank USA,
National Association -4- September 17, 1997
The Chase Manhattan Bank
We hereby consent to the use of our name under the heading "Legal
Matters" in the Prospectus and to the use of this opinion for filing with the
Registration Statement as Exhibit 5.1 thereto.
Very truly yours,
/s/ Simpson Thacher & Bartlett
------------------------------
SIMPSON THACHER & BARTLETT
<PAGE>
September 17, 1997
Chase Manhattan Bank, USA, National
Association
802 Delaware Avenue
Wilmington, Delaware 19801
The Chase Manhattan Bank
270 Park Avenue
New York, New York 10017
Re: The Issuance and Sale of $852,500,000 of Asset
Backed Notes, $44,895,285.54 of
Asset Backed Certificates by Chase Manhattan
RV Owner Trust 1997-A
Ladies and Gentlemen:
We have acted as tax counsel ("Federal Tax Counsel") for Chase
Manhattan Bank USA, National Association, a national banking association
organized under the laws of the United States, and The Chase Manhattan Bank, a
New York banking corporation (together, the "Sellers"), in connection with the
preparation and filing by the Sellers with the Securities and Exchange
Commission (the "Commission") of a Registration Statement on Form S-3
(Registration No. 333-32263) as amended (the "Registration Statement") and in
connection with the issuance and sale of (i) $59,500,000 of Class A-1 Asset
Backed Notes, (ii) $119,000,000 of Class A-2 Asset Backed Notes, (iii)
$113,000,000 of Class A-3 Asset Backed Notes, (iv) $73,000,000 of
Class A-4 Asset Backed Notes, (v) $132,000,000 of Class A-5 Asset Backed Notes,
(vi) $88,000,000 of Class A-6 Asset Backed Notes, (vii) $57,000,000 of Class A-7
Asset Backed Notes, (viii) $85,000,000 of Class A-8 Asset Backed Notes, (ix)
$61,000,000 of Class A-9 Asset Backed Notes, (x) $65,000,000 of Class A-10 Asset
Backed Notes (collectively, the "Notes") and (xi) $44,895,285.54 of Asset Backed
Certificates (the "Certificates" and, together with the Notes, the
"Securities"), by Chase Manhattan RV Owner Trust 1997-A, a statutory business
trust organized under the Business Trust Act of the State of Delaware (the
"Trust"), pursuant to: (a) with respect to the Notes, the Indenture, dated as of
September 1, 1997 (the "Indenture"), between the Trust and Norwest Bank
Minnesota, National Association, as
<PAGE>
-2- September 17, 1997
trustee (the "Indenture Trustee"); and (b) with respect to the Certificates, the
Trust Agreement, dated as of September 1, 1997 (the "Trust Agreement"), among
the Sellers and the Wilmington Trust Company, as owner trustee (the "Owner
Trustee"). The Securities will be offered for sale to investors pursuant to the
Registration Statement.
All capitalized terms used in this opinion letter and not
otherwise defined herein shall have the meaning assigned to such terms in the
Registration Statement.
In delivering this opinion, we have reviewed: (i) the
Registration Statement, (ii) the Indenture, (iii) the Trust Agreement, (iv) the
Sale and Servicing Agreement, dated as of September 1, 1997 (the "Sale and
Servicing Agreement"), among the Sellers, CIT Group/Sales Financing, Inc. and
the Trust and (v) forms of the Securities. We also have examined such other
documents, papers, statutes and authorities as we have deemed necessary to form
the basis for the opinions expressed herein.
In our examination of such material, we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals and the conformity to original documents of copies of documents
submitted to us. As to certain matters of fact relevant to the opinions
hereinafter expressed, we have relied upon the representations and warranties
set forth in the Indenture, the Trust Agreement and the Sale and Servicing
Agreement.
On the basis of the foregoing and assuming, with your permission,
that (i) the Trust is formed and maintained in accordance with the discussion
set forth in the Registration Statement and is operated in compliance with the
terms of the Trust Agreement, (ii) the terms of the Indenture, the Trust
Agreement and the Sale and Servicing Agreement are not amended, and (iii) the
aggregate amount of the Administrative Fees received or accrued each year by the
Trust on, or with respect to, the Receivables will be equal to, or less than,
five percent (5%) of the aggregate amount of the Administrative Fees and
interest or other income accrued or received by the Trust on, or with respect
to, the Receivables each such year, we hereby confirm (a) our opinions set forth
in the Registration Statement under the caption "Certain Federal Income Tax
Consequences" and (b) that, subject to the qualifications set forth therein, the
discussion set forth in the Registration Statement under the caption "Certain
Federal Income Tax Consequences" is an accurate summary of the United States
federal income tax matters described therein.
We express no opinion with respect to the transactions referred
to herein and in the Registration Statement other than as expressly set forth
herein. Our opinions are not binding on the Internal Revenue Service ("IRS")
and the IRS could disagree with the opinions expressed herein. Although we
believe that the opinions we express herein would be sustained if challenged,
there can be no assurance that this will be the case.
<PAGE>
-3- September 17, 1997
Our opinions are based upon the Code, the Treasury regulations
promulgated thereunder and other relevant authorities and law, all as in effect
on the date hereof. Consequently, future changes in the law may cause the tax
treatment of the transactions referred to herein to be materially different from
that described above.
We are members of the Bar of the State of New York, and we do not
express any opinion herein concerning any law other than the federal law of the
United States.
This opinion letter is rendered to you in connection with the
above-described transactions. This opinion may not be relied upon by you for any
other purpose or relied upon by, or furnished to, any other person, firm or
corporation without our prior written consent. We hereby consent to the use of
this opinion for filing as Exhibit 8.1 to the Registration Statement.
Very truly yours,
/s/ Simpson Thacher & Bartlett
Simpson Thacher & Bartlett
<PAGE>
September 17, 1997
The Chase Manhattan Corporation
Treasury
270 Park Avenue, 28th Floor
New York, New York 10017
Re: CHASE MANHATTAN RV OWNER TRUST 1997-A
Ladies and Gentlemen:
For the purpose of the sale of Asset-Backed Notes and
Asset-Backed Certificates issued by the Chase Manhattan RV Owner Trust 1997-A
(the "Trust"), we have acted as Oklahoma tax counsel for you and the Trust
regarding the anticipated Oklahoma income tax characterization of the Trust.
This letter is pursuant to your request that we advise The
Chase Manhattan Corporation regarding the likely characterization under Oklahoma
income tax law of the Trust. We understand the Trust will purchase RV notes
and/or chattel paper from Chase Manhattan Bank USA, National Association and The
Chase Manhattan Bank, a New York Banking Corporation.
In furnishing this opinion, we have examined copies of the
following documents:
(i) Amendment to the Registration Statement of
Chase Manhattan RV Owner Trust 1997-A;
(ii) Registration Statement of Chase Manhattan RV
Owner Trust 1997-A filed with the Securities
and Exchange Commission on July 29, 1997;
(iii) Chase Manhattan RV Owner Trust 1997-A Amended
and Restated Trust Agreement among Chase
Manhattan Bank USA, National Association
<PAGE>
The Chase Manhattan Corporation
September 17, 1997
Page 2
and The Chase Manhattan Bank, as Depositors;
and Wilmington Trust Company, as Owner
Trustee;
(iv) the Chase Manhattan RV Owner Trust 1997-A
Indenture;
(v) the Sale and Servicing Agreement among Chase
Manhattan Bank USA, National Association, a
National Banking Association, The Chase
Manhattan Bank, a New York Banking
Corporation, as Sellers; and The CIT
Group/Sales Financing, Inc., a Delaware
Corporation, as Servicer; and Chase
Manhattan RV Owner Trust 1997-A, as Issuer;
(vi) the Note Underwriting Agreement;
(vii) the Certificate Underwriting Agreement;
(viii) the CITSF Administration Agreement; and
(ix) the Chase Administration Agreement.
I. Assumptions and Opinion
In rendering the opinions expressed herein, we have made the
following assumptions, the accuracy of which we have not verified:
1. The Trust has been properly characterized as a nonpublicly
traded Partnership for federal income tax purposes.
2. Any Notes issued by the Trust have been properly
characterized as debt for federal income tax purposes.
Based upon the foregoing and in reliance thereon, and upon
consideration of applicable Oklahoma income tax laws, and subject to the
qualifications and limitations described below, we are of the following
opinions:
1. The Trust will be characterized as a nonpublicly traded
Partnership for purposes of Oklahoma income tax laws, and the nonpublicly
traded Partnership will not be taxed as an entity, but rather, the profits,
income, losses, and deductions of the Trust will, for income tax purposes, flow
through the Trust to the partner level. 68 Okla. Stat. ss. 2353(3) (1996 Supp.);
Oklahoma Tax Commission Rule ss. 710:50-3-35.
2. The Notes will be characterized as debt for Oklahoma
income tax purposes. 68 Okla. Stat. ss. 2353(3) (1996 Supp.); Oklahoma Tax
Commission Rule ss. 710:50-3-35. Noteholders not otherwise subject to taxation
in Oklahoma should not become subject to taxation in Oklahoma because
<PAGE>
The Chase Manhattan Corporation
September 17, 1997
Page 3
of the holder's ownership of Notes. However, a Noteholder already subject to
Oklahoma's income tax could be required to pay additional Oklahoma income tax as
a result of the holder's ownership or disposition of Notes.
II. Additional Discussion
For the purpose of this additional discussion, we have made
the following assumptions, the accuracy of which we have not verified:
1. The Trust is organized as a business trust under the laws
of Delaware. The activities of the Trust occurring within the State of Oklahoma
consist solely of the maintenance of the original notes and/or chattel paper and
of the related contract files and documents with a custodian within the State of
Oklahoma and of the activities described in Paragraph 4 below.
2. Less than ten percent (10%) of the notes and/or chattel
paper acquired by the Trust will originate in Oklahoma.
3. The Trust will acquire the notes and/or chattel paper in a
series of transactions occurring outside of Oklahoma.
4. The only activities which the Servicer, as Servicer of the
Trust, will conduct in Oklahoma is the servicing of the loans evidenced by the
notes and chattel paper including without limitation: (i) the maintenance of
custody of the notes and/or chattel paper; (ii) the maintenance of the
administrative records concerning payments and outstanding balances on the notes
and/or chattel paper; (iii) the receipt of the payments on the notes and/or
chattel paper; (iv) the deposit of the payments received on the notes and/or
chattel paper in an Oklahoma financial institution for purposes of collection;
(v) the collection activities relating to the notes and/or chattel paper; and
(vi) the repossession and sale of the collateral therefor.
As a nonpublicly traded Partnership for Oklahoma and federal
income tax purposes, the Oklahoma distributive share of the partnership income,
gains, losses or deductions of the partnership to be reported by the partners
shall be the same portion of that reported for federal income tax purposes, as
the Oklahoma income, gain, losses or deductions determined under ss.ss. 2358 and
2362 of Title 68 of the Oklahoma Statutes for said partnership, bears to the
federal income, gains, losses or deductions. 68 Okla. Stat. ss. 2363 (1991). The
Oklahoma taxable income of a nonresident includes the distributive share of the
Oklahoma part of partnership income, gains, losses or deductions. 68 Okla. Stat.
ss. 2362(4) (1996 Supp.). However, income from intangible personal property of a
nonresident of Oklahoma is generally excluded from Oklahoma taxable income
except to the extent that such income is from property employed in an Oklahoma
trade or business or from property that has acquired a nonunitary business or
commercial situs in Oklahoma. 68 Okla. Stat. ss.ss. 2358(A)(4)(b), 2362(6) (1996
Supp.). We believe it is unlikely that the Oklahoma Tax Commission would attempt
to classify the income of the Trust as Oklahoma source income or as arising from
an Oklahoma trade or business. Accordingly, a nonresident of Oklahoma should not
incur Oklahoma taxable income solely as a result of an
<PAGE>
The Chase Manhattan Corporation
September 17, 1997
Page 4
ownership interest in the Trust. However, we are not aware of any authority or
pronouncement of the Oklahoma Tax Commission or the Oklahoma courts addressing
this issue on comparable facts and no absolute assurance can be given in this
regard.
III. Qualifications and Limitations
In preparing this letter, we have reviewed Oklahoma Statutes,
Oklahoma court decisions and Oklahoma administrative rules and decisions,
generally available to the public as of the date of this letter. We have no
obligation to update or supplement this opinion to reflect any facts or
circumstances that may hereafter come to our attention or any changes in the law
that may hereafter occur which place a different interpretation on the law other
than that which has been applied herein, including interpretations of the law
whether by way of Oklahoma statutory enactments or amendments, judicial
decisions or administrative actions.
This opinion has been rendered solely for the benefit of The
Chase Manhattan Corporation and the Trust for use in the Trust's offering of the
Asset-Backed Notes and the Asset-Backed Certificates and may not be used,
circulated, quoted, relied upon or otherwise referred to for any other purpose
without our prior written consent; provided, however, that this opinion may be
delivered to your regulators, accountants, attorneys and other professional
advisers and may be used in connection with any legal or regulatory proceeding
relating to the subject matter of this opinion and the disclosure statement
entitled "Certain State Tax Consequences" included in the September 4, 1997,
draft of the Amendment to the Registration Statement may be included in the
Prospectus related to the offering. The undersigned shall not be responsible,
liable or obligated to any third party who may obtain access to this letter.
Very truly yours,
CROWE & DUNLEVY
A Professional Corporation
By: /s/James H. Holloman, Jr.
-------------------------------
James H. Holloman, Jr.
<PAGE>
AMENDED AND RESTATED SERVICING AGREEMENT
AMENDED AND RESTATED SERVICING AGREEMENT ("Agreement") dated
as of the 15th day of September, 1997, by and among THE CHASE MANHATTAN BANK, a
banking corporation organized under the laws of the State of New York and having
its principal place of business in New York, New York ("CMB"), CHASE MANHATTAN
BANK USA, NATIONAL ASSOCIATION, a banking association organized under the laws
of the United States and having its principal place of business in Wilmington,
Delaware ("CUSA"), CHASE FINANCIAL HOLDINGS, INC., an Ohio corporation with its
principal place of business in Cleveland, Ohio ("CFHI"), CHASE FINANCIAL
ACCEPTANCE CORPORATION, an Ohio corporation with its principal place of business
in Cleveland, Ohio ("CFAC," and collectively with CMB, CUSA and CFHI, "Chase"),
CHASE FINANCIAL MANAGEMENT CORPORATION, an Ohio corporation with its principal
place of business in Cleveland, Ohio (the "Chase Servicer"), and THE CIT
GROUP/SALES FINANCING, INC., a Delaware corporation ("CIT"), with offices at 650
CIT Drive, Livingston, New Jersey 07039, as servicer (the "Servicer").
RECITALS
WHEREAS, Chase, CIT and The CIT Group/Consumer Finance, Inc.
(NY) ("CITNY") entered into that certain Agreement dated as of May 9, 1997 (the
"Purchase Agreement") pursuant to which CIT and CITNY acquired from Chase
certain assets relating to its marine and recreational vehicle lending
businesses (the "Acquisition");
WHEREAS, in connection with the Acquisition, Chase, the Chase
Servicer and CIT entered into the Servicing Agreement, dated as of May 9, 1997,
as amended by Amendment No. 1 thereto, dated as of August 13, 1997 (the
"Original Servicing Agreement"), pursuant to which Chase and the Chase Servicer
retained the Servicer to service or subservice the Accounts and the Servicer
agreed to perform such services in accordance with the terms and conditions set
forth in the Original Servicing Agreement; and
WHEREAS, Chase, the Chase Servicer and CIT desire to amend and
restate the Original Servicing Agreement in its entirety as set forth in this
Agreement and the Exhibits referred to herein;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, it is agreed that the Original Servicing Agreement
is hereby amended and restated in its entirety as follows:
<PAGE>
2
ARTICLE I - DEFINITIONS
All capitalized terms not otherwise defined herein are used as
defined in the Purchase Agreement and the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
1.1. Accounts - shall mean the collective reference to the
Chase Accounts, the New Securitization Accounts and the Old Securitization
Accounts;
1.2. Account Owner - shall mean, (i) with respect to a Chase
Account, CMB, CUSA, CFAC or CFHI, as the case may be, (ii) with respect to an
Old Securitization Account, the trustee, acting on behalf of the
certificateholders, identified in the related Pooling and Servicing Agreement
and (iii) with respect to a New Securitization Account, the trustee, acting on
behalf of the certificateholders, or trust identified in the related New
Securitization Servicing Agreement;
1.3. Aggregate Losses - shall mean, with respect to any
calendar year or partial calendar year, an amount equal to (x) the sum of the
Losses for such calendar year or partial calendar year, less (y) any recoveries
(including, but not limited to, sales proceeds and insurance credits) received
during such calendar year or partial calendar year in respect of Accounts in
default in, and included in the calculation of Aggregate Losses with respect to,
any prior calendar year or partial calendar year.
1.4. Agreement - shall mean this Agreement, as the same may
be amended from time to time, and any Exhibits hereto;
1.5. Business Day - shall be any day other than (i) a Saturday
or Sunday, or (ii) a day in which banking institutions in New York, New York,
Cleveland, Ohio or Oklahoma City, Oklahoma are authorized or obligated by law or
executive order to be closed;
1.6. Chase Accounts - shall mean the collective reference to
the Retained Accounts and the Repurchase Accounts;
1.7. Loss - shall mean with regard to any Account in default
the amount obtained by adding to the principal balance of such Account (i)
accrued interest, (ii) collection and insurance charges applicable to such
Account (including, but not limited to, any expenses for which the Servicer is
reimbursed pursuant to Section 8.3 hereof), (iii) repossession and liquidation
expenses incurred in connection with such Account (including, but not limited
to, any expenses for which the Servicer is reimbursed pursuant to Section 8.3
hereof) and (iv) forbearance expenses incurred in connection with such Account,
less any recovery on such Account including, but not limited to, sales proceeds
and insurance credits. Forbearance expenses shall be deemed to include any
losses incurred in connection with a bankruptcy court ordered modification of
the terms of the Account. Accrued interest is calculated at (a) the rate
disclosed in the Account or (b) in the case of precomputed Accounts in which no
rate is disclosed, at the interest rate which the Chase Servicer would be
obligated to use in computing the unpaid principal balance pursuant to the Rule
of 78's or actuarial
<PAGE>
3
method, as applicable, in the event of prepayment by the Obligor under any such
Account, from the last day paid to the Date of Repossession. Date of
Repossession shall be the date on which the Notice of Sale is sent to the
Obligor. Repossession inventory (meaning those Accounts for which the Chase
Servicer has mailed a Notice of Sale) prior to the Transfer Date will not be
taken into consideration when calculating Losses;
1.8. New Securitization Account - shall mean each Retained
Account that is included in a New Securitization;
1.9. New Securitization Servicing Agreement - shall have the
meaning referred to in Section 4.4 hereof;
1.10. Old Securitization Account - shall mean each conditional
sales contract, retail installment sales agreement or note relating to a marine
or recreational vehicle loan, and each security agreement or preferred ship
mortgage related thereto, included in an Old Securitization;
1.11. Repurchase Account - shall mean each conditional sales
contract, retail installment sales agreement or note relating to a marine or
recreational vehicle loan, and each security agreement or preferred ship
mortgage related thereto, that was transferred by Chase in connection with an
Old Securitization, or a New Securitization or transferred to CIT or CITNY
pursuant to the Purchase Agreement and subsequently repurchased by Chase as a
result of a breach of representation and warranty made by Chase in connection
with such Old Securitization, New Securitization or the Purchase Agreement, as
the case may be;
1.12. Retained Account - shall mean each conditional sales
contract, retail installment sales agreement or note relating to a marine or
recreational vehicle loan, and each security agreement or preferred ship
mortgage related thereto, retained by Chase on or after the Closing Date, other
than (i) any such conditional sales contract, retail installment sales agreement
or note relating to a marine or recreational vehicle loan, and each security
agreement or preferred ship mortgage related thereto, transferred to CIT or
CITNY pursuant to the Purchase Agreement on the Cut-Off Date Closing Date or
(ii) any New Securitization Account.
ARTICLE II - RETENTION OF SERVICER;
SERVICER'S GENERAL OBLIGATIONS
2.1. Chase and the Chase Servicer retain the Servicer as an
independent contractor to provide the services described in this Agreement
during the term of this Agreement, and the Servicer agrees to perform such
services in accordance with the terms and conditions contained in this
Agreement.
2.2. In the performance of its duties hereunder, the Servicer
shall be an independent contractor acting on its own behalf and for its own
account. It shall have no authority, express or implied, to act in any manner or
by any means for or on behalf of Chase or the Chase Servicer in any capacity
other than as an independent contractor. It is agreed
<PAGE>
4
that the Servicer and Chase, together with the Chase Servicer, are not partners
or joint venturers, or agents or assignees of each other.
2.3. In the performance of its duties hereunder, the Servicer
shall service all Accounts in compliance with the terms of this Agreement, and
the underlying Accounts, and will comply in all material respects with all
applicable state and federal laws and regulations governing financing,
licensing, loan servicing, debt collection, credit reporting, consumer
protection, foreclosure and other disposition of collateral, and the protection
of any security interest in collateral.
2.4. Promptly after the execution and delivery of this
Agreement, the Servicer shall deliver to the Chase Servicer a list of key
officers of the Servicer that will be involved in, or responsible for, the
servicing of the Accounts, and the Chase Servicer shall deliver to the Servicer
a list of key officers and employees of the Chase Servicer who have been
authorized by Chase Servicer to receive any reports hereunder from the Servicer.
Each party shall notify the other party promptly of any changes to such list.
ARTICLE III - SERVICING OF ACCOUNTS
3.1. The Servicer shall service the Accounts with due care in
accordance with the terms of this Agreement and shall have full power and
authority, acting alone and subject only to the provisions of this Agreement and
applicable law, to do any and all things in connection with the servicing of the
Accounts that it believes to be reasonable and necessary to carry out its
obligations under this Agreement. The Servicer agrees that it shall service the
Accounts using the same standard of care that it uses to service its own loans
or credit sales secured by Boats or Recreational Vehicles, except as otherwise
specifically provided in Exhibit 3.1 hereto. The Servicer shall not make any
change to its current servicing policies and procedures which would have a
material effect on the collectibility of the Accounts, including, but not
limited to, any change to the policies and procedures set forth in Exhibit 3.1
hereto, without the prior written consent of the Chase Servicer.
3.2. The Servicer shall provide servicing of the Accounts
which will include the following: collection of principal, finance and other
charges; payment processing; payment of any applicable taxes; filing and
processing of claims under insurance policies; filing claims in bankruptcy
proceedings; making reports as set forth in Exhibit 3.1 hereto and as otherwise
reasonably required; liquidation, repossession and foreclosure; and other
services with respect to the Accounts customarily provided by servicers
servicing these types of assets.
3.3. The Chase Servicer understands and agrees that the
Servicer shall have no monetary obligation to remit to the Chase Servicer any
sums due on a Account, unless a payment is received from the Obligor, an insurer
or any other party (such as proceeds on sale of collateral) on a Account.
3.4. The Servicer shall take all actions that are necessary or
desirable to maintain continuous perfection and priority of the rights, title
and interests of the Account
<PAGE>
5
Owners (or of the originators in the case of any New Securitization Accounts) in
the Boats and Recreational Vehicles securing the Accounts, including, but not
limited to, the notation on certificates of title and the recording, filing and
refiling of all financing statements, continuation statements, preferred ship
mortgages or other instruments. In addition, if the Servicer discovers any
deficiency in the priority or perfection of the security interest in a Boat or
Recreational Vehicle constituting security for any Account or any other defect
in the documents constituting a part of any Account, which deficiency or defect
can be corrected, the Servicer shall use its best efforts to correct such
deficiency or defect.
ARTICLE IV - SUBSERVICING OF OLD SECURITIZATION ACCOUNTS;
SERVICING OF NEW SECURITIZATION ACCOUNTS
4.1. CMB and the Chase Servicer, in their respective
capacities as "Servicers" under the Pooling and Servicing Agreements, hereby
designate and appoint the Servicer as a subservicer as of the Transfer Date
under the Pooling and Servicing Agreements with respect to the Old
Securitization Accounts. The Servicer hereby agrees to perform and comply with
each and every duty and obligation of CMB or the Chase Servicer, as the case may
be, as "Servicer" under the Pooling and Servicing Agreements with respect to the
Old Securitization Accounts, except such duties and obligations which are set
forth on Exhibit 4.1 hereof as the continuing responsibilities of CMB or the
Chase Servicer. The Servicer shall have full power and authority to perform all
duties, and to exercise all rights and remedies, of CMB or the Chase Servicer,
as the case may be, as Servicer under the Pooling and Servicing Agreements,
except for such duties, rights and remedies as are reserved for CMB or the Chase
Servicer as set forth on Exhibit 4.1 hereof.
4.2. CMB and the Chase Servicer, in their respective
capacities as "Servicers" under the Pooling and Servicing Agreements with
respect to the Old Securitization Accounts, hereby agree that neither shall
consent to any material change to the provisions of the Pooling and Servicing
Agreements to which it is a party relating to the servicing of the Old
Securitization Accounts without the prior written consent of the Servicer, which
such consent shall not be unreasonably withheld.
4.3. In the event that the Servicer shall fail to perform any
obligation or satisfy any liability undertaken or assumed by the Servicer
hereunder, CMB or the Chase Servicer, as the case may be, shall remain obligated
and be liable in accordance with the terms of the Pooling and Servicing
Agreements to which it is a party without diminution of any such obligation or
liability by virtue of the appointment of the Servicer hereunder; provided,
however, that CMB or the Chase Servicer, as the case may be, shall be entitled
to indemnification of any such obligation or liability to the extent set forth
in Section 10.1 hereof.
4.4. The Servicer has agreed under the Purchase Agreement to
use its best efforts to enter into one or more agreements (each a "New
Securitization Servicing Agreement") in connection with each New Securitization
pursuant to which it will agree to service the related New Securitization
Accounts on and after the closing date with respect to
<PAGE>
6
such New Securitization. If the Servicer enters into any New Securitization
Servicing Agreement, the Servicer hereby agrees to perform and comply with each
and every duty of the "Servicer" under such New Securitization Servicing
Agreement with respect to the New Securitization Accounts subject thereto.
ARTICLE V - CONVERSION OF ACCOUNT RECORDS
AND OTHER DOCUMENTS FROM THE CHASE SERVICER TO THE SERVICER
5.1. In order to enable the Servicer to fulfill its
obligations under this Agreement, the Chase Servicer shall timely and
effectively cooperate with and assist the Servicer in, and the Servicer shall
effect, a conversion of the Accounts to the Servicer's computer system on or
before October 1, 1997.
5.2. On or prior to the Transfer Date, Chase or the Chase
Servicer shall provide to the Servicer limited powers of attorney to endorse
checks for deposit only and other instruments of payment in the Account Owners'
names, to sign other documents necessary to the continued perfection of any
security interest, to release liens upon full payment or upon resale of
collateral after repossession, and to initiate suits in the Account Owner's name
on Accounts upon which there has been a default.
5.3. The Chase Servicer and the Servicer shall produce the
following notices in mutually acceptable forms:
(a) Notices to the Obligors of the transfer of the servicing of
the Accounts to the Servicer in accordance with applicable state and
federal laws and regulations; and
(b) Notices to all insurance companies, taxing authorities and
tax sources as appropriate of the transfer of the servicing of the
Accounts to the Servicer.
5.4. On and after the Transfer Date, the Chase Servicer will
(i) continue to cooperate with and provide documents to the Servicer as
reasonably necessary in order to facilitate the servicing of the Accounts and
(ii) promptly forward to the Servicer any correspondence and payments received
by the Chase Servicer which appropriately should have been sent to the Servicer.
ARTICLE VI -- THE SERVICER'S SERVICING OBLIGATIONS
6.1. During the term hereof, the Servicer shall retain
information on its computer system relating to the Accounts (the "Computer
Files") and shall provide the Chase Servicer with on-line computer terminal
access at the Chase Servicer's office to such Computer Files.
6.2. In the event Chase or the Chase Servicer desire some
special services not specified herein, the Servicer shall use its best efforts
to provide such services if the Servicer
<PAGE>
7
reasonably concludes that such services are reasonably attainable and
technically feasible. There will be no additional fee or charge for additional
services unless the Servicer notifies Chase or the Chase Servicer, as the case
may be, in advance of providing such services of the additional charge and Chase
or the Chase Servicer agree to the charge in writing.
6.3. CMB, the Chase Servicer or the Account Owners, as set
forth in the Pooling and Servicing Agreements, may retain physical possession of
the Files. The Servicer shall maintain all documents it holds relating to the
Accounts in a safe, up-to-date manner. The Servicer may, at its sole expense,
use the services of a file storage and retention company reasonably acceptable
to the Chase Servicer. In the event the Servicer obtains any original documents
relating to the Accounts, the Servicer shall hold them in trust for the Account
Owners. Any original documents relating to the Accounts held by the Servicer
shall be maintained in fire-proof files, except those documents held by a file
storage and retention company reasonably acceptable to the Chase Servicer which
does not offer fire-proof storage. The Servicer shall exercise reasonable care
in handling and delivering the documents in its files relating to the Accounts.
Unless otherwise requested by the Chase Servicer or unless otherwise required by
governmental rule, the Servicer shall retain the documents in its files relating
to the Accounts during the time the Account Owners own the Accounts and for the
term of this Agreement. However, the Servicer shall, upon request of the Chase
Servicer, forward to the Chase Servicer the documents in its files relating to
an Account and the related repossession file after the sale of the repossessed
Boat or Recreational Vehicle. The Servicer shall maintain the privacy of the
Obligors in accordance with all applicable governmental rules. The Servicer
shall deliver any of the documents in its files relating to an Account to Chase
or the Chase Servicer upon request.
6.4. The Servicer does not warrant by its acceptance of any
original document relating to the Accounts or any copy of any such document,
forwarded to it by the Chase Servicer, or the related Account Owner, that such
document is legally valid or enforceable in any respect.
6.5. The Servicer shall retain the Computer Files and other
data and records (including, without limitation, computerized records) relating
directly to or maintained in connection with the servicing of the Accounts,
which Computer Files, data and records shall be clearly marked to reflect that
the Accounts are owned by the Account Owners, at the address of the Servicer, or
upon thirty (30) days' advance notice to the Chase Servicer at such other place
where the servicing offices of the Servicer are located and shall be readily
separable from the other files or property of the Servicer.
6.6. Upon the termination of this Agreement, the Servicer
shall, upon request of the Chase Servicer, deliver to the Chase Servicer, at the
Chase Servicer's expense (unless such termination is by the Chase Servicer for
"cause" pursuant to Section 12.3(a) hereof or is a result of a default by the
Servicer hereunder), all data and records (including, without limitation,
computerized records) created or used for the servicing of the Accounts and all
monies received by the Servicer. In addition to delivering such data, records
and monies, the Servicer shall, at the Chase Servicer's expense (unless such
termination is by the Chase Servicer for "cause" pursuant to Section 12.3(a)
hereof or is a result of a default by the
<PAGE>
8
Servicer hereunder), use reasonable efforts to effect the orderly and efficient
transfer of the servicing of the Accounts with respect to which such termination
shall have occurred to such party as may have been appointed by the Chase
Servicer to assume responsibility for such servicing, including, without
limitation, directing the Obligors to remit all payments in respect of the
Accounts to an account or address designated by the Chase Servicer.
6.7. In order to facilitate the servicing of the Accounts by
the Servicer, CMB and the Chase Servicer hereby appoint the Servicer, with
respect to any payments remitted on an Account by any Obligor or other person on
behalf of an Obligor directly to the Servicer, to retain possession of such
payment as custodian and bailee of CMB or the Chase Servicer, as the case may
be. The Servicer shall cause each of such payments to be processed and deposited
in the manner set forth in Article VII on the Business Day following receipt or
as otherwise directed by the Chase Servicer in writing.
6.8. The Servicer shall process normal payoffs of Accounts by
quoting amounts due, accepting payoff amounts, stamping the original contracts
relating to such Accounts "Paid" and returning them to Obligors, and releasing
liens as required.
6.9. If payment of any amount due with respect to an Account
is not received from a Obligor within eleven (11) days after the date such
payment is due under the Account, the Servicer shall, consistent with the
Servicer's collection policies and procedures specified in Exhibit 3.1, contact
such Obligor to effect collection and to discourage delinquencies in payments on
such Account, doing so by lawful means, including, but not limited to, the
following:
(a) Attempting to contact Obligors by telephone to encourage
payment;
(b) Mailing of past due notices as necessary;
(c) Preparing and mailing of collection letters;
(d) Mailing reminder notices to Obligors as deemed
necessary;
(e) Using skip tracing techniques to locate missing
Obligors;
(f) Using field calls directly on Obligors;
(g) Identifying and taking action on reasonable alternatives
to avoid or minimize losses; and
(h) Initiating all steps leading to termination or
foreclosure actions deemed necessary.
Upon receipt of proceeds with respect to any defaulted
Account, the Servicer shall deposit all the proceeds collected without deduction
for any fee or amount due the
<PAGE>
9
Servicer (except for retention of fees pursuant to Section 8.2 hereof), as
provided in Article VII and provide to the Chase Servicer an itemized
accounting.
6.10. Based on an Obligor's reasons for delinquency, the
Servicer may grant extensions (monthly payment deferrals) in accordance with the
criteria set forth on Exhibit 3.1 to those Obligors having temporary cash flow
problems. The Servicer shall exercise care in offering extensions so as not to
defer obvious losses. The Servicer shall provide to the Chase Servicer on the
15th day of each month a list of all extensions granted during the preceding
calendar month and the reasons for such extensions or modifications. The Chase
Servicer reserves the right to direct the Servicer with respect to loss
mitigation strategies, to require the Servicer to initiate repossession or to
direct the Servicer to refrain from repossession, based on reasonable criteria
communicated in writing from time to time.
6.11. The Servicer shall not waive or release any right to
collect any amount due under the Accounts; provided, however, that in connection
with the settlement of a defaulted Account, the Servicer may forgive a portion
of such Account if, in its discretion, it believes that the acceptance of the
settlement proceeds from the related Obligor would result in the receipt of an
amount of collections greater than the net proceeds that would result from
repossessing and liquidating the related Boat or Recreational Vehicle, taking
into account any payments that would be required by law to be remitted to the
Obligor and other expenses customarily deducted from sales proceeds in
connection with sales or other dispositions of Boats or Recreational Vehicles,
as the case may be.
6.12. In the event repossession or foreclosure proceedings are
instituted in respect of the Accounts, whether by the Servicer or otherwise,
then and until otherwise directed by the Chase Servicer, the Servicer, from the
date of the commencement thereof until the termination thereof and the
conveyance of title, or until other disposition of the Account Owner's interest
in the financed Boat or Recreational Vehicle, shall manage and protect the
financed Boat or Recreational Vehicle, including the maintenance of insurance
against loss and damage. If an insurer of any such Boat or Recreational Vehicle
shall from time to time direct the Servicer with respect to the manner or
procedure of the performance of any of the duties and services referred to in
this Agreement, the Servicer will perform such duties and services in accordance
with such direction, anything herein to the contrary notwithstanding. The
Servicer shall be paid additional reasonable compensation as agreed by the
parties and be reimbursed for its expenses if the Chase Servicer or any insurer
requests that it take actions beyond the scope of this Agreement.
6.13. Unless repossessed or liquidated in accordance herewith,
the Servicer shall commence foreclosure proceedings against, or otherwise
comparably convert the ownership of any collateral securing a defaulted Account
as to which no satisfactory arrangements can be made for collection of
delinquent payments. In connection with such foreclosure proceedings or other
conversion, the Servicer shall follow the same practices and procedures as it
does with its own loans or credit sales, except as otherwise specifically
provided in Exhibit 3.1 hereto, and shall be in compliance with all applicable
federal, state and local laws and governmental rules. The Servicer shall also
arrange the foreclosure sale of repossessed Boats and Recreational Vehicles and
Boats and Recreational Vehicles taken by
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10
the Servicer in full satisfaction of any debt in accordance with the criteria
set forth herein or on Exhibit 3.1. The Servicer shall utilize its best efforts
to sell repossessed collateral in such a manner as to minimize losses. The
Servicer warrants that its servicing will not prejudice the rights of the
Account Owners with respect to the Accounts, including the right to collect
deficiency amounts due under the Accounts after repossession or foreclosure.
6.14. The Servicer shall not initiate any litigation in the
name of Chase or the Chase Servicer or pursue any deficiency balance without
Chase's or the Chase Servicer's advance written consent; provided, however, that
(i) the Servicer may initiate litigation to recover possession of or to
foreclose upon collateral securing the Accounts and (ii) the Servicer may
initiate collection suits or actions to recover deficiencies, provided that any
legal counsel retained by the Servicer in connection therewith shall be
compensated on a contingency basis and the total amount of "out-of-pocket"
expenses of such counsel to be reimbursed shall not exceed the amount set forth
in Section 8.3(b) hereof. The Servicer hereby agrees that prior to the
initiation of any litigation to collect amounts owing with respect to an
Account, the Servicer shall review the files, including but not limited to the
Computer Files, relating to such Account to determine if such files indicate
that there exist facts which might constitute a defense or counterclaim in any
such litigation. If such review of the files indicates the existence of facts
which might constitute a defense or counterclaim, the Servicer shall not
initiate any litigation with respect to such Account without the prior written
consent of the Chase Servicer. The Servicer shall give the Chase Servicer prompt
written notice of all litigation including any claims or counterclaims asserted
by the Obligor or any other party.
6.15. The Servicer shall apply payments received on the
Accounts in accordance with the priorities as set forth on Exhibit 6.15 hereto,
except as otherwise provided in any New Securitization Servicing Agreement,
including the procedures for handling insurance proceeds under insurance
policies relating to the Accounts.
6.16. The Servicer agrees at its own cost and expense to
maintain adequate fidelity bond coverage of the officers and employees of the
Servicer who handle or may have occasion to handle or control any funds
collected by the Servicer or documents and papers relating to the Accounts under
this Agreement. Such fidelity bond shall protect against losses, including
forgery, theft, embezzlement and fraud and the coverage under the fidelity bond
shall be at least $5,000,000. On or prior to the Transfer Date, the Servicer
shall furnish to the Chase Servicer certification by the carrier of such
fidelity coverage attesting to the form or type of bond evidencing such
coverage, together with the amount, term, date of commencement, anniversary or
renewal date and name of insured and affirmatively assuring the Chase Servicer
that such coverage cannot be changed, other than by an increase in amount, or
cancelled without prior written notice to the Chase Servicer. Regardless of any
provisions contained in this Agreement which require the Servicer to maintain
fidelity bond coverage, the Servicer shall not be relieved of and from its
accountability and responsibility to Chase and the Chase Servicer for the proper
performance under this Agreement of the duties and obligations to be performed
hereunder by the Servicer.
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11
ARTICLE VII - DEPOSIT OF COLLECTIONS
7.1. Except as otherwise specified in any Pooling and
Servicing Agreement with respect to any Old Securitization Account or in any New
Securitization Servicing Agreement with respect to any New Securitization
Account, upon the Servicer's receipt of any payment on the Accounts, including
principal, interest, insurance proceeds, liquidation proceeds or any other
proceeds on any Account, however or from whomever made, the Servicer shall
within two (2) Business Days deposit such payment by wire transfer of
immediately available funds to account number 322-006716 (ABA Routing Number
021000021) at The Chase Manhattan Bank in the Chase Servicer's name. The
Servicer shall have no rights to such payments. The Servicer shall insure that
deposits into such account with respect to the Accounts will be accomplished and
recorded in such manner as to permit auditing of such transactions in accordance
with the terms hereof.
ARTICLE VIII - COMPENSATION TO THE SERVICER; ADDITIONAL
COMPENSATION TO THE SERVICER; OUT-OF-POCKET EXPENSES
8.1. In consideration of its services provided hereunder with
respect to the Old Securitization Accounts, the Chase Servicer shall pay to the
Servicer a servicing fee for each calendar month equal to one-twelfth of the
product of 0.50% and the aggregate outstanding principal balance (excluding any
separate notes or amounts due from any Obligor for taxes, insurance or other
advances) of all Old Securitization Accounts at the close of business on the
last day of the preceding calendar month. The Chase Servicer shall, upon receipt
of a bill for such service fees and/or out-of-pocket costs described in Section
8.3 hereof, remit payment to the Servicer of such amounts within 30 days of
receipt.
8.2. The Servicer shall be entitled to retain the following
fees payable in respect of the Accounts as additional compensation: late payment
fees, extension fees and transfer of equity and assumption fees accruing and
collected by the Servicer after the Transfer Date. The Servicer shall be
responsible for paying all amounts due dealers in respect of dealer
participations on the Accounts accruing on and after the Transfer Date, which
such payments shall be based upon the information recorded on the conversion
tape provided to the Servicer by the Chase Servicer as of the Transfer Date. The
Servicer shall not be responsible for paying any other amounts due dealers in
respect of dealer participations. The Servicer shall have no liability for
defenses, counterclaims, off-sets or recoupments arising under or in connection
with events which occur prior to the Transfer Date.
8.3. The Servicer shall be responsible for all of its own
expenses and costs in carrying out its obligations under this Agreement, except
that the Chase Servicer shall reimburse the Servicer for the following
"out-of-pocket" expenses:
(a) Customary or necessary repossession expenses reasonably
incurred in connection with the transporting, repair, care, custody,
control and resale of repossessed Boats or Recreational Vehicles;
provided, however, that the Servicer shall
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12
not incur, and the Chase Servicer shall not be obligated to reimburse
the Servicer for, expenses in excess of the dollar amounts set forth
on Exhibit 3.1, unless the express written consent of the Chase
Servicer is obtained in advance of the time such expenses are
incurred;
(b) Expenses of legal counsel retained to enforce Accounts
after default and the related court costs; provided, however, that the
Servicer shall not incur, and the Chase Servicer shall not be
obligated to reimburse the Servicer for, more than $1,000 for legal
fees on any Account, unless the express written consent of the Chase
Servicer is obtained in advance of the time such fees are incurred;
and
(c) Any amounts paid or advanced by the Servicer to pay taxes
or to satisfy any tax lien on any Boat or Recreational Vehicle.
8.4. In consideration of its services provided hereunder with
respect to the Chase Accounts and the New Securitization Accounts, the Chase
Servicer shall pay to the Servicer the fee as agreed to and specified in that
certain Fee Letter, as amended, dated as of May 9, 1997, among Chase, the Chase
Servicer and the Servicer (the "Fee Letter").
ARTICLE IX - REPRESENTATIONS AND WARRANTIES
9.1. The Servicer represents and warrants to Chase and the
Chase Servicer that as of the Closing Date and as of the Transfer Date:
(a) The Servicer (i) is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware,
(ii) is qualified to transact business in each jurisdiction in which
failure to so qualify would render any Account unenforceable in such
jurisdiction and (iii) has the corporate power to own its property, to
conduct its business and to service the Accounts hereunder;
(b) The Servicer has the corporate power and authority to
enter into and perform its obligations under this Agreement and this
Agreement has been duly authorized, executed and delivered by the
Servicer and constitutes a valid and legally binding obligation of the
Servicer, enforceable in accordance with its terms;
(c) The execution, delivery and performance of this Agreement
by the Servicer will not violate any provision of any existing law or
regulation or any order or decree of any court or the charter or the
by-laws of the Servicer or any mortgage, indenture, contract or other
agreement to which the Servicer is a party or by which the Servicer and
any of its property or assets may be bound;
(d) The Servicer is not required to obtain any consent,
license, approval or authorization, or registration or declaration
with, any governmental authority, bureau or agency in connection with
the execution, delivery and performance of this Agreement;
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13
(e) The Servicer has, or will have prior to the Transfer Date,
sufficient personnel and equipment, including but not limited to
computer, bookkeeping and record keeping capabilities, to perform its
obligations under this Agreement; and
(f) There is no litigation or administrative proceeding of or
before any court, tribunal or governmental body pending or, to the best
of the Servicer's knowledge, threatened, which could reasonably be
expected to affect adversely the validity or enforceability of this
Agreement or the ability of Servicer to service the Accounts hereunder
in accordance with the terms hereof or which could reasonably be
expected to have a material adverse effect on the financial condition
of the Servicer.
9.2. Each of CMB, CUSA, CFHI, CFAC and the Chase Servicer
represents and warrants to the Servicer that as of the Closing Date and as of
the Transfer Date:
(a) It (i) is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization and
(ii) has the corporate power to own its property and to conduct its
business;
(b) It has the corporate power and authority to enter into and
perform its obligations under this Agreement and this Agreement has
been duly authorized, executed and delivered by it and constitutes a
valid and legally binding obligation of it, enforceable in accordance
with its terms;
(c) The execution, delivery and performance of this Agreement
by it will not violate any provision of any existing law or regulation
or any order or decree of any court or its charter or the by-laws or
any mortgage, indenture, contract or other agreement to which it is a
party or by which it and any of its property or assets may be bound;
(d) It is not required to obtain any consent, license,
approval or authorization, or registration or declaration with, any
governmental authority, bureau or agency in connection with the
execution, delivery and performance of this Agreement;
(e) There is no litigation or administrative proceeding of or
before any court, tribunal or governmental body pending or, to the best
of its knowledge, threatened, which could reasonably be expected to
have a material adverse effect on the validity or enforceability of
this Agreement; and
(f) All data provided to the Servicer as to the balances of
the Accounts is correct in all material respects.
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14
ARTICLE X - MUTUAL INDEMNITY
10.1. The Servicer agrees to indemnify Chase and the Chase
Servicer and hold Chase and the Chase Servicer harmless from and against any and
all losses, liabilities, claims, damages and actions, including reasonable
attorneys' fees, reasonable accountants' fees and court costs, arising out of
(i) the Servicer's failure to comply with its obligations, warranties,
representations and covenants contained in this Agreement, (ii) the negligent
action taken or negligent omission of the Servicer in performing its duties
hereunder or (iii) the Servicer's erroneous calculation of the participation due
any dealer on the Accounts, provided that Chase or the Chase Servicer notifies
the Servicer immediately by telephone and thereafter in writing upon receipt of
notice of any such claim made by a dealer; provided, however, that the Servicer
shall not be liable for any losses, liabilities, claims, damages or actions
arising out of any breach by Chase or the Chase Servicer of any of their
obligations, warranties or representations in this Agreement.
10.2. Chase and the Chase Servicer agree to indemnify the
Servicer and hold the Servicer harmless from and against any and all losses,
liabilities, claims, damages and actions, including reasonable attorneys' fees,
reasonable accountants' fees, and court costs, arising out of (i) Chase or the
Chase Servicer's breach of any of their obligations, warranties, representations
and covenants contained in this Agreement, (ii) any events which occurred prior
to the Transfer Date, (iii) Chase or the Chase Servicer's assignment to the
Servicer of Authorizations for Automatic Payment relating to Automated Clearing
House electronic fund transfers from the Accounts of Obligors or (iv) any claim
by a dealer for an amount in respect of dealer participations greater than the
amount that would be payable to such dealer based upon the information recorded
on the conversion tape provided to the Servicer by the Chase Servicer, provided
that the Servicer notifies Chase and the Chase Servicer immediately by telephone
and thereafter in writing upon receipt of notice of any such claim made by a
dealer; provided, however, that neither Chase nor the Chase Servicer shall be
liable for any losses, liabilities, claims, damages or actions arising out of
any breach by the Servicer of any of its obligations, warranties or
representations in this Agreement.
ARTICLE XI - AUDIT RIGHTS: FINANCIAL STATEMENTS
11.1. At all times during the term of this Agreement, the
Servicer shall afford the Chase Servicer and the Account Owners and their
authorized agents, subject to appropriate notice, reasonable access during
normal business hours to audit the Servicer's books, records, data, premises and
operations relating to the Accounts and will cause its personnel to assist in
any examination of such records. The examination referred to in this Section
will be conducted in a timely manner which does not interfere unreasonably with
the Servicer's normal operations or customer or employee relations and shall be
at the Chase Servicer's or the Account Owner's sole expense.
11.2. The Servicer shall deliver to the Chase Servicer on or
before March 31 of each year, commencing March 31, 1998, an Officers'
Certificate stating, that (i) a review of the activities of the Servicer during
the preceding calendar year (or since execution of this
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15
Agreement in the case of the first such Officers' Certificate required to be
delivered) and of performance under this Agreement has been made under such
officer's supervision, and (ii) to the best of such officer's knowledge, based
on such review, the Servicer has fulfilled all its obligations under this
Agreement throughout the period covered by such review, or, if there has been a
default in the fulfillment of any such obligations, specifying each such default
known to such officer and the nature and status thereof.
11.3. Annually on or before each March 31st, commencing March
31, 1998, so long as the Servicer shall be servicing Accounts, the Servicer
shall, at its option, either (a) provide the Chase Servicer's auditors with
adequate information and access to financial data, Account data, systems,
procedures, testing and support to enable the Chase Servicer's auditors to
provide the following described report or (b) furnish to the Chase Servicer a
statement for the most recently ended calendar year certified by a firm of
independent public accountants with respect to the Servicer to the effect that
such firm has examined certain documents and records relating to the servicing
of the Accounts and that, on the basis of an examination conducted substantially
in compliance with a recognized program for auditing the servicing of loans
similar to the Accounts, that such firm is of the opinion that such servicing
has been conducted in compliance with this Agreement except for (i) such
exceptions as such firm shall believe to be immaterial and (ii) such other
exceptions as shall be set forth in such statement.
ARTICLE XII - TERM AND TERMINATIONS
12.1. Unless sooner terminated as herein provided or by mutual
agreement, this Agreement shall continue from the date hereof during the term of
the Accounts and until all of the principal, finance charges and other charges
of all of the Accounts are paid in full, or until proceedings to foreclose are
terminated finally and title to all collateral which are the subject of such
proceeds is liquidated and received by the Chase Servicer or the Account Owner.
12.2. Notwithstanding any provision of this Agreement to the
contrary, this Agreement shall become and be terminated immediately with respect
to all Accounts other than the New Securitization Accounts upon the mailing of
written notice of termination by the party described below upon the occurrence
of any one or more of the following events:
(a) By the Chase Servicer in the event that, subject to
Section 15.7 hereof, due to a delay attributable to the Servicer, the
Transfer Date shall not have occurred on or before October 1, 1997. In
such circumstance, the Servicer will pay the Chase Servicer, promptly
after the end of each calendar year over the life of the Accounts, the
difference, if any, between (x) the fees to be paid to any third-party
substitute servicer under a servicing agreement negotiated in good
faith by Chase and such third-party substitute servicer and (y) the
product of (i) 0.50% and (ii) the quotient obtained by dividing (A) the
sum of the aggregate principal balances of all Accounts as of the close
of business on the last Business Day of each month of such calendar
year by (B) twelve (12).
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16
(b) By the Chase Servicer in the event of any failure by the
Servicer to make any deposit or payment, or to remit to the Chase
Servicer any payment, required to be made under the terms of this
Agreement, any Pooling and Servicing Agreement or any New
Securitization Servicing Agreement which continues unremedied for a
period of two Business Days after notice of such failure, but in any
event not more than five Business Days after receipt of written notice
of such failure; or
(c) By the Chase Servicer in the event of a failure on the
part of the Servicer to deliver reports to the Chase Servicer or the
Account Owners which failure continues unremedied for a period of five
(5) Business Days after receipt of written notice of such failure, or
(d) By the non-defaulting party, other than as a result of
voluntary proceedings (covered by (e) below), if the other party shall
be adjudged bankrupt or insolvent by a court of competent jurisdiction,
or an order shall be made by a court of competent jurisdiction for the
appointment of a receiver, liquidator or trustee of such party or of
all or substantially all of its property or approving any petition
filed against such party for its reorganization, and such adjudication
or order shall remain in force or unstayed for a period of thirty (30)
days; or
(e) By either party if the other party shall institute
proceedings for voluntary bankruptcy, or shall file a petition seeking
reorganization under the federal bankruptcy laws or for relief under
any law for the relief to debtors, or shall consent to the appointment
of a receiver of such party or of all or substantially all of its
property, or shall make a general assignment for the benefit of its
creditors, or shall admit in writing its inability to pay its debts
generally as they become due; or
(f) By the Chase Servicer if the Servicer shall assign or
delegate its rights or its duties hereunder to any Person other than an
Affiliate without the prior written consent of the Chase Servicer; or
(g) By the Chase Servicer if the Servicer shall merge with or
consolidate into any other corporation, other than a merger by the
Servicer into another wholly-owned subsidiary of The CIT Group Holdings
Inc., without the prior written consent of the Chase Servicer, which
such consent shall not be unreasonably withheld; or
(h) By the Chase Servicer if the Servicer shall sell or
otherwise dispose of all or substantially all of its property or
assets, except to another wholly owned subsidiary of The CIT Group
Holdings, Inc., without the prior written consent of the Chase
Servicer.
The Servicer agrees that if any of the events specified in subparagraphs (b)
through (h) of this Section 12.2 shall happen, it will give written notice
thereof to the Chase Servicer within five (5) days after the occurrence of such
event.
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17
12.3. Notwithstanding any provision of this Agreement to the
contrary, this Agreement may also become and be terminated with respect to all
Accounts other than the New Securitization Accounts upon the occurrence of any
one or more of the following events:
(a) The Chase Servicer may terminate this Agreement for
"cause" without payment of any additional compensation to the Servicer.
If the Chase Servicer terminates this Agreement for "cause" and, as a
result of such termination, a servicing systems conversion is required,
the Servicer shall pay the expenses of such conversion, including, but
not limited to, the expenses of formatting all information into a
format acceptable to the successor Servicer. "Cause" shall exist if,
during any calendar year or partial calendar year, (i) Aggregate Losses
with respect to Accounts secured by Recreational Vehicles exceed 0.80%
of the Average Annual Balance (as such term is defined in the Fee
Letter) for such calendar year or partial calendar year or (ii)
Aggregate Losses with respect to Accounts secured by Boats exceed 1.20%
of the Average Annual Balance (as such term is defined in the Fee
Letter) for such calendar year or partial calendar year. If during any
calendar year or partial calendar year (i) Aggregate Losses with
respect to Accounts secured by Recreational Vehicles exceed 0.80% of
the Average Annual Balance (as such term is defined in the Fee Letter)
or (ii) Aggregate Losses with respect to Accounts secured by Boats
exceed 1.20% of the Average Annual Balance (as such term is defined in
the Fee Letter) for such calendar year or partial calendar year, the
Chase Servicer shall, in addition to its right to terminate the
Agreement, have the right to (i) conduct a full audit of the operations
and procedures of the Servicer with respect to the Accounts and (ii)
require that the Servicer produce a detailed plan acceptable to the
Chase Servicer for reducing Losses; or
(b) Either party may terminate this Agreement with respect to
all Accounts other than the New Securitization Accounts in the event
that the other party materially defaults in the performance of any of
its respective covenants, agreements, representations, warranties,
duties or obligations hereunder, which default shall not be
substantially cured within forty-five (45) days after written notice is
received by the other party specifying the default, or, with respect to
any default which cannot be reasonably cured within forty-five (45)
days, if the defaulting party fails to diligently proceed within
forty-five (45) days to commence curing said default and thereafter to
proceed with all due diligence to substantially cure the same, then the
non-defaulting party may, by giving written notice thereof to the other
party, terminate this Agreement as of a date specified in such notice
of termination; provided, however, that in the event a breach of
warranty cannot be reasonably cured, the non-defaulting party may not
terminate this Agreement if the defaulting party indemnifies the
non-defaulting party pursuant to Article X; or
(c) Either party may terminate this Agreement with respect to
all Accounts other than the New Securitization Accounts immediately
upon notice if the other party fails to make any other payment due
under this Agreement within five (5) Business Days after receipt of
notice thereof from the party entitled to payment.
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12.4. Notwithstanding any provision of this Agreement to the
contrary, this Agreement shall become and be terminated with respect to any New
Securitization Account immediately upon the termination of the Servicer as
"Servicer" under the related New Securitization Servicing Agreement.
12.5. From and after the effective date of termination of this
Agreement pursuant to Section 12.1, 12.2 or 12.3, the Servicer shall not be
entitled to compensation for servicing the Accounts (other than the New
Securitization Accounts) after such effective date and shall be relieved of
further responsibility in connection therewith. In any such event the rights,
duties, powers and authority of the Servicer hereunder with respect to all
Accounts other than the New Securitization Accounts shall immediately terminate,
and, without limitation, the Chase Servicer is hereby authorized and empowered
to execute and deliver, on behalf of the Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or accomplish
all other acts or things necessary or appropriate to effect the purposes of such
termination, whether to complete the transfer and endorsement or assignment of
the Accounts and related documents, or otherwise. The Servicer shall forthwith
upon such termination pay over to the Chase Servicer all monies collected and
held by it with respect to all Accounts other than the New Securitization
Accounts pursuant to this Agreement, and shall deliver to the Chase Servicer (a)
all documents relating to all Accounts being serviced hereunder other than the
New Securitization Accounts, a payment history on each such Account, ledger
cards, tax bills, accrual records and insurance policies and (b) a full
accounting, including a statement showing the monthly payments or other payments
collected by it and a statement of monies held by it with respect to the
Accounts other than the New Securitization Accounts. The Servicer shall
cooperate with the Chase Servicer in effecting any such termination and any
successor servicer's administration of the Accounts.
12.6. From and after the effective date of termination of this
Agreement with respect to any New Securitization Accounts pursuant to Section
12.4 hereof, the Servicer shall not be entitled to compensation for servicing
such New Securitization Accounts after such effective date and shall be relieved
of further responsibility in connection therewith. In any such event the rights,
duties, powers and authority of the Servicer hereunder with respect to such New
Securitization Accounts shall immediately terminate. The servicing of such New
Securitization Accounts shall be transferred to a successor servicer in
accordance with the related New Securitization Servicing Agreement.
ARTICLE XIII - CONFIDENTIALITY
13.1. The Servicer shall keep confidential and shall not make
available to any Person not employed by the Servicer or any Affiliate, or its
counsel, accountants or other experts, any information relating to the Accounts
or reports without the specific authorization of the Chase Servicer unless such
disclosure is necessary to comply with law or with the requirements of this
Agreement; provided, however, that the Servicer may disclose such information as
is necessary for the Servicer to perform and comply with each and every duty of
the Servicer under any New Securitization Servicing Agreement or in connection
with any New Securitization.
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13.2. In order to permit the Servicer to perform its
obligations hereunder, and to permit the Chase Servicer to assist the Servicer
in doing so, the Chase Servicer and the Servicer may from time to time have
access to each other's computer systems and certain of the data stored therein.
The Chase Servicer and the Servicer will each use its best efforts not to access
any information from the other except information reasonably needed to fulfill
the terms of this Agreement. The Servicer and the Chase Servicer each agree that
they shall treat as confidential, consistent with their duties and obligations
hereunder, any information received from the other whether obtained through the
other's computer system or otherwise and will only permit those employees
engaged in the rendering of the services hereunder, or assisting the other in
rendering services hereunder, to have access to the other party's computer
system and the information with respect to the Accounts received from the other.
ARTICLE XIV - SURVIVAL OF AGREEMENTS, WARRANTIES
COVENANTS AND REPRESENTATIONS
14.1. The covenants and indemnities of Chase, the Chase
Servicer and the Servicer that are contained in this Agreement shall survive its
termination for (i) a period of two (2) years with respect to (x) any claim
asserted by Chase or the Chase Servicer against the Servicer or (y) any claim
asserted by the Servicer against Chase or the Chase Servicer or (ii) a period of
four (4) years with respect to any claim arising as a result of a claim asserted
by a Person other than Chase, the Chase Servicer or the Servicer.
ARTICLE XV - MISCELLANEOUS
15.1. This Agreement and the Exhibits hereto set forth the
entire agreement and understanding between Chase, the Chase Servicer and the
Servicer and supersede any and all representations, promises, and statements,
oral or written, made in connection with the subject matter of this Agreement
and the negotiation hereof. No such representation, promise or statement not
written in this Agreement and the Exhibits hereto shall be binding on the
parties. Notwithstanding the foregoing, if any provision of this Agreement or
the Exhibits hereto is found to be inconsistent with any provision of the
Pooling and Servicing Agreements with respect to the Old Securitizations or the
New Securitization Servicing Agreements with respect to the New Securitization
Accounts, the provisions of such Pooling and Servicing Agreements or New
Securitization Servicing Agreements, as the case may be, shall govern. This
Agreement may not be varied or altered nor its provisions waived except by an
agreement in writing executed by duly authorized officers of Chase, the Chase
Servicer and the Servicer.
15.2. Any corporation or other entity (i) into which any party
hereto may be merged or consolidated, (ii) which may result from any merger,
conversion or consolidation to which any party hereto shall be a party or (iii)
which may succeed to all or substantially all of the business of any party
hereto, shall be bound to perform every obligation of such party under this
Agreement and shall be successor to such party hereunder without execution or
filing of any document or any further act by any of the parties hereto;
provided, however,
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that, in accordance with Section 12.2 hereof, the Servicer shall not (i) merge
with or consolidate into any other corporation, other than a merger by the
Servicer into another wholly-owned subsidiary of The CIT Group Holdings Inc.,
without the prior written consent of the Chase Servicer, which such consent
shall not be unreasonably withheld, or (ii) sell or otherwise dispose of all or
substantially all of its property or assets, except to another wholly owned
subsidiary of The CIT Group Holdings, Inc., without the prior written consent of
the Chase Servicer.
15.3. This Agreement shall be binding upon and inure to the
benefit of Chase, the Chase Servicer and the Servicer and each of their
respective successors and assigns, provided, however, no party may assign or
transfer this Agreement without the prior written consent of the others, which
such consent shall not be unreasonably withheld, except that the Servicer may
assign or transfer this Agreement to any of its Affiliates. In the event that
any such assignee or transferee shall fail to perform any obligation or satisfy
any liability undertaken or assumed by the Servicer hereunder, the Servicer
shall remain obligated and be liable in accordance with the terms of this
Agreement without diminution of any such obligation or liability by virtue of
such assignment or transfer. Any assignment or transfer in violation of this
paragraph shall constitute a material breach of this Agreement.
15.4. Captions in this Agreement are for convenience of
reference only and are not to be considered as defining or limiting in any way
the scope or intent of the provisions of this Agreement.
15.5. The waiver of any breach, term, provision, or condition
of this Agreement shall not be construed to be a waiver of any other or
subsequent breach, term, provision, or condition. All remedies afforded by this
Agreement for a breach hereof shall be cumulative.
15.6. If any provision or provisions of this Agreement shall
be held to be invalid, illegal or unenforceable, the validity, legality and the
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
15.7. Wherever under this Agreement one party is required or
permitted to give written notice to the others, such notice shall be deemed
given upon receipt after its mailing by the party providing notice by certified
mail or registered mail (postage prepaid) or by overnight delivery service
addressed as follows:
In the case of the CMB, CUSA, CFAC, CFHI and the Chase Servicer:
c/o Chase Financial Corporation
250 W. Huron
Cleveland, Ohio 44113
Attn: Chief Financial Officer
With a copy to:
<PAGE>
21
Chase Financial Corporation
250 W. Huron
Cleveland, Ohio 44113
Attn: General Counsel
In the case of the Servicer:
The CIT Group/Sales Financing, Inc.
650 CIT Drive
Livingston, New Jersey 07039
Attn: President
With a copy to:
The CIT Group/Sales Financing, Inc.
715 South Metropolitan Avenue, Suite 150
Oklahoma City, Oklahoma 73108-2090
Attn: John Alkire, Senior Vice President
Any writing which may be mailed pursuant to the foregoing may also be delivered
by hand.
15.8. Anything in this Agreement to the contrary
notwithstanding, Chase, the Chase Servicer and the Servicer shall be excused
from performing any of their respective obligations under this Agreement, which
are prevented or delayed by any occurrence not within their respective control
including but not limited to strikes or other labor matters, destruction of or
damage to any building, natural disasters, accidents, riots, or any regulation,
rule, law, ordinance or order of any federal state or local government
authority.
<PAGE>
22
15.9. This Agreement may be executed in several counterparts,
all of which taken together shall constitute one single Agreement among the
parties hereto.
THE CHASE MANHATTAN BANK
By: /s/ William Hoefling
--------------------------------
Title: Executive Vice President
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION
By: /s/ William Hoefling
--------------------------------
Title: Director
CHASE FINANCIAL ACCEPTANCE
CORPORATION
By: /s/ Thomas M. Boylan
--------------------------------
Title: Senior Vice President
CHASE FINANCIAL HOLDINGS, INC
By: /s/ Thomas M. Boylan
--------------------------------
Title: Senior Vice President
CHASE FINANCIAL MANAGEMENT
CORPORATION
By: /s/ Thomas M. Boylan
--------------------------------
Title: Senior Vice President
THE CIT GROUP/SALES FINANCING, INC.
By: /s/ Frank Garcia
--------------------------------
Title: Vice President
<PAGE>
EXHIBIT 3.1
SERVICING STANDARDS
A. STANDARDS
1. Delinquent Accounts will be collected with the same
care and diligence as those originated and owned by
CIT. CIT staffing and expertise of staff will be
consistent with those servicing its own portfolio.
2. Accounts will be downloaded to the autodialer at 11
days delinquent. Daily passes will be made between
the hours of 7 a.m. and 11 p.m. Central Time on the
accounts to contact the customers to collect the
arrearage. After the Account has been on the
autodialer more than 10 days without contact, a
manual review will be made on the Account to
determine the appropriate course of action. Accounts
will be referred to manual collections when
potentially 60 days delinquent and will remain
assigned to a specific collector until cured. CIT
will use the same prudent judgment to cure
delinquents that it does with its own portfolio,
utilizing, including, but not limited to, deferments,
reschedules, settlements, etc.
3. Repossession will be initiated when it is evident the
customer can no longer pay or the collateral is at
risk.
4. If CIT utilizes consignment dealers to remarket
collateral, total units at one dealership cannot
exceed ten (10). All consignment dealers utilized
must have a UCC-1 agreement and a consignment
agreement satisfactory to Chase.
5. Total collection Accounts per employee cannot exceed
eight hundred (800). Collection Accounts per employee
defined as total Accounts entering collections in a
month divided by total number of collectors assigned.
B. SERVICE POWERS
1. CIT requires Chase's approval for each repossession
sale or short sale/settlement in which the present
loss to balance exceeds 60% and the loan balance
exceeds $30,000.
2. CIT requires Chase's approval for each
non-repossession sale charge off in which the charge
off exceeds $50,000.
<PAGE>
2
C. REPORTING
1. CIT must provide Chase a month-end report of all
Accounts carried 30 days or more past due that have
balances greater than $150,000. The report must
include:
(a) Account Number
(b) Customer Name
(c) Days Past Due
(d) Balance
(e) Brief Status
2. CIT must provide Chase a month-end report by product
identifying total on-hand repossession inventory
(number of units and dollar value), total
repossession sales for the month, total percent loss
to balance for month and year-to-date.
3. CIT must provide Chase a month-end report identifying
all repossessions on-hand more than 90 days.
4. CIT must provide Chase a month-end report by product
identifying total bankruptcy inventory (number of
claims and dollar value) for the month and total
litigation inventory (number of claims and dollar
value) for the month.
5. CIT must provide Chase a terminal to access
collection activity on Accounts real-time.
D. USE OF SUBCONTRACTORS/SUBSERVICERS
1. No use of subcontractors or subservicers is permitted
with the exception of the hiring of vendors to
perform an assigned function on an individual
Account, (i.e. a company to perform a repossession/an
attorney to handle a bankruptcy/litigation) or the
use of third party collection agencies to collect
post-charged off Accounts. Agency fees for primary
placement should not exceed 25%. Fee schedule for
repossessions pursuant to Section 8.3 of the
Servicing Agreement will be a standard flat rate of
$1000.00 (exclusive of sales commissions to dealers).
E. MISDIRECTED COLLECTIONS AND CORRESPONDENCE
1. All correspondence will be mailed overnight to CIT.
<PAGE>
3
F. SYSTEM CONVERSION PLAN
1. Chase is reviewing plan to provide
(a) A file from TCS with collection comments of
active accounts
(b) A file from BART with all repossession
inventory information of transfer date.
G. TRANSFER PLAN FOR COLLECTIONS/REPOSSESSION
1. CIT will have appropriate
collection/repossession/customer service personnel 1
to 3 weeks before transfer to work with counterparts
to ensure a smooth hand-off.
H. STANDARDS
1. Current account will be serviced with the same care
and diligence as those originated and owned by CITSF.
CITSF staffing and expertise will be consistent with
those servicing its own portfolio.
2. Performance measurements for the portfolio are as
follows
<TABLE>
<CAPTION>
Call Center: Monthly Abandon Rate Less than 8%
-----------
<S> <C> <C>
Average Speed of Answer Less than 45 seconds
Hours of Operation Call Center: 8:00 AM - 7:00 PM, M-F
Back Office: Resolution Rate Complete inquiries within 7-10 days
Escalated Complaints Completed in 3-5 days
Lien Releases Within normal processing (not to
exceed 45 days) or as dictated by state
parameter
Overages Due to
Customer Within normal processing (not to
exceed 60 days) or as dictated by state
parameter
</TABLE>
I. SERVICE POWERS
1. CIT requires Chase approval for any loan balance
write off in excess of $5,000.00 due to errors and
omissions.
<PAGE>
4
J. REPORTING
1. CIT must provide Chase a month-end report of the
outstanding loan balances for the approximately 200
loans with previously placed credit/life insurance
for as long as such loans shall be in existence.
Chase agrees that such loans will be identified on
the master loan file to facilitate this reporting
requirement.
2. CIT must provide Chase a month-end report detailing:
(a) Call Volume
(b) Abandon Rate
(c) Number of Escalated Complaints
3. CIT must provide Chase a month-end report by product
detailing any significant issue that impacted the
agreed upon service quality and target resolution and
timeframe.
4. CIT must provide Chase a month-end report for each
calendar month until and including March 1998 of all
loans which were (i) originated after February 1,
1997 and (ii) paid off in full as of the previous
month. Such report shall include: customer name,
account number, dealer name, dealer number, contract
date and effective date of payoff. In connection with
such report, CIT shall also provide Chase conversion
tables for account numbers and dealer numbers.
K. NOTIFICATION
1. CIT must provide Chase (names to be provided) notice
immediately, or no later than 24 hours after the
occurrence, of:
(a) An unplanned shut down
(b) A disaster recovery situation and re-up plan
2. CIT must provide Chase (names to be provided) at
least 48 hours advance notice of:
(a) A planned shut down (meetings, etc.)
(b) A system shut down that would impact
servicing.
L. MISDIRECTED CORRESPONDENCE
1. All correspondence will be mailed to CIT, or to Chase
if received by CIT in error, overnight.
M. TRANSFER PLAN FOR SERVICING
<PAGE>
5
1. CIT will have appropriate staffing personnel hired
and trained 3 weeks prior to the transfer of
servicing.
N. TRAINING/MONITORING
1. All CIT servicing reps, including phone center and
back office will receive at least 1 week of product
and systems training.
2. Service quality evaluations will be done on all reps
at least once a month with retraining sessions
scheduled as needed based on performance monitoring.
<PAGE>
EXHIBIT 4.1
CONTINUING RESPONSIBILITIES OF CMB AND THE CHASE SERVICER UNDER
THE OLD SECURITIZATIONS
1. CFAC Grantor Trust 1991-A. The Chase Servicer shall remain responsible
for the duties and obligations of the Servicer with respect to Sections
5.09(a), 5.09(b), 5.09(d), 5.11(a), 5.11(c), 5.11(d), 5.11(e), 5.12,
10.02 and 11.06(c) of the Pooling and Servicing Agreement, dated as of
December 1, 1991, among CFAC, as Seller, CFMC, as Servicer, and
Sumitomo Bank of New York Trust Company, a New York trust company, as
Trustee of the CFAC Grantor Trust 1991-A.
2. CBNJ Boat Loan Trust 1994-1. CMB shall remain responsible for the
duties and obligations of the Servicer with respect to Sections
5.09(a), 5.09(b), 5.09(d), 5.11(a), 5.11(c), 5.11(d), 5.11(e), 5.12,
10.02 and 11.06(c) of the Pooling and Servicing Agreement, dated as of
June 9, 1994, among CMB, as Seller and Servicer, CFMC, as Subservicer,
and Bankers Trust Company, a New York banking corporation, as Trustee
of CBNJ Boat Loan Trust 1994-1.
<PAGE>
EXHIBIT 6.15
PAYMENT PROCESSING SEQUENCE
ALS - Precompute and Simple Interest Accounts
Primary Sequence -- INTEREST*, DEALER RESERVE INTEREST*, FORCE PLACED
INSURANCE, PRINCIPAL
Overage Sequence -- LATE CHARGES, INTEREST, FORCE PLACED INSURANCE,
PRINCIPAL
ACLS - Precompute, Simple Interest & Fixed Amortizations
Primary Sequence -- EXTENSION FEES, INTEREST, INSURANCES, PRINCIPAL, LATE
CHARGES, FORCE PLACED INSURANCE, EXPENSES
Overage Sequence -- INTEREST, LATE CHARGES, INSURANCE, FORCE PLACED
INSURANCE, EXPENSES, EXTENSIONS, PRINCIPAL
- --------
* The sum of (i) interest and (ii) dealer reserve interest equals the total
customer finance charge.
<PAGE>
Exhibit 25.1
Filing pursuant to Registrtation
Statement number 333-07575
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
-----------------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO
___ SECTION 305(b) (2)
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
(Exact name of trustee as specified in its charter)
A U.S. National Banking Association 41-1592157
(Jurisdiction of incorporation or (I.R.S. Employer
organization if not a U.S. national Identification No.)
bank)
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479
(Address of principal executive offices) (Zip code)
Stanley S. Stroup, General Counsel
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION
Sixth Street and Marquette Avenue
Minneapolis, Minnesota 55479
(612) 667-1234
(Name, address and telephone number of Agent for Service)
-----------------------------
Chase Manhattan RV Owner Trust 1997-A
(Exact name of obligor as specified in its charter)
Delaware 52-6867634
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
c/o Wilmington Trust Company
Attn: Corporate Trust Administration
Rodney Square North
1100 North Market Square
<PAGE>
Wilmington, DE 19890-0001
(Address of principal executive offices) (Zip code)
-----------------------------
Asset Backed Notes of Chase Manhattan RV Owner Trust 1997-A
(Title of the indenture securities)
2
<PAGE>
Item 1. General Information. Furnish the following information as to the
trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Comptroller of the Currency
Treasury Department
Washington, D.C.
Federal Deposit Insurance Corporation
Washington, D.C.
The Board of Governors of the Federal Reserve System
Washington, D.C.
(b) Whether it is authorized to exercise corporate trust
powers.
The trustee is authorized to exercise corporate trust
powers.
Item 2. Affiliations with Obligor. If the obligor is an affiliate of the
trustee, describe each such affiliation.
None with respect to the trustee.
No responses are included for Items 3-14 of this Form T-1, pursuant to General
Instruction B, because the obligor is not in default as provided under Item 13.
Item 15. Foreign Trustee. Not applicable.
Item 16. List of Exhibits. List below all exhibits filed as a part of
this Statement of Eligibility.
Exhibit 1. a. A copy of the Articles of Association of the
trustee now in effect.*
Exhibit 2. a. A copy of the certificate of authority of
the trustee to commence business issued June
28, 1872, by the Comptroller of the Currency
to The Northwestern National Bank of
Minneapolis.*
b. A copy of the certificate of the Comptroller
of the Currency dated January 2, 1934,
approving the consolidation of The
Northwestern National Bank of Minneapolis
and The Minnesota Loan and Trust Company of
Minneapolis, with the surviving entity being
titled Northwestern National Bank and Trust
Company of Minneapolis.*
c. A copy of the certificate of the Acting
Comptroller of the Currency dated January
12, 1943, as to change of corporate title of
Northwestern National Bank and Trust Company
of Minneapolis to Northwestern National Bank
of Minneapolis.*
d. A copy of the letter dated May 12, 1983 from
the Regional Counsel, Comptroller of the
Currency, acknowledging receipt of notice of
name
3
<PAGE>
change effective May 1, 1983 from
Northwestern National Bank of Minneapolis to
Norwest Bank Minneapolis, National
Association.*
e. A copy of the letter dated January 4, 1988
from the Administrator of National Banks for
the Comptroller of the Currency certifying
approval of consolidation and merger
effective January 1, 1988 of Norwest Bank
Minneapolis, National Association with
various other banks under the title of
"Norwest Bank Minnesota, National
Association."*
Exhibit 3. A copy of the authorization of the trustee to
exercise corporate trust powers issued January 2,
1934, by the Federal Reserve Board.*
Exhibit 4. Copy of By-laws of the trustee as now in effect.*
Exhibit 5. Not applicable.
Exhibit 6. The consent of the trustee required by Section 321(b)
of the Act.
Exhibit 7. Consolidated Reports of Condition and Income of the
trustee as of June 30, 1997.
Exhibit 8. Not applicable.
Exhibit 9. Not applicable.
* Incorporated by reference to the corresponding numbered
exibits to the form T-1 filed as Exhibit 25 to registration
statement number 33-66026.
4
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the
trustee, Norwest Bank Minnesota, National Association, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this statement of eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of
Minneapolis and State of Minnesota on the 26th day of August, 1997.
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
-----------------------
Marianna C. Stershic
Assistant Vice-President
5
<PAGE>
EXHIBIT 6
August 26, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In accordance with Section 321(b) of the Trust Indenture Act of 1939, as
amended, the undersigned hereby consents that reports of examination of the
undersigned made by Federal, State, Territorial, or District authorities
authorized to make such examination may be furnished by such authorities to the
Securities and Exchange Commission upon its request therefor.
Very truly yours,
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
-----------------------
Marianna C. Stershic
Assistant Vice-President
6
