EXHIBIT 4.3




 


 





 


 


SALE AND SERVICING AGREEMENT


 


among


 


JOHN DEERE OWNER TRUST 2003


 


Issuer


 


JOHN DEERE RECEIVABLES, INC.


 


Seller


 


and


 


JOHN DEERE CAPITAL CORPORATION


 


Servicer


 


 


Dated as of July 15, 2003




 


 





 

















 


TABLE OF CONTENTS


 


	
   

  	
  Page

  
	
  ARTICLE I

  	
   

  
	
   

  	
   

  
	
  Definitions

  	
   

  
	
   

  	
   

  
	
  SECTION 1.01
  Definitions

  	
  1

  
	
  SECTION 1.02
  Other Definitional Provisions

  	
  12

  
	
  SECTION 1.03
  Calculations

  	
  13

  
	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
   

  
	
  Conveyance of Receivables

  	
   

  
	
   

  	
   

  
	
  SECTION 2.01
  Conveyance of Receivables

  	
  13

  
	
  SECTION 2.02
  Waiver

  	
  14

  
	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
   

  
	
  The Receivables

  	
   

  
	
   

  	
   

  
	
  SECTION 3.01
  Representations and Warranties of Seller

  	
  14

  
	
  SECTION 3.02
  Repurchase by Seller upon Breach

  	
  15

  
	
  SECTION 3.03
  Custody of Receivable Files

  	
  15

  
	
  SECTION 3.04
  Duties of Servicer as Custodian

  	
  16

  
	
  SECTION 3.05
  Instructions; Authority to Act

  	
  16

  
	
  SECTION 3.06
  Custodian’s Indemnification

  	
  16

  
	
  SECTION 3.07
  Effective Period and Termination

  	
  17

  
	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
   

  
	
  Administration and Servicing of Receivables

  	
   

  
	
   

  	
   

  
	
  SECTION 4.01
  Duties of Servicer

  	
  17

  
	
  SECTION 4.02
  Collection of Receivable Payments

  	
  18

  
	
  SECTION 4.03
  Realization upon Receivables

  	
  18

  
	
  SECTION 4.04
  Physical Damage Insurance

  	
  18

  
	
  SECTION 4.05
  Maintenance of Security Interests in Financed Equipment

  	
  19

  
	
  SECTION 4.06
  Covenants of Servicer

  	
  19

  
	
  SECTION 4.07
  Purchase by Servicer of Receivables upon Breach

  	
  19

  
	
  SECTION 4.08
  Servicing Fee

  	
  19

  
	
  SECTION 4.09
  Servicer’s Certificate

  	
  19

  
	
  SECTION 4.10
  Annual Statement as to Compliance; Notice of Default

  	
  20

  
	
  SECTION 4.11
  Annual Independent Certified Public Accountants’ Report

  	
  20

  
	
  SECTION 4.12
  Access to Certain Documentation and Information Regarding Receivables

  	
  21

  



 


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  SECTION 4.13
  Servicer Expenses

  	
  21

  
	
  SECTION 4.14
  Appointment of Sub-Servicer

  	
  21

  
	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
   

  	
   

  
	
  Distributions; Reserve Account;

  Statements to the Certificateholder and Noteholders

  	
   

  
	
   

  	
   

  
	
  SECTION 5.01
  Establishment of Trust Accounts

  	
  21

  
	
  SECTION 5.02
  Collections

  	
  24

  
	
  SECTION 5.03
  Additional Deposits

  	
  24

  
	
  SECTION 5.04
  Distributions

  	
  24

  
	
  SECTION 5.05
  Reserve Account

  	
  25

  
	
  SECTION 5.06
  Statements to the Certificateholder and Noteholders

  	
  26

  
	
  SECTION 5.07 Net Deposits

  	
  28

  
	
   

  	
   

  
	
  ARTICLE VI

  	
   

  
	
   

  	
   

  
	
  The Seller

  	
   

  
	
   

  	
   

  
	
  SECTION 6.01
  Representations of Seller

  	
  28

  
	
  SECTION 6.02
  Corporate Existence

  	
  29

  
	
  SECTION 6.03
  Liability of Seller; Indemnities

  	
  30

  
	
  SECTION 6.04
  Merger or Consolidation of, or Assumption of the Obligations of, Seller

  	
  31

  
	
  SECTION 6.05
  Limitation on Liability of Seller and Others

  	
  31

  
	
  SECTION 6.06
  Seller May Own Notes; Retention of the Certificate

  	
  31

  
	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
   

  	
   

  
	
  The Servicer

  	
   

  
	
   

  	
   

  
	
  SECTION 7.01
  Representations of Servicer

  	
  31

  
	
  SECTION 7.02
  Indemnities of Servicer

  	
  33

  
	
  SECTION 7.03
  Merger or Consolidation of, or Assumption of the Obligations of, Servicer

  	
  34

  
	
  SECTION 7.04
  Limitation on Liability of Servicer and Others

  	
  35

  
	
  SECTION 7.05
  JDCC Not to Resign as Servicer

  	
  35

  
	
  SECTION 7.06
  Servicer to Act as Administrator

  	
  36

  
	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  
	
   

  	
   

  
	
  Default

  	
   

  
	
   

  	
   

  
	
  SECTION 8.01
  Servicer Default

  	
  36

  
	
  SECTION 8.02
  Appointment of Successor

  	
  37

  
	
  SECTION 8.03
  Notification to Noteholders and the Certificateholder

  	
  38

  
	
  SECTION 8.04
  Waiver of Past Defaults

  	
  38

  



 


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  ARTICLE IX

  	
   

  
	
   

  	
   

  
	
  Termination

  	
   

  
	
   

  	
   

  
	
  SECTION 9.01
  Optional Purchase of All Receivables and Termination

  	
  38

  
	
   

  	
   

  
	
  ARTICLE X

  	
   

  
	
   

  	
   

  
	
  Miscellaneous Provisions

  	
   

  
	
   

  	
   

  
	
  SECTION
  10.01 Amendment

  	
  39

  
	
  SECTION
  10.02 Protection of Title to Trust

  	
  40

  
	
  SECTION
  10.03 Notices

  	
  42

  
	
  SECTION
  10.04 Assignment

  	
  43

  
	
  SECTION
  10.05 Limitations on Rights of Others

  	
  43

  
	
  SECTION
  10.06 Severability

  	
  43

  
	
  SECTION
  10.07 Separate Counterparts

  	
  43

  
	
  SECTION
  10.08 Headings

  	
  43

  
	
  SECTION
  10.09 Governing Law

  	
  43

  
	
  SECTION
  10.10 Assignment to Indenture Trustee

  	
  43

  
	
  SECTION 10.11 Nonpetition Covenants

  	
  43

  
	
  SECTION
  10.12 Limitation of Liability of Owner Trustee and Indenture Trustee

  	
  44

  
	
  SECTION
  10.13 Additional Securities

  	
  44

  



 


	
  SCHEDULES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULE A

  	
  –

  	
  Schedule of
  Receivables

  
	
  SCHEDULE B

  	
  –

  	
  Location of
  Receivable Files

  
	
  SCHEDULE C

  	
  –

  	
  List of
  Fiscal Months

  
	
  SCHEDULE D

  	
  –

  	
  Servicer’s
  Certificate

  
	
  SCHEDULE E

  	
  –

  	
  Statement to
  Certificateholder

  
	
  SCHEDULE F

  	
  –

  	
  Statement to
  Noteholders

  
	
  SCHEDULE G

  	
  –

  	
  Payment and
  Deposit Instructions to Indenture Trustee

  



 


iii

















 


This SALE AND
SERVICING AGREEMENT dated as of July 15, 2003, among JOHN DEERE OWNER
TRUST 2003, a Delaware statutory trust (the “Issuer”), JOHN DEERE RECEIVABLES,
INC., a Nevada corporation (the “Seller”), and JOHN DEERE CAPITAL CORPORATION,
a Delaware corporation (the “Servicer”).


 


WHEREAS the
Issuer desires to purchase a portfolio of receivables arising in connection
with agricultural and construction equipment retail installment sale and loan
contracts generated by John Deere Capital Corporation in the ordinary course of
business;


 


WHEREAS the
Seller has purchased such receivables from John Deere Capital Corporation and
desires to sell such receivables to the Issuer; and


 


WHEREAS John
Deere Capital Corporation desires to service such receivables.


 


NOW,
THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the parties hereto agree as follows:


 


ARTICLE I


 


Definitions


 


SECTION 1.01   Definitions.  Whenever used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the following meanings:


 


“Administration
Agreement” means the Administration Agreement dated as of July 15, 2003
among the Trust, JDCC, as Administrator, and The Bank of New York, as indenture
trustee, as the same may be amended and supplemented from time to time.


 


“Administration
Fee” means the fee payable to the Administrator pursuant to Section 3 of the
Administration Agreement.


 


“Administrator”
means the administrator under the Administration Agreement.


 


“Agreement”
means this Sale and Servicing Agreement, as the same may be amended and
supplemented from time to time.


 


“Amount
Financed” with respect to a Receivable means the amount advanced under the
Receivable toward the purchase price of the related Financed Equipment and any
related costs.


 


“Annual
Percentage Rate” or “APR” of a Receivable means the fixed annual rate of
finance charges specified in the related Contract.


 


“August 2004
Payment Date” means the payment date scheduled for August 16, 2004.


 


“Certificate”
means the Certificate (as defined in the Trust Agreement).


 

















 


“Certificate
Balance” equals, initially, $7,546,670 and, on each day thereafter, equals the
initial Certificate Balance reduced by all amounts allocable to principal
previously distributed to the Certificateholder.


 


“Certificate
Distribution Account” has the meaning assigned to such term in the Trust
Agreement.


 


“Certificateholder”
has the meaning assigned to such term in the Trust Agreement.


 


“Certificate
Monthly Principal Distributable Amount” means (a) zero on any Payment Date on
which the outstanding principal balance of the Notes has not been reduced to
zero after taking into account distributions on such Payment Date and (b) on
each Payment Date on and after the Payment Date on which the outstanding
principal balance of the Notes is reduced to zero, an amount equal to the
Principal Distributable Amount minus the principal payment, if any, on the
Notes on such Payment Date.


 


“Class A
Monthly Principal Distributable Amount” means, for any Payment Date, the
Principal Distributable Amount less the Class B Monthly Principal Distributable
Amount; provided that on (i) the Class A-1 Final Payment Date, the Class A
Monthly Principal Distributable Amount will at least equal the outstanding
principal balance of the Class A-1 Notes, (ii) the Class A-2 Final Payment
Date, the Class A Monthly Principal Distributable Amount will at least equal
the outstanding principal balance of the Class A-2 Notes, (iii) the Class A-3
Final Payment Date, the Class A Monthly Principal Distributable Amount will at
least equal the outstanding principal balance of the Class A-3 Notes, and (iv)
the Class A-4 Final Payment Date, the Class A Monthly Principal Distributable
Amount will at least equal the outstanding principal balance of the Class A-4
Notes.


 


“Class A-1
Note Final Payment Date” means the Special Payment Date.


 


“Class A-1
Note Interest Rate” means a rate per annum equal to 1.08125%.


 


“Class A-1
Notes” means the Class A-1 Notes (as defined in the Indenture).


 


“Class A-2
Note Final Payment Date” means January 17, 2006.


 


“Class A-2
Note Interest Rate” means a rate per annum equal to 1.31%.


 


“Class A-2
Notes” means the Class A-2 Notes (as defined in the Indenture).


 


“Class A-3
Note Final Payment Date” means April 16, 2007.


 


“Class A-3
Note Interest Rate” means a rate per annum equal to 1.79%.


 


“Class A-3
Notes” means the Class A-3 Notes (as defined in the Indenture).


 


“Class A-4
Note Final Payment Date” means June 15, 2010.


 


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“Class A-4
Note Interest Rate” means a rate per annum equal to 2.44%.


 


“Class A-4
Notes” means the Class A-4 Notes (as defined in the Indenture).


 


“Class B
Adjusted Principal Distributable Amount” means, with respect to any Payment
Date, an amount equal to the excess, if any, of (i) the outstanding principal
balance of the Class B Notes (before giving effect to payments on that Payment
Date) less any Class B Principal Carryover Shortfall over (ii) the Class B
Percentage of the outstanding Note Value as of the end of the related
Collection Period; provided that on any Payment Date on which the outstanding
principal balance of the Class A-1 Notes is greater than zero before giving
effect to any payments on such Payment Date, the Class B Adjusted Principal
Distributable Amount will not be greater than the greater of (x) zero and (y)
the Principal Distributable Amount minus such outstanding principal balance of
the Class A-1 Notes.


 


“Class B
Monthly Principal Distributable Amount” means, for any Payment Date, the sum of
(a) the Class B Adjusted Principal Distributable Amount and (b) the
Class B Principal Carryover Shortfall; provided that on the Class B Note Final
Payment Date, the Class B Monthly Principal Distributable Amount shall equal
the outstanding principal balance of the Class B Notes.


 


“Class B
Notes” means the Class B Notes (as defined in the Indenture).


 


“Class B Note
Final Payment Date” means June 15, 2010.


 


“Class B Note
Interest Rate” means a rate per annum equal to 2.01%.


 


“Class B
Percentage” means, for any Payment Date, the quotient (expressed as a
percentage) of (i) the initial principal amount of the Class B Notes divided by
(ii) the sum of the initial principal amount of the Class A-2 Notes, the Class
A-3 Notes, the Class A-4 Notes, the Class B Notes and the initial Certificate
Balance.


 


“Class B
Principal Carryover Shortfall” means, for any Payment Date, the excess of
(a) the Class B Monthly Principal Distributable Amount for the preceding
Payment Date over (b) the amount of principal actually paid to the Class B
Noteholders on such preceding Payment Date.


 


“Collection
Account” means the account designated as such, established and maintained
pursuant to Section 5.01.


 


“Collection
Period” means, with respect to the first Payment Date, the period from the
Cut-off Date through the Fiscal Month ending on July 27, 2003 and, with
respect to each subsequent Payment Date, the Fiscal Month ending immediately
preceding such Payment Date.  Any amount
stated “as of the close of business on the last day of a Collection Period”
shall give effect to the following calculations as determined as of the end of
the day on such last day:  (1) all
applications of collections and (2) all distributions to be made on the
following Payment Date.


 


“Contract”
means an agricultural or construction equipment retail installment sale or loan
contract.


 


3

















 


“Corporate
Trust Office” means the principal office of the Indenture Trustee at which at
any particular time its corporate trust business shall be administered, which
office at date of the execution of this Agreement is located at 101 Barclay
Street, New York, New York 10286, Attention: Asset Backed Finance Unit; or at
such other address as the Indenture Trustee may designate from time to time by
notice to the Noteholders and the Seller, or the principal corporate trust
office of any successor Indenture Trustee (the address of which the successor
Indenture Trustee will notify the Noteholders and the Seller).


 


“Current
Principal Distribution Amount” means, with respect to any Payment Date, an
amount equal to the Note Value at the beginning of the related Collection
Period less the Note Value at the end of that Collection Period.


 


“Cut-off Date”
means June 22, 2003.


 


“Dealer” means
the dealer who sold an item of Financed Equipment securing a Receivable.


 


“Deere” means
Deere & Company, a Delaware corporation, and its successors.


 


“Delivery”
when used with respect to Trust Account Property the perfection and priority in
which is governed by Article 8 of the UCC or the Federal Book-Entry Regulations
means:


 


(a)                                  with
respect to bankers’ acceptances, commercial paper, negotiable certificates of
deposit and other obligations that constitute “instruments” within the meaning
of Section 9-102(47) of the UCC (other than certificated securities) and are
susceptible to physical delivery, transfer thereof to the Indenture Trustee or
its nominee or custodian by physical delivery 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, and such additional
or alternative procedures as may hereafter become appropriate to effect the
complete transfer of ownership of any such Trust Property to the Indenture
Trustee or its nominee or custodian free and clear of any adverse claims,
consistent with changes in applicable law or regulations or the interpretation
thereof;


 


(b)                                 with
respect to a “certificated security” (as defined in Section 8-102(a)(4) of the
UCC), transfer thereof (i) by physical delivery of such certificated security
endorsed to, or registered in the name of, the Indenture Trustee or its nominee
or custodian or endorsed in blank, (ii) by physical delivery of such
certificated security in registered form to a “securities intermediary” (as
defined in Section 8-102(a)(14) of the UCC) acting on behalf of the Indenture
Trustee if the certificated security has been specially endorsed to the
Indenture Trustee by an effective endorsement;


 


(c)                                  with
respect to any security issued by the U.S. Treasury, the Federal Home Loan
Mortgage Corporation or by the Federal National Mortgage Association that is a
book-entry security held through the Federal Reserve System pursuant to Federal
book-entry regulations, the following procedures, all in accordance with
applicable law, including applicable Federal regulations and Articles 8 and 9
of the UCC:  book-entry


 


4

















 


registration of such Trust Account Property to an appropriate
book-entry account maintained with a Federal Reserve Bank by a securities
intermediary which is also a “depository” pursuant to applicable Federal
regulations and issuance by such securities intermediary of a deposit advice or
other written confirmation of such book-entry registration to the Indenture
Trustee or its nominee or custodian of the purchase by the Indenture Trustee or
its nominee or custodian of such book-entry securities; the identification by
the Federal Reserve Bank of such book-entry certificates on its records being
credited to the securities intermediary’s Participant’s securities account; the
making by such securities intermediary of entries in its books and records
identifying such book-entry security held through the Federal Reserve System
pursuant to Federal book-entry regulations as belonging to the Indenture
Trustee or its nominee or custodian and indicating that such custodian holds
such Trust Account Property solely as agent for the Indenture Trustee or its
nominee or custodian; and such additional or alternative procedures as may
hereafter become appropriate to effect complete transfer of ownership of any
such Trust Account Property to the Indenture Trustee or its nominee or
custodian, consistent with changes in applicable law or regulations or the
interpretation thereof; and


 


(d)                                 with
respect to any item of Trust Account Property that is an uncertificated security
under Article 8 of the UCC and that is not governed by clause (c) above,
registration on the books and records of the issuer thereof in the name of the
Indenture Trustee, or by another Person (not a securities intermediary) either
becoming the registered owner of the uncertificated security on behalf of the
Indenture Trustee, or having become the registered owner, acknowledging that it
holds for the Indenture Trustee, or the issuer thereof agreeing that it will
comply with instructions originated by the Indenture Trustee without further
consent of the registered owner thereof;


 


(e)                                  with
respect to a “financial asset” (as defined in Section 8-102(a)(9) of the UCC)
to the extent not covered by paragraphs (a) through (d) above, if a securities
intermediary (i) indicates by book entry that such financial asset has been
credited to the Indenture Trustee’s “securities account” (as defined in Section
8-501(a) of the UCC), (ii) receives a financial asset from the Indenture
Trustee or acquires a financial asset for the Indenture Trustee, and in either
case, accepts it for credit to the Indenture Trustee’s securities account,
(iii) becomes obligated under other law, regulation or rule to credit a
financial asset to the Indenture Trustee’s securities account, or (iv) has
agreed that it will comply with “entitlement orders” (as defined in Section
8-102(a)(8) of the UCC) originated by the Indenture Trustee without further
consent by the “entitlement holder” (as defined in Section 8-102(a)(7) of the
UCC); and


 


(f)                                    in
each case of delivery contemplated herein, the Indenture Trustee shall make
appropriate notations on its records, and shall cause same to be made on the
records of its nominees, indicating that securities are credited to the
appropriate Trust Account and held in trust pursuant to and as provided in this
Agreement.


 


“Depositor”
shall mean the Seller in its capacity as Depositor under the Trust Agreement.


 


5

















 


“Determination
Date” means, with respect to any Payment Date, the third Business Day prior to
such Payment Date.


 


“Eligible
Deposit Account” means either (a) a segregated trust account with an Eligible
Institution or (b) a segregated trust account with the corporate trust
department of a depository institution organized under the laws of the United
States of America or any State (or any domestic branch of a foreign bank),
having corporate trust powers and acting as trustee for funds deposited in such
account, so long as any of the unsecured debt obligations of such depository
institution shall have a credit rating from each of Moody’s and Standard &
Poor’s in one of its generic rating categories which signifies investment
grade.


 


“Eligible
Institution” means (a) the corporate trust department of the Indenture Trustee
or the Owner Trustee, or (b) a depository institution organized under the laws
of the United States of America or any State (or any domestic branch of a
foreign bank), (1)(i) which has either (A) a long-term unsecured debt rating of
AAA or better by Standard & Poor’s and Aaa or better by Moody’s or (B) a
short-term unsecured debt rating or a certificate of deposit rating of A-1+ by
Standard & Poor’s and P-1 or better by Moody’s, or any
other long-term, short-term or certificate of deposit rating acceptable to the
Rating Agencies and (ii) whose deposits are insured by the FDIC or (2)(i) the
parent of which has a long-term or short-term unsecured debt rating acceptable
to the Rating Agencies and (ii) whose deposits are insured by the FDIC.  If so qualified, the Indenture Trustee, the
Owner Trustee, U.S. Bank Trust National Association or The Bank of New York may
be considered an Eligible Institution for the purposes of clause (b) of this
definition.


 


“Eligible
Investments” mean book-entry securities, negotiable instruments or securities
represented by instruments in bearer or registered form which evidence:


 


(a)                                  direct
obligations of, and obligations fully guaranteed as to timely payment by, the
United States of America;


 


(b)                                 demand
deposits, time deposits or certificates of deposit of any depository
institution or trust company incorporated under the laws of the United States
of America or any State (or any domestic branch of a foreign bank) and subject
to supervision and examination by Federal or State banking or depository
institution authorities; provided, however, that at the time of the investment
or contractual commitment to invest therein, the commercial paper or other
short-term unsecured debt obligations (other than such obligations the rating
of which is based on the credit of a Person other than such depository
institution or trust company) thereof shall have a credit rating from each of
Standard & Poor’s and Moody’s, in the highest investment category granted
thereby:


 


(c)                                  commercial
paper having, at the time of the investment or contractual commitment to invest
therein, a rating from each of Standard & Poor’s and Moody’s in the highest
investment category granted thereby;


 


(d)                                 investments
in money market funds having a rating from each of Standard & Poor’s and
Moody’s in the highest investment category granted thereby (including


 


6

















 


funds for which the Indenture Trustee or the Owner Trustee or any of
their respective Affiliates is investment manager or advisor);


 


(e)                                  bankers’
acceptances issued by any depository institution or trust company referred to
in clause (b) above;


 


(f)                                    repurchase
obligations with respect to any security that is a direct obligation of, or
fully guaranteed by, the United States of America or any agency or
instrumentality thereof the obligations of which are backed by the full faith
and credit of the United States of America, in either case entered into with a
depository institution or trust company (acting as principal) described in
clause (b); and


 


(g)                                 any
other investment permitted by each of the Rating Agencies in writing; provided,
however, that if an investment would be an Eligible Investment solely by virtue
of clause (b), (c), (d), (e) or (f) and has a remaining maturity of more than
30 days at the time of its acquisition by the Indenture Trustee, then such
investment shall be an Eligible Investment only if the long-term unsecured debt
rating of the obligor on such investment is at least A-1 from Moody’s and at
least A+ by S&P.


 


“FDIC”
means the Federal Deposit Insurance Corporation.


 


“Financed
Equipment” means an item of agricultural, construction or forestry equipment,
together with all accessions thereto, which was purchased by an Obligor
pursuant to the terms of the related Contract and securing such Obligor’s
indebtedness under the respective Receivable.


 


“Fiscal
Month” means a fiscal month specified in Schedule C, as may be amended from
time to time by the delivery by the Servicer to the Seller, the Owner Trustee
and the Indenture Trustee of a new Schedule C hereto listing the fiscal months;
provided that the fiscal months on any such new Schedule C shall have the
ranges of number of days generally similar to the ranges of the number of days
in the fiscal months set forth in the original Schedule C hereto and shall not
result in a Collection Period that does not allow the Servicer a sufficient
amount of time to perform the calculations required of it hereunder in respect
of such Collection Period prior to the related Determination Date.


 


“Indenture”
means the Indenture dated as of July 15, 2003, between the Issuer and the
Indenture Trustee, as the same may be amended and supplemented from time to
time.


 


“Indenture
Trustee” means The Bank of New York solely in its capacity as indenture trustee
under the Indenture and not in its individual capacity, its successors in
interest and any successor indenture trustee under the Indenture.


 


“Initial
Pool Balance” means the Pool Balance as of the Cut-off Date, which is
$750,123,881.06.


 


“Insolvency
Event” means, with respect to 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


 


7

















 


bankruptcy, insolvency or other similar law now or
hereafter in effect, or appointing a receiver, 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 90 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.


 


“Investment
Earnings” means, with respect to any Payment Date, the investment earnings (net
of losses and investment expenses) on amounts on deposit in the Trust Accounts
to be deposited into the Collection Account on such Payment Date pursuant to
Section 5.01(b).


 


“JDCC”
means John Deere Capital Corporation, a Delaware corporation, and its
successors.


 


“Lien”
means a security interest, lien, charge, pledge, equity or encumbrance of any
kind, other than tax liens, mechanics’ liens and any liens which attach to the
respective Receivable by operation of law as a result of any act or omission by
the related Obligor.


 


“Liquidated
Receivable” means any Receivable liquidated by the Servicer through the sale or
other disposition of the Financed Equipment or which the Servicer has
determined to charge-off without realizing upon the Financed Equipment.


 


“Liquidation
Proceeds” means, with respect to any Liquidated Receivable, the moneys
collected in respect thereof, from whatever source (including the proceeds of
insurance policies with respect to the related Financed Equipment or Obligor
but excluding any amounts from Dealer reserves) on a Liquidated Receivable
during the Fiscal Month in which such Receivable became a Liquidated
Receivable, net of the sum of any amounts expended by the Servicer in
connection with such liquidation and any amounts required by law to be remitted
to the Obligor on such Liquidated Receivable.


 


“Moody’s”
means Moody’s Investors Service, Inc., or its successor.


 


“Net
APR” means, with respect to a Receivable, its APR less the Servicing Fee Rate.


 


“Note
Distribution Account” means the account designated as such, established and
maintained pursuant to Section 5.01.


 


“Note
Interest Rate” means the per annum interest rate borne by a Note.


 


“Note
Monthly Principal Distributable Amount” means, for any Payment Date, the sum of
(i) the Class A Monthly Principal Distributable Amount and (ii) the Class B
Monthly


 


8

















 


Principal Distributable Amount;
provided, that the Note Monthly Principal Distributable Amount shall not exceed
the aggregate outstanding principal balance of the Class A Notes and the Class
B Notes.


 


“Note
Value” means, with respect to any day, the present value of the unpaid
Scheduled Payments on the Receivables, discounted at an annual rate equal to
6.121%.  For purposes of calculating
Note Value, in the case of a defaulted Receivable, (a) prior to the time the
related Financed Equipment becomes repossessed, the Scheduled Payments on such
Receivable will be computed based on the amounts that would have been the
Scheduled Payments had such delinquency not occurred, (b) after the time, if
any, at which the Financed Equipment securing such defaulted Receivable has
been repossessed, but prior to the time such defaulted Receivable becomes a
Liquidated Receivable, the Principal Balance of such defaulted Receivable shall
be added to such Note Value, but there shall be deemed to be no Scheduled
Payments due on such defaulted Receivable and (c) after the time such defaulted
Receivable becomes a Liquidated Receivable, and after the payment of a Purchase
Amount in respect of a Purchased Receivable, there shall be deemed to be no
Scheduled Payments due on such Receivable.


 


“Noteholders’
Distributable Amount” means, with respect to any Payment Date, the sum of (a)
the accrued and unpaid interest on the Notes for such Payment Date and (b) the
Note Monthly Principal Distributable Amount.


 


“Notes”
means the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the Class
A-4 Notes and the Class B Notes.


 


“Obligor”
on a Receivable means the purchaser or co-purchasers of the Financed Equipment
and any other Person who owes payments under the Receivable.


 


“Officers’
Certificate” means a certificate signed by (a) the chairman of the board, the
president, any vice president, the treasurer or any assistant treasurer and (b)
the secretary or any assistant secretary of the Seller or the Servicer, as
appropriate.


 


“Opinion
of Counsel” means one or more written opinions of counsel who may be an
employee of or counsel to the Seller or the Servicer, which counsel shall be
acceptable to the Indenture Trustee, the Owner Trustee or the Rating Agencies,
as applicable.


 


“Owner
Trust Estate” has the meaning assigned to such term in the Trust Agreement.


 


“Owner Trustee” means U.S. Bank Trust National
Association in its capacity as Owner Trustee under the Trust Agreement, its
successors in interest and any successor owner trustee under the Trust
Agreement.


 


“Payment
Date” means the 15th day of each month or, if such day is not a Business Day,
the immediately following Business Day, commencing on August 15, 2003,
provided, however, that if any Class A-1 Notes are outstanding after the
Payment Date in July 2004, Payment Date shall also mean, solely in the
context of determining the date for final


 


9

















 


payment of the Class A-1 Notes
and the interest accrual period for the Class A-1 Notes from the Payment Date
in July 2004 to but excluding such final payment date, the Special Payment
Date.


 


“Pool
Balance” as of the close of business on the last day of a Collection Period,
means the aggregate Principal Balance of the Receivables (excluding Purchased
Receivables and Liquidated Receivables).


 


“Principal
Balance” of a Receivable, as of the close of business on the last day of a
Collection Period, means the Amount Financed minus the sum of (i) that portion
of all Scheduled Payments paid on or prior to such day allocable to principal
using the actuarial method, (ii) any payment of the Purchase Amount with
respect to the Receivable purchased by the Servicer or repurchased by the
Seller and allocable to principal, and (iii) any prepayment in full or any
partial prepayments applied to reduce the Principal Balance of the Receivable.


 


“Principal
Carryover Shortfall” means, with respect to any Payment Date, the excess of (i)
the Principal Distributable Amount for the immediately preceding Payment Date
over (ii) the amount that was actually deposited into the Note Distribution
Account and the Certificate Distribution Account, if applicable, on account of
principal on such immediately preceding Payment Date.


 


“Principal
Distributable Amount” means, with respect to any Payment Date, the sum of (i)
the Current Principal Distribution Amount for such Payment Date and (ii) the
Principal Carryover Shortfall for such Payment Date.


 


“Purchase
Agreement” means the Purchase Agreement dated as of July 15, 2003, between
the Seller and JDCC, as the same may be amended and supplemented from time to
time.


 


“Purchase
Amount” means with respect to a Receivable, the amount, as of the close of
business on the last day of a Collection Period, required to prepay in full the
Receivable under the terms thereof including interest to the last day of such
Collection Period.


 


“Purchased
Receivable” means a Receivable purchased as of the close of business on the
last day of a Collection Period by the Servicer pursuant to Section 4.07 or
repurchased as of such time by the Seller pursuant to Section 3.02.


 


“Rating
Agencies” means Moody’s and Standard & Poor’s.  If no such organization or successor is in existence, “Rating
Agency” shall be a nationally recognized statistical rating organization or
other comparable Person designated by the Seller, notice of which designation
shall be given to the Indenture Trustee, the Owner Trustee and the Servicer.


 


“Rating
Agency Condition” means, with respect to any action, that each Rating Agency
shall have been given 10 days (or such shorter period that is acceptable to
each Rating Agency) prior notice thereof and that each of the Rating Agencies
shall have notified the Seller, the Servicer, the Owner Trustee and the
Indenture Trustee in writing that such action will not result in a reduction or
withdrawal of the then current rating of the Notes.


 


“Receivable”
means any retail installment sale or loan contract listed on Schedule A hereto.


 


10

















 


“Receivable
Files” means the documents specified in Section 3.03.


 


“Recoveries”
means, with respect to any Liquidated Receivable, monies collected in respect
thereof, from whatever source (other than any amounts from Dealer reserves)
after the Fiscal Month in which such Receivable became a Liquidated Receivable,
net of the sum of any amounts expended by the Servicer for the account of the
Obligor and any amounts required by law to be remitted to the Obligor.


 


“Reserve
Account” means the account designated as such, established and maintained
pursuant to Section 5.01.


 


“Reserve
Account Initial Deposit” means, with respect to the Closing Date, $13,259,692.


 


“Scheduled
Payment” on a Receivable, means the scheduled periodic payment of principal and
interest required to be made by the Obligor.


 


“Seller”
means John Deere Receivables, Inc., a Nevada corporation, and its successors in
interest to the extent permitted hereunder.


 


“Servicer”
means JDCC, as the servicer of the Receivables, and each successor to JDCC (in
the same capacity) pursuant to Section 7.03 or 8.02.


 


“Servicer
Default” means an event specified in Section 8.01.


 


“Servicer’s
Certificate” means an Officers’ Certificate of the Servicer delivered pursuant
to Section 4.09, substantially in the form of Schedule D.


 


“Servicing
Fee” means the fee payable to the Servicer for services rendered during the
respective Collection Period, determined pursuant to Section 4.08.


 


“Servicing
Fee Rate” means 1.00% per annum.


 


“Special
Payment Date” means August 13, 2004, with respect to the Class A-1 Notes
only, if any of the Class A-1 Notes are outstanding after the Payment Date in
July 2004.


 


“Specified
Reserve Account Balance” means, unless otherwise consented to by the Rating
Agencies as described below, with respect to any Payment Date, 1.75% of the
initial Note Value; provided, however, that the Specified Reserve
Account Balance shall not exceed the sum of the outstanding principal amount of
the Notes immediately preceding such Payment Date less the Principal
Distribution Amount to be deposited in the Note Distribution Account on such
Payment Date and upon payment of all interest and principal due on the Notes,
the Specified Reserve Account Balance shall be zero.  The Specified Reserve Account Balance may be reduced or the
definition otherwise modified without the consent of the Noteholders and the
Certificateholder provided that the Rating Agencies confirm in writing that
such reduction or modification will not result in the reduction or withdrawal
of the then current rating of any class of the Notes and provided, further, the
Owner Trustee obtains an Opinion of Counsel confirming


 


11

















 


that the reduction or
modification will not change the tax classification of the Notes as
indebtedness.


 


“Standard
& Poor’s” means Standard & Poor’s, a division of The McGraw-Hill
Companies, Inc., or any successor to the business of such division.


 


“Sub-Servicer”
means Deere Credit Services, Inc., a Delaware corporation, and each successor
to Deere Credit Services, Inc. (in the same capacity) pursuant to Section 4.14.


 


“Total
Distribution Amount” means, for each Payment Date, the sum of the aggregate
collections in respect of Receivables (including Liquidation Proceeds and
Purchase Amounts) received during the related Collection Period, plus
Investment Earnings; provided that, in the event of a Special Payment Date, a
portion of the Total Distribution Amount for the August 2004 Payment Date
shall be deposited to the Trust Accounts on the Special Payment Date as
provided in Section 5.04(c) and the remaining Total Distribution Amount shall
be distributed on the August 2004 Payment
Date as provided in Section 5.04(b).


 


“Transfer
Date” means, with respect to any Payment Date, the Business Day preceding such
Payment Date.


 


“Trust”
means the Issuer.


 


“Trust
Account Property” means the Trust Accounts, all amounts and investments held
from time to time in any Trust Account (whether in the form of deposit
accounts, book-entry securities, uncertificated securities or otherwise),
including the Reserve Account Initial Deposit, and all proceeds of the
foregoing.


 


“Trust
Accounts” has the meaning assigned thereto in Section 5.01.


 


“Trust
Agreement” means the Trust Agreement dated as of July 15, 2003, between
the Seller and the Owner Trustee, as the same may be amended and supplemented
from time to time.


 


“Trust
Officer” means, in the case of the Indenture Trustee, any officer within the
Corporate Trust Office of the Indenture Trustee, including any Vice President,
Assistant Vice President, Secretary, Assistant Secretary or any other officer
of the Indenture Trustee 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 and,
with respect to the Owner Trustee, any officer in the Corporate Trust Services
Department of the Owner Trustee with direct responsibility for the
administration of the Trust Agreement and the Basic Documents on behalf of the
Owner Trustee.


 


SECTION 1.02   Other Definitional Provisions.


 


(a)                                  Capitalized
terms used herein and not otherwise defined herein have the meanings assigned
to them in the Indenture.


 


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(b)                                 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.


 


(c)                                  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 in the United States.  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 in the United States, the definitions contained in this
Agreement or in any such certificate or other document shall control.


 


(d)                                 The
words “hereof,” “herein,” “hereunder” and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement; Section, Schedule and Exhibit
references contained in this Agreement are references to Sections, Schedules
and Exhibits in or to this Agreement unless otherwise specified; and the term
“including” shall mean “including without limitation.”


 


(e)                                  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.


 


SECTION 1.03   Calculations.  For all purposes of this Agreement, interest
in respect of the Class A-1 Notes shall be computed on the basis of a 360-day
year and the actual number of days in the related period of accrual.  Interest in respect of the Class A-1 Notes
shall accrue from and including the Closing Date or from and including the most
recent Payment Date to which interest has been paid to but excluding the
current Payment Date.  For the avoidance
of doubt, if any Class A-1 Notes are outstanding after the Payment Date in
July 2004, interest on the Class A-1 Notes will accrue from and including
the Payment Date in July 2004 to but excluding the Special Payment Date.  Interest in respect of the Class A-2 Notes,
the Class A-3 Notes, the Class A-4 Notes and the Class B Notes shall be
computed on the basis of a 360-day year consisting of twelve 30-day
months.  Interest on the Class A-2
Notes, the Class A-3 Notes, the Class A-4 Notes and the Class B Notes in
respect of a Payment Date will accrue from and including the 15th day of the
month preceding such Payment Date (or the Closing Date in the case of the first
Payment Date) to and including the 14th day of the month of such Payment Date.


 


ARTICLE II


 


Conveyance of
Receivables


 


SECTION 2.01   Conveyance of Receivables.  In consideration of the Issuer’s delivery to
or upon the order of the Seller of $749,025,702.39, the issuance to the Seller
of the Certificate and the waiver, termination and release set forth in 2.02
below, the Seller does hereby


 


13

















 


sell, transfer, assign, set
over and otherwise convey to the Issuer, without recourse (subject to the
obligations herein):


 


(a)                                  all
right, title and interest of the Seller in and to the Receivables, and all
moneys due thereon, on or after the Cut-off Date;


 


(b)                                 the
interest of the Seller in the security interests in the Financed Equipment
granted by Obligors pursuant to the Receivables and any other interest of the
Seller in the Financed Equipment;


 


(c)                                  the
interest of the Seller in any proceeds with respect to the Receivables from
claims on any physical damage, credit life or disability insurance policies
covering Financed Equipment or Obligors;


 


(d)                                 all
right, title and interest of the Seller in and to the Purchase Agreement,
including the right of the Seller to cause JDCC to repurchase Receivables from
the Seller under certain circumstances; and


 


(e)                                  the
proceeds of any and all of the foregoing.


 


SECTION 2.02   Waiver.  The Issuer hereby waives, releases and terminates (i) any rights
it may have in any equipment (other than the Financed Equipment) as security
for any obligations owing to it under the Receivables, (ii) any rights it may
have in any property as security for any Receivable other than the rights
relating to the related Financed Equipment and the proceeds thereof and (iii)
any rights it may have to apply moneys received under a receivable that was not
sold to the Issuer pursuant to Section 2.01.  Notwithstanding anything to the contrary contained herein, the
foregoing in no way constitutes a waiver, release or termination of any of the
rights of the Issuer with respect to the Financed Equipment and the rights
related to the Financed Equipment.


 


ARTICLE III


 


The Receivables


 


SECTION 3.01   Representations and Warranties of Seller.  The Seller makes the following
representations and warranties as to the Receivables on which the Issuer is
deemed to have relied in acquiring the Receivables.  Such representations and warranties speak as of the execution and
delivery of this Agreement, but shall survive the sale, transfer and assignment
of the Receivables to the Issuer and the pledge thereof to the Indenture
Trustee pursuant to the Indenture.


 


(a)                                  Title.
 It is the intention of the Seller that
the transfer and assignment herein contemplated constitute a sale of the
Receivables from the Seller to the Issuer and that the beneficial interest in
and title to such Receivables not be part of the debtor’s estate in the event
of the filing of a bankruptcy petition by or against the Seller under any
bankruptcy law.  No Receivable has been
sold, transferred, assigned or pledged by the Seller to any Person other than
the Issuer.  Immediately prior to the
transfer and


 


14

















 


assignment herein contemplated, the Seller had good and marketable
title to each Receivable, free and clear of all Liens and rights of others and,
immediately upon the transfer thereof, the Issuer shall have good and
marketable title to each such Receivable, free and clear of all Liens and
rights of others; and the transfer has been perfected under the UCC.


 


(b)                                 All
Filings Made.  All filings
(including UCC filings) necessary in any jurisdiction to give the Issuer a
first perfected ownership interest in the Receivables, and to give the
Indenture Trustee a first perfected security interest therein, shall have been
made.


 


SECTION 3.02   Repurchase by Seller upon Breach.  The Seller, the Servicer, the Sub-Servicer
or the Owner Trustee, as the case may be, shall inform the other parties to the
Agreement and the Indenture Trustee and JDCC promptly, in writing, upon the
discovery of any breach of the Seller’s representations and warranties made
pursuant to Section 3.01 or JDCC’s representations and warranties made pursuant
to Section 3.02(b) of the Purchase Agreement. 
Unless any such breach shall have been cured by the last day of the
second month following the month of the discovery thereof by the Owner Trustee
or receipt by the Owner Trustee of written notice from the Seller, the Servicer
or the Sub-Servicer of such breach, the Seller shall be obligated, and, if
necessary, the Seller or the Owner Trustee shall enforce the obligation of JDCC
under the Purchase Agreement, to repurchase any Receivable materially and
adversely affected by any such breach as of such last day (or, at the Seller’s
option, the last day of the first month following the month of the
discovery).  In consideration of the
repurchase of the Receivable, the Seller shall remit the Purchase Amount, in
the manner specified in Section 5.03; provided, however, that the
obligation of the Seller to repurchase any Receivable arising solely as a
result of a breach of JDCC’s representations and warranties pursuant to Section 3.02
(b) of the Purchase Agreement is subject to the receipt by the Seller of the
Purchase Amount from JDCC.  Subject to
the provisions of Section 6.03, the sole remedy of the Issuer, the Owner
Trustee, the Indenture Trustee, the Noteholders or the Certificateholder with
respect to a breach of representations and warranties pursuant to Section 3.01
and the agreement contained in this Section shall be to require the Seller to
repurchase Receivables pursuant to this Section, subject to the conditions
contained herein, or to enforce JDCC’s obligation to the Seller to repurchase
such Receivables pursuant to the Purchase Agreement.  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.


 


SECTION 3.03   Custody of Receivable Files.  To assure uniform quality in servicing the
Receivables and to reduce administrative costs, the Issuer hereby appoints the
Servicer, and the Servicer hereby accepts such appointment, to act as the agent
of the Issuer and the Indenture Trustee as custodian of the following documents
or instruments which are hereby constructively delivered to the Indenture
Trustee, as pledgee of the Issuer with respect to each Receivable:


 


(a)                                  the
original executed copy of the Receivable;


 


(b)                                 the
original or a copy of the credit application fully executed by the Obligor;


 


15

















 


(c)                                  the
original certificate of title (or a secured party copy thereof), the file
stamped copy of the UCC financing statement or such other documents that the
Seller or JDCC shall keep on file, in accordance with its customary procedures,
evidencing the security interest of Deere & Company or an affiliate of
Deere & Company in the Financed Equipment; and


 


(d)                                 any
and all other documents that JDCC or the Seller shall keep on file, in
accordance with its customary procedures, relating to a Receivable, an Obligor
or Financed Equipment.


 


SECTION 3.04   Duties of Servicer as Custodian.


 


(a)                                  Safekeeping.  The Servicer shall hold the Receivable Files
on behalf of the Issuer and maintain such accurate and complete accounts,
records and computer systems pertaining to each Receivable File as shall enable
the Issuer to comply with this Agreement. 
In performing its duties as custodian the Servicer shall act with
reasonable care, using that degree of skill and attention that the Servicer
exercises with respect to the receivable files relating to all comparable
receivables that the Servicer services for itself or others.  The Servicer shall conduct, or cause to be
conducted, periodic audits of the Receivable Files held by it under this
Agreement and of the related accounts, records and computer systems, in such a
manner as shall enable the Issuer or the Indenture Trustee to verify the
accuracy of the Servicer’s record keeping. 
The Servicer shall promptly report to the Issuer and the Indenture
Trustee any failure on its part to hold the Receivable Files and maintain its
accounts, records and computer systems as herein provided and promptly take
appropriate action to remedy any such failure. 
Nothing herein shall be deemed to require an initial review or any
periodic review by the Issuer, the Owner Trustee or the Indenture Trustee of
the Receivable Files.


 


(b)                                 Maintenance
of and Access to Records.  The
Servicer shall maintain each Receivable File at its office specified in
Schedule B to this Agreement or at such other office as shall be specified to
the Issuer and the Indenture Trustee by written notice not later than 90 days
after any change in location.  The
Servicer shall make available to the Issuer and the Indenture Trustee or their
respective duly authorized representatives, attorneys or auditors a list of
locations of the Receivable Files and the related accounts, records and
computer systems maintained by the Servicer at such times as the Issuer or the
Indenture Trustee shall instruct.


 


(c)                                  Release
of Documents.  Upon instruction from
the Indenture Trustee, the Servicer shall release any Receivable File to the
Indenture Trustee, the Indenture Trustee’s agent, or the Indenture Trustee’s
designee, as the case may be, at such place or places as the Indenture Trustee
may designate, as soon as practicable.


 


SECTION 3.05   Instructions; Authority to Act.  The Servicer shall be deemed to have
received proper instructions with respect to the Receivable Files upon its
receipt of written instructions signed by a Trust Officer of the Indenture
Trustee.


 


SECTION 3.06  Custodian’s Indemnification.  The Servicer as custodian shall indemnify
the Trust, the Owner Trustee and the Indenture Trustee and each of their
officers, directors and agents for any and all liabilities, obligations,
losses, compensatory damages,


 


16

















 


payments, costs or expenses of
any kind whatsoever that may be imposed on, incurred by or asserted against the
Trust, the Owner Trustee or the Indenture Trustee or any of their officers,
directors and agents as the result of any improper act or omission in any way
relating to the maintenance and custody by the Servicer as custodian of the
Receivable Files; provided, however, that the Servicer shall not be liable to
the Trust or the Owner Trustee for any portion of any such amount resulting
from the willful misfeasance, bad faith or negligence of the Owner Trustee and
the Servicer shall not be liable to the Trust or the Indenture Trustee for any
portion of any such amount resulting from the willful misfeasance, bad faith or
negligence of the Indenture Trustee.


 


SECTION 3.07   Effective Period and Termination.  The Servicer’s appointment as custodian
shall become effective as of the Cut-off Date and shall continue in full force
and effect until terminated pursuant to this Section.  If JDCC shall resign as Servicer in accordance with the
provisions of the Agreement or if all of the rights and obligations of any
Servicer shall have been terminated under Section 8.01, the appointment of such
Servicer as custodian shall be terminated by the Indenture Trustee or by the
Holders of Notes evidencing not less than 25% of the Outstanding Amount of the
Notes or, with the consent of Holders of the Notes evidencing not less than 25%
of the Outstanding Amount of the Notes, by the Owner Trustee or by the
Certificateholder, in the same manner as the Indenture Trustee or such Holders
may terminate the rights and obligations of the Servicer under Section
8.01.  The Indenture Trustee or, with the
consent of the Indenture Trustee, the Owner Trustee may terminate the
Servicer’s appointment as custodian, with cause, at any time upon written
notification to the Servicer, and without cause upon 30 days’ prior written
notification to the Servicer.  As soon
as practicable after any termination of such appointment, the Servicer shall
deliver the Receivable Files to the Indenture Trustee or the Indenture
Trustee’s agent at such place or places as the Indenture Trustee may reasonably
designate.  The Servicer shall pay the
fees of any other Person acting as custodian of the Receivables Files.


 


ARTICLE IV


 


Administration and Servicing of Receivables


 


SECTION 4.01   Duties of Servicer.  The Servicer, as agent for the Issuer (to
the extent provided herein), shall manage, service, administer and make collections
on the Receivables (other than Purchased Receivables) with reasonable care,
using that degree of skill and attention that the Servicer exercises with
respect to all comparable equipment receivables that it services for itself or
others.  The Servicer’s duties shall
include calculating, billing, collection and posting of all payments,
responding to inquiries of Obligors on such Receivables, investigating
delinquencies, reporting tax information to Obligors, accounting for
collections, and furnishing monthly and annual statements to the Owner Trustee
and the Indenture Trustee with respect to distributions.  Subject to the provisions of Section 4.02,
the Servicer shall follow its customary standards, policies and procedures in
performing its duties as Servicer. 
Without limiting the generality of the foregoing, the Servicer is
authorized and empowered to execute and deliver, on behalf of itself, the
Issuer, the Owner Trustee, the Indenture Trustee, the Certificateholder and the
Noteholders or any of them, any and all instruments of satisfaction or
cancellation, or partial or full release or discharge, and all other comparable
instruments, with


 


17

















 


respect to such Receivables or
to the Financed Equipment securing such Receivables.  If the Servicer shall commence a legal proceeding to enforce a
Receivable, the Issuer (in the case of a Receivable other than a Purchased
Receivable) shall thereupon be deemed to have automatically assigned, solely
for the purpose of collection, such Receivable to the Servicer.  If in any enforcement suit or legal
proceeding it shall be held that the Servicer may not enforce a Receivable on
the ground that it shall not be a real party in interest or a holder entitled
to enforce such Receivable, the Owner Trustee shall, at the Servicer’s expense
and direction, take steps to enforce such Receivable, including bringing suit
in its name or the name of the Owner Trustee, the Indenture Trustee, the
Certificateholder or the Noteholders.  The Owner Trustee shall upon the written request of the Servicer
furnish the Servicer with any powers of attorney and other documents reasonably
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.


 


SECTION 4.02   Collection of Receivable Payments.  The Servicer shall make reasonable efforts
to collect all payments called for under the terms and provisions of the
Receivables as and when the same shall become due and shall follow such
collection procedures as it follows with respect to all comparable equipment
receivables that it services for itself or others.  In connection therewith, the Servicer may grant extensions,
rebates or adjustments on a Receivable in accordance with its customary
collection procedures with respect to all comparable equipment receivables that
it services for itself or others; provided, however, that if the Servicer
extends the date for final payment by the Obligor of any Receivable beyond
June 21, 2009, it shall promptly purchase the Receivable from the Issuer
in accordance with the terms of Section 4.07; provided, further, that the
Servicer shall not extend the final Scheduled Payment for the sole purpose of
purchasing the Receivables from the Issuer. 
The Servicer may in its discretion waive any additional interest above
the related APR due on late Scheduled Payments or any other fees that may be
collected in the ordinary course of servicing a Receivable.  The Servicer shall not agree to any
alteration of the interest rate on any Receivable or of the amount of any
Scheduled Payment on a Receivable. 
Notwithstanding anything in this Agreement to the contrary, any
Recoveries shall be paid to the Seller and the related Liquidated Receivable
shall be assigned by the Trust to the Seller.


 


SECTION 4.03   Realization upon Receivables.  On behalf of the Issuer, the Servicer shall
use its best efforts, consistent with its customary servicing procedures, to
repossess or otherwise realize upon the Financed Equipment securing any
Receivable as to which the Servicer shall have determined pursuant to customary
servicing procedures that eventual payment in full is unlikely.  The Servicer shall follow such customary and
usual practices and procedures as it shall deem necessary or advisable in its
servicing of comparable equipment receivables, which may include selling the
Financed Equipment at public or private sale. 
The foregoing shall be subject to the provision that, in any case in
which the Financed Equipment shall have suffered damage, consistent with its
customary servicing procedures the Servicer may but shall not be required to
expend funds in connection with the repair or the repossession of such Financed
Equipment.


 


SECTION 4.04   Physical Damage Insurance.  The Servicer shall, in accordance with its
customary servicing procedures, require that each Obligor shall have obtained
physical damage insurance covering the Financed Equipment as of the execution
of the Receivable.


 


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SECTION 4.05   Maintenance of Security Interests in
Financed Equipment.  The Servicer
shall, in accordance with its customary servicing procedures, take such steps
as are necessary to maintain perfection of the security interest created by
each Receivable in the related Financed Equipment.  The Servicer is hereby authorized to take such steps as are
necessary to re-perfect such security interest on behalf of the Issuer and the
Indenture Trustee in the event of the relocation of the Financed Equipment or
for any other reason.


 


SECTION 4.06   Covenants of Servicer.  The Servicer shall not release the Financed
Equipment securing any Receivable from the security interest granted by such
Receivable in whole or in part except in accordance with Section 4.03 above or
in the event of payment in full by the Obligor thereunder, nor shall the
Servicer impair the rights of the Issuer, the Indenture Trustee, the
Certificateholder or the Noteholders in such Receivables, nor shall the
Servicer increase the number of scheduled payments due under a Receivable
except in accordance with the terms thereof or the terms of Section 4.02.


 


SECTION 4.07   Purchase by Servicer of Receivables upon
Breach.  The Servicer (or the
Sub-Servicer on behalf of the Servicer) or the Owner Trustee shall inform the
other party and the Indenture Trustee, the Seller and JDCC promptly, in
writing, upon the discovery of any breach of Section 4.02, 4.05 or 4.06.  Unless the breach shall have been cured by
the last day of the second month following such discovery (or, at the
Servicer’s election, the last day of the first following month), the Servicer
shall purchase any Receivable materially and adversely affected by such
breach.  If the Servicer takes any
action pursuant to Section 4.02 that impairs the rights of the Issuer, the
Indenture Trustee, the Certificateholder or the Noteholders in any Receivable
or as otherwise provided in Section 4.02, the Servicer shall purchase such
Receivable.  In consideration of the
purchase of any such Receivable pursuant to either of the two preceding
sentences, the Servicer shall remit the Purchase Amount in the manner specified
in Section 5.03.  Subject to Section
7.02, the sole remedy of the Issuer, the Owner Trustee, the Indenture Trustee,
the Certificateholder or the Noteholders with respect to a breach pursuant to
Section 4.02, 4.05 or 4.06 shall be to require the Servicer to purchase
Receivables pursuant to this Section. 
The Owner Trustee shall have no duty to conduct any affirmative investigation
as to the occurrence of any condition requiring the purchase of any Receivable
pursuant to this Section.


 


SECTION 4.08   Servicing Fee.  On each Determination Date, the Servicer
shall be entitled to receive the Servicing Fee in respect of the immediately
preceding Collection Period equal to the product of (a) one twelfth of the
Servicing Fee Rate and (b) the Pool Balance as of the first day of such
preceding Collection Period.  The
Servicer shall also be entitled to that portion of interest due on a Receivable
that is in excess of interest at the related APR and that is due because of a
late Scheduled Payment, and other administrative fees or similar charges
allowed by applicable law or the Receivable with respect to Receivables,
collected (from whatever source) on the Receivables.


 


SECTION 4.09   Servicer’s Certificate.  On each Determination Date, the Servicer
shall deliver to the Owner Trustee, the Indenture Trustee and the Seller, with
a copy to the Rating Agencies, a Servicer’s Certificate containing all
information necessary to make the distributions pursuant to Sections 5.04 and
5.06 for the Collection Period preceding the date of such Servicer’s
Certificate.  Neither the Owner Trustee
nor the Indenture Trustee shall be required to determine, confirm or
recalculate the information contained in the Servicer’s


 


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Certificate.  Receivables to be purchased by the Servicer
or to be repurchased by the Seller shall be identified by the Servicer by
account number with respect to such Receivable (as specified in Schedule A).


 


SECTION 4.10   Annual Statement as to Compliance;
Notice of Default.


 


(a)                                  The
Servicer shall deliver to the Owner Trustee and the Indenture Trustee, on or
before February 28 of each year beginning February 28, 2004, an Officers’
Certificate stating that (i) a review of the activities of the Servicer during
the 12-month period ending on October 31 of the preceding year (or, in the
case of October 31, 2003, the period from the Closing Date to
October 31, 2003) and of its performance under this Agreement has been
made under such officers’ supervision and (ii) to the best of such officers’
knowledge, based on such review, the Servicer has fulfilled in all material
respects all its obligations under this Agreement throughout such period or, if
there has been a default in the fulfillment of any such obligation in any
material respect, specifying each such default known to such officers and the
nature and status thereof.  The
Indenture Trustee shall send a copy of such certificate and the report referred
to in Section 4.11 to the Rating Agencies. 
A copy of such certificate and the report referred to in Section 4.11
may be obtained by the Certificateholder by a request in writing to the Owner
Trustee at its address in Section 10.03.


 


(b)                                 The
Servicer shall deliver to the Owner Trustee, the Indenture Trustee and the
Rating Agencies, promptly after having obtained knowledge thereof, but in no
event later than five Business Days thereafter, written notice in an Officers’
Certificate of any event which with the giving of notice or lapse of time, or
both, would become a Servicer Default under Section 8.01(a) or (b).


 


SECTION 4.11   Annual Independent Certified Public
Accountants’ Report.  The Servicer
shall cause a firm of independent certified public accountants, which may also
render other services to the Servicer, the Seller or JDCC, to deliver to the
Owner Trustee and the Indenture Trustee on or before February 28 of each
year beginning February 28, 2004, a report addressed to the Board of
Directors of the Servicer, the Owner Trustee and the Indenture Trustee, to the
effect that such firm has examined the financial statements of JDCC and issued
its report thereon and that such examination (a) was made in accordance with
generally accepted auditing standards and accordingly included such tests of
the accounting records and such other auditing procedures as such firm
considered necessary in the circumstances; (b) included tests relating to
equipment loans serviced for others in accordance with the requirements of the
Uniform Single Attestation Program for Mortgage Bankers (the “Program”), to the
extent the procedures in such program are applicable to the servicing
obligations set forth in this Agreement; and (c) except as described in the report,
disclosed no exceptions or errors in the records relating to equipment loans
(including the Receivables) serviced for others during the 12-month period (or,
in the case of the report due on or before February 28, 2004, the period
from the Closing Date to October 31, 2003) that, in the firm’s opinion,
such Program requires such firm to report.


 


Such
report will also indicate that the firm is independent of the Servicer within
the meaning of the Code of Professional Ethics of the American Institute of
Certified Public Accountants.


 


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SECTION 4.12   Access to Certain Documentation and
Information Regarding Receivables. 
The Servicer shall provide to the Certificateholder and Noteholders
access to the Receivable Files in such cases where the Certificateholder or
Noteholders shall be required by applicable statutes or regulations to review
such documentation.  Access shall be
afforded without charge, but only upon reasonable request and during the normal
business hours at the respective offices of the Servicer.  Nothing in this Section shall affect the
obligation of the Servicer to observe any applicable law prohibiting disclosure
of information regarding the Obligors and the failure of the Servicer to provide
access to information as a result of such obligation shall not constitute a
breach of this Section.


 


SECTION 4.13   Servicer Expenses.  The Servicer shall be required to pay all
expenses incurred by it in connection with its activities hereunder, including
fees and disbursements of independent accountants, fees and disbursements
incurred in connection with collection and enforcement of Receivables (other
than amounts incurred in connection with the liquidation of a Receivable which
amounts shall be netted against the Liquidation Proceeds, if any), taxes
imposed on the Servicer and expenses incurred in connection with distributions
and reports to the Certificateholder and the Noteholders.


 


SECTION 4.14   Appointment of Sub-Servicer.  The Servicer hereby appoints Deere Credit
Services, Inc. as Sub-Servicer and may at any time appoint a successor
Sub-Servicer to perform all or any portion of its obligations as Servicer
hereunder; provided, however, that the Rating Agency Condition shall have been
satisfied in connection with the appointment of a successor Sub-Servicer;
provided further that the Servicer shall remain obligated and be liable to the
Issuer, the Owner Trustee, the Indenture Trustee, the Certificateholder and the
Noteholders for the servicing and administering of the Receivables in
accordance with the provisions hereof without diminution of such obligation and
liability by virtue of the appointment of such Sub-Servicer and to the same
extent and under the same terms and conditions as if the Servicer alone were
servicing and administering the Receivables. 
The fees and expenses of the Sub-Servicer shall be as agreed between the
Servicer and its Sub-Servicer from time to time and none of the Issuer, the
Owner Trustee, the Indenture Trustee, the Certificateholder or the Noteholders
shall have any responsibility therefor.


 


ARTICLE V


 


Distributions;
Reserve Account;

Statements to the Certificateholder and Noteholders


 


SECTION 5.01   Establishment of Trust Accounts.


 


(a)                                  (i)  The
Servicer, for the benefit of the Noteholders and the Certificateholder, shall
establish and maintain in the name of the Indenture Trustee an Eligible Deposit
Account (the “Collection Account”), bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the Noteholders
and the Certificateholder.


 


(ii)                                  The
Servicer, for the benefit of the Noteholders, shall establish and maintain in
the name of the Indenture Trustee an Eligible Deposit Account (the “Note


 


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Distribution Account”), bearing
a designation clearly indicating that the funds deposited therein are held for
the benefit of the Noteholders.


 


(iii)                               The
Servicer, for the benefit of the Noteholders and the Certificateholder, shall
establish and maintain in the name of the Indenture Trustee an Eligible Deposit
Account (the “Reserve Account”), bearing a designation clearly indicating that
the funds deposited therein are held for the benefit of the Noteholders and the
Certificateholder.


 


(b)                                 Funds
on deposit in the Collection Account, the Note Distribution Account and the
Reserve Account (collectively the “Trust Accounts”) shall be invested by the
Indenture Trustee pursuant to the Servicer’s written instruction in Eligible
Investments selected by the Servicer; provided, however, it is understood and
agreed that the Indenture Trustee shall not be liable for any loss arising from
such investment in Eligible Investments; provided further none of the funds
deposited in the Trust Accounts shall be invested in an Eligible Investment or
Eligible Investments issued by the Servicer or the Seller for a period of 30
days following the Closing Date.  All
such Eligible Investments shall be held by the Indenture Trustee for the
benefit of the Noteholders and the Certificateholder or the Noteholders, as
applicable; provided, however, that on each Payment Date all interest and other
investment income (net of losses and investment expenses) on funds on deposit
in the Trust Accounts shall be deposited into the Collection Account and shall
be deemed to constitute a portion of the Total Distribution Amount.  Other than as permitted by the Rating
Agencies, funds on deposit in the Trust Accounts shall be invested in Eligible
Investments that will mature so that such funds (in the case of the Special
Payment Date, the portion of such funds needed to make the final payment on the
Class A-1 Notes pursuant to Section 5.04(c)) will be available at the close of
business on the Transfer Date preceding the following Payment Date or, in the
case of the Note Distribution Account and the Reserve Account, the following
Payment Date.  Funds deposited in a
Trust Account on a Transfer Date which immediately precedes a Payment Date are
not required to be invested overnight.


 


(c)                                  (i)  The
Indenture Trustee shall possess all right, title and interest in all funds on
deposit from time to time in the Trust Accounts and in all proceeds thereof
(including all income thereon) and all such funds, investments, proceeds and
income shall be part of the Trust Estate. 
The Trust Accounts shall be under the sole dominion and control of the
Indenture Trustee for the benefit of the Noteholders and the Certificateholder
or the Noteholders, as the case may be. 
If, at any time, any of the Trust Accounts ceases to be an Eligible
Deposit Account, the Indenture Trustee (or the Servicer on its behalf) shall
within 10 Business Days (or such longer period, not to exceed 30 calendar days,
as to which each Rating Agency may consent) establish a new Trust Account as an
Eligible Deposit Account and shall transfer any cash and/or any investments to
such new Trust Account.  So long as The
Bank of New York is an Eligible Institution, any Trust Account shall be
maintained with it in an Eligible Deposit Account.


 


(ii)                                  With
respect to the Trust Account Property, the Indenture Trustee agrees, by its
acceptance hereof, that:


 


(A)                              any
Trust Account Property that is held in “deposit accounts” (as defined in
Section 9-102(a)(29) of the UCC) shall be held solely in the Eligible Deposit
Accounts and (1)


 


22

















 


each such Eligible Deposit
Account shall be subject to the exclusive custody and control of the Indenture
Trustee, the Indenture Trustee shall have sole signature authority with respect
thereto and to the extent the Indenture Trustee ceases to be an Eligible
Institution, the Indenture Trustee shall be the related Eligible Institution’s
“customer” and shall have “control” (in each case within the meaning of Section
9-104 of the UCC) with respect to such Eligible Deposit Account, (2) the
Eligible Institution at which such Eligible Deposit Account is maintained shall
be a “bank” as defined in Section 9-102(a)(8) of the UCC and shall agree to
maintain such Eligible Deposit Account as a “deposit account” as such term is
defined in Section 9-102(a)(29) of the UCC, and (3) the “bank’s jurisdiction”
(within the meaning of Section 9-304 of the UCC) with respect to such Eligible
Deposit Account shall be the State of New York;


 


(B)                                any
Trust Account Property that is held in “securities accounts” (as defined in
Section 8-501(a) of the UCC) shall be held solely in Eligible Deposit Accounts;
and (1) the Eligible Institution at which each such Eligible Deposit Account is
maintained shall be a “securities intermediary” as defined in Section
8-102(a)(14) of the UCC and shall agree to maintain such Eligible Deposit
Account as a “securities account” as such term is defined in Section 8-501(a)
of the UCC, (2) the Eligible Institution at which such Eligible Deposit Account
is maintained shall treat the Indenture Trustee as entitled to exercise the
rights that comprise any “financial asset” (as defined in Section 8-102(a)(9)
of the UCC) credited to the account, and if at any time such Eligible
Institution shall receive an “entitlement order” (within the meaning of Section
8-102(a)(8) of the UCC) issued by the Indenture Trustee and relating to such
Eligible Deposit Account, such Eligible Institution shall comply with such
entitlement order without further consent by the Issuer or any other Person,
(3) the Eligible Institution at which such Eligible Deposit Account is
maintained shall agree with the Indenture Trustee that each item of property
(whether investment property, financial asset, security, instrument or cash)
credited to such Eligible Deposit Account shall be treated as a “financial
asset” within the meaning of Section 8-102(a)(9) of the UCC, and (4) the
“securities intermediaries’ jurisdiction” (within the meaning of Section 8-110
of the UCC) with respect to such Eligible Deposit Account shall be the State of
New York;


 


(C)                                any
Trust Account Property that is of the type described in paragraph (a) or (b) of
the definition of “Delivery” shall be delivered to the Indenture Trustee in
accordance with paragraph (a) or (b), as applicable, of the definition of
“Delivery”, and shall be held as described in such paragraph;


 


(D)                               any
Trust Account Property that is a book-entry security held through the Federal
Reserve System pursuant to Federal book-entry regulations shall be delivered in
accordance with paragraph (c) of the definition of “Delivery” and shall be
maintained by the Indenture Trustee, pending maturity or disposition, through
continued book-entry registration of such Trust Account Property as described in
such paragraph; and


 


(E)                                 any
Trust Account Property that is an “uncertificated security” under Article 8 of
the UCC and that is not governed by clause (C) above shall be delivered to the
Indenture Trustee in accordance with paragraph (d) of the definition of
“Delivery” and shall be maintained by the Indenture Trustee, pending maturity
or disposition, through continued registration of the Indenture Trustee’s (or
its nominee’s) ownership of such security.


 


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(iii)                               The
Servicer shall have the power, revocable by the Indenture Trustee or by the
Owner Trustee with the consent of the Indenture Trustee, to instruct the
Indenture Trustee to make withdrawals and payments from the Trust Accounts for
the purpose of permitting the Servicer or the Owner Trustee to carry out its
respective duties hereunder or permitting the Indenture Trustee to carry out
its duties under the Indenture.


 


SECTION 5.02   Collections.  The Servicer shall remit to the Collection
Account all payments by or on behalf of the Obligors with respect to the
Receivables (other than Purchased Receivables) and all Liquidation Proceeds
(exclusive of Recoveries, which shall be applied in accordance with Section
4.02), within two Business Days of receipt thereof.  Notwithstanding the foregoing, if (i) JDCC is the Servicer, (ii)
a Servicer Default shall not have occurred and be continuing and (iii) JDCC’s
unsecured, non-guaranteed short-term debt is assigned a rating of at least A-1
by Standard & Poor’s and Prime-1 by Moody’s, the Servicer shall remit such
collections (as collected during each Fiscal Month) to the Collection Account
not less than two Business Days prior to the 15th day of the calendar month
following such Fiscal Month (or, if such Fiscal Month ends in the early part of
a calendar month, then the 15th day of such calendar month in which such Fiscal
Month ends).  For purposes of this
Article V the phrase “payments by or on behalf of Obligors” shall mean payments
made with respect to the Receivables by persons other than the Servicer or
JDCC.


 


SECTION 5.03   Additional Deposits.  The Servicer and the Seller shall deposit or
cause to be deposited in the Collection Account the aggregate Purchase Amount
with respect to Purchased Receivables and the Servicer shall deposit therein
all amounts to be paid under Section 9.01(a). 
The Servicer will deposit the aggregate Purchase Amount with respect to
Purchased Receivables when such obligations are due, unless the Servicer shall
not be required to make deposits within two Business Days of the receipt of
collections from Obligors pursuant to Section 5.02, in which case deposits of
Purchased Amounts shall be made on the Transfer Date.


 


SECTION 5.04   Distributions.


 


(a)                                  On
each Determination Date, the Servicer shall calculate the amounts to be
deposited in the Note Distribution Account and the Certificate Distribution
Account.


 


(b)                                 On
the second Business Day prior to each Payment Date, the Servicer shall instruct
the Indenture Trustee in writing in substantially the form of Schedule G hereto
(based on the information contained in the Servicer’s Certificate delivered on
the related Determination Date pursuant to Section 4.09) to make deposits and
distributions to the Servicer or the Administrator or distribute to the
applicable Trust Account or Certificate Distribution Account by 12:00 noon (New
York time) in the case of the Trust Accounts and 11:00 A.M. (New York time) in
the case of the Certificate Distribution Account, in each case on such Payment
Date.  Distributions of the Total
Distribution Amount shall be made by the Indenture Trustee in the following
order of priority:


 


(i)                                     to the Servicer,
from the Total Distribution Amount, the Servicing Fee and all unpaid Servicing
Fees from prior Collection Periods:


 


24

















 


(ii)                                  to the Administrator
under the Administration Agreement, from the Total Distribution Amount
remaining after the application of clause (i), the Administration Fee and all
unpaid Administration Fees from prior Collection Periods;


 


(iii)                               to the Note Distribution
Account, from the Total Distribution Amount remaining after the application of
clauses (i) and (ii), the accrued and unpaid interest on the Notes for such
Payment Date;


 


(iv)                              to the Note Distribution
Account, from the Total Distribution Amount remaining after the application of
clauses (i), (ii) and (iii), the Note Monthly Principal Distributable Amount:


 


(v)                                 to the Reserve
Account, from the Total Distribution Amount remaining after the application of
clauses (i), (ii), (iii) and (iv), the amount, if any, necessary to increase
the amounts on deposit in the Reserve Account to the Specified Reserve Account
Balance;


 


(vi)                              to the Certificate
Distribution Account, from the Total Distribution Amount remaining after the
application of clauses (i), (ii), (iii), (iv) and (v), the Certificate Monthly
Principal Distributable Amount, if any; and


 


(vii)                           to the Reserve Account, the
Total Distribution Amount remaining after the application of clauses (i), (ii),
(iii), (iv), (v) and (vi).


 


(c)                                  With
respect to the Special Payment Date, if any, the instructions provided by the
Servicer pursuant to Section 5.04(b) above, shall specify that on the Special
Payment Date, distributions shall be made to the Trust Account no later than
12:00 noon (New York time) in respect of the Class A-1 Notes.  The portion of the Total Distribution Amount
deposited to the Trust Accounts in respect of the Class A-1 Notes on the
Special Payment Date, shall be calculated in the order and priority set forth
in Section 5.04(b) as though such amounts were to be distributed on the
August 2004 Payment Date.


 


SECTION 5.05   Reserve Account.


 


(a)                                  On
the Closing Date, the Seller shall deposit the Reserve Account Initial Deposit
into the Reserve Account.  The Servicer
shall determine the Specified Reserve Account Balance for each Payment Date.


 


(b)                                 (i)  If
the amount on deposit in the Reserve Account on each Payment Date (after giving
effect to all deposits or withdrawals therefrom on such Payment Date pursuant
to Section 5.04 and Section 5.05(c)) is greater than the Specified Reserve
Account Balance for such Payment Date, the Servicer shall instruct the
Indenture Trustee to distribute such excess in the Reserve Account to the
Seller.


 


(ii)                                  On
the date on which all interest on and principal of the Notes have been paid in
full, the Servicer shall instruct the Indenture Trustee to distribute the
Reserve Account balance to the Seller.


 


25

















 


(iii)                               Amounts
properly distributed to the Seller pursuant to this Section 5.05(b) shall be
deemed released from the Trust and the security interest therein granted to the
Indenture Trustee, and the Seller shall in no event thereafter be required to
refund any such distributed amounts.


 


(c)                                  In
the event that the Noteholders’ Distributable Amount for a Payment Date exceeds
the amount deposited into the Note Distribution Account pursuant to Section
5.04(b)(iii) and (iv) on such Payment Date, the Servicer shall instruct the
Indenture Trustee to withdraw from the Reserve Account on such Payment Date, to
the extent of funds available therein, an amount equal to such excess and
deposit such amount into the Note Distribution Account.


 


SECTION 5.06   Statements to the Certificateholder and
Noteholders.


 


(a)                                  On
the second Business Day preceding each Payment Date, the Servicer shall provide
to the Indenture Trustee (with a copy to the Rating Agencies) and to the Owner
Trustee for the Owner Trustee to forward to the Certificateholder of record a
statement substantially in the form of Schedule E setting forth at least the
following information as to the Notes and the Certificate to the extent
applicable:


 


(i)                                     the amount of such
distribution allocable to principal;


 


(ii)                                  the amount of such
distribution allocable to interest;


 


(iii)                               the Pool Balance and the
Note Value as of the close of business on the last day of the preceding
Collection Period;


 


(iv)                              (A) the outstanding
principal balance of (1) the Class A-1 Notes, (2) the Class A-2 Notes, (3) the
Class A-3 Notes, (4) the Class A-4 Notes and (5) the Class B Notes and (B) the
Certificate Balance, in each case after giving effect to payments allocated to
principal reported under (i) above;


 


(v)                                 the amount of the
Servicing Fee paid to the Servicer with respect to the related Collection
Period;


 


(vi)                              the amount of the
Administration Fee paid to the Administrator with respect to such Collection
Period;


 


(vii)                           the aggregate amount of the
Purchase Amounts for Purchased Receivables with respect to the related
Collection Period;


 


(viii)                        the balance of the Reserve
Account on such Payment Date, after giving effect to distributions made on such
Payment Date, and the Specified Reserve Account Balance for such Payment Date;
and


 


(ix)                                the amount of any
payments in respect of the Receivables that are more than 60 days past due.


 


26

















 


Each
amount set forth pursuant to paragraph (i), (ii) or (iv) above shall be
expressed as a dollar amount per $1,000 of original principal balance of a
Certificate or Note, as applicable. 
Notwithstanding anything to contrary contained herein, in the event of a
Special Payment Date, the certificate delivered pursuant to this Section shall
be delivered two days prior to the Special Payment Date but shall reflect all
amounts specified above, with respect to the Special Payment Date and the
August 2004 Payment Date.


 


(b)                                 On
the second Business Day preceding each Payment Date, the Servicer shall provide
to the Indenture Trustee (with a copy to the Rating Agencies) for the Indenture
Trustee to forward to each Noteholder of record, a statement substantially in
the form of Schedule F setting forth at least the following information as to
the Notes to the extent applicable with respect to such Payment Date or the
related Collection Period:


 


(i)                                     the amount of such
distribution allocable to principal;


 


(ii)                                  the amount of such
distribution allocable to interest;


 


(iii)                               the Pool Balance and the
Note Value as of the close of business on the last day of the preceding
Collection Period;


 


(iv)                              (A) the outstanding
principal balance of (1) the Class A-1 Notes, (2) the Class A-2 Notes, (3) the
Class A-3 Notes, (4) the Class A-4 Notes and (5) the Class B Notes and (B) the
Certificate Balance, in each case after giving effect to payments allocated to
principal reported under (i) above;


 


(v)                                 the amount of the
Servicing Fee paid to the Servicer with respect to such Collection Period;


 


(vi)                              the amount of the
Administration Fee paid to the Administrator with respect to such Collection
Period;


 


(vii)                           the aggregate amount of
Purchase Amounts for Purchased Receivables with respect to such Collection
Period;


 


(viii)                        the balance of the Reserve
Account on such Payment Date, after giving effect to the distributions made on
such Payment Date, and the Specified Reserve Account Balance for such Payment
Date; and


 


(ix)                                the amount of any
payments in respect of the Receivables that are more than 60 days past due.


 


Each
amount set forth pursuant to subclause (i), (ii) or (iv) above shall be
expressed as a dollar amount per $1,000 of original principal balance of a
Note. Notwithstanding anything to contrary contained herein, in the event of a
Special Payment Date, the certificate delivered pursuant to this Section shall
be delivered two days prior to the Special Payment Date but shall reflect all
amounts specified above, with respect to the Special Payment Date and the
August 2004 Payment Date.


 


27

















 


Within
the prescribed period of time for tax reporting purposes after the end of each
calendar year during the term of the Indenture, the Indenture Trustee shall
mail to each Person who at any time during such calendar year shall have been a
Noteholder and received any payment thereon, a statement containing the amounts
described in (i) and (ii) (other than information relating to the Note Interest
Rates) above and any other information required by applicable tax laws, for the
purposes of such Noteholder’s preparation of Federal income tax returns.


 


The
Indenture Trustee shall only be required to provide to the Noteholders the
information furnished to it by the Servicer.


 


SECTION 5.07   Net Deposits.  As an administrative convenience, unless the
Servicer is required to remit collections within two Business Days of their
receipt, the Servicer will be permitted to make the deposit of collections on
the Receivables and Purchase Amounts for or with respect to the Collection
Period net of distributions to be made to the Servicer with respect to the Collection
Period.  The Servicer, however, will
account to the Owner Trustee, the Indenture Trustee, the Noteholders and the
Certificateholder as if all deposits, distributions and transfers were made
individually.


 


ARTICLE VI


 


The Seller


 


SECTION 6.01   Representations of Seller.  The Seller makes the following
representations on which the Issuer is deemed to have relied in acquiring the
Receivables.  The representations speak
as of the execution and delivery of this Agreement and shall survive the sale
of the Receivables to the Issuer and the pledge thereof to the Indenture
Trustee pursuant to the Indenture.


 


(a)                                  Organization
and Good Standing.  The Seller is
duly organized and validly existing as a corporation in good standing under the
laws of the State of Nevada, with the power and authority to own its properties
and to conduct its business as such properties are currently owned and such
business is presently conducted, and had at all relevant times, and has, the
power, authority and legal right to acquire and own the Receivables.


 


(b)                                 Due
Qualification.  The Seller is duly
qualified to do business as a foreign corporation in good standing, and has
obtained all necessary licenses and approvals in all jurisdictions in which the
failure to so qualify or to obtain such license or approval would render any
Receivable unenforceable that would otherwise be enforceable by the Seller, the
Sub-Servicer or the Owner Trustee.


 


(c)                                  Power
and Authority.  The Seller has the
power and authority to execute and deliver this Agreement and to carry out its
terms; the Seller has full power and authority to sell and assign the property
to be sold and assigned to and deposited with the Issuer and the Seller and
shall have duly authorized such sale and assignment to the Issuer by all
necessary corporate action; and the execution, delivery and performance of this
Agreement have been duly authorized by the Seller by all necessary corporate
action.


 


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(d)                                 Binding
Obligation.  This Agreement
constitutes a legal, valid and binding obligation of the Seller enforceable in
accordance with its terms except that such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors’ rights generally and the remedy of
specific performance and injunctive relief may be subject to certain equitable
defenses and to the discretion of the court before which any proceeding
therefor may be brought.


 


(e)                                  No
Violation.  The consummation of the
transactions contemplated by this Agreement and the fulfillment of the terms
hereof do not conflict with, result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or lapse of time) a
default under, the articles of incorporation or by-laws of the Seller, or any
indenture, agreement or other instrument to which the Seller is a party or by
which it shall be bound; 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 (other than pursuant to the Basic Documents); nor
violate any law or, to the best of the Seller’s knowledge, any order, rule or
regulation applicable to the Seller of any court or of any federal or State
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Seller or its properties.


 


(f)                                    No
Proceedings.  To the Seller’s best
knowledge, there are no proceedings or investigations pending, or threatened,
before any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Seller or its properties:  (i) asserting the invalidity of this
Agreement, the Indenture or any of the other Basic Documents, the Notes or the
Certificate, (ii) seeking to prevent the issuance of the Notes or the
Certificate or the consummation of any of the transactions contemplated by this
Agreement, the Indenture or any of the other Basic Documents, (iii) seeking any
determination or ruling that might materially and adversely affect the
performance by the Seller of its obligations under, or the validity or
enforceability of, this Agreement, the Indenture, any of the other Basic
Documents, the Notes or the Certificate or (iv) which involve the Seller and
which might adversely affect the Federal or state income tax attributes of the
Notes or the Certificate.


 


SECTION 6.02   Corporate Existence.


 


(a)                                  During
the term of this Agreement, the Seller will keep in full force and effect its
existence, rights and franchises as a corporation under the laws of the
jurisdiction of its incorporation and will obtain and preserve its
qualification to do business in each jurisdiction in which such qualification
is or shall be necessary to protect the validity and enforceability of this
Agreement, the Basic Documents and each other instrument or agreement necessary
or appropriate to the proper administration of this Agreement and the
transactions contemplated hereby.


 


(b)                                 During
the term of this Agreement, the Seller shall observe the applicable legal
requirements for the recognition of the Seller as a legal entity separate and
apart from its Affiliates, including as follows:


 


(i)                                     the Seller shall
maintain corporate records and books of account separate from those of its
Affiliates;


 


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(ii)                                  except as otherwise
provided in this Agreement, the Seller shall not commingle its assets and funds
with those of its Affiliates;


 


(iii)                               the Seller shall hold
such appropriate meetings of its Board of Directors as are necessary to
authorize all the Seller’s corporate actions required by law to be authorized
by the Board of Directors, shall keep minutes of such meetings and of meetings
of its stockholder(s) and observe all other customary corporate formalities
(and any successor Seller not a corporation shall observe similar procedures in
accordance with its governing documents and applicable law);


 


(iv)                              the Seller shall at all
times hold itself out to the public under the Seller’s own name as a legal
entity separate and distinct from its Affiliates; and


 


(v)                                 all transactions and
dealings between the Seller and its Affiliates will be conducted on an
arm’s-length basis.


 


SECTION 6.03   Liability of Seller; Indemnities.  The Seller shall be liable in accordance
herewith only to the extent of the obligations specifically undertaken by the
Seller under the Agreement.


 


(a)                                  The
Seller shall indemnify, defend and hold harmless the Issuer, the Owner Trustee
and the Indenture Trustee and their officers, directors and agents from and
against any taxes that may at any time be asserted against the Issuer, the
Owner Trustee or the Indenture Trustee or their officers, directors, and agents
with respect to the sale of the Receivables to the Issuer or the issuance and
original sale of the Certificate and the Notes, including any sales, gross
receipts, general corporation, tangible personal property, privilege or license
taxes (but, in the case of the Issuer, not including any taxes asserted with
respect to ownership of the Receivables or Federal or other income taxes
arising out of the transactions contemplated by this Agreement) and costs and
expenses in defending against the same.


 


(b)                                 The
Seller shall indemnify, defend and hold harmless the Issuer, the Owner Trustee
and the Indenture Trustee and their officers, directors, and agents from and
against any loss, liability or expense incurred by reason of (i) the Seller’s
willful misfeasance, bad faith or negligence in the performance of its duties
under this Agreement, or by reason of reckless disregard of its obligations and
duties under this Agreement and (ii) the Seller’s or the Issuer’s violation of
Federal or State securities laws in connection with the offering and sale of the
Notes and the Certificate.


 


(c)                                  The
Seller shall pay any and all property taxes (including taxes on intangibles),
excise taxes, sales taxes and similar taxes levied or assessed upon all or any
part of the Trust Estate including, without limitation, the Receivables.


 


Indemnification
under this Section shall survive the resignation or removal of the Owner
Trustee or the Indenture Trustee and the termination of this Agreement and
shall include reasonable fees and expenses of counsel and expenses of litigation.  If the Seller shall have made any indemnity
payments pursuant to this Section and the Person to or on behalf of whom such
payments are made thereafter shall collect any of such amounts from others,
such Person shall promptly repay such amounts to the Seller, without interest.


 


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SECTION 6.04   Merger or Consolidation of, or
Assumption of the Obligations of, Seller. 
Any Person (a) into which the Seller may be merged or consolidated, (b)
which may result from any merger or consolidation to which the Seller shall be
a party or (c) which may succeed to the properties and assets of the Seller
substantially as a whole, which Person in any of the foregoing cases executes
an agreement of assumption to perform every obligation of the Seller under this
Agreement, shall be the successor to the Seller hereunder without the execution
or filing of any document or any further act by any of the parties to this
Agreement; provided, however, that (i) immediately after giving effect to such
transaction, no representation or warranty made pursuant to Section 3.01 shall
have been breached and no Servicer Default, and no event that, after notice or
lapse of time, or both, would become a Servicer Default shall have occurred and
be continuing, (ii) the Seller shall have delivered to the Owner Trustee and
the Indenture Trustee an Officers’ Certificate and an Opinion of Counsel each
stating that such consolidation, merger or succession and such agreement of
assumption comply with this Section and that all conditions precedent, if any,
provided for in this Agreement relating to such transaction have been complied
with, (iii) the Rating Agency Condition shall have been satisfied with respect
to such transaction and (iv) the Seller shall have delivered to the Owner
Trustee and the Indenture Trustee an Opinion of Counsel either (A) stating
that, in the opinion of such counsel, all financing statements and continuation
statements and amendments thereto have been executed and filed that are
necessary fully to preserve and protect the interest of the Owner Trustee and
Indenture Trustee, respectively, in the Receivables and reciting the details of
such filings, or (B) stating that, in the opinion of such counsel, no such
action shall be necessary to preserve and protect such interests.  Notwithstanding anything herein to the
contrary, the execution of the foregoing agreement of assumption and compliance
with clauses (i), (ii), (iii) and (iv) above shall be conditions to the
consummation of the transactions referred to in clause (a), (b) or (c) above.


 


SECTION 6.05   Limitation on Liability of Seller and
Others.  The Seller and any director
or officer or employee or agent of the Seller may rely in good faith on the
advice of counsel or on any document of any kind, prima facie properly executed
and submitted by any Person respecting any matters arising hereunder.  The Seller shall not be under any obligation
to appear in, prosecute or defend any legal action that shall not be incidental
to its obligations under this Agreement, and that in its opinion may involve it
in any expense or liability.


 


SECTION 6.06   Seller May Own Notes; Retention of
the Certificate.  The Seller and any
Affiliate thereof may in its individual or any other capacity become the owner
or pledgee of the Notes with the same rights as it would have if it were not
the Seller or an Affiliate thereof, except as expressly provided herein or in
any Basic Document.  The Seller shall
retain and not transfer the Certificate.


 


ARTICLE VII


 


The Servicer


 


SECTION 7.01   Representations of Servicer.  The Servicer makes the following
representations on which the Issuer is deemed to have relied in acquiring the
Receivables.  The representations speak
as of the execution and delivery of this Agreement (or as of the date a


 


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Person (other than the
Indenture Trustee) becomes Servicer pursuant to Sections 7.03 and 8.02, in the
case of a successor to the Servicer) and shall survive the sale of the
Receivables to the Issuer and the pledge thereof to the Indenture Trustee
pursuant to the Indenture.


 


(a)                                  Organization
and Good Standing.  The Servicer is
a corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation, and has the corporate power and
authority to own its properties and to conduct the business in which it is
currently engaged, and had at all relevant times, and has, the power, authority
and legal right to acquire, own, sell and service the Receivables and to hold
the Receivable Files as custodian.


 


(b)                                 Power
and Authority.  The Servicer has the
corporate power and authority to execute and deliver this Agreement and to
carry out its terms; and the execution, delivery and performance of this
Agreement have been duly authorized by the Servicer by all necessary corporate
action.


 


(c)                                  Binding
Obligation.  This Agreement
constitutes a legal, valid and binding obligation of the Servicer enforceable
in accordance with its terms except that such enforcement may be subject to
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors’ rights generally and the remedy of
specific performance and injunctive relief may be subject to certain equitable
defenses and to the discretion of the court before which any proceeding
therefor may be brought.


 


(d)                                 No
Violation.  The consummation of the
transactions contemplated by this Agreement and the fulfillment of the terms
hereof shall not conflict with, result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or lapse of time) a
default under, the articles of incorporation or by-laws of the Servicer, or any
indenture, agreement or other instrument to which the Servicer is a party or by
which it shall be bound; 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 (other than this Agreement); nor violate any law
or, to the best of the Servicer’s knowledge, any order, rule or regulation
applicable to the Servicer of any court or of any Federal or State regulatory
body, administrative agency or other governmental instrumentality having
jurisdiction over the Servicer or its properties.


 


(e)                                  No
Proceedings.  To the Servicer’s best
knowledge, there are no proceedings or investigations pending, or threatened,
before any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Servicer or its properties:  (i) asserting the invalidity of this
Agreement, the Indenture, any of the other Basic Documents, the Notes or the
Certificate, (ii) seeking to prevent the issuance of the Notes or the
Certificate or the consummation of any of the transactions contemplated by this
Agreement, the Indenture or any of the other Basic Documents, (iii) seeking any
determination or ruling that might materially and adversely affect the
performance by the Servicer of its obligations under, or the validity or
enforceability of, this Agreement, the Indenture, any of the other Basic
Documents, the Notes or the Certificate or (iv) relating to the Servicer and
which might adversely affect the Federal or state income tax attributes of the
Notes or the Certificate.


 


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(f)                                    No
Insolvent Obligors.  As of the
Cut-off Date, no Obligor on a Receivable is shown on the Receivable Files as
the subject of a bankruptcy proceeding.


 


SECTION 7.02   Indemnities of Servicer.  The Servicer shall be liable in accordance
herewith only to the extent of the obligations specifically undertaken by the
Servicer under this Agreement.


 


(a)                                  The
Servicer shall defend, indemnify and hold harmless the Issuer, the Owner Trustee,
the Indenture Trustee, the Noteholders, the Certificateholder and the Seller
and any of the officers, directors and agents of the Issuer, the Owner Trustee,
the Indenture Trustee and the Seller from and against any and all costs,
expenses, losses, damages, claims and liabilities, arising out of or resulting
from the use, ownership or operation by the Servicer or any Affiliate thereof
of any Financed Equipment.


 


(b)                                 The
Servicer shall indemnify, defend and hold harmless the Issuer, the Owner
Trustee, the Indenture Trustee, and the Seller and their respective officers,
directors and agents from and against any taxes that may at any time be
asserted against any such Person with respect to the transactions contemplated
herein, including any sales, gross receipts, general corporation, tangible
personal property, privilege or license taxes (but, in the case of the Issuer,
not including any taxes asserted with respect to, and as of the date of, the
sale of the Receivables to the Issuer or the issuance and original sale of the
Certificate and the Notes, or asserted with respect to ownership of the
Receivables, or Federal or other income taxes arising out of distributions on
the Certificate or the Notes) and costs and expenses in defending against the
same.


 


(c)                                  The
Servicer shall indemnify, defend and hold harmless the Issuer, the Owner
Trustee, the Indenture Trustee, the Seller, the Certificateholder and the
Noteholders and any of the officers, directors and agents of the Issuer, the
Owner Trustee, the Indenture Trustee and the Seller from and against any and
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 any such Person through, the negligence, willful misfeasance or
bad faith of the Servicer in the performance of its duties under this Agreement
or by reason of reckless disregard of its obligations and duties under this
Agreement or on account of the failure of the Servicer to be qualified to do business
as a foreign corporation or to have obtained a license or approval in any
jurisdiction.


 


(d)                                 The
Servicer shall indemnify, defend and hold harmless the Owner Trustee and the
Indenture Trustee and their respective officers, directors and agents from and
against all costs, expenses, losses, claims, damages and liabilities arising
out of or incurred in connection with the acceptance or performance of the
trusts and duties herein and contained in the Trust Agreement, in the case of
the Owner Trustee, and contained in the Indenture, in the case of the Indenture
Trustee, except to the extent that such cost, expense, loss, claim, damage or
liability:  (i) shall be due to the
willful misfeasance, bad faith or negligence (except for errors in judgment) of
the Owner Trustee or the Indenture Trustee as applicable; or (ii) shall arise
from the breach by the Owner Trustee of any of its representations or
warranties set forth in Section 7.03 of the Trust Agreement.


 


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(e)                                  To
the extent not indemnified by the Seller under Section 6.03, the Servicer shall
pay any and all taxes levied or assessed upon all or any part of the Owner
Trust Estate, other than any taxes asserted with respect to, and as of the date
of, the sale of the Receivables to the Issuer or the issuance and original sale
of the Certificate and the Notes, or Federal or other income taxes imposed on
the Issuer because of its classification or reclassification for tax purposes,
or Federal or other income taxes arising out of distributions on the
Certificate or the Notes.


 


(f)                                    The
Servicer shall pay the Indenture Trustee from time to time reasonable
compensation for all services rendered by the Indenture Trustee under the
Indenture (which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust).


 


(g)                                 The
Servicer shall, except as otherwise expressly provided in the Indenture,
reimburse the Indenture Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Indenture Trustee in
accordance with any provision of the Indenture (including, but not limited to,
the reasonable compensation, expenses and disbursements of its agents and
either in-house counsel or outside counsel, but not both) except any such
expense, disbursement or advance as may be attributable to its negligence or
bad faith.


 


For
purposes of this Section 7.02, in the event of the termination of the rights
and obligations of JDCC (or any successor thereto pursuant to Section 7.03) as
Servicer pursuant to Section 8.01, or a resignation by such Servicer pursuant
to this Agreement, such Servicer shall be deemed to be the Servicer pending
appointment of a successor Servicer (other than the Indenture Trustee) pursuant
to Section 8.02.


 


Indemnification
under this Section shall survive the resignation or removal of the Owner
Trustee or the Indenture Trustee or the termination of this Agreement and shall
include reasonable fees and expenses of counsel and expenses of
litigation.  If the Servicer shall have
made any indemnity payments pursuant to this Section and the Person to or on
behalf of whom such payments are made thereafter collects any of such amounts
from others, such Person shall promptly repay such amounts to the Servicer,
without interest.


 


SECTION 7.03   Merger or Consolidation of, or
Assumption of the Obligations of, Servicer.  Any Person (a) into which the Servicer may be merged or
consolidated, (b) which may result from any merger or consolidation to which
the Servicer shall be a party, (c) which may succeed to the properties and
assets of the Servicer substantially as a whole, or (d) with respect to the
Servicer’s obligations hereunder, which is a corporation 50% or more of the
voting stock of which is owned, directly or indirectly, by Deere, which Person
executed an agreement of assumption to perform every obligation of the Servicer
hereunder, shall be the successor to the Servicer under this Agreement without
further act on the part of any of the parties to this Agreement; provided,
however, that (i) immediately after giving effect to such transaction, no
Servicer Default, and no event which, after notice or lapse of time, or both,
would become a Servicer Default shall have occurred and be continuing, (ii) the
Servicer shall have delivered to the Owner Trustee and the Indenture Trustee an
Officers’ Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption


 


34

















 


comply with this Section and
that all conditions precedent provided for in this Agreement relating to such
transaction have been complied with, (iii) the Rating Agency Condition shall
have been satisfied with respect to such transaction and (iv) the Servicer
shall have delivered to the Owner Trustee and the Indenture Trustee an Opinion
of Counsel either (A) stating that, in the opinion of such counsel, all
financing statements and continuation statements and amendments thereto have
been executed (if required) and filed that are necessary fully to preserve and
protect the interest of the Owner Trustee and the Indenture Trustee,
respectively, in the Receivables and reciting the details of such filings or
(B) stating that, in the opinion of such counsel, no such action shall be
necessary to preserve and protect such interests.  Notwithstanding anything herein to the contrary, the execution of
the foregoing agreement of assumption and compliance with clauses (i), (ii),
(iii) and (iv) above shall be conditions to the consummation of the
transactions referred to in clause (a), (b), (c) or (d) above.


 


SECTION 7.04   Limitation on Liability of Servicer and
Others.  Neither the Servicer nor
the Sub-Servicer nor any of the directors or officers or employees or agents of
the Servicer or the Sub-Servicer, as the case may be, shall be under any
liability to the Issuer, the Noteholders or the Certificateholder, except as
provided under this Agreement, for any action taken or for refraining from the
taking of any action pursuant to this Agreement or for errors in judgment;
provided, however, that this provision shall not protect the Servicer, the
Sub-Servicer or any such person against any liability that would otherwise be
imposed by reason of willful misfeasance, bad faith or negligence in the
performance of duties or by reason of reckless disregard of obligations and
duties under this Agreement.  The
Servicer, the Sub-Servicer and any director or officer or employee or agent of
the Servicer or the Sub-Servicer, as the case may be, may rely in good faith on
any document of any kind prima facie properly executed and submitted by any
person respecting any matters arising under this Agreement.


 


Except
as provided in this Agreement, neither the Servicer nor the Sub-Servicer shall
be under any obligation to appear in, prosecute or defend any legal action that
shall not be incidental to its duties to service the Receivables in accordance
with this Agreement, and that in its opinion may involve it in any expense or
liability; provided, however, that the Servicer or the Sub-Servicer may
undertake any reasonable action that it may deem necessary or desirable in
respect of this Agreement and the Basic Documents and the rights and duties of
the parties to this Agreement and the Basic Documents and the interests of the
Certificateholder under this Agreement and the Noteholders under the Indenture.


 


SECTION 7.05   JDCC Not to Resign as Servicer.  Subject to the provisions of Section 7.03,
JDCC shall not resign from the obligations and duties hereby imposed on it as
Servicer under this Agreement except upon determination that the performance of
its duties under this Agreement shall no longer be permissible under applicable
law.  Notice of any such determination
permitting the resignation of JDCC shall be communicated to the Owner Trustee
and the Indenture Trustee at the earliest practicable time (and, if such
communication is not in writing, shall be confirmed in writing at the earliest
practicable time) and any such determination shall be evidenced by an Opinion
of Counsel to such effect delivered to the Owner Trustee and the Indenture
Trustee concurrently with or promptly after such notice.  No such resignation shall become effective
until the Indenture Trustee or a successor Servicer shall have assumed the
responsibilities and obligations of JDCC in accordance with Section 8.02.


 


35

















 


SECTION 7.06   Servicer to Act as Administrator.  In the event of the resignation or removal
of the Administrator and the failure of a successor Administrator to have been
appointed and to have accepted such appointment as successor Administrator, the
Servicer shall become the successor Administrator and shall be bound by the terms
of the Administration Agreement.


 


ARTICLE VIII


 


Default


 


SECTION 8.01   Servicer Default.  If any one of the following events (a
“Servicer Default”) shall occur and be continuing:


 


(a)                                  any
failure by the Servicer to deliver to the Indenture Trustee for deposit in any
of the Trust Accounts or the Certificate Distribution Account any required
payment or to direct the Indenture Trustee to make any required distributions
therefrom that shall continue unremedied for a period of three Business Days
after written notice of such failure is received by the Servicer from the Owner
Trustee or the Indenture Trustee or after discovery of such failure by an
officer of the Servicer; or


 


(b)                                 failure
on the part of the Servicer or the Seller, as the case may be, duly to observe
or to perform in any material respect any other covenants or agreements of the
Servicer or the Seller (as the case may be) set forth in this Agreement or any
other Basic Document, which failure shall (i) materially and adversely affect
the rights of Certificateholder or Noteholders and (ii) continue unremedied for
a period of 60 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given (A) to the Servicer or
the Seller (as the case may be) by the Owner Trustee or the Indenture Trustee
or (B) to the Servicer or the Seller (as the case may be), and to the Owner
Trustee and the Indenture Trustee by the Holders of Notes evidencing not less
than 25% of the Outstanding Amount of the Notes or the Certificateholder (as
defined in the Trust Agreement); or


 


(c)                                  an
Insolvency Event occurs with respect to the Servicer;


 


then, and in
each and every case, so long as the Servicer Default shall not have been
remedied, either the Indenture Trustee, or the Holders of Notes evidencing not
less than 25% of the Outstanding Amount of the Notes, by notice then given in
writing to the Servicer (and to the Indenture Trustee and the Owner Trustee if
given by the Noteholders) may terminate all the rights and obligations (other
than the obligations set forth in Section 7.02 hereof) of the Servicer under
this Agreement.  On or after the receipt
by the Servicer of such written notice, all authority and power of the Servicer
under this Agreement, whether with respect to the Notes, the Certificate or the
Receivables or otherwise, shall, without further action, pass to and be vested
in the Indenture Trustee or such successor Servicer as may be appointed under
Section 8.02; and, without limitation, the Indenture Trustee and the Owner
Trustee are hereby authorized and empowered to execute and deliver, on behalf
of the predecessor Servicer, as attorney-in-fact or otherwise, any and all
documents and other instruments, and to do or accomplish all other acts or


 


36

















 


things necessary or appropriate
to effect the purposes of such notice of termination, whether to complete the
transfer and endorsement of the Receivables and related documents, or
otherwise.  The predecessor Servicer
shall cooperate with the successor Servicer, the Indenture Trustee and the
Owner Trustee in effecting the termination of the responsibilities and rights
of the predecessor Servicer under this Agreement, including the transfer to the
successor Servicer for administration by it of all cash amounts that shall at
the time be held by the predecessor Servicer for deposit, or shall thereafter
be received by it with respect to a Receivable.  All reasonable costs and expenses (including reasonable
attorneys’ fees) incurred in connection with transferring the Receivable Files
to the successor Servicer and amending this Agreement to reflect such
succession as Servicer pursuant to this Section shall be paid by the
predecessor Servicer upon presentation of reasonable documentation of such
costs and expenses.  Upon receipt of
notice of the occurrence of a Servicer Default, the Owner Trustee shall give
notice thereof to the Rating Agencies.


 


SECTION 8.02   Appointment of Successor.


 


(a)                                  Upon
the Servicer’s receipt of notice of termination, pursuant to Section 8.01 or
the Servicer’s resignation in accordance with the terms of this Agreement, the
predecessor Servicer shall continue to perform its functions as Servicer under
this Agreement, in the case of termination, only until the date specified in
such termination notice or, if no such date is specified in a notice of
termination, until receipt of such notice and, in the case of resignation,
until the earlier of (x) the date 45 days from the delivery to the Owner
Trustee and the Indenture Trustee of written notice of such resignation (or
written confirmation of such notice) in accordance with the terms of this
Agreement and (y) the date upon which the predecessor Servicer shall become
unable to act as Servicer, as specified in the notice of resignation and
accompanying Opinion of Counsel.  In the
event of the Servicer’s termination hereunder, the Indenture Trustee shall
appoint a successor Servicer, and the successor Servicer shall accept its appointment
by a written assumption in form acceptable to the Owner Trustee and the
Indenture Trustee.  In the event that a
successor Servicer has not been appointed at the time when the predecessor
Servicer has ceased to act as Servicer in accordance with this Section, pending
the appointment of and acceptance by a successor Servicer, the Indenture
Trustee without further action shall automatically be appointed and serve as
the successor Servicer and the Indenture Trustee shall be entitled to the
Servicing Fee; provided, however, the provisions of Section 7.01 shall not
apply and the provisions of Section 4.07 shall not apply in the case of a
breach by a predecessor Servicer.  The
Indenture Trustee may delegate any of its servicing obligations to an Affiliate
or agent in accordance with Section 4.14. 
The Indenture Trustee shall not be liable for any action or failure to
act on the part of the predecessor Servicer. 
Notwithstanding the above, the Indenture Trustee shall, if it shall be
legally unable so to act, appoint or petition a court of competent jurisdiction
to appoint, any established institution, having a net worth of not less than
$50,000,000 and whose regular business shall include the servicing of equipment
receivables, as the successor to the Servicer under this Agreement.


 


(b)                                 Upon
appointment, the successor Servicer (including the Indenture Trustee acting as
successor Servicer) shall be the successor in all respects to the predecessor
Servicer and shall be subject to all the responsibilities, duties and
liabilities arising thereafter relating thereto placed on the predecessor
Servicer and shall be entitled to the Servicing Fee and all the rights granted
to the predecessor Servicer by the terms and provisions of this Agreement.


 


37

















 


(c)                                  Subject
to the Indenture Trustee’s right to appoint a successor Servicer pursuant to
Section 8.02(a) after the Indenture Trustee has become the Servicer, the
Servicer may not resign unless it is prohibited from serving as such by law.


 


SECTION 8.03   Notification to Noteholders and the
Certificateholder.  Upon any
termination of, or appointment of a successor to the Servicer pursuant to this
Article VIII, the Owner Trustee shall give prompt written notice thereof to the
Certificateholder and the Indenture Trustee shall give prompt written notice
thereof to Noteholders and the Rating Agencies.


 


SECTION 8.04   Waiver of Past Defaults.  The Holders of Notes evidencing not less
than a majority of the Outstanding Amount of the Notes, on behalf of all
Noteholders (or the Holder (as defined in the Trust Agreement) of the
Certificate, in the case of any default which does not adversely affect the
Indenture Trustee or the Noteholders) may, waive in writing any default by the
Servicer in the performance of its obligations hereunder and its consequences,
except a default in making any required deposits to or payments from any of the
Trust Accounts in accordance with this Agreement.  Upon any such waiver of a past default, such default shall cease
to exist, and any Servicer Default arising therefrom shall be deemed to have
been remedied for every purpose of this Agreement.  No such waiver shall extend to any subsequent or other default or
impair any right consequent thereto.


 


ARTICLE IX


 


Termination


 


SECTION 9.01   Optional Purchase of All Receivables and
Termination.


 


(a)                                  On
the last day of any Collection Period immediately preceding a Payment Date as
of which the then outstanding Pool Balance is 10% or less of the Initial Pool
Balance, the Servicer shall have the option to purchase the Owner Trust Estate,
other than the Trust Accounts and the Certificate Distribution Account;
provided, however, that the Servicer may not effect any such purchase so long
as the rating on Deere’s long-term debt obligations is less than Baa3 by Moody’s,
unless the Owner Trustee and the Indenture Trustee shall have received an
Opinion of Counsel to the effect that such purchase would not constitute a
fraudulent conveyance; provided further that each Rating Agency shall receive a
copy of such Opinion of Counsel and shall have confirmed that the rating
assigned to the Notes by such Rating Agency shall not be withdrawn or
downgraded as a result of such purchase. 
To exercise such option, the Servicer shall deposit pursuant to Section
5.03 in the Collection Account an amount equal to the aggregate Purchase Amount
for the Receivables (including defaulted Receivables) and shall succeed to all
interests in and to the Trust.


 


(b)         Upon any sale of the assets of the Trust
pursuant to Section 9.02 of the Trust Agreement, the Servicer shall instruct
the Indenture Trustee to deposit the proceeds from such sale after all payments
and reserves therefrom have been made (the “Insolvency Proceeds”) in the
Collection Account.  On the Payment Date
on which the Insolvency Proceeds are deposited in the Collection Account (or,
if such proceeds are not so deposited on a Payment Date, on the Payment Date
immediately following such deposit), the Servicer shall instruct the Indenture


 


38

















 


Trustee to make the following
deposits (after the application on such Payment Date of the Total Distribution
Amount and funds on deposit in the Reserve Account pursuant to Sections 5.04
and 5.05) from the Insolvency Proceeds and any funds remaining on deposit in
the Reserve Account (including the proceeds of any sale of investments therein
as described in the following sentence):


 


(i)                                     to the Note
Distribution Account, any portion of the accrued but unpaid interest on the
Notes not otherwise deposited into the Note Distribution Account on such
Payment Date;


 


(ii)                                  to the Note
Distribution Account, the outstanding principal balance of the Notes (after
giving effect to the reduction in the outstanding principal balance of the
Notes to result from the deposits made in the Note Distribution Account on such
Payment Date and on prior Payment Dates); and


 


(iii)                               to the Certificate
Distribution Account, the Certificate Balance (after giving effect to the
reduction in the Certificate Balance to result from the deposits made in the
Certificate Distribution Account on such Payment Date).


 


Any investments on deposit in the Reserve Account and
Note Distribution Account which will not mature on or before such Payment Date
shall be sold by the Indenture Trustee at such time as will result in the
Indenture Trustee receiving the proceeds from such sale not later than the
Transfer Date preceding such Payment Date. 
Any Insolvency Proceeds remaining after the deposits described above shall
be paid to the Seller.


 


(c)                                  Notice
of any termination of the Trust shall be given by the Servicer to the Owner
Trustee and the Indenture Trustee as soon as practicable after the Servicer has
received notice thereof.


 


(d)                                 Following
the satisfaction and discharge of the Indenture and the payment in full of the
principal of and interest on, and the cancellation of all of, the Notes, the
Certificateholder will succeed to the rights of the Noteholders hereunder other
than Section 5.05(b) and the Owner Trustee will succeed to the rights of the
Indenture Trustee pursuant to this Agreement.


 


(e)                                  This
Agreement shall terminate upon the termination of the Trust.


 


ARTICLE X


 


Miscellaneous
Provisions


 


SECTION 10.01   Amendment.  The Agreement may be amended by the Seller, the Servicer and the
Owner Trustee, with the consent of the Indenture Trustee, but without the
consent of any of the Noteholders or the Certificateholder, to cure any
ambiguity, to correct or supplement any provision 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 Certificateholder; provided, however, that


 


39

















 


such action shall not,
adversely affect in any material respect the interests of any Noteholder or
Certificateholder; provided further that 10 days prior written notice of any
such amendment be given to each Rating Agency and, if a Rating Agency notifies
the Owner Trustee that such amendment will result in a downgrading or
withdrawal of the then current rating of any class of the Notes or the
Certificate, such amendment shall become effective with the consent of the
Holders of Notes evidencing not less than a majority of the Outstanding Amount
of the Notes and the consent of the Certificateholder; provided further that
any solicitation of such consent shall disclose the downgrading or withdrawal
that would result from such amendment.


 


This
Agreement may also be amended from time to time, with 10 days prior notice to
each of the Rating Agencies, by the Seller, the Servicer and the Owner Trustee,
with the consent of the Indenture Trustee, the consent of the Holders of Notes
evidencing not less than a majority of the Outstanding Amount of the Notes and
the consent of the Holder of the Certificate, 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 Certificateholder; provided, however, that no such amendment shall (a)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, collections of payments on Receivables or distributions that shall
be required to be made for the benefit of the Noteholders or the
Certificateholder or (b) reduce the aforesaid percentage of the Outstanding
Amount of the Notes and the Certificate Balance, the Holders of which are
required to consent to any such amendment, without the consent of the Holders
of all the outstanding Notes and the consent of the Certificateholder.


 


Promptly
after the execution of any such amendment or consent, the Owner Trustee shall
furnish written notification of the substance of such amendment or consent to
the Certificateholder.


 


It
shall not be necessary for the consent of the Certificateholder or the
Noteholders pursuant to this Section to approve the particular form of any
proposed amendment or consent, but it shall be sufficient if such consent shall
approve the substance thereof.


 


Prior
to the execution of any amendment to this Agreement, the Owner Trustee and the
Indenture 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 and the Opinion of Counsel referred to in Section 10.02(i)(1)
and that all conditions precedent have been satisfied.  The Owner Trustee and the Indenture Trustee
may, but shall not be obligated to, enter into any such amendment which affects
the Owner Trustee’s or the Indenture Trustee’s, as applicable, own rights,
duties or immunities under this Agreement or otherwise.


 


SECTION 10.02   Protection of Title to Trust.


 


(a)                                  The
Seller shall file (and if required, authorize) such financing statements and
cause to be authorized 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 interest of the Issuer and the interests of the
Indenture Trustee in the Receivables and in the proceeds thereof.  The Seller shall deliver (or cause to be
delivered) to the Owner Trustee and the Indenture Trustee


 


40

















 


file-stamped copies of, or
filing receipts for, any document filed as provided above, as soon as available
following such filing.


 


(b)                                 Neither
the Seller nor the Servicer shall change its name, identity, corporate
structure or jurisdiction of organization in any manner that would, could or
might make any financing statement or continuation statement filed in
accordance with paragraph (a) above seriously misleading within the meaning of
Section 9-506 of the UCC, unless it shall have given the Owner Trustee and the
Indenture Trustee at least five days’ prior written notice thereof and shall
have promptly filed appropriate new financing statements and/or amendments to
all previously filed financing statements or continuation statements.


 


(c)                                  Each
of the Seller and the Servicer shall have an obligation to give the Owner
Trustee and the Indenture Trustee at least 60 days prior written notice of any
relocation of its jurisdiction of organization if, as a result of such
relocation, the applicable provisions of the UCC would require the filing of
any amendment of any previously filed financing or continuation statement or of
any new financing statement and shall promptly file any such amendment or new
financing statements as the case may be. 
The Servicer shall at all times maintain each office from which it shall
service Receivables, and its jurisdiction of organization, within the United
States of America.


 


(d)                                 The
Servicer shall maintain accounts and records as to each Receivable accurately
and in sufficient detail to permit (i) the reader thereof to know at any time
the status of such Receivable, including payments and recoveries made and
payments owing (and the nature of each) and (ii) reconciliation between
payments or recoveries on (or with respect to) each Receivable and the amounts
from time to time deposited in the Collection Account in respect of such
Receivable.


 


(e)                                  The
Servicer shall maintain its computer systems so that, from and after the time
of sale under this Agreement of the Receivables, the Servicer’s master computer
records (including any backup archives) that refer to a Receivable shall
indicate clearly the interest of the Issuer and the Indenture Trustee in such
Receivable and that such Receivable is owned by the Issuer and has been pledged
to the Indenture Trustee.  Indication of
the Issuer’s and the Indenture Trustee’s interest in a Receivable shall be
deleted from or modified on the Servicer’s computer systems when, and only
when, the related Receivable shall have been paid in full, purchased or
repurchased.


 


(f)                                    If
at any time the Seller or the Servicer shall propose to sell, grant a security
interest in, or otherwise transfer any interest in equipment receivables to any
prospective purchaser, lender or other transferee, the Servicer shall give to
such prospective purchaser, lender or other transferee computer tapes, records
or printouts (including any restored from backup archives) that, if they shall
refer in any manner whatsoever to any Receivable, shall indicate clearly that
such Receivable has been sold and is owned by the Issuer and has been pledged
to the Indenture Trustee.


 


(g)                                 The
Servicer shall permit the Indenture Trustee and its agents at any time during
normal business hours to inspect, audit and make copies of and abstracts from
the Servicer’s records regarding any Receivable.


 


41

















 


(h)                                 Upon
request, the Servicer shall furnish to the Owner Trustee or to the Indenture
Trustee, within five Business Days, a list of all Receivables (by contract
number and name of Obligor) then held as part of the Trust, together with a
reconciliation of such list to the Schedule of Receivables and to each of the
Servicer’s Certificates furnished before such request indicating removal of
Receivables from the Trust.


 


(i)                                     The
Servicer shall deliver to the Owner Trustee and the Indenture Trustee:


 


(1)                                  promptly
after the execution and delivery of this Agreement and of each amendment
thereto, an Opinion of Counsel either (A) stating that, in the opinion of such
counsel, all financing statements and continuation statements have been
executed and filed that are necessary fully to preserve and protect the
interest of the Owner Trustee and the Indenture Trustee in the Receivables, and
reciting the details of such filings or referring to prior Opinions of Counsel
in which such details are given, or (B) stating that, in the opinion of such
counsel, no such action shall be necessary to preserve and protect such
interest; and


 


(2)                                  within
90 days after the beginning of each calendar year beginning with the first
calendar year beginning more than three months after the Cut-off Date, an
Opinion of Counsel, dated as of a date during such 90-day period, either (A)
stating that, in the opinion of such counsel, all financing statements and
continuation statements have been executed and filed that are necessary fully
to preserve and protect the interest of the Owner Trustee and the Indenture
Trustee in the Receivables, and reciting the details of such filings or
referring to prior Opinions of Counsel in which such details are given, or (B)
stating that, in the opinion of such counsel, no such action shall be necessary
to preserve and protect such interest.


 


Each
Opinion of Counsel referred to in clause (1) or (2) above shall specify any
action necessary (as of the date of such opinion) to be taken in the following
year to preserve and protect such interest.


 


(j)                                     The
Seller shall, to the extent required by applicable law, cause the Certificate
and the Notes to be registered with the Commission pursuant to Section 12(b) or
Section 12 (g) of the Exchange Act within the time periods specified in such
sections.


 


SECTION 10.03   Notices.  All demands, notices, instructions and communications upon or to
the Seller, the Servicer, the Owner Trustee, the Indenture Trustee or the
Rating Agencies under this Agreement shall be in writing, personally delivered,
sent by facsimile or mailed by certified mail, return receipt requested, and
shall be deemed to have been duly given upon receipt (a) in the case of the
Seller, to John Deere Receivables, Inc., First Interstate Bank Building, 1 East
First Street, Reno, Nevada 89501, Attention: 
Manager (702-786-5914), with a copy to Assistant Treasurer, Deere &
Company, One John Deere Place, Moline, Illinois 61265-8098 (309-765-5697), (b)
in the case of the Servicer, to John Deere Capital Corporation, 1 East First
Street, Reno, Nevada 89501, Attention: 
Manager (702-786-5527), with a copy to Assistant Treasurer, Deere &
Company, One John Deere Place, Moline, Illinois 61265-8098 (309-765-5697), (c)
in the case of the Issuer or the Owner Trustee, at the Corporate Trust Office
(as defined in the Trust Agreement), (d) in the case of the Indenture


 


42

















 


Trustee, at the Corporate Trust
Office, (e) in the case of Moody’s, to Moody’s Investors Service, Inc., ABS
Monitoring Department, 99 Church Street, New York, New York 10007, and (f) in
the case of Standard & Poor’s, to Standard & Poor’s Ratings Services,
55 Water Street, 40th Floor, New York, New York 10041, Attention of Asset Backed
Surveillance Department; or, as to each of the foregoing, at such other address
as shall be designated by written notice to the other parties.


 


SECTION 10.04   Assignment.  Notwithstanding anything to the contrary
contained herein, except as provided in Sections 6.04 and 7.03 and as provided
in the provisions of this Agreement concerning the resignation of the Servicer,
this Agreement may not be assigned by the Seller or the Servicer.


 


SECTION 10.05   Limitations on Rights of Others.  The provisions of this Agreement are solely
for the benefit of the Seller, the Servicer, the Issuer, the Owner Trustee, the
Certificateholder, 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 10.06   Severability.  Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.


 


SECTION 10.07   Separate Counterparts.  This Agreement may be executed by the
parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.


 


SECTION 10.08   Headings.  The headings of the various Articles and Sections herein are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.


 


SECTION 10.09   Governing Law.  THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.


 


SECTION 10.10   Assignment to Indenture Trustee.  The Seller hereby acknowledges and consents
to any mortgage, pledge, assignment and grant of a security interest by the
Issuer to the Indenture Trustee pursuant to the Indenture for the benefit of
the Noteholders of all right, title and interest of the Issuer in, to and under
the Receivables and/or the assignment of any or all of the Issuer’s rights and
obligations hereunder to the Indenture Trustee.


 


SECTION 10.11   Nonpetition Covenants.


 


(a)                                  Notwithstanding
any prior termination of this Agreement, the Servicer and the Seller 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


 


43

















 


to invoke the process of any
court or 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.


 


(b)                                 Notwithstanding
any prior termination of this Agreement, the Servicer shall not, prior to the
date which is one year and one day after there has been paid in full all debt
issued by any securitization vehicle in respect of which the Seller holds any
interest, acquiesce, petition or otherwise invoke or cause the Seller to invoke
the process of any court or government authority for the purpose of commencing
or sustaining a case against the Seller under any Federal or State bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Seller or any
substantial part of its property, or ordering the winding up or liquidation of
the affairs of the Seller.


 


SECTION 10.12   Limitation of Liability of Owner Trustee
and Indenture Trustee.


 


(a)                                  Notwithstanding
anything contained herein to the contrary, this Agreement has been
countersigned by U.S. Bank Trust National Association not in its individual
capacity but solely in its capacity as Owner Trustee of the Issuer and in no
event shall U.S. Bank Trust National Association in its individual capacity
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 accepted by
The Bank of New York not in its individual capacity but solely as Indenture
Trustee and in no event shall The Bank of New York have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the assets
of the Issuer.


 


SECTION 10.13   Additional Securities.  The issuance of any securities by John Deere
Receivables, Inc., other than the Notes and the Certificate, will require
satisfaction of the Rating Agency Condition.


 


44

















 


IN WITNESS
WHEREOF, the parties hereto have caused this Agreement to be duly executed by
their respective officers as of the day and year first above written.


 


	
   

  	
  JOHN DEERE OWNER TRUST 2003

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  U.S. Bank Trust National Association,

  not in its individual capacity but solely as

  Owner Trustee on behalf of the Trust,

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JOHN DEERE RECEIVABLES, INC.,

  Seller,

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JOHN DEERE CAPITAL CORPORATION,

  Servicer,

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Acknowledged and Accepted:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  The Bank of New York,

    not in its individual

    capacity but solely

    as Indenture Trustee,

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						



 


45

















 


SCHEDULE A


 


Schedule of Receivables


 


(Delivered to the Trust at the Closing)


 


46

















 


SCHEDULE B


 


Location of Receivable Files


 


Suite 600


 


1 East First Street


 


Reno, Nevada 89501


 


47

















 


SCHEDULE C


 


LIST OF FISCAL MONTHS


 


FISCAL MONTH CUTOFF DATES (BY FISCAL YEAR)


 


Fiscal
Month Cutoff Dates (By Fiscal Year)


 


	
  Fiscal

  Month

  	
   

  	
  Calendar

  Month

  	
   

  	
  2003

  	
   

  	
  2004

  	
   

  	
  2005

  	
   

  	
  2006

  	
   

  	
  2007

  	
   

  	
  2008

  	
   

  	
  2009

  	
   

  	
  2010

  	
   

  
	
  1

  	
   

  	
  November

  	
   

  	
   

  	
   

  	
  30-Nov-03

  	
   

  	
  28-Nov-04

  	
   

  	
  27-Nov-05

  	
   

  	
  26-Nov-06

  	
   

  	
  25-Nov-07

  	
   

  	
  30-Nov-08

  	
   

  	
  29-Nov-09

  	
   

  
	
  2

  	
   

  	
  December

  	
   

  	
   

  	
   

  	
  28-Dec-03

  	
   

  	
  26-Dec-04

  	
   

  	
  25-Dec-05

  	
   

  	
  24-Dec-06

  	
   

  	
  23-Dec-07

  	
   

  	
  28-Dec-08

  	
   

  	
  27-Dec-09

  	
   

  
	
  3

  	
   

  	
  January

  	
   

  	
   

  	
   

  	
  01-Feb-04

  	
   

  	
  30-Jan-05

  	
   

  	
  29-Jan-06

  	
   

  	
  28-Jan-07

  	
   

  	
  27-Jan-08

  	
   

  	
  01-Feb-09

  	
   

  	
  31-Jan-10

  	
   

  
	
  4

  	
   

  	
  February

  	
   

  	
   

  	
   

  	
  29-Feb-04

  	
   

  	
  27-Feb-05

  	
   

  	
  26-Feb-06

  	
   

  	
  25-Feb-07

  	
   

  	
  24-Feb-08

  	
   

  	
  01-Mar-09

  	
   

  	
  28-Feb-10

  	
   

  
	
  5

  	
   

  	
  March

  	
   

  	
   

  	
   

  	
  28-Mar-04

  	
   

  	
  27-Mar-05

  	
   

  	
  26-Mar-06

  	
   

  	
  25-Mar-07

  	
   

  	
  23-Mar-08

  	
   

  	
  29-Mar-09

  	
   

  	
  28-Mar-10

  	
   

  
	
  6

  	
   

  	
  April

  	
   

  	
   

  	
   

  	
  02-May-04

  	
   

  	
  01-May-05

  	
   

  	
  30-Apr-06

  	
   

  	
  29-Apr-07

  	
   

  	
  27-Apr-08

  	
   

  	
  03-May-09

  	
   

  	
  02-May-10

  	
   

  
	
  7

  	
   

  	
  May

  	
   

  	
   

  	
   

  	
  30-May-04

  	
   

  	
  29-May-05

  	
   

  	
  28-May-06

  	
   

  	
  27-May-07

  	
   

  	
  25-May-08

  	
   

  	
  31-May-09

  	
   

  	
  30-May-10

  	
   

  
	
  8

  	
   

  	
  June

  	
   

  	
  22-Jun-03

  	
   

  	
  27-Jun-04

  	
   

  	
  26-Jun-05

  	
   

  	
  25-Jun-06

  	
   

  	
  24-Jun-07

  	
   

  	
  22-Jun-08

  	
   

  	
  28-Jun-09

  	
   

  	
  27-Jun-10

  	
   

  
	
  9

  	
   

  	
  July

  	
   

  	
  27-Jul-03

  	
   

  	
  01-Aug-04

  	
   

  	
  31-Jul-05

  	
   

  	
  30-Jul-06

  	
   

  	
  29-Jul-07

  	
   

  	
  27-Jul-08

  	
   

  	
  02-Aug-09

  	
   

  	
  01-Aug-10

  	
   

  
	
  10

  	
   

  	
  August

  	
   

  	
  24-Aug-03

  	
   

  	
  29-Aug-04

  	
   

  	
  28-Aug-05

  	
   

  	
  27-Aug-06

  	
   

  	
  26-Aug-07

  	
   

  	
  24-Aug-08

  	
   

  	
  30-Aug-09

  	
   

  	
  29-Aug-10

  	
   

  
	
  11

  	
   

  	
  September

  	
   

  	
  28-Sep-03

  	
   

  	
  26-Sep-04

  	
   

  	
  25-Sep-05

  	
   

  	
  24-Sep-06

  	
   

  	
  23-Sep-07

  	
   

  	
  28-Sep-08

  	
   

  	
  27-Sep-09

  	
   

  	
  26-Sep-10

  	
   

  
	
  12

  	
   

  	
  October

  	
   

  	
  31-Oct-03

  	
   

  	
  31-Oct-04

  	
   

  	
  31-Oct-05

  	
   

  	
  31-Oct-06

  	
   

  	
  31-Oct-07

  	
   

  	
  31-Oct-08

  	
   

  	
  31-Oct-09

  	
   

  	
  31-Oct-10

  	
   

  



 


48

















 


SCHEDULE D


 


Servicer’s Certificate


 


The
undersigned hereby certify that (i) they are, respectively, a duly elected Vice
President and Assistant Secretary of John Deere Capital Corporation and (ii)
this Servicing Certificate complies with the requirements of, and is being
delivered pursuant to, Section 4.09 of the Sale and Servicing Agreement (the
“Sale and Servicing Agreement”) dated as of July 15, 2003 between John
Deere Owner Trust 2003, John Deere Receivables, Inc. and John Deere Capital
Corporation.


 


	
  Dated:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
  Assistant Secretary

  
				



 


49

















 


Payment Date:
                                                       



 


(1)           Servicing Fee:


(2)           Administration Fee:


(3)           Total Distribution
Amount:


(4)           Accrued and unpaid
interest on the Notes:


(5)           Class A Monthly
Principal Distributable Amount:


(6)           Class B Monthly
Principal Distributable Amount:


(7)           Deposit to Reserve
Account from Collection Account to increase the amount on deposit in the
Reserve Account to the Specified Reserve Account Balance:


(8)           Deposit of Excess to
Reserve Account from Collection Account:


(9)           Specified Reserve
Account Balance (before any distributions of excess):


(10)         Reserve Account Balance
over the Specified Reserve Account Balance (before any distributions of
excess):


(11)         Excess Reserve Account
Balance distributable to Seller 

(5.05 (b) (i) or (ii))


(12)         Certificate Monthly
Principal Distributable Amount:


(13)         Amount to be withdrawn
from the Reserve Account and deposited into the Note Distribution Account 

(5.05(c)):


Interest
amount included in above figure:


Principal
amount included in above figure:


(14)         (a)           Pool Balance as of the close of business on
the last day of the related Collection Period:


(b)           Note Value at the end
of the related Collection Period:


(c)           Number of Accounts at
the end of the related Collection Period:


(15)         Outstanding Principal
Balance of Class A-1 Notes:


Outstanding
Principal Balance of Class A-2 Notes


Outstanding
Principal Balance of Class A-3 Notes


Outstanding
Principal Balance of Class A-4 Notes


Outstanding
Principal Balance of Class B Notes


Outstanding
Principal Balance of the Certificate:


(16)         Aggregate amount of
Purchased Receivables for related Collection Period:


(17)         Reserve Account Balance
after giving effect to all distributions:


(18)         Specified Reserve Account
Balance (after all distributions and adjustments):


 


50

















 


Officer’s Certificate


 


The
undersigned hereby certify that (i) they are, respectively, a duly elected Vice
President and Assistant Secretary of John Deere Capital Corporation, (ii)
Schedule E hereto complies with the requirements of, and is being delivered
pursuant to, Section 5.06(a) of the Sale and Servicing Agreement (the “Sale and
Servicing Agreement”) dated as of July 15, 2003 between John Deere Owner
Trust 2003, John Deere Receivables, Inc. and John Deere Capital Corporation,
(iii) Schedule F hereto complies with the requirements of, and is delivered
pursuant to, Section 5.06(b) of the Sale and Servicing Agreement, and (iv)
Schedule G hereto complies with the requirements of, and is being delivered
pursuant to, Section 5.04(b) of the Sale and Servicing Agreement.


 


	
  Dated:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
  Assistant Secretary

  
				



 


51

















 


SCHEDULE E


 


Statement to Certificateholder 

pursuant to Section 5.06(a)


 


Payment Date:
                                                       



 


(1)           Amount
of principal being paid or distributed:


 


(a)           Class A-1 Notes: 

per $1,000 original principal amount:


 


(b)           Class A-2 Notes: 

per $1,000 original principal amount:


 


(c)           Class A-3 Notes: 

per $1,000 original principal amount:


 


(d)           Class A-4 Notes: 

per $1,000 original principal amount:


 


(e)           Class B Notes:

per $1,000 original principal amount:


 


(f)            Certificate: 

per $1,000 original principal amount:


 


(g)           Total:


 


(2)           (a)           Amount of interest
being paid or distributed:


 


(i)            Class A-1 Notes: 

per $1,000 original principal amount:


 


(ii)           Class A-2 Notes: 

per $1,000 original principal amount:


 


(iii)          Class A-3 Notes: 

per $1,000 original principal amount:


 


(iv)          Class A-4 Notes: 

per $1,000 original principal amount:


 


(v)           Class B Notes:

per $1,000 original principal amount:


 


(vi)          Total:


 


52

















 


(3)           (a)           Pool Balance at end of
related Collection Period:


 


(b)           Note Value at end of
related Collection Period:


 


(4)           After
giving effect to distributions on this Payment Date:


 


(a)           (i)            Outstanding principal
amount of 

Class A-1 Notes:


 


(ii)           Outstanding principal amount of Class A-2
Notes:


 


(iii)          Outstanding principal
amount of Class A-3 Notes:


 


(iv)          Outstanding principal
amount of Class A-4 Notes:


 


(v)           Outstanding principal
amount of Class B Notes:


 


(b)           Certificate Balance:


 


(5)           Amount of Servicing
Fee: 

per $1,000 original principal amount of Notes and Certificate:


 


(6)           Amount
of Administration Fee:


 


(7)           Aggregate
Purchase Amounts for Collection Period:


 


(8)           (i)            Amount in Reserve
Account:


 


(ii)           Specified Reserve Account
Balance:


 


(9)           Amount of any payments
in respect of the Receivables that are more than 60 days past due as of the end
of the related Collection Period:


 


53

















 


SCHEDULE F


 


Statement for Noteholders 

pursuant to Section 5.06(b)


 


Payment Date:
                                                       



 


(1)           Amount
of principal being paid on Notes:


 


(a)           Class A-1 Notes:

per $1,000 original principal amount:


 


(b)           Class A-2 Notes:

per $1,000 original principal amount:


 


(c)           Class A-3 Notes:

per $1,000 original principal amount:


 


(d)           Class A-4 Notes:

per $1,000 original principal amount:


 


(e)           Class B Notes:

per $1,000 original principal amount:


 


(f)            Total:


 


(2)           (a)           Amount of interest
being paid on Notes:


 


(i)            Class A-1 Notes:

per $1,000 original principal amount:


 


(ii)           Class A-2 Notes:

per $1,000 original principal amount:


 


(iii)          Class A-3 Notes:

per $1,000 original principal amount:


 


(iv)          Class A-4 Notes:

per $1,000 original principal amount:


 


(v)           Class B Notes:

per $1,000 original principal amount:


 


(vi)          Total:


 


(3)           (a)           Pool Balance at end of
related Collection Period:


 


(b)           Note Value at end of
related Collection Period:


 


54

















 


(4)           After
giving effect to distributions on this Payment Date:


 


(a)                                  (i)            Outstanding principal
amount of Class A-1 Notes:


                                                (ii)           Outstanding principal
amount of Class A-2 Notes:


                                                (iii)          Outstanding principal
amount of Class A-3 Notes:


                                                (iv)          Outstanding principal
amount of Class A-4 Notes:


                                                (v)           Outstanding principal
amount of Class B Notes:


 


(b)                                 (i)            Certificate Balance:


                                                (ii)           Certificate Factor:


 


(5)           Amount of Servicing
Fee:

per $1,000 original principal amount of

Notes and Certificate:


 


(6)           Amount of
Administration Fee:


 


(7)           Aggregate Purchase
Amounts for Collection Period:


 


(8)           (i)            Amount in Reserve Account:


 


(ii)           Specified Reserve
Account Balance:


 


(9)           Amount of any payments
in respect of the Receivables that are more than 60 days past due as of the end
of the related Collection Period:


 


55

















 


SCHEDULE G


 


Instructions to the Trustee for payments and deposits
pursuant to Section 5.04 (b) of the Sale and Servicing Agreement:


 


Payment Date:  
                                                       



 


(i)            Payment of Servicing
Fee (including any previously 

unpaid Servicing Fees) to Servicer:  
                                        



 


(ii)           Payment of
Administration Fee to Administrator: 
                                        



 


(iii)          Accrued and unpaid
interest on the Notes for such 

Payment Date: 
                                        



 


(iv)          Note Monthly Principal
Distributable Amount to be deposited into 

Note Distribution Account: 
                                        



 


(v)           Deposit to Reserve
Account to increase the amounts on deposit in the Reserve Account to the
Specified Reserve Account Balance: 
                                        



 


(vi)          Certificate Monthly
Principal Distributable Amount to be deposited into Certificate Distribution
Account:                                          



 


(vii)         Deposit to Reserve Account: 
                                        


 


56