<Page>
THE INFORMATION IN THIS PRELIMINARY PROSPECTUS SUPPLEMENT IS NOT COMPLETE AND
MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES OR ACCEPT OFFERS TO BUY THESE
SECURITIES PRIOR TO THE TIME THIS PRELIMINARY PROSPECTUS SUPPLEMENT IS DELIVERED
IN FINAL FORM. THIS PRELIMINARY PROSPECTUS SUPPLEMENT WITH THE ACCOMPANYING
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IS NOT SOLICITING AN
OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT
PERMITTED.
SUBJECT TO COMPLETION DATED DECEMBER 9, 2003 [BOMBARDIER LOGO]
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED AUGUST 20, 2003
BOMBARDIER RECEIVABLES MASTER TRUST I
ISSUER
$500,000,000 FLOATING RATE CLASS A ASSET BACKED CERTIFICATES, SERIES 2003-3
BOMBARDIER CREDIT RECEIVABLES CORPORATION
DEPOSITOR
BOMBARDIER CAPITAL INC.
SERVICER
-------------------
- --------------------------------------------------------------------------------
The Class A Certificates represent obligations of the trust only and do not
represent interests in or obligations of Bombardier Credit Receivables
Corporation, Bombardier Capital Inc. or any of their affiliates. The Class A
Certificates will not be insured or guaranteed by any governmental agency.
INVESTING IN THE CLASS A CERTIFICATES INVOLVES RISKS. YOU SHOULD CONSIDER
CAREFULLY THE INFORMATION UNDER THE CAPTION 'RISK FACTORS' BEGINNING ON PAGE
S-9 OF THIS PROSPECTUS SUPPLEMENT AND PAGE 5 OF THE PROSPECTUS.
- --------------------------------------------------------------
The Class A Certificates will represent interests in a
pool of receivables due from dealers of consumer,
recreational and commercial products under financing
arrangements. The interest rate for the Class A
Certificates for any interest period will be the
certificate rate equal to One-Month LIBOR plus [ ]%,
payable monthly commencing January 15, 2004, as described
in this prospectus supplement under 'Description of the
Class A Certificates -- Interest.' The Class A
Certificates will be insured by a financial guaranty
insurance policy issued by XL Capital Assurance Inc.
<Table>
<Caption>
PER CLASS A
CERTIFICATE TOTAL
----------- -----
Price to public per certificate............ [ ]% $ [ ]
Underwriting discounts and commissions..... [ ]% $ [ ]
Proceeds to depositor...................... [ ]% $ [ ]
</Table>
[BOMBARDIER CAPITAL ASSURANCE LOGO]
The price to the public will include any accrued interest at the certificate
rate from [ ], 2003. The proceeds are calculated before deducting expenses
payable by the depositor which are estimated to be $750,000.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
BANC ONE CAPITAL MARKETS, INC. JPMORGAN
CITIGROUP BNP PARIBAS
The date of this Prospectus Supplement is December [ ], 2003.
<Page>
IMPORTANT NOTICE ABOUT THE INFORMATION IN THIS PROSPECTUS SUPPLEMENT
You should rely only on the information contained in, or incorporated by
reference into, this document. Bombardier Credit Receivables Corporation has not
authorized anyone to provide you with information that is different. This
document may only be used where it is legal to sell these securities. Bombardier
Credit Receivables Corporation is not offering the Class A Certificates in any
state where the offer is not permitted.
We describe the Class A Certificates in two separate documents, the prospectus
and the prospectus supplement, of which the prospectus supplement provides more
detail regarding the Class A Certificates and the offering:
The attached prospectus, which provides general information,
some of which may not apply to your Class A Certificates;
and
This prospectus supplement, which describes the specific
terms of your Class A Certificates.
This prospectus supplement includes cross-references to captions in these
materials where you can find further discussions about related topics. The
following table of contents provides the pages on which these captions are
located.
S-2
<Page>
TABLE OF CONTENTS
<Table>
<Caption>
PAGE
----
SUMMARY OF SERIES TERMS..................................... S-4
RISK FACTORS................................................ S-9
CAPITALIZED TERMS........................................... S-12
FORWARD-LOOKING STATEMENTS.................................. S-12
USE OF PROCEEDS............................................. S-12
BOMBARDIER INC. AND BOMBARDIER CAPITAL INC.................. S-13
THE FLOORPLAN FINANCING BUSINESS............................ S-14
THE ACCOUNTS................................................ S-15
General................................................. S-15
Historical Size......................................... S-16
Delinquency............................................. S-17
Loss Experience......................................... S-17
MANAGEMENT DISCUSSION AND ANALYSIS.......................... S-18
Product Mix............................................. S-18
Aging Experience........................................ S-20
Geographic Distribution................................. S-20
MATURITY AND PRINCIPAL PAYMENT CONSIDERATIONS............... S-21
DESCRIPTION OF THE CLASS A CERTIFICATES..................... S-23
General................................................. S-23
Interest................................................ S-23
Principal............................................... S-24
Excess Funding Account.................................. S-25
Allocation Percentages.................................. S-26
Daily Allocations....................................... S-27
Limited Subordination of Retained Interest.............. S-28
Distributions from the Collection Account; Reserve Fund;
Principal Account...................................... S-30
Discount Option......................................... S-33
Investor Charge-Offs.................................... S-34
Optional Repurchase..................................... S-34
Early Amortization Events............................... S-34
Voting Rights........................................... S-36
Termination............................................. S-36
Servicing Fee........................................... S-36
Reports................................................. S-37
DESCRIPTION OF THE FINANCIAL GUARANTY INSURER............... S-38
General................................................. S-38
Reinsurance............................................. S-38
Financial Strength and Financial Enhancement Ratings of
XLCA................................................... S-39
Capitalization of the Financial Guaranty Insurer........ S-39
Regulation of the Financial Guaranty Insurer............ S-40
THE FINANCIAL GUARANTY INSURANCE POLICY..................... S-40
UNDERWRITING................................................ S-42
LEGAL MATTERS............................................... S-43
WHERE YOU CAN FIND MORE INFORMATION......................... S-43
REPORTS TO CLASS A CERTIFICATEHOLDERS....................... S-43
EXPERTS..................................................... S-43
GLOSSARY.................................................... S-45
ANNEX I -- PRIOR SERIES
ANNEX II -- RECEIVABLES IN ADDITIONAL ACCOUNTS CONVEYED TO
THE TRUST
ANNEX III -- GLOBAL CLEARANCE, SETTLEMENT AND TAX DOCUMENTATION
PROCEDURES SUMMARY OF SERIES TERMS
</Table>
S-3
<Page>
SUMMARY OF SERIES TERMS
THIS SUMMARY HIGHLIGHTS SELECTED INFORMATION FROM THIS PROSPECTUS SUPPLEMENT
AND DOES NOT CONTAIN ALL OF THE INFORMATION THAT YOU NEED TO CONSIDER IN MAKING
YOUR INVESTMENT DECISION. TO UNDERSTAND ALL OF THE TERMS OF THE SERIES 2003-3
CERTIFICATES, YOU SHOULD CAREFULLY READ THIS ENTIRE PROSPECTUS SUPPLEMENT AND
THE ACCOMPANYING PROSPECTUS.
THE TRUST
The trust was formed by a pooling and servicing agreement, dated as of January
1, 1994, among Bombardier Credit Receivables Corporation, as depositor,
Bombardier Capital Inc., as servicer and Deutsche Bank Trust Company Americas,
as trustee.
THE OFFERED CERTIFICATES
The trust will issue a new series of certificates designated as the 'Series
2003-3 Certificates.' The new series will consist of one class of certificates
designated as the 'Class A Certificates.'
<Table>
<Caption>
CLASS A
CERTIFICATES
------------
Certificate rate: One-Month LIBOR
+[ ]% annually
Ratings (S&P/Moody's): AAA/Aaa
First interest payment date: January 15, 2004
Scheduled principal payment
date: December 2005
Distribution Date
Legal final payment date: December 2007
Distribution Date
</Table>
PRINCIPAL PARTIES
Issuer: Bombardier Receivables Master Trust I will issue the Series 2003-3
Certificates.
Depositor: Bombardier Credit Receivables Corporation which is a wholly-owned
subsidiary of Bombardier Capital Inc. Bombardier Credit Receivables
Corporation's address is P.O. Box 5544, Burlington, Vermont 05402 and its
telephone number is (802) 655-2824. See 'The Depositor and the Trust -- The
Depositor' in the prospectus.
Servicer: Bombardier Capital Inc. services the receivables on behalf of the
trust. Bombardier Capital Inc.'s address is 261 Mountain View Drive, Colchester,
Vermont 05446 and its telephone number is (802) 654-8100. See 'Description of
the Certificates -- Collection and Other Servicing Procedures' and 'Bombardier
Capital Inc.' in the prospectus.
Trustee: Deutsche Bank Trust Company Americas, a New York banking corporation
acts as trustee for the trust. Deutsche Bank Trust Company Americas' address is
60 Wall Street, New York, New York 10005 and its telephone number is (212)
250-2500. See 'Description of the Certificates -- The Trustee' in the
prospectus.
Financial Guaranty Insurer: XL Capital Assurance Inc. will issue a financial
guaranty insurance policy for the benefit of the Class A certificateholders
under which it will guarantee the full and timely payment of interest on the
Class A Certificates on each distribution date and the full payment of principal
on the Class A Certificates on the December 2007 distribution date.
TRUST ASSETS
The assets of the trust include:
receivables arising in accounts established by inventory security agreements
entered into with dealers under which the dealers receive funds to purchase
or finance consumer, recreational and commercial product inventory; the
receivables include those which have been added to the trust and those which
will be added in the future less receivables paid or charged-off and
excluding receivables generated in removed accounts or accounts which are
not eligible and receivables removed from the trust from time to time;
an assignment of Bombardier Credit Receivables Corporation's rights and
remedies concerning the receivables under the receivables purchase
agreement;
all funds collected or to be collected on the receivables;
all funds on deposit in all accounts of the trust, including the reserve
funds, the excess funding accounts, the principal account and the collection
account;
enhancement for the Class A Certificates in the form of a financial guaranty
insurance policy provided by XL Capital Assurance Inc.; and
an assignment of any security interests in products, contracts or other
assets securing the receivables.
S-4
<Page>
The Class A Certificates do not benefit from any enhancement available to
another series. Interests in the trust will be evidenced by the Class A
Certificates, investor certificates of other series, the certificate held by the
depositor and representing an interest which is partially subordinated to
various certificates and the variable funding certificate.
Bombardier Credit Receivables Corporation may, at its option, add accounts to
the trust. If receivables in the trust fall below required levels, Bombardier
Credit Receivables Corporation may be required to designate additional accounts.
See 'The Floorplan Financing Business' below and 'The Floorplan Financing
Business', 'Description of the Certificates -- Addition of Accounts' and
' -- Removal of Accounts and Assignment of Receivables' in the prospectus.
All new receivables arising under the designated accounts during the term of the
trust will be transferred by Bombardier Credit Receivables Corporation to the
trust. Accordingly, the aggregate amount of receivables in the trust will
fluctuate daily as new receivables are generated and as existing receivables are
collected, charged off as uncollectible or otherwise adjusted.
PRIOR SERIES AND ISSUANCE OF NEW SERIES
The trust has issued eight prior series of investor certificates, four of which
will be outstanding as of the date of issuance of the Class A Certificates.
Bombardier Credit Receivables Corporation has summarized information concerning
the outstanding prior series in Annex I to this prospectus supplement. Annex I
is incorporated by reference into this prospectus supplement. Bombardier Credit
Receivables Corporation may cause the trust to issue one or more new series of
investor certificates. See 'Description of the Certificates -- New Issuances' in
the prospectus.
DISTRIBUTION DATE
All distributions on your Class A Certificates will be made on the 15th day of
each month or, if the 15th day is not a business day for New York banks,
distributions will occur on the next business day. The first interest
distribution is scheduled to be made on January 15, 2004.
PAYMENT OF PRINCIPAL ON YOUR CLASS A CERTIFICATES
The type of period your Class A Certificates are in will determine the method
used for allocating collections of receivables and the timing of principal
payments to you.
From the issuance date to the distribution date in December 2005, unless
another period begins during this time, you will not receive principal
payments on your Class A Certificates.
From the first business day of July 2005, or a later date determined by the
servicer, until the amount on deposit is sufficient to pay the principal
amount on your Class A Certificates unless another period begins before or
during this time, a controlled portion of the monthly principal collections
allocable to your Series Class A Certificates will be deposited into the
principal account.
If specified triggering events occur, including those concerning the trust
assets, the servicer or Bombardier Credit Receivables Corporation, you will
receive each month all principal collections allocated to your Class A
Certificates until your Class A Certificates are paid in full. See
'Description of the Class A Certificates -- Early Amortization Events' below
and 'Description of the Certificates -- Early Amortization Events' in the
prospectus for a discussion of these triggers.
ALLOCATIONS OF COLLECTIONS OF RECEIVABLES AND DEFAULTED RECEIVABLES
Varying percentages of collections and receivables in default allocable to the
trust for each calendar month will be allocated to the Class A Certificates. See
'Description of the Class A Certificates -- Allocation Percentages.'
Collections and receivables in default not allocated to the Class A Certificates
will be allocated to the other certificates issued by the trust.
Non-principal collections and receivables in default at all times and principal
collections for periods when principal is not being paid or accumulated will be
allocated to the Class A Certificates daily based on a floating percentage.
Generally, this percentage for any calendar month is the percentage, which will
never exceed 100%, obtained by dividing the principal amount
S-5
<Page>
of the Class A Certificates as of each day by the total principal amount of
receivables in the trust as of that day.
Principal collections allocable to the Class A Certificates and not necessary
for any deposit or payment for the Class A Certificates will be allocated to
other certificates issued by the trust in exchange for the allocation to the
Class A Certificates of an equal interest in the receivables that are new or
that would otherwise be allocable to other certificates. See 'Description of the
Class A Certificates -- Allocation Percentages,' ' -- Deposits in Collection
Account,' ' -- Limited Subordination of the Retained Interest' and
' -- Distributions from the Collection Account; Reserve Fund; Principal
Account.'
If principal is being paid or accumulated, principal collections generally will
be allocated to the Class A Certificates based on the percentage obtained by
dividing the principal amount of the Class A Certificates on the last day when
they were not being paid or accumulated by the total principal amount of
receivables in the trust. See 'Description of the Class A Certificates --
Allocation Percentages -- Principal Collections for all Series' and
' -- Distributions from the Collection Account; Reserve Fund; Principal
Account -- Principal Collections.'
INTEREST PAYMENTS
You will receive interest monthly on each distribution date, commencing January
15, 2004. The Class A Certificates will accrue interest from and including one
distribution date to but excluding the next distribution date. Interest will be
calculated based on the actual number of days elapsed during the related
interest period and a 360-day year. See 'Description of the Class A
Certificates -- Interest.'
Interest payments on the Class A Certificates will be derived solely from
collections other than principal collections for the related calendar month, any
amount on deposit in the reserve fund, investment proceeds, if any, a portion of
the collections allocated to the BCRC Certificate and, if the above amounts are
insufficient, from a draw on the financial insurance guaranty policy. See
'Description of the Class A Certificates -- Interest.'
PRINCIPAL PAYMENTS
Bombardier Credit Receivables Corporation expects the Class A Certificates to
receive one principal distribution equal to the full principal amount of the
Class A Certificates on the December 2005 distribution date.
The Class A Certificates may also receive principal earlier than expected as
described in 'Description of the Class A Certificates -- Early Amortization
Events.'
The final principal distribution on the Class A Certificates will be made not
later than the December 2007 distribution date.
In addition, on the first distribution date following the monthly period in
which an early amortization event occurs, any amounts on deposit in the excess
funding account will be distributed to Class A certificateholders. See
'Description of the Class A Certificates -- Distributions from the Collection
Account; Reserve Fund; Principal Account.'
EXCESS FUNDING ACCOUNT
If the receivables in the trust are less than the required amount on the dates
described in this prospectus supplement, a deposit to the excess funding account
will be required. Amounts in that account will be made available for payment on
the Class A Certificates as described under 'Description of the Class A
Certificates -- Excess Funding Account.'
REALLOCATION OF EXCESS PRINCIPAL COLLECTIONS
Principal collections and other amounts that are allocated to the Class A
Certificates, but that are not needed to make payment to you, may be applied to
cover principal distributions to certificateholders or enhancement providers of
other series. Principal collections and other amounts allocable to other series
during any amortization or accumulation period to the extent they are not needed
to make payment for these other series, may be applied as principal
distributions or principal accumulation on your Class A Certificates. See
'Description of the Class A Certificates -- Allocation Percentages -- Principal
Collections for all Series.'
S-6
<Page>
CREDIT ENHANCEMENT
Retained Interest: A portion of the collections allocated to the interest in the
trust represented by the BCRC Certificate retained by Bombardier Credit
Receivables Corporation will be available to cover amounts payable on the Class
A Certificates and the monthly servicing fee described below. See 'Description
of the Class A Certificates -- Retained Interest and Variable Funding
Certificate.'
If collections other than principal collections, investment proceeds, amounts in
the reserve fund and other amounts allocable to the Class A Certificates for any
monthly period are not sufficient to cover:
the interest payable on the Class A Certificates on the next distribution
date;
the amount of overdue interest and the interest due on this amount, if any;
the net servicing fee;
the premium payable to the financial guaranty insurer;
any allocations to the Class A Certificates of defaults on the receivables;
and
any amounts required to be paid by Bombardier Credit Receivables Corporation
as a result of adjustments to the balances of the receivables,
then a portion of the collections allocated to the interest represented by a
certificate held by the depositor and representing the retained interest will be
applied to make up the deficiency.
Collections of receivables are allocated to our interest, as holder of the
variable funding certificate, as well as to the interests in the trust owned by
you and other holders of investor certificates. A portion of the amounts
allocated to our interest is, however, subordinated and, if needed will be
diverted to make payments on the investors' certificates.
It is expected that this subordinated amount for the first distribution date
will be no less than $46,448,087. This subordinated amount for subsequent
distribution dates will fluctuate as described under 'Description of the
Certificates -- Limited Subordination of Retained Interest.'
Subject to limitations, the portion of our interest available to make payments
on the Class A Certificates may be increased at our option. See 'Description of
the Class A Certificates -- Limited Subordination of Retained Interest.'
Reserve Fund: A reserve fund will be established and maintained in the name of
the trustee for the benefit of the Class A Certificates. On the date the Class A
Certificates are issued, Bombardier Credit Receivables Corporation will deposit
in the reserve fund an amount no less than $2,500,000 plus an amount to be used
to pay interest on the Class A Certificates on the first distribution date.
Any amounts on deposit in the reserve fund will be withdrawn to make payments of
interest on the Class A Certificates, to pay the premium on the financial
guaranty insurance policy for the Class A Certificates, to pay the net servicing
fee for the Class A Certificates and to cover the amount of defaults allocated
to the Class A Certificates if non-principal collections and investment proceeds
are not sufficient. Amounts withdrawn from the reserve fund will be replenished,
in the circumstances described under 'Description of the Class A Certificates --
Distributions from the Collection Account; Reserve Fund; Principal Account,' to
the extent funds are available.
Financial Guaranty Insurance Policy: On the closing date, the financial guaranty
insurer will issue a financial guaranty insurance policy unconditionally and
irrevocably guaranteeing to Class A certificateholders the full and timely
payment of interest on the Class A Certificates on each distribution date and
the full payment of principal on the Class A Certificates on the legal final
payment date.
FEDERAL INCOME TAX CONSEQUENCES
The material tax consequences to you are described under 'Material Federal
Income Tax Consequences' in the prospectus. As more fully set forth in that
section, Sidley Austin Brown & Wood LLP, special U.S. tax counsel to the
depositor and trust, is of the opinion that, although no transaction closely
comparable to the issuance of the Class A Certificates has been the subject of
any Treasury regulation, public ruling or judicial decision, for federal income
tax purposes, the Class A Certificates will be characterized as indebtedness,
and the trust will not be subject to an entity-level federal income tax.
S-7
<Page>
By purchasing and accepting the Class A Certificates, you agree to treat the
Class A Certificates as indebtedness for all federal, state and local tax
purposes.
ERISA CONSIDERATIONS
You may not acquire Class A Certificates if you are purchasing with the assets
of a retirement plan, individual retirement plan or other employee benefit plan
subject to ERISA or Section 4975 of the Internal Revenue Code of 1986, as
amended. See 'ERISA Considerations' in the prospectus.
RATINGS
The Class A Certificates will not be offered unless they receive the ratings
indicated on page S-4 of this prospectus supplement.
A rating is not a recommendation to buy, sell or hold securities and either
rating agency can revise or withdraw its rating at any time. In general ratings
address credit risk and do not address the likelihood of prepayment. See 'Risk
Factors -- The Rating On Your Class A Certificates Is Based Primarily On The
Financial Guaranty Insurer And Any Reduction In The Rating Of The Financial
Guaranty Insurer Could Have An Adverse Effect On The Value Of Your Class A
Certificates.'
S-8
<Page>
RISK FACTORS
YOU SHOULD CONSIDER THE FOLLOWING RISK FACTORS TOGETHER WITH THE RISK
FACTORS SET FORTH IN THE PROSPECTUS IN DECIDING WHETHER TO PURCHASE THE CLASS A
CERTIFICATES.
THE RATING ON YOUR CLASS A CERTIFICATES IS BASED PRIMARILY ON THE FINANCIAL
GUARANTY INSURER AND ANY REDUCTION IN THE RATING OF THE FINANCIAL GUARANTY
INSURER COULD HAVE AN ADVERSE EFFECT ON THE VALUE OF YOUR CLASS A CERTIFICATES
We cannot issue the Class A Certificates unless they are rated 'AAA' or the
equivalent. The rating of the Class A Certificates will be based primarily on
the claims-paying ability of the financial guaranty insurer and, to a lesser
degree, on the credit underlying the receivables, the interest we retain in the
trust that is subordinate to your Class A Certificates and amounts on deposit in
the reserve fund. Any reduction in the financial guaranty insurer's ratings
would be likely to cause a reduction in the ratings of the Class A Certificates.
The rating addresses the likelihood of the ultimate payment of principal and
timely payment of interest on the Class A Certificates. A rating is not a
recommendation to buy, sell or hold securities, inasmuch as it does not comment
as to the market price or suitability for a particular investor.
We cannot assure you that a rating will remain for any given period of time
or that a rating will not be lowered or withdrawn entirely by a rating agency if
in its judgment circumstances so warrant. Any suspension, reduction or
withdrawal in the ratings assigned to the Class A Certificates would probably
reduce the market value of the Class A Certificates and may affect your ability
to sell them.
VOTING RIGHTS MAY BE EXERCISED BY THE FINANCIAL GUARANTY INSURER
So long as the financial guaranty insurer is not insolvent and has not
defaulted on its obligations under the financial guaranty insurance policy, the
financial guaranty insurer will be treated as a 100% holder of the Class A
Certificates for the purpose of determining voting rights. As a result, the
financial guaranty insurer will have the right to exercise all of the voting
rights of the Class A certificateholders to consent to all amendments and
actions that require Class A certificateholder consent.
Actions pursued by the financial guaranty insurer under these circumstances
could be adverse to the interests of the Class A certificateholders, and the
financial guaranty insurer will have no obligation to consider any possible
adverse effects to such interests.
If the financial guaranty insurer has paid the principal amount of any
Class A Certificate, the financial guaranty insurer will be considered the
holder of that Class A Certificate, to the extent of the principal amount paid,
for all purposes under the pooling and servicing agreement and the other
transaction documents.
ANY AMOUNTS ON DEPOSIT IN THE EXCESS FUNDING ACCOUNT WILL EARN INTEREST AT A
RATE LOWER THAN THAT OF THE RECEIVABLES INCREASING THE RISK THAT YOU WILL NOT
RECEIVE ALL PAYMENTS DUE TO YOU
Any funds deposited in the excess funding account will be subject to
specified investment restrictions and, as a result, will likely earn a rate of
return lower than the interest rates on the same amount of receivables.
Accordingly, for any period during which funds are on deposit in the excess
funding account, the amount of collections available to make payments to you
will be reduced.
EXISTENCE OF OTHER SERIES OF CERTIFICATES MAY AFFECT WHEN YOU RECEIVE PRINCIPAL
The trust, as a master trust, has previously issued eight series of investor
certificates, four of which will remain outstanding as of the date of issuance
of the Class A Certificates. The trust may
S-9
<Page>
issue additional series of investor certificates. Each series may be represented
by different classes within the series.
We cannot assure you that previously issued series or the issuance of any
future series might not adversely affect the timing or amount of payments
received by you. See 'Description of the Certificates -- New Issuances' in the
prospectus.
We may issue an additional series without your consent.
THE OCCURRENCE OF AN EARLY AMORTIZATION EVENT WILL RESULT IN THE ACCELERATION OF
PAYMENTS ON YOUR CLASS A CERTIFICATES
Upon the occurrence of an early amortization event under the pooling and
servicing agreement, all principal collections allocable to the Class A
Certificates will be paid as principal to the Class A certificateholders on each
distribution date. In addition, so long as XL Capital Assurance Inc., as
financial guaranty insurer, shall not have defaulted and so long as any default
by XL Capital Assurance Inc. is not continuing, the financial guaranty insurer
may, at its option, elect to pay all or a portion of the outstanding balance of
the Class A Certificates, which will cause an early payment of all or a portion
of the outstanding amount of the Class A Certificates, plus any accrued interest
on that portion of the Class A Certificates that is paid. The financial guaranty
insurance policy will not guarantee payment of any amounts of principal that
become due on an accelerated basis, unless the financial guaranty insurer
elects, in its sole discretion, to pay those amounts prior to the legal final
payment date of the Class A Certificates.
YOUR CLASS A CERTIFICATES HAVE LIMITED CREDIT ENHANCEMENT INCREASING THE RISK OF
LOSS ON THE CLASS A CERTIFICATES
Credit enhancement of the Class A Certificates will be provided by a portion
of the interest in the trust retained by us, by amounts in the reserve fund and
by the financial guaranty insurance policy issued by XL Capital Assurance Inc.
The amount of credit enhancement is limited and will be reduced from time to
time as described in this prospectus supplement. If problems develop with the
receivables, such as an increase in losses on the receivables or if there are
problems with the collection and transfer of the receivables to the trust, and
if the financial guaranty insurer defaults on its obligations under the
financial guaranty insurance policy, it is possible that you may not receive the
full amount of interest and principal that you would otherwise receive. See
'Description of the Class A Certificates -- Limited Subordination of Retained
Interest.'
GEOGRAPHIC CONCENTRATION MAY CREATE ADDITIONAL RISKS OF LOSS ON YOUR CLASS A
CERTIFICATES
As of October 31, 2003, approximately 7.86%, 7.49%, 6.34%, 5.57%, 5.13%,
4.98% and 4.49% of the obligors under the receivables by aggregate principal
balance as of the cut-off date were located in the States of California,
Florida, North Carolina, New York, Michigan, Texas and Georgia, respectively.
Consequently, losses on the receivables and resultant payments on the Class A
Certificates may, both generally and particularly, be affected significantly by
deterioration of economic conditions in these states. Because a material
percentage of the obligors are located in the southern states of the United
States, an economic downturn in that region may have a disproportionately
material adverse effect on the receivables and your Class A Certificates.
POTENTIAL DELAYS IN PAYMENTS AND LOSSES ON THE CLASS A CERTIFICATES DUE TO
REMOVAL OF ACCOUNTS
You may suffer delays in payments and losses on the Class A Certificates
because of the removal of accounts from the trust. Bombardier Credit Receivables
Corporation, as depositor, may, and in some cases will be obligated to, remove
accounts from the trust. In some cases receivables in those accounts may remain
in the trust, and in other cases receivables in those accounts will be removed
from the trust. Following the removal of an account, without the removal of the
related receivables, some receivables relating to the account will be outside of
the trust and other receivables relating to the account may remain in the trust.
If the servicer applies collections
S-10
<Page>
relating to an account to receivables that are outside of the trust rather than
to receivables that remain in the trust, then delays in payments and losses on
your Class A Certificates could occur.
THE CLASS A CERTIFICATES ARE NOT SUITABLE INVESTMENTS FOR ALL INVESTORS
The Class A Certificates are not a suitable investment for any investor that
requires a regular or predictable schedule of payments or payments on specific
dates. The Class A Certificates are complex investments that should be
considered only by sophisticated investors. We suggest that only investors who,
either alone or with their financial, tax and legal advisors, have the expertise
to analyze the prepayment, reinvestment and default risks, the tax consequences
of an investment, and the interaction of these factors, should consider
investing in the Class A Certificates.
S-11
<Page>
CAPITALIZED TERMS
For purposes of clarity, a number of terms used in this prospectus
supplement have been assigned specialized definitions. These terms appear
throughout this prospectus supplement as capitalized words and phrases.
Definitions for these terms may be found in the glossary at the back of this
prospectus supplement and the accompanying prospectus.
FORWARD-LOOKING STATEMENTS
In this prospectus supplement and the accompanying prospectus, Bombardier
Credit Receivables Corporation uses forward-looking statements. These
forward-looking statements are found in the material, including each of the
tables, set forth under 'Risk Factors' and 'Maturity and Principal Payment
Considerations.' Forward-looking statements are also found elsewhere in this
prospectus supplement and the accompanying prospectus and include words like
'expects,' 'intends,' 'anticipates,' 'estimates' and other similar words. These
statements are inherently subject to a variety of risks and uncertainties.
Actual results differ materially from those we anticipate due to changes in,
among other things:
economic conditions and industry competition;
political, social and economic conditions;
the law and government regulatory initiatives; and
interest rate fluctuations.
Bombardier Credit Receivables Corporation will not update or revise any
forward-looking statements to reflect changes in its expectations or changes in
the conditions or circumstances on which the statements were originally based.
USE OF PROCEEDS
The net proceeds from the sale of the Class A Certificates will be paid to
the depositor, which will use these proceeds, except the portion used to fund
the reserve fund, to pay in full the outstanding Series 2003-2 Certificates, and
with the remainder, to repay amounts owing to Bombardier Capital Inc. under the
promissory note issued by the depositor in favor of Bombardier Capital Inc. or
to purchase receivables from Bombardier Capital Inc.
S-12
<Page>
BOMBARDIER INC. AND BOMBARDIER CAPITAL INC.
RECENT DEVELOPMENTS
On December 3, 2003, Bombardier Inc. announced that it signed a sale and
purchase agreement for its recreational products segment with Bombardier
Recreational Products Inc., a corporation formed by Bain Capital, members of the
Bombardier family and the Caisse de depot et placement du Quebec.
On August 27, 2003, Bombardier Inc. announced that it had reached an
agreement in principle to sell its recreational products business for an
aggregate purchase price of CDN $1.225 billion, subject to certain price
adjustments, for a net purchase price of CDN $1.075 billion.
As a result of further negotiations between Bombardier Inc. and the
purchaser, the net purchase price has been reduced by an amount of CDN $115
million, primarily due to the continued appreciation of the Canadian dollar
relative to the U.S. dollar which adversely affects the value of the
recreational products business. Consequently, the revised net purchase price
stipulated in the agreement is CDN $960 million, of which CDN $910 million will
be paid in cash and CDN $50 million will be paid by the issuance of preferred
shares of the purchaser's parent company.
As is customary for such transactions, cash proceeds will be impacted at
closing by adjustments for variations in working capital, pension plan funding
and other off balance sheet items. These are currently estimated to be in the
range of CDN $160 million in favor of the purchaser.
The transaction is expected to close during the current fiscal year and is
subject to the completion of the purchaser's committed financing, obtaining the
consent of governmental authorities and fulfillment of other customary
conditions.
In connection with the sale, Bombardier Inc. and the purchaser will enter
into certain other agreements, including a trademark license agreement under
which Bombardier Inc. will license to the purchaser certain trademarks which
will continue to be owned by Bombardier Inc. In addition, certain floor plan and
other financing arrangements will be entered into by the purchaser with
Bombardier Capital Inc. and its affiliates. However, there can be no assurance
that Bombardier Capital Inc. will be able to originate floorplan receivables at
a level comparable to that before the sale. See 'Risk Factors -- If Bombardier
Credit Receivables Corporation And Bombardier Capital Inc. Are Unable To
Generate And Transfer Sufficient Receivables To The Trust You Will Receive
Principal Sooner Than You May Expect', in the prospectus.
On April 3, 2003, Bombardier Inc. announced that Bombardier Capital Inc.'s
origination activities will be concentrated on floorplan financing as well as
interim financing for Bombardier Aerospace regional aircraft. Bombardier Capital
Inc. will continue to significantly reduce its assets under management in the
areas other than floorplan financing and interim financing for Bombardier
Aerospace through the ongoing wind-down and sale of all its other portfolios.
Bombardier Inc. also announced it will cease origination for Bombardier Capital
Inc.'s railcar leasing activities.
Earlier, on September 27, 2002, Bombardier Inc. announced the sale and
gradual wind-down of Bombardier Capital Inc.'s receivable factoring and business
aircraft financing portfolios. These processes are underway and, although there
is no assurance, could be completed later in fiscal year 2004. After the earlier
announcement by Bombardier Inc., Bombardier Capital Inc.'s receivable factoring
portfolio was reduced by approximately 34% and the business aircraft portfolio
by approximately 24% during the quarter ended January 31, 2003. Bombardier
Capital Inc. will also continue to wind down its manufactured housing finance
and consumer finance portfolios that were discontinued in September 2001, and
continue the divestiture of its technology management and finance, mid-market
commercial equipment finance and small ticket finance portfolios that were
discontinued in fiscal year 2000. The portfolios being wound down or sold
represented approximately 55% of Bombardier Capital Inc.'s assets under
management as of January 31, 2003.
S-13
<Page>
THE FLOORPLAN FINANCING BUSINESS
GENERAL
The prospectus includes a general discussion of the practices and procedures
applicable to the origination of receivables arising from extensions of credit
and advances made to dealers of consumer, recreational and commercial products
which dealers are located in the United States.
The remainder of the discussion below concentrates on Bombardier Capital
Inc.'s floorplan financing business from which the loans in the Bombardier
Capital Inc. Domestic Inventory Portfolio are generated. As of October 31, 2003,
the loans in the Bombardier Capital Inc. Domestic Inventory Portfolio were
outstanding to 3,818 dealers located throughout the United States for products
sold by approximately 420 manufacturers and distributors.
In its floorplan financing business, Bombardier Capital Inc.'s primary
marketing focus is the manufacturer, importer or distributor of the financed
product. Affiliates of Bombardier Capital Inc. manufacture recreational
products, including Ski-Doo'r' snowmobiles, Sea-Doo'r' personal watercraft,
sport boats, all-terrain vehicles and Evinrude'r' and Johnson'r' outboard
engines and related parts and accessories, which are financed directly by
Bombardier Capital Inc. As of October 31, 2003, approximately 30.11% based on
outstanding receivables or approximately 25.93% based on financing volume for
the calendar year period ended October 31, 2003 of the receivables in the
Bombardier Capital Inc. Domestic Inventory Portfolio were attributable to
products manufactured by Bombardier Inc. or its subsidiaries. Bombardier Inc.
has entered into an agreement to dispose of its recreational products business,
and the closing is expected to occur during the current fiscal year. With the
exception of 3 independent manufacturers who accounted, as of October 31, 2003,
for approximately, 7.89%, 6.01% and 5.35%, respectively, of Bombardier Capital
Inc.'s Domestic Inventory Portfolio, no other manufacturer, importer, or
distributor currently accounts for more than 4% of Bombardier Capital Inc.'s
Domestic Inventory Portfolio.
REVENUE EXPERIENCE
Bombardier Capital Inc. generally charges dealers interest at a floating
rate on each business day. Bombardier Capital Inc.'s policy is to charge a rate
equal to the 'prime rate' designated in the 'Wall Street Journal' or a rate
determined by Bombardier Capital Inc., plus a spread generally ranging from
- .05% to 8.5% per annum based on risk and/or other factors including the
manufacturer's, importer's or distributor's support of the dealer. The interest
rate for any given period is the average daily prime rate plus the applicable
spread and is applied to the average balances outstanding during the applicable
period. The average spread over the average prime rate charged to dealers for
accounts included in the Bombardier Capital Inc. Domestic Inventory Portfolio
and the average prime rate as of the end of each month have been averaged for
the fiscal years ended January 31, 2003, 2002, 2001, 2000 and 1999 and for the
nine month periods ended October 31, 2003 and October 31, 2002 and are set forth
in the chart below.
AVERAGE SPREAD AND PRIME RATE
<Table>
<Caption>
NINE MONTHS
ENDED
YEAR ENDED JANUARY 31, OCTOBER 31,
---------------------------------------- -----------
2003 2002 2001 2000 1999 2003 2002
---- ---- ---- ---- ---- ---- ----
Average Spread over Prime Rate... 4.19% 3.15% 2.41% 2.30% 3.27% 4.66% 4.15%
Average Prime Rate............... 4.63% 6.57% 9.28% 8.06% 8.29% 4.15% 4.75%
Spread plus Prime Rate........... 8.82% 9.72% 11.69% 10.36% 11.56% 8.81% 8.90%
</Table>
There is seasonality in the level of outstanding accounts included in the
Bombardier Capital Inc. Domestic Inventory Portfolio and in repayments of
principal. Dealer inventory financed by Bombardier Capital Inc. typically
increases during the fall and winter months reaching a peak during the late
winter or early spring, at which point the outstanding receivables then begin
liquidating during the spring and summer. In large part, this seasonality is
attributable to the
S-14
<Page>
accounts included in the Bombardier Capital Inc. Domestic Inventory Portfolio
related to marine products and Bombardier products. See 'Maturity and Principal
Payment Considerations.' The 'Average Spread over Prime Rate' has fluctuated and
may decrease in the future due in part to increased competitive pressures from
other lenders and to an increase in the portion of the Bombardier Capital Inc.
Domestic Inventory Portfolio that consists of accounts related to non-Bombardier
related product. Other factors may have contributed to past decreases and may
contribute to further decreases.
THE ACCOUNTS
GENERAL
Set forth below is certain statistical information about the accounts in the
trust as of October 31, 2003.
CREDIT LIMITS OF THE ACCOUNTS
<Table>
<Caption>
PRINCIPAL AMOUNT % OF RECEIVABLES
ACCOUNTS WITH CREDIT LIMITS RANGING FROM: OF RECEIVABLES IN THE TRUST
- ----------------------------------------- -------------- ------------
$ 0 to $ 249,999................................... $ 63,974,735 5.41%
$ 250,000 to $ 499,999................................... 166,111,554 14.04
$ 500,000 to $ 999,999................................... 352,793,785 29.82
$ 1,000,000 to $15,000,000.................................. 563,212,615 47.60
$15,000,001 to $48,000,000.................................. 37,177,210 3.14
-------------- ------
Totals.................................................. $1,183,269,899 100.00%
-------------- ------
-------------- ------
</Table>
YEAR ACCOUNTS ESTABLISHED
<Table>
<Caption>
PRINCIPAL AMOUNT % OF RECEIVABLES
YEAR ACCOUNT ESTABLISHED: OF RECEIVABLES IN THE TRUST
- ------------------------- -------------- ------------
2003........................................................ $ 0 0.00%
2002........................................................ 132,521,817 11.20
2001........................................................ 130,658,579 11.04
2000........................................................ 123,972,579 10.48
1999........................................................ 97,363,494 8.23
1998........................................................ 71,673,208 6.06
1997 or earlier............................................. 627,080,221 53.00
-------------- ------
Totals.................................................. $1,183,269,899 100.00%
-------------- ------
-------------- ------
</Table>
As of October 31, 2003:
There were approximately 4,075 Accounts which had been designated to
the trust of which 3,156 accounts have outstanding balances.
Receivables in these Accounts had an aggregate principal balance of
approximately $1,227,515,740.
The average aggregate credit limit per Account was approximately
$628,000.
The average principal balance of receivables per Account was
approximately $375,000.
The aggregate principal balance of receivables as a percentage of the
aggregate credit limits of these Accounts was approximately 59.71%.
All of the historical information including tables and numbers contained in
this prospectus supplement regarding Bombardier Capital Inc. or any receivables
or Accounts also includes receivables and accounts held by BCI Finance Inc.
which was formerly BCI Recovery Inc. BCI Finance Inc. was incorporated in 1991
and is a wholly-owned subsidiary of Bombardier Capital Inc. In October 1991 and
June 1993, pools of then non-performing receivables held by Bombardier
S-15
<Page>
Capital Inc. were sold to BCI Finance Inc. In January 1993, an additional pool
of non-performing receivables held by Bombardier Capital Inc. was transferred to
BCI Finance Inc. in exchange for receivables held by BCI Finance Inc. which had
become performing receivables.
Bombardier Capital Inc. and the depositor may designate Additional Accounts
from time to time and transfer the related receivables to the trust. As a
result, the actual composition of the receivables by business line represented
by the trust's assets is expected to change over time. In addition, due to the
variability and uncertainty with respect to the rates at which receivables in
the trust are created, paid or otherwise reduced, the information set forth in
' -- Historical Size', ' -- Delinquency' and ' -- Loss Experience', and below
under 'Management Discussion and Analysis -- Product Mix', ' -- Aging
Experience' and ' -- Geographic Distribution' below may vary significantly over
time.
HISTORICAL SIZE
The Accounts comprise only a portion of the entire receivables in the
Bombardier Capital Inc. Domestic Inventory Portfolio, which portfolio would also
include accounts which would not qualify as Eligible Accounts. As a result, the
historical information with respect to Eligible Accounts may be different than
the historical information set forth in the table below.
The following table sets forth information for the entire Bombardier Capital
Inc. Domestic Inventory Portfolio on the aggregate fiscal year-end and October
31 outstanding principal balances, average number of dealers financed, average
month-end outstanding principal balance per dealer on receivables and average
volume per dealer for each of the periods shown.
SIZE OF PORTFOLIO
BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO
<Table>
<Caption>
OCTOBER 31, JANUARY 31,
----------------------- --------------------------------------------------------------
2003 2002 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ---- ----
Outstanding Principal
Balance*........... $1,426,263 $1,393,505 $1,610,591 $1,451,698 $1,487,373 $1,314,882 $1,214,066
Average Number of
Dealers............ 3,818 5,268 5,242 4,752 4,368 4,013 3,785
Average Month-End
Principal Balances
Per Dealer......... $ 373,563 $ 264,523 $ 307,277 $ 291,753 $ 335,150 $ 291,602 $ 239,626
Average Financing
Volume Per
Dealer............. $ 650,959 $ 437,985 $ 617,535 $ 599,385 $ 681,456 $ 710,465 $ 573,526
</Table>
- ---------
* U.S. Dollars in Thousands
The figures for outstanding principal balance and the average financing
volume per dealer in the table above reflect data for principal balance and
number of dealers existing as of the dates indicated. The figures for average
financing volume per dealer in the table above represent the average of the
total financing volume per dealer for the nine month periods ending October 31
or the one year periods ending January 31. The figures for average number of
dealers for each of the fiscal years ended January 31 were calculated by taking
the average of the number of dealers at the beginning and end of that fiscal
year. The figures for average number of dealers for each of the nine month
periods ended October 31 reflect data for the number of dealers as of the end of
that period. The figures for average month-end principal balances per dealer
represent the average
S-16
<Page>
of the end of month averages of principal balance per dealer over the course of
the nine month periods ending October 31 or the one year periods ending January
31.
DELINQUENCY
The following table shows delinquency information for the Bombardier Capital
Inc. Domestic Inventory Portfolio as of the dates shown. On the date of the
issuance of the Class A Certificates, the percentage of receivables in the
Bombardier Capital Inc. Domestic Inventory Portfolio that are delinquent will
not exceed by more than 5% the percentage of receivables in the Bombardier
Capital Inc. Domestic Inventory Portfolio that were delinquent at the date of
the most recent information in the following table.
DELINQUENCY EXPERIENCE
BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO
<Table>
<Caption>
OCTOBER 31, JANUARY 31,
------------------- ----------------------------------------------------
2003 2002 2003 2002 2001 2000 1999
---- ---- ---- ---- ---- ---- ----
(U.S. DOLLARS IN MILLIONS)
Outstanding Principal
Balance................. $1,426.3 $1,393.5 $1,610.6 $1,451.7 $1,487.4 $1,314.9 $1,214.1
Delinquent Amount......... 0.81 1.69 2.77 4.31 4.67 1.80 8.80
Delinquent Amount/
Outstanding Principal
Balance................. 0.06% 0.12% 0.17% 0.30% 0.31% 0.13% 0.73%
Allowance for Credit
Losses On Bombardier
Capital Inc.'s Books.... $ 20.4 $ 13.6 $ 18.8 $ 8.2 $ 6.2 $ 4.1 $ 4.9
Allowance/Outstanding
Principal Balance....... 1.43% 0.98% 1.17% 0.56% 0.42% 0.31% 0.40%
</Table>
The Delinquent Amount consists of the total principal on receivables which
were unpaid when due as a result of retail sale of the underlying product, that
is, sold out of trust, or were unpaid when due under a scheduled payment program
and with respect to which Bombardier Capital Inc. determined that the payment
was undercollateralized after the due date plus the past due interest on these
receivables to the extent that the receivables are from an account which has
past due interest of $1,000 or more. The percentage of outstanding receivables
in the Bombardier Capital Inc. Domestic Inventory Portfolio which were on a
scheduled payment program as of the above dates was generally less than 1% by
principal balance.
LOSS EXPERIENCE
The following table sets forth Bombardier Capital Inc.'s average principal
receivables balance and loss experience for each of the periods shown with
respect to the receivables in the Bombardier Capital Inc. Domestic Inventory
Portfolio.
The average principal receivables balance reflects the average over the
relevant period of the principal balance in the Bombardier Capital Inc. Domestic
Inventory Portfolio at the end of each month during that period. The receivables
in the Accounts designated to the trust will comprise only a portion of the
entire receivables in the Bombardier Capital Inc. Domestic Inventory Portfolio,
which also includes accounts that would be ineligible or that otherwise are not
designated to the trust. As a result, actual loss experience with respect to the
Accounts designated to the trust may be different. There can be no assurance
that the loss experience for the receivables in the future will be similar to
the historical experience set forth in the table below.
S-17
<Page>
LOSS EXPERIENCE
BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO
<Table>
<Caption>
9 MONTHS ENDED
OCTOBER 31, YEAR ENDED JANUARY 31,
------------------- ---------------------------------------------------
2003 2002 2003 2002 2001 2000 1999(1)
---- ---- ---- ---- ---- ---- -------
(U.S. DOLLARS IN MILLIONS)
Average Principal Receivables
Balance...................... $1,374.0 $1,363.6 $1,424.6 $1,415.6 $1,362.5 $1,170.2 $907.0
Net Losses..................... 8.6 11.7 12.7 13.1 13.6 5.3 12.7
Net Losses/Liquidations........ 0.32% 0.49% 0.41% 0.45% 0.49% 0.21% 0.61%
Net Losses/Average Principal
Receivables Balance.......... 0.84%* 1.14%* 0.89% 0.93% 1.00% 0.45% 1.40%
</Table>
- ---------
* Annualized.
(1) These figures do not reflect the charge-off policy
implemented in 1999.
When reviewing the information in the immediately preceding table, you
should be aware that prior to January 1999, Bombardier Capital Inc.'s policy was
to charge-off a receivable based upon management discretion. Beginning in 1999,
Bombardier Capital Inc.'s policy is to charge off a principal receivable on or
before 90 days after it is discovered that the product related to that
receivable was sold. The change in Bombardier Capital Inc.'s charge-off policy
increased the Net Losses, Net Losses/Liquidations and Net Losses/Average
Principal Receivables Balance for the year ended January 31, 1999 and, to a
lesser extent, for the year ended January 31, 2000, and decreased such amounts
as Net Losses were reduced by recoveries on receivables previously included as
Net Losses. The figures set out under 'Average Principal Receivables Balance'
indicate the average of the month-end outstanding principal balances for the
nine months ending October 31 or the twelve months ending January 31. The
figures representing net losses in any period were derived by reducing gross
losses by recoveries for that period. Recoveries include recoveries from
collateral security in addition to the products.
MANAGEMENT DISCUSSION AND ANALYSIS
As noted in the preceding section under the caption 'The Accounts -- Loss
Experience', loss and recovery data were affected by Bombardier Capital Inc.'s
change in write-off policy. There can be no assurance that the delinquency and
loss experience on the portfolio will remain consistent with past performance.
In particular, a change in the current economic conditions could have a material
adverse effect on the assets in the trust. See 'Risk Factors -- Social, Economic
And Other Factors May Cause Dealers To Fail To Sell Products Securing
Receivables Causing Losses On Receivables And Thus Your Certificates Or
Accelerating Payments Of Principal To You' in the prospectus. Some of the asset
types in the trust may be more sensitive to recessionary cycles than others. For
example, if an economic recession occurs, consumers are less likely to buy
high-end recreational products. This would cause dealers to have difficulty
selling the high-end recreational products that secure receivables. In addition,
unexpected events may cause an increase in delinquencies and losses.
PRODUCT MIX
The following tables detail Bombardier Capital Inc.'s domestic inventory
financing activity by outstanding aggregate receivables and by volume based on
current product categories for the Bombardier Capital Inc. Domestic Inventory
Portfolio. While the information reflected in these tables includes receivables
arising under accounts that would not qualify as Eligible Accounts, the
S-18
<Page>
relative product mix for receivables arising under accounts that would qualify
as Eligible Accounts would be similar to the product mix reflected in these
tables.
OUTSTANDING RECEIVABLES
BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO
<Table>
<Caption>
OCTOBER 31, JANUARY 31,
------------------------------- ------------------------------------------------
PRODUCT 2003 2002 2003 2002 2001
- ------- ---- ---- ---- ---- ----
Bombardier
Recreational
Products............ $ 429,450,209 $ 398,784,904 $ 487,588,010 $ 380,321,320 $ 316,378,076
Marine Products other
than Bombardier
Products............ 348,672,155 312,538,885 405,289,974 415,281,408 468,830,654
Manufactured
Housing............. 392,870,784 395,353,048 401,415,502 337,181,899 357,599,965
Recreational
Vehicles............ 211,703,339 199,136,497 240,942,816 194,515,352 184,509,102
Other................ 43,566,576 87,691,265 75,354,829 124,397,704 160,054,712
-------------- -------------- -------------- -------------- --------------
Totals............ $1,426,263,063 $1,393,504,599 $1,610,591,131 $1,451,697,683 $1,487,372,509
-------------- -------------- -------------- -------------- --------------
-------------- -------------- -------------- -------------- --------------
<Caption>
JANUARY 31,
------------------------------
PRODUCT 2000 1999
- ------- ---- ----
Bombardier
Recreational
Products............ $ 245,330,278 $ 307,690,567
Marine Products other
than Bombardier
Products............ 397,296,601 315,569,409
Manufactured
Housing............. 376,353,368 399,859,041
Recreational
Vehicles............ 178,725,155 99,460,273
Other................ 117,177,081 91,486,875
------------- --------------
Totals............ $1,314,882,483 $1,214,066,165
------------- --------------
------------- --------------
</Table>
FINANCING VOLUME
BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO
<Table>
<Caption>
OCTOBER 31, JANUARY 31,
------------------------------- ------------------------------------------------
PRODUCT 2003 2002 2003 2002 2001
- ------- ---- ---- ---- ---- ----
Bombardier
Recreational
Products............ $ 644,464,697 $ 654,507,759 $1,049,642,044 $ 935,859,953 $ 860,489,107
Marine Products other
than Bombardier
Products............ 537,660,297 464,589,053 637,874,595 553,387,984 677,575,655
Manufactured
Housing............. 729,025,187 645,631,563 850,654,487 684,638,428 735,635,853
Recreational
Vehicles............ 467,336,595 393,391,639 519,943,296 404,537,276 357,058,616
Other................ 106,876,198 149,186,396 178,695,180 269,851,763 345,840,824
-------------- -------------- -------------- -------------- --------------
Totals............ $2,485,362,974 $2,307,306,409 $3,236,809,602 $2,848,275,404 $2,976,600,057
-------------- -------------- -------------- -------------- --------------
-------------- -------------- -------------- -------------- --------------
<Caption>
JANUARY 31,
------------------------------
PRODUCT 2000 1999
- ------- ---- ----
Bombardier
Recreational
Products............ $ 668,918,238 $ 785,229,267
Marine Products other
than Bombardier
Products............ 593,803,894 529,938,038
Manufactured
Housing............. 1,000,527,521 475,987,545
Recreational
Vehicles............ 317,215,775 177,719,671
Other................ 270,631,333 201,920,641
------------- --------------
Totals............ $2,851,096,761 $2,170,795,162
------------- --------------
------------- --------------
</Table>
Bombardier Recreational Products
As a manufacturer, Bombardier Inc. is one of Bombardier Capital Inc.'s most
significant customers. Bombardier recreational products financed by Bombardier
Capital Inc. include Ski-Doo'r' snowmobiles, Sea-Doo'r' personal watercraft,
sport boats, all-terrain vehicles and Evinrude'r' and Johnson'r' outboard
engines and related parts and accessories. Bombardier Inc. has entered into an
agreement to dispose of its Recreational Products Group which manufactures its
recreational products, and the closing is expected to occur during the current
fiscal year. After the sale of the Bombardier recreational products business is
completed, Ski-Doo'r' snowmobiles, Sea-Doo'r'personal watercraft, all-terrain
vehicles and related parts and accessories will continue to be financed by
Bombardier Capital Inc. and classified in the new Powersports industry category.
Jet Boats, Johnson'r' and Evinrude'r' outboard motors and related parts and
accessories will also continue to be financed by Bombardier Capital Inc. but
will migrate into the Marine products industry category. As of October 31, 2003,
Powersports totaled $372,879,427 and Marine totaled $56,570,781, respectively,
which constitute 86.83% and 13.17%, respectively, of Bombardier recreational
products.
S-19
<Page>
Marine Products Other Than Bombardier Products
As of October 31, 2003, Bombardier Capital Inc. provided inventory finance
to approximately 979 dealers for purchases of the products of approximately 198
marine manufacturers and distributors. The marine products financed by
Bombardier Capital Inc. are primarily boats under 30 feet in length, outboard
motors and trailers, including packages consisting of all three products.
Manufactured Housing
Manufactured housing products for which Bombardier Capital Inc. provides
inventory financing consist of manufactured housing units and modular homes. As
of October 31, 2003, Bombardier Capital Inc. was financing approximately 758
dealers for purchases of the products of approximately 73 manufacturers of
manufactured homes. In January 1999, Bombardier Capital Inc. significantly
expanded its manufactured housing inventory receivables through a portfolio
purchase from NationsCredit Manufactured Housing Corporation in the principal
amount of approximately US$203 million.
Recreational Vehicles
The recreational vehicles financed by Bombardier Capital Inc. are
on-the-road recreational vehicles, pull-behind travel trailers and campers.
Other
Bombardier Capital Inc. also provides inventory financing for motorcycles,
lawn and garden equipment, horse trailers, personal computers, consumer
electronics and appliances, specialty vehicles, rental cars, spare parts
relating to these products and music. The types of products for which Bombardier
Capital Inc. provides inventory financing may change over time.
AGING EXPERIENCE
The following table provides the age distribution of product inventory for
all dealers in the Bombardier Capital Inc. Domestic Inventory Portfolio as a
percentage of total principal outstanding at the date indicated. Because the
Accounts designated to the trust will comprise only a portion of the entire
Bombardier Capital Inc. Domestic Inventory Portfolio, which also includes
accounts which have not been designated to the trust, actual age distribution
with respect to the Accounts may be different.
PRODUCT AGE DISTRIBUTION
BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO
<Table>
<Caption>
OCTOBER 31, JANUARY 31,
--------------- ------------------------------------------
DAYS 2003 2002 2003 2002 2001 2000 1999
- ---- ---- ---- ---- ---- ---- ---- ----
1-120...................... 50.07% 48.20% 47.71% 43.56% 43.96% 50.32% 52.93%
121-180...................... 9.01% 10.15% 14.60% 15.12% 15.56% 15.65% 14.04%
181-270...................... 10.86% 12.03% 11.41% 11.03% 12.30% 11.43% 11.52%
Over 270..................... 30.07% 29.62% 26.28% 30.29% 28.18% 22.61% 21.50%
</Table>
GEOGRAPHIC DISTRIBUTION
The following table provides information concerning those seven states which
have the greatest number of receivables outstanding and the number of dealers
generating these receivables with respect to the Bombardier Capital Inc.
Domestic Inventory Portfolio. While some of the receivables included in this
table arose under accounts that would not qualify as Eligible Accounts, the
relative geographic distribution of receivables arising under accounts that
would qualify as Eligible Accounts would be similar to the distribution
reflected in this table.
S-20
<Page>
GEOGRAPHIC DISTRIBUTION
BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO
AS OF OCTOBER 31, 2003
<Table>
<Caption>
PERCENTAGE OF PERCENTAGE OF
RECEIVABLES RECEIVABLES TOTAL NUMBER NUMBER OF
STATE OUTSTANDING OUTSTANDING OF ACCOUNTS ACCOUNTS
- ----- ----------- ----------- ----------- --------
California.............................. $ 112,163,854 7.86% 245 6.42%
Florida................................. 106,825,949 7.49% 264 6.91%
North Carolina.......................... 90,396,047 6.34% 212 5.55%
New York................................ 79,452,638 5.57% 201 5.26%
Michigan................................ 73,125,920 5.13% 186 4.87%
Texas................................... 71,071,255 4.98% 180 4.71%
Georgia................................. 64,047,573 4.49% 132 3.46%
-------------- ------ ----- ------
Total............................... $1,426,263,063 100.00% 3,818 100.00%
-------------- ------ ----- ------
-------------- ------ ----- ------
</Table>
No state other than those listed in this table represents more than 4% of
the outstanding receivables in the Bombardier Capital Inc. Domestic Inventory
Portfolio.
MATURITY AND PRINCIPAL PAYMENT CONSIDERATIONS
Principal of the Class A Certificates is scheduled to be paid on the
December 2005 distribution date. It is possible, however, that principal on the
Class A Certificates may be paid earlier if an Early Amortization Event has
occurred. See 'Description of the Class A Certificates -- Early Amortization
Events' below. We expect that a single principal payment on the Class A
Certificates will be made on the December 2005 distribution date, but the
principal of the Class A Certificates may be paid earlier or, depending on the
actual payment rate on the receivables, later, as described in this section. The
financial guaranty insurance policy guarantees the full payment of principal on
Class A Certificates on the legal final payment date.
The majority of receivables are payable upon the retail sale of the related
Eligible Product and therefore, the timing of these payments is uncertain.
In addition, we cannot assure you that Bombardier Capital Inc. will generate
additional receivables under the Accounts or that any particular pattern of
payments will occur. In the event of a decline in the rate at which additional
receivables are generated during the Revolving Period, the depositor may be
unable to convey new receivables to the trust at the level anticipated or may be
unable to contribute receivables in new Accounts when otherwise required to do
so under the pooling and servicing agreement. The obligation to designate
Additional Accounts under some circumstances applies to Accounts of the same
type or types as are then included in the trust. This failure to convey new
receivables to the trust on the part of the depositor would constitute an Early
Amortization Event, causing principal payments on the Class A Certificates to
commence earlier than would otherwise have been the case.
Further, during the Controlled Accumulation Period or Early Amortization
Period, a decline in the rate at which additional receivables are generated may
have the effect of reducing the rate of principal distributions on the Class A
Certificates, thus extending the maturity of the Class A Certificates and
increasing their exposure to losses in the trust. Alternatively, the issuance of
other series may result in the allocation of Excess Principal Collections from
these other series to the Class A Certificates during an Early Amortization
Period, which may shorten the maturity of the Class A Certificates. See
'Description of the Class A Certificates -- Interest' and ' -- Principal' in
this prospectus supplement and 'Description of the Certificates -- Interest' and
' -- Principal' and 'The Floorplan Financing Business' in the prospectus.
Following the exhaustion of coverage provided by the Available Subordinated
Amount, the yield to maturity on the Class A Certificates will be more sensitive
to the rate and timing of
S-21
<Page>
Defaulted Receivables. For a description of Investor Charge-Offs, see
'Description of the Class A Certificates -- Investor Charge-Offs' in this
prospectus supplement.
Receivables arise through financing arrangements related to Eligible
Products. The amount of new receivables generated in any month and monthly
payment rates on the receivables may vary because of seasonal variations in
sales and inventory levels of Eligible Products, retail incentive programs
provided by the manufacturers, importers and distributors of the Eligible
Products and various economic factors affecting Eligible Product sales. The
following table sets forth the highest and lowest monthly payment rates for the
Bombardier Capital Inc. Domestic Inventory Portfolio during any month in the
periods shown and the average of the monthly payment rates for all months during
the periods shown. In each case it is calculated as the percentage equivalent of
a fraction, the numerator of which is the total of all collections of principal
during the period and the denominator of which is the average total principal
balance for this period. We cannot assure you that the rate of principal
collections will be similar to the historical experience in the table below.
Because the Accounts designated to the trust will comprise only a portion of the
entire Bombardier Capital Inc. Domestic Inventory Portfolio, which includes
accounts which have not been designated to the trust, actual monthly payment
rates with respect to the Accounts designated to the trust may be different.
MONTHLY PRINCIPAL PAYMENT RATES
BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO
<Table>
<Caption>
OCTOBER 31, JANUARY 31,
--------------- ------------------------------------------
DAYS 2003 2002 2003 2002 2001 2000 1999
- ---- ---- ---- ---- ---- ---- ---- ----
Highest Month................ 27.87% 24.81% 24.81% 26.17% 27.37% 30.17% 31.14%
Lowest Month................. 16.09% 12.18% 12.18% 11.33% 12.74% 11.00% 10.38%
Average of the Months in the
Period..................... 20.37% 19.12% 18.21% 17.47% 17.44% 18.60% 19.32%
</Table>
Because the occurrence of an Early Amortization Event would initiate an
Early Amortization Period, the final distribution of principal on the Class A
Certificates may be made prior to the scheduled principal payment date. See
'Description of the Class A Certificates -- Early Amortization Events' in this
prospectus supplement and in the prospectus.
S-22
<Page>
DESCRIPTION OF THE CLASS A CERTIFICATES
GENERAL
The Class A Certificates will be issued in accordance with the pooling and
servicing agreement, as supplemented by the respective supplements for prior
series of investor certificates and for the Class A Certificates and the
variable funding certificate. This description supplements the more general
description of the Class A Certificates and the pooling and servicing agreement
set forth under 'Description of the Certificates' in the prospectus. Together,
this prospectus supplement and the prospectus provide a summary of the material
terms of the Class A Certificates and the pooling and servicing agreement but do
not provide a complete description. For further information, owners and
prospective owners of Class A Certificates are advised to examine the pooling
and servicing agreement, copies of which, without specified exhibits or
schedules, will be made available by the trustee upon written request.
The Class A Certificates will evidence undivided beneficial ownership
interests in the receivables representing the right to receive from the trust,
upon terms as further described in this section, funds up to, but not in excess
of, the amounts required to make payments of interest on and principal of the
Class A Certificates under the pooling and servicing agreement and the right to
receive payments pursuant to the financial guaranty insurance policy. The
initial principal balance of the Class A Certificates will be $500,000,000. The
Class A Certificates will initially be represented by one or more Class A
Certificates registered in the name of the nominee of The Depository Trust
Company. See 'Description of the Certificates -- Book-Entry Registration' in the
prospectus.
INTEREST
Interest on the principal balance of the Class A Certificates will accrue at
the Class A Certificate Rate and will be payable to the holders of the Class A
Certificates on each distribution date, starting January 15, 2004. The Class A
Certificate Rate for any interest period will be one-month LIBOR plus [ ]%.
Interest due on a distribution date will accrue from and including the
preceding distribution date -- or, in the case of the first distribution date,
from and including the date of the issuance of the Class A Certificates -- to
but excluding the distribution date on which this interest is due. Interest due
for any distribution date will be calculated on the basis of the actual number
of days elapsed during the related Interest Period and a 360-day year. On the
date the Class A Certificates are issued, Bombardier Credit Receivables
Corporation will deposit into the reserve fund an amount equal to the interest
due on the Class A Certificates on the first distribution date. This amount will
be withdrawn to pay interest on the Class A Certificates on the first
distribution date. If the issuer does not pay interest on the Class A
Certificates as calculated above when due on a distribution date and the
financial guaranty insurer fails to pay the interest under the insurance policy,
the amount not paid will be due on the next distribution date together with, to
the extent lawfully payable, interest on the amount of this unpaid interest at
the Class A Certificate Rate.
Interest payments on your Class A Certificates will be derived solely from:
(1) collections of non-principal receivables allocated to the Class A
Certificates for the preceding calendar month;
(2) the amount, if any, then on deposit in the reserve fund;
(3) any Investment Proceeds; and
(4) Series 2003-3 Available Retained Collections to the extent of the
Required Subordination Draw Amount.
See ' -- Allocation Percentages' and ' -- Distributions from the Collection
Account; Reserve Fund; Principal Account' below and 'Description of the
Certificates -- Interest' and ' -- Allocation Percentages' in the prospectus.
S-23
<Page>
In addition, if on any distribution date amounts available to pay interest
on the Class A Certificates are insufficient to cover the full amount due, then
the trustee will demand payment on the financial guaranty insurance policy in an
amount equal to that deficiency in accordance with the Series 2003-3 supplement
to the pooling and servicing agreement. See 'Description of the Financial
Guaranty Insurance Policy and the Financial Guaranty Insurer' in this prospectus
supplement.
PRINCIPAL
No principal payments will be made on the Class A Certificates until the
December 2005 distribution date unless an Early Amortization Event, as described
under ' -- Early Amortization Events' below, occurs. If an Early Amortization
Event occurs, principal distributions on your Class A Certificates will begin on
the distribution date following the end of the calendar month in which this
event occurs.
During the Revolving Period, principal collections allocated to the Class A
Certificates, subject to limitations, will either:
(1) be deposited in the excess funding account as described under
' -- Excess Funding Account' below;
(2) be treated as excess principal collections and be allocated to one
or more outstanding series which are in amortization, early amortization or
accumulation periods to cover shortfalls in principal payments due to the
certificateholders of any of these other series or which provide for excess
funding accounts or similar arrangements; or
(3) to the extent the excess principal collections are not needed to
cover principal shortfalls for other outstanding series, either be paid or
made available to the holder of the BCRC Certificate to maintain at a
constant level the interest in the trust represented by the certificates,
or, if the Pool Balance does not exceed the Required Pool Balance, be held
in the collection account as unallocated Principal Collections.
See ' -- Allocation Percentages -- Principal Collections for all Series' and
' -- Distributions from the Collection Account; Reserve Fund; Principal
Account -- Principal Collections' below and 'Description of the
Certificates -- Allocation Percentages' and ' -- Allocation of Collections' in
the prospectus.
During the Controlled Accumulation Period or an Early Amortization Period,
principal collections allocable to the Class A Certificates plus other amounts
comprising Available Investor Principal Collections will no longer be deposited
in the excess funding account or allocated to another outstanding series or paid
or made available to the holder of the BCRC Certificate. Instead, in the case of
the Controlled Accumulation Period, Available Investor Principal Collections for
each month will be deposited into the principal account up to the Controlled
Deposit Amount for that month, and, in the case of an Early Amortization Period,
will be deposited, up to the amount of Monthly Principal for the related
distribution date into the collection account and distributed to the Class A
certificateholders as Monthly Principal, until the outstanding principal balance
of the Class A Certificates has been reduced to zero.
The Controlled Accumulation Period will begin on the first business day of
July 2005 or a later date determined by the servicer on the basis of the
Accumulation Period Length. The Controlled Accumulation Period will continue for
one, two, three, four or five months and for each of the months, principal
collections allocated to your Class A Certificates will be deposited into the
principal account, in an amount sufficient, when combined with the deposits in
all other months, to pay the Class A Certificates in full on the distribution
date in December 2005, which is the scheduled principal payment date. During an
Early Amortization Period, principal collections allocable to the Class A
Certificates will be distributed to the Class A Certificates until their
principal balance is reduced to zero.
We expect that amounts accumulated in the principal account will be paid to
the holders of the Class A Certificates on the December 2005 distribution date,
which is the scheduled principal
S-24
<Page>
payment date, resulting in a single principal payment in respect of the entire
principal balance of the Class A Certificates. The principal of the Class A
Certificates may be paid earlier or, depending on the actual payment rate on the
receivables, later, as described under 'Maturity and Principal Payment
Considerations' in this prospectus supplement.
If an interest in the receivables represented by all outstanding series is
required to be repurchased as described in the prospectus under 'Description of
the Receivables Purchase Agreement -- Representations and Warranties' in the
prospectus, principal payments on your Class A Certificates will be made on the
distribution date occurring or immediately following the date of this
repurchase.
See ' -- Allocation Percentages -- Principal Collections for all Series' and
' -- Distributions from the Collection Account; Reserve Fund; Principal
Account -- Principal Collections' below and 'Description of the
Certificates -- Distributions from the Collection Account; Principal Account' in
the prospectus.
Distributions on the Class A Certificates will be made on each distribution
date to the holders of Class A Certificates in whose names the Class A
Certificates were registered which is expected to be Cede & Co. as nominee of
The Depository Trust Company at the close of business on the day preceding the
relevant distribution date. If definitive Class A Certificates are issued,
distributions will be made to the holder of Class A Certificates in whose names
the Class A Certificates were registered on the last day of the preceding
calendar month. However, the final distribution on the Class A Certificates will
be made only upon presentation and surrender of the Class A Certificates.
Distributions will be made to The Depository Trust Company in immediately
available funds. See 'Description of the Certificates -- Book-Entry
Registration' in the prospectus.
EXCESS FUNDING ACCOUNT
The servicer has established and is required to maintain, or, cause to be
established and maintained for the life of the Class A Certificates, an excess
funding account which will be an Eligible Deposit Account for the benefit of the
Class A certificateholders in the name of the trustee. The excess funding
account is intended to preserve for the benefit of the Class A
certificateholders principal collections allocated to the Class A Certificates
but otherwise payable to other series or to the BCRC Certificate during the
Revolving Period and the Controlled Accumulation Period.
On each business day during the Revolving Period, if the Pool Balance at the
end of the preceding business day was less than the Required Pool Balance also
calculated as of the end of that preceding business day, the servicer will cause
principal collections allocable to the Class A Certificates to be deposited by
the servicer in the excess funding account in an amount equal to the Excess
Funded Amount calculated as of the end of the preceding business day, minus the
amount then held in the excess funding account.
On each business day during the Controlled Accumulation Period, if the Pool
Balance at the end of the preceding business day was less than the Required Pool
Balance also calculated as of the end of that preceding business day, the
servicer will cause principal collections allocable to the Class A Certificates,
which remain after making required deposits into the principal account, to be
deposited by the servicer in the excess funding account in an amount equal to
the Excess Funded Amount calculated as of the end of the preceding business day,
minus the amount then held in the excess funding account.
The Excess Funded Amount will be calculated for each business day and will
be an amount equal to the product of:
(1) the excess, if any, of the Required Pool Balance over the Pool
Balance, each as of the end of the preceding day; and
(2) a fraction the numerator of which is the sum of the Available
Subordinated Amount and 104 percent of the Adjusted Invested Amount and the
denominator of which is the aggregate of the required balances for all
series providing for excess funding accounts or
S-25
<Page>
similar arrangements, including the required balance for this series, which
are in their revolving periods or, if applicable, their amortization
periods. The depositor may reduce or adjust the above percentage from 104
percent without the consent of the Class A certificateholders if the Rating
Agency Condition is satisfied.
On each business day during the Revolving Period or the Controlled
Accumulation Period, funds on deposit in the excess funding account, including
the Excess Funded Amount, will be withdrawn and paid or made available to the
holder of the BCRC Certificate or allocated to one or more series which are in
amortization, early amortization or accumulation periods to the extent that as
of the end of the preceding day, the Pool Balance exceeds the Required Pool
Balance.
Funds on deposit in the excess funding account will be invested at the
direction of the servicer in Eligible Investments. On each distribution date,
all net investment income earned on amounts in the excess funding account since
the preceding distribution date will be withdrawn from the excess funding
account and applied on the same basis as Investor Non-Principal Collections.
ALLOCATION PERCENTAGES
This section describes the procedure for calculating the Class A
Certificates' allocable share of specified distributions and other payments made
on the receivables. Amounts not allocated to the Class A Certificates will be
allocated to other series, the variable funding certificate or the BCRC
Certificate.
Allocation to the Class A Certificates
The servicer will allocate amounts to the Class A Certificates for each
calendar month as follows:
(1) Non-Principal Collections and the Defaulted Amount will be allocated
to the Class A Certificates based on the Floating Allocation Percentage;
(2) during the Revolving Period, principal collections will be allocated
to the Class A Certificates based on the Floating Allocation Percentage;
(3) during the Controlled Accumulation Period and any Early Amortization
Period, principal collections will be allocated to the Class A Certificates
based on the Principal Allocation Percentage; and
(4) Miscellaneous Payments will be allocated to the Class A Certificates
on the basis of the Series 2003-3 Investor Allocation Percentage.
When allocating principal collections, if the sum of:
(1) the floating allocation percentages, including the Floating
Allocation Percentage, if applicable, for each series in its revolving
period,
(2) the principal allocation percentages, including the Principal
Allocation Percentage, if applicable, for each series in its amortization,
accumulation or early amortization period, and
(3) the Variable Funding Percentage
exceeds 100%, then principal collections for the previous calendar month will be
allocated among the series and the variable funding certificate pro rata on the
basis of these allocation percentages after the pro rata reduction of these
percentages so that the sum of these percentages equals 100% for this period.
When allocating Non-Principal Collections, if the sum of:
(1) the floating allocation percentages, including the Floating
Allocation Percentage, for each series, and
(2) the Variable Funding Percentage
S-26
<Page>
exceeds 100%, then Non-Principal Collections for the previous calendar month
will be allocated among the series and the variable funding certificate on the
basis of these allocation percentages after the pro rata reduction of these
percentages so that the sum of these percentages equals 100% for that period.
Principal Collections for all Series
Principal collections allocable to the Class A Certificates for any calendar
month during the Revolving Period will first be allocated to the excess funding
account to the extent described above under ' -- Excess Funding Account.'
Principal collections allocable to the Class A Certificates for any calendar
month during the Controlled Accumulation Period will first be allocated to make
deposits up to the Controlled Deposit Amount in the principal account. Principal
collections allocable to the Class A Certificates for any calendar month during
any Early Amortization Period will first be allocated to make required payments
of Monthly Principal on the Class A Certificates. See ' -- Distributions from
the Collection Account; Reserve Fund; Principal Account -- Principal
Collections' below.
Principal collections allocable to the Class A Certificates for any calendar
month during the Controlled Accumulation Period remaining after the allocation
to provide for the deposit of the Controlled Deposit Amount into the principal
account will then be allocated to the excess funding account to the extent
described above under ' -- Excess Funding Account.' The servicer will next
determine the amount of Available Investor Principal Collections remaining after
these required payments are made and the amount of any similar excess for any
other series. The servicer will allocate Excess Principal Collections to cover
any principal distributions on any series which are either scheduled or
permitted to receive payments of principal and which have not been covered out
of principal collections and other amounts allocated to that series.
Excess Principal Collections will generally not be used to cover investor
charge-offs, including Investor Charge-Offs, for any series. If for any calendar
month a principal shortfall occurs for one or more series of certificates,
Excess Principal Collections from other series may be available to cover some or
all of the shortfall. The determination of what constitutes a principal
shortfall for a series is made on a series by series basis. If for any
distribution date the aggregate amount of principal shortfalls for all series
exceeds Excess Principal Collections, then Excess Principal Collections will be
allocated pro rata among the applicable series entitled to receive monthly
principal based on the relative amounts of these principal shortfalls.
To the extent that Excess Principal Collections exceed principal shortfalls,
the balance will be paid or made available to the holder of the BCRC Certificate
only if the Pool Balance for the related distribution date, determined after
giving effect to any receivables transferred to the trust on that date, exceeds
the Required Pool Balance for the immediately preceding determination date,
after giving effect to the allocations, distributions, withdrawals and deposits
to be made on that distribution date. Any amount not paid to the holder of the
BCRC Certificate because the Pool Balance does not exceed the Required Pool
Balance will be held unallocated in the collection account until the Pool
Balance exceeds the Required Pool Balance, at which time this amount will be
paid to the holder of the BCRC Certificate, or until an early amortization event
occurs or an accumulation or scheduled amortization period commences for any
series, after which event or commencement this amount will be treated as a
Miscellaneous Payment.
DAILY ALLOCATIONS
On any date on which collections are received during the Revolving Period or
the Controlled Accumulation Period, the servicer will allocate to the Class A
Certificates an amount equal to the sum of
(1) the product of the Floating Allocation Percentage for that date
multiplied by the total amount of Non-Principal Collections on that date,
and
(2) the Series 2003-3 Available Retained Collections for that date,
S-27
<Page>
and of that allocation, the servicer will deposit and retain in the collection
account an amount equal to the lesser of
(1) the Daily Allocation on that date, and
(2) the difference between
the Class A Monthly Interest for the related distribution
date plus the amount of any unpaid Class A Monthly Interest
plus interest thereon, if Bombardier Capital Inc. is not the
servicer, the Monthly Servicing Fee for the current calendar
month, the insurance premium and disbursements payable to
the financial guaranty insurer under the Insurance Agreement
for the related Distribution Date, the sum for each day
through the deposit date of the Floating Allocation
Percentage of the Defaulted Amount and the amount, if any,
by which the Reserve Fund Required Amount exceeded the
amount on deposit in the reserve fund on the preceding
distribution date, and
the sum of the Daily Allocations previously deposited in the
collection account for the current calendar month, and the
remainder of this Daily Allocation will be retained by the
servicer for application as described in the second
following paragraph.
During the Early Amortization Period, the entire Daily Allocation for each
date will be deposited and retained in the collection account.
On each Determination Date for the Revolving Period or the Controlled
Accumulation Period, the servicer will deposit in the collection account an
amount equal to the excess, if any, of the amounts required to be distributed on
the related distribution date under clauses (1) through (8) under
' -- Distributions from the Collection Account; Reserve Fund; Principal
Account -- Non-Principal Collections' below over any Daily Allocations deposited
by the servicer in the collection account during the related calendar month,
provided that if Bombardier Capital Inc. is the servicer, Bombardier Capital
Inc. may make this deposit net of the Monthly Servicing Fee (to the extent of
funds available to pay the Monthly Servicing Fee for the related Distribution
Date) plus Daily Allocations consisting of Series 2003-3 Available Retained
Collections retained by the servicer and not used on the related distribution
date as described under ' -- Distributions from the Collection Account; Reserve
Fund; Principal Account' below.
LIMITED SUBORDINATION OF RETAINED INTEREST
A portion of the Retained Interest up to the Available Subordinated Amount
will be available to fund payment of principal and interest on the Class A
Certificates in the event that the proportionate interests of the Class A
Certificates in collections received on the receivables during any particular
calendar month are less than the required distributions thereon. The following
paragraphs describe the extent to which collections otherwise allocable to the
BCRC Certificate will be available to satisfy shortfalls in the payment of
principal and interest on the Class A Certificates.
Deficiency Amount
For each distribution date, the servicer will determine for the Class A
Certificates the Deficiency Amount, which will be the amount, if any, by which
the sum of
(1) the Class A Monthly Interest for the distribution date,
(2) the Class A Monthly Interest accrued but not covered by the
financial guaranty insurance policy or paid for prior distribution dates
plus interest on these amounts,
(3) the Net Servicing Fee for the distribution date,
(4) the premium due on the financial guaranty insurance policy and any
previously accrued and unpaid premium,
S-28
<Page>
(5) the portion of the Defaulted Amount allocated to the Class A
Certificates for the distribution date, and
(6) the Series 2003-3 Investor Allocation Percentage of any Adjustment
Payment for the distribution date that has not been deposited in the
collection account as required under the pooling and servicing agreement,
exceeds
the sum of
(1) Investor Non-Principal Collections and Investment Proceeds for that
distribution date and
(2) the amount of funds in the reserve fund on the distribution date
available to fund the amount by which the amount in (1) through (6) above
exceeds the amount in (1) immediately above.
The lesser of the Deficiency Amount and the Available Subordinated Amount is
the 'Required Subordination Draw Amount.'
Required Subordinated Amount
The 'Required Subordinated Amount' means, as of any date of determination,
the sum of
(1) 9.2896% of the Invested Amount;
(2) the MH Incremental Subordinated Amount;
(3) the Designated Manufacturer Incremental Subordinated Amount;
(4) the Payment Rate Enhancement Amount; and
(5) the Incremental Subordinated Amount for the immediately preceding
distribution date or, if the date of determination is a distribution date,
for that date;
provided, however, that for any date before the end of the Revolving Period, the
Required Subordinated Amount will in no event be less than an amount equal to
the sum of 3.75% of the initial principal amount of the Class A Certificates
plus the Incremental Subordinated Amount for the immediately preceding
distribution date or, if the date of determination is a distribution date, for
that date; and provided further, that upon the start of the Controlled
Accumulation Period or if an Early Amortization Event occurs, the Required
Subordinated Amount for each date of determination after this commencement will
equal the Required Subordinated Amount as of the close of business on the day
preceding the first day of the Controlled Accumulation Period or the day on
which the Early Amortization Event occurs.
Available Subordinated Amount
The 'Available Subordinated Amount' for any date of determination after the
first distribution date means an amount equal to the sum of:
the lesser of:
(1) the Available Subordinated Amount for the preceding distribution
date, minus, with some limitations, the Required Subordination Draw Amount
for the preceding distribution date or, if the date of determination is a
distribution date, that distribution date, minus the amount of any deposits
in the reserve fund from Series 2003-3 Available Retained Collections for
the purpose of reimbursing funds withdrawn from the reserve fund applied to
cover any portion of the Defaulted Amount allocated to the Class A
Certificates on the preceding distribution date or, if the date of
determination is a distribution date, that distribution date, minus an
amount equal to the Defaulted Amount for the immediately preceding calendar
month multiplied by a fraction, the numerator of which is the Available
Subordinated Amount as of the last day of the preceding calendar month (or
in the case of the first distribution date, the Required Subordinated Amount
as of the date the Class A Certificates are issued) and the denominator of
which is the Pool Balance as of the last day of the preceding calendar
S-29
<Page>
month, or in the case of the first distribution date, the Pool Balance as of
the date of the issuance of the Class A Certificates, plus the total amount
of Excess Servicing paid to the holder of the BCRC Certificate on the
previous distribution date as described below under ' -- Distributions from
the Collection Account; Reserve Fund; Principal Account -- Excess
Servicing,' minus the Incremental Subordinated Amount for the second
preceding distribution date or if the date of determination is a
distribution date, the preceding distribution date, plus the Incremental
Subordinated Amount for the immediately preceding distribution date, or if
the date of determination is a distribution date, that distribution date,
minus the MH Incremental Subordinated Amount for the second preceding
distribution date or if the date of determination is a distribution date,
the preceding distribution date, plus the MH Incremental Subordinated Amount
for the immediately preceding distribution date or if the date of
determination is a distribution date, that distribution date, minus the
Designated Manufacturer Incremental Subordinated Amount for the second
preceding distribution date or if the date of determination is a
distribution date, the preceding distribution date, plus the Designated
Manufacturer Incremental Subordinated Amount for the immediately preceding
distribution date, or if the date of determination is a distribution date,
that distribution date, minus the Payment Rate Enhancement Amount for the
second preceding distribution date or if the date of determination is a
distribution date, the preceding distribution date, plus the Payment Rate
Enhancement Amount for the immediately preceding distribution date, or if
the date of determination is a distribution date, that distribution date,
plus the percentage equivalent of a fraction, the numerator of which is 8.5%
and the denominator of which is the excess of 100% over 8.5%, multiplied by
the aggregate amount of any increases in the Invested Amount resulting from
any withdrawals from the excess funding account since the preceding
distribution date; and
(2) the Required Subordinated Amount for that date of determination; and
the amount of any optional increase in the Available
Subordinated Amount exercised by the depositor as described
below in the final paragraph of this section 'Limited
Subordination of Retained Interest -- Available Subordinated
Amount.'
The Available Subordinated Amount for any date of determination during the
period from the date your Class A Certificates are issued through the first
distribution date will equal the Required Subordinated Amount as of that date of
determination, which will equal at least $46,448,087 on the date the Class A
Certificates are issued.
If the Available Subordinated Amount for any distribution date is less than
the Required Subordinated Amount for that distribution date, an Early
Amortization Event will occur. The holder of the BCRC Certificate may elect to
increase the Available Subordinated Amount -- but the total amount of these
increases may not exceed an amount equal to 1% of the initial principal amount
of the Class A Certificates -- at the time this Early Amortization Event would
otherwise occur, thus preventing or delaying the occurrence of this Early
Amortization Event.
DISTRIBUTIONS FROM THE COLLECTION ACCOUNT; RESERVE FUND; PRINCIPAL ACCOUNT
Non-Principal Collections
On each distribution date, the trustee will apply Investor Non-Principal
Collections and Investment Proceeds for that distribution date to make the
following distributions in the following order of priority:
(1) an amount equal to the Class A Monthly Interest for that
distribution date, plus the amount of any Class A Monthly Interest
previously due but not covered by the financial guaranty insurance policy or
distributed on a prior distribution date, plus, to the extent permitted
under applicable law, interest at the Class A Certificate Rate on Class A
Monthly Interest previously due but not covered by the financial guaranty
insurance policy or distributed, shall be distributed on the Class A
Certificates;
S-30
<Page>
(2) an amount equal to the Net Servicing Fee for that distribution date
shall be distributed to the servicer, unless this amount has been deducted
from amounts that would otherwise be deposited to the collection account as
described above under ' -- Daily Allocations' or waived as described under
' -- Servicing Fee' below;
(3) an amount equal to the insurance premium due to the financial
guaranty insurer and reimbursement of draws on the policy plus any
previously accrued and unpaid premium;
(4) an amount shall be deposited in the reserve fund equal to the
amount, if any, by which the Reserve Fund Required Amount for that
distribution date exceeds the amount on deposit in the reserve fund after
giving effect to any withdrawal from the reserve fund on that distribution
date;
(5) any other amounts owed to the financial guaranty insurer under the
Insurance Agreement;
(6) an amount equal to the portion of the Defaulted Amount allocated to
the Class A Certificates, if any, for that distribution date shall be
treated as a portion of Available Investor Principal Collections for that
distribution date and shall be allocated by the trustee in the manner
described under ' -- Distributions from the Collection Account; Reserve
Fund; Principal Account -- Principal Collections' below;
(7) an amount equal to the remainder of the Monthly Servicing Fee for
that distribution date, if any, due but not paid to the servicer shall be
paid to the servicer, unless this amount has been deducted from amounts that
would otherwise be deposited to the collection account as described above
under ' -- Daily Allocations' or waived as described under ' -- Servicing
Fee' below;
(8) the balance, if any, shall constitute Excess Servicing and shall be
allocated by the trustee in the manner described under ' -- Distributions
from the Collection Account; Reserve Fund; Principal Account -- Excess
Servicing' below.
If the Investor Non-Principal Collections and Investment Proceeds are not
enough to make the distributions required by clauses (1), (2), (3) to the extent
of the insurance premium and (6), the trustee will withdraw funds from the
reserve fund and apply these funds to complete, to the extent available, the
distributions in accordance with clauses (1), (2), (3) to the extent of the
insurance premium and (6), in that order.
If there is a Deficiency Amount for that distribution date, the servicer
will apply or cause the trustee to apply the total amount of Series 2003-3
Available Retained Collections for the related calendar month on that
distribution date, but only up to the Required Subordination Draw Amount, to
make the distributions required by clauses (1), (2), (3) to the extent of the
insurance premium and (6) above that have not been made through the application
of funds from the reserve fund as described in the preceding paragraph. If such
amounts are not sufficient to make the distributions required by clause (1)
above, the trustee will make a claim for payment on the financial guaranty
insurance policy in the amount of such deficiency. Any of the Series 2003-3
Available Retained Collections remaining after application in accordance with
the first sentence of this paragraph will be treated as a portion of the
Available Investor Principal Collections, but only up to the amount of unpaid
Adjustment Payments allocated to the Class A Certificates.
Reserve Fund
The reserve fund, which will be an Eligible Deposit Account, will be
established and maintained in the name of the trustee for the benefit of the
Class A certificateholders. The depositor will make an initial deposit into the
reserve fund on the date the Class A Certificates are issued in an amount no
less than $2,500,000 plus an amount necessary to pay interest on the Class A
Certificates on the first payment date. If, after giving effect to the
allocations, distributions and deposits in the reserve fund described above
under the caption ' -- Distributions from the Collection Account; Reserve Fund;
Principal Account -- Non-Principal Collections,' the amount in the reserve fund
is less than the Reserve Fund Required Amount for that distribution date, the
S-31
<Page>
trustee will deposit any remaining Series 2003-3 Available Retained Collections
to the extent of the Available Subordinated Amount for the related calendar
month into the reserve fund until the amount in the reserve fund is equal to the
Reserve Fund Required Amount. Funds in the reserve fund will be invested in the
same manner in which funds in the collection account may be invested. On each
distribution date, the servicer will credit to the collection account any
investment earnings net of losses and investment expenses for the reserve fund.
After the payment in full of the total principal balance of the Class A
Certificates and any amounts owing to the financial guaranty insurer, any funds
remaining on deposit in the reserve fund will be paid to the holder of the BCRC
Certificate.
Excess Servicing
On each distribution date, the trustee will allocate Excess Servicing for
the calendar month immediately preceding that distribution date, in the
following order of priority:
(1) an amount equal to the aggregate amount of Investor Charge-Offs
which have not been previously reimbursed, after giving effect to the
allocation on that distribution date of the Series 2003-3 Investor
Allocation Percentage of Miscellaneous Payments for that distribution date,
will be included in Available Investor Principal Collections for that
distribution date;
(2) an amount equal to the total outstanding amounts of the Monthly
Servicing Fee which have been previously waived as described below under
' -- Servicing Fee' and not previously paid from Excess Servicing will be
distributed to the servicer; and
(3) the balance, if any, will be distributed, or made available, to the
holder of the BCRC Certificate and will also increase the Available
Subordinated Amount to the extent described in its definition.
Principal Account
The principal account, which will be an Eligible Deposit Account, will be
established and maintained in the name of the trustee for the benefit of the
Class A certificateholders. Funds on deposit in the principal account will be
invested at the direction of the servicer in Eligible Investments. On each
distribution date, the servicer will credit to the collection account any
investment earnings, net of losses and investment expenses, for the principal
account. On the first to occur of the December 2005 distribution date and the
first distribution date after the occurrence of an Early Amortization Event,
amounts in the principal account will be used to pay principal of the Class A
Certificates. After the payment in full of the outstanding principal balance of
the Class A Certificates and all amounts owing to the financial guaranty
insurer, any funds remaining on deposit in the principal account will be paid to
the holder of the BCRC Certificate.
Principal Collections
The trustee will apply Available Investor Principal Collections as follows:
(1) on each business day during the Revolving Period, first, to make a
deposit to the excess funding account if the Pool Balance at the end of the
preceding business day was less than the Required Pool Balance for that day,
calculated as provided above under ' -- Excess Funding Account', and,
second, to Excess Principal Collections as described above under
' -- Allocation Percentages -- Principal Collections for all Series';
(2) for each distribution date for the Controlled Accumulation Period:
an amount equal to the Controlled Deposit Amount will be
deposited into the principal account for payment to the
Class A certificateholders on the earlier to occur of the
distribution date in December 2005, or the first
distribution date for the Early Amortization Period; and
S-32
<Page>
an amount equal to the difference, if any, between the
Excess Funded Amount and the amount then on deposit in the
excess funding account will be deposited into the excess
funding account; and
the balance, if any, will be allocated to Excess Principal
Collections; and
(3) for each distribution date for any Early Amortization Period:
an amount equal to Monthly Principal for that distribution
date will be distributed to the holders of Class A
Certificates until the principal amount thereof is reduced
to zero;
amounts will be distributed to the financial guaranty
insurer in reimbursement of draws on the policy; and
the balance, if any, will be allocated to Excess Principal
Collections.
In the event that the Invested Amount is greater than zero on the December
2005 distribution date if so directed by the financial guaranty insurer, any
funds remaining in the reserve fund, after the application of funds in the
reserve fund as described above under ' -- Distributions from the Collection
Account; Reserve Fund; Principal Account -- Non-Principal Collections', will be
treated as a portion of Available Investor Principal Collections for the
December 2005 distribution date.
Available Investor Principal Collections for any distribution date means the
sum of
(1) the product of the Floating Allocation Percentage, for the Revolving
Period, or the Principal Allocation Percentage, for the Controlled
Accumulation Period or any Early Amortization Period, for each day in the
related calendar month multiplied by principal collections for each day in
the related calendar month,
(2) the amount, if any, of Investor Non-Principal Collections,
Investment Proceeds, funds in the reserve fund and Series 2003-3 Available
Retained Collections allocated to cover any portion of the Defaulted Amount
allocated to the Class A Certificates or any unpaid Adjustment Payments
allocated to the certificates or to reimburse Investor Charge-Offs,
(3) the Series 2003-3 Investor Allocation Percentage of Miscellaneous
Payments for that distribution date,
(4) Excess Principal Collections, if any, from other series allocated to
the Class A Certificates,
(5) if an Early Amortization Period began during the related calendar
month, any amounts on deposit in the excess funding account, and
(6) on the December 2005 distribution date if so directed by the
financial guaranty insurer, any funds remaining in the reserve fund, after
the application of funds in the reserve fund as described above under
' -- Distributions from the Collection Account; Reserve Fund; Principal
Account -- Non-Principal Collections'.
If the sum of the Floating Allocation Percentage during the Revolving Period
or the Principal Allocation Percentage during the Early Amortization Period or
Controlled Accumulation Period, the floating allocation percentages for all
other outstanding series of investor certificates in their revolving periods and
the principal allocation percentages for all other outstanding series in their
amortization or early amortization periods and the variable funding percentage
exceeds 100%, then the principal collections shall be allocated among all series
and the variable funding interest pro rata on the basis of these floating
allocation percentages, principal allocation percentages and the variable
funding percentage.
DISCOUNT OPTION
The pooling and servicing agreement provides that the depositor may at any
time designate a fixed percentage of the amount of collections on receivables
arising in the Accounts on and after the date of the designation that otherwise
would be treated as principal collections to be treated as Non-Principal
Collections. The depositor must provide 10 days' prior written notice to the
S-33
<Page>
servicer, the trustee, the financial guaranty insurer and each Rating Agency of
any of these designations, and these designations will become effective on the
date specified in the written notice only if an officer's certificate is
delivered to the trustee to the effect that in the reasonable belief of the
depositor the designation would not result in an Early Amortization Event or
have a materially adverse effect on the Class A certificateholders and if the
Rating Agency Condition is satisfied.
INVESTOR CHARGE-OFFS
If the Available Subordinated Amount is reduced to zero, and on any
distribution date the Deficiency Amount is greater than zero, the Invested
Amount will be reduced by the excess of this Deficiency Amount over any
remaining Available Subordinated Amount on the related Determination Date, but
not by more than the portion of the Defaulted Amount allocated to the Class A
Certificates for that distribution date. Any reduction in the Invested Amount
may have the effect of slowing or reducing the return of principal on your Class
A Certificates. If the Invested Amount has been reduced by any Investor
Charge-Offs, it will subsequently be increased on any distribution date, but not
by an amount in excess of the aggregate Investor Charge-Offs, by the sum of the
Series 2003-3 Investor Allocation Percentage of Miscellaneous Payments for that
distribution date plus the amount of Excess Servicing allocated and available
for that purpose as described above. The financial guaranty insurance policy
guarantees the payment in full of the outstanding principal amount of the Class
A Certificates on the legal final payment date, notwithstanding the occurrence
of any reduction in the Invested Amount by any Investor Charge-Offs. No
principal amounts will be paid under the financial guaranty insurance policy
until the legal final payment date unless the financial guaranty insurer elects,
in its sole discretion, to make such payments on an earlier date.
OPTIONAL REPURCHASE
On any distribution date occurring on or after the date on which the
Invested Amount is reduced to 10% or less of the initial aggregate principal
balance of the Class A Certificates, the depositor will have the option, subject
to specified conditions, to repurchase the entire amount of the Class A
Certificates. The purchase price will be equal to the sum of the outstanding
principal balance of the Class A Certificates on that distribution date, accrued
and unpaid interest due on those Class A Certificates together with interest on
overdue Class A Monthly Interest to the extent lawfully payable on the date of
this repurchase plus all amounts owing to the financial guaranty insurer. The
purchase price will be deposited in the collection account in immediately
available funds on the distribution date on which the depositor exercises this
option. Following any deposit of this type, the Class A certificateholders will
have no further rights under the Class A Certificates, other than the right to
receive the final distribution on the Class A Certificates. In the event that
the depositor fails for any reason to deposit this purchase price, payments will
continue to be allocated to the Class A Certificates as described above under
' -- Distributions from the Collection Account; Reserve Fund; Principal
Account.'
EARLY AMORTIZATION EVENTS
Starting on the first distribution date following the calendar month in
which an Early Amortization Event has occurred, principal collections allocable
to the Class A Certificates will no longer be allocated to any other series or
to the BCRC Certificate but instead will be allocated to the Class A
Certificates monthly on each distribution date, except as described below in
this section.
An Early Amortization Event refers to any of the events so defined in the
prospectus and any of the following events:
1. on any distribution date, the Available Subordinated Amount is less
than the Required Subordinated Amount, after giving effect to the
distributions to be made on that distribution date;
S-34
<Page>
2. on any distribution date, the balance of the reserve fund is less
than the Reserve Fund Required Amount, in each case after giving effect to
all deposits and distributions on that distribution date;
3. the ratio, expressed as a percentage, of the average for each month
of the net losses on the receivables in the trust, that is, gross losses
less recoveries on any receivables, including, without limitation,
recoveries from security granted by obligors in addition to the products
financed by the receivables, recoveries from manufacturers, distributors or
importers and insurance proceeds, during any three consecutive calendar
months to the average of the month-end Pool Balances for that three-month
period, exceeds 5% on an annualized basis; provided, that this clause (3)
may be revised or waived without the consent of the Class A
certificateholders if the Rating Agency Condition is satisfied;
4. the percentage obtained by dividing the aggregate principal
collections for three consecutive calendar months by the average daily Pool
Balance for those three consecutive calendar months:
(a) for the three consecutive calendar months ended January through
March of any calendar year is less than 12% and
(b) for the three consecutive calendar months ended April of any
calendar year is less than 13% and
(c) for the three consecutive calendar months ended July through
August of any calendar year is less than 18% and
(d) for any other three consecutive calendar months is less than 14%,
provided, that this clause (4) may be revised or waived without the
consent of the Class A certificateholders if the Rating Agency Condition
is satisfied;
5. the failure to pay the outstanding principal amount of the Class A
Certificates on the December 2005 distribution date;
6. the sum of all Eligible Investments and amounts on deposit in the
excess funding account for this series and excess funding accounts for all
other series represents more than 25% of the total assets of the trust on
each of three or more consecutive distribution dates, after giving effect to
all payments made or to be made on those distribution dates;
7. during any four month period starting June 1, October 1 or February 1
of any year, more than 10% of the aggregate principal amount of receivables
that were originated and transferred to the trust during the four month
period starting sixteen months before the four month period starting June 1,
October 1 or February 1 which is under consideration and are then owned by
the trust have not been paid in full within 491 days following the date of
origination thereof;
8. an event of default shall occur and be continuing under the Insurance
Agreement, including, but not limited to, events relating to certain
breaches of representations, warranties and covenants of the Depositor and
the Seller under the Insurance Agreement, the occurrence of an early
amortization event with respect to other outstanding series, defaults by the
Depositor or the Seller on certain indebtedness, and the occurrence of a
change of control with respect to the Depositor, the Seller or the Servicer,
and, in each case, the financial guaranty insurer has declared such event of
default to be an Early Amortization Event; or
9. any draw shall have been made under the financial guaranty insurance
policy.
Immediately upon the occurrence of any event described above or in the
prospectus, an Early Amortization Event will be deemed to have occurred without
any notice or other action on the part of any other party. The Early
Amortization Period will commence as of the day on which the Early Amortization
Event occurs. Monthly distributions of principal on the Class A Certificates
will begin on the first distribution date following the calendar month in which
an Early Amortization Period has commenced.
S-35
<Page>
Following the occurrence of an Early Amortization Event, the financial
guaranty insurer will be entitled to withdraw amounts on deposit in accounts
established for the benefit of the Class A certificateholders to pay amounts due
in accordance with the allocations described herein. In addition, so long as no
Insurer Default shall have occurred and be continuing, the financial guaranty
insurer may, at its option, elect to pay all or a portion of the outstanding
balance of the Class A Certificates, which will cause an early payment of all or
a portion of the outstanding amount of the Class A Certificates, plus any
accrued interest on that portion of the Class A Certificates that is paid.
VOTING RIGHTS
Unless an Insurer Default has occurred and is continuing, the financial
guaranty insurer will generally be deemed to be the sole registered holder of
the Class A Certificates for the purpose of exercising voting rights and the
giving of any consents, approvals, instructions, directions, declarations and
notices relating to the Class A Certificates.
An 'Insurer Default' includes the occurrence and continuance of any of the
following events:
(a) the financial guaranty insurer's failure to make a required policy
payment;
(b) the financial guaranty insurer's:
filing or commencing of a petition or any case or proceeding
under any provision or chapter of the United States
Bankruptcy Code or any other similar federal or state law
relating to insolvency, bankruptcy, rehabilitation,
liquidation or reorganization;
general assignment for the benefit of its creditors; or
having an order for relief entered against it under the
United States Bankruptcy Code or any other similar federal
or state law relating to insolvency, bankruptcy,
rehabilitation, liquidation or reorganization which is final
and nonappealable; or
(c) the entering of a final and nonappealable order, judgment or decree
by a court of competent jurisdiction, the New York Department of insurance
or other competent regulatory authority:
appointing a custodian, trustee, agent or receiver for the
financial guaranty insurer or for all or any material
portion of its property; or
authorizing a custodian, trustee, agent or receiver to take
possession of the financial guaranty insurer or to take
possession of all or any material portion of the property of
the financial guaranty insurer.
TERMINATION
The last payment of principal and interest on the Class A Certificates will
be due and payable no later than the December 2007 distribution date. In the
event that the Invested Amount is greater than zero on the December 2007
distribution date, the trustee, at the direction of the financial guaranty
insurer, will use its best efforts to sell or cause to be sold an interest in
the Pool Balance then represented by the Class A Certificates. The net proceeds
of this sale will be paid pro rata to Class A certificateholders as of the
December 2007 distribution date, up to the amount necessary to pay principal of
and accrued and unpaid interest on outstanding Class A Certificates, as the
final payment of the Class A Certificates. If the net proceeds are insufficient
to pay principal of the outstanding Class A Certificates, the financial guaranty
insurance policy guarantees payment of principal of the Class A Certificates on
the legal final payment date, unless the financial guaranty insurer elects, in
its sole discretion, to make such payments on an earlier date.
SERVICING FEE
The Monthly Servicing Fee for your series will be equal to one-twelfth of
the product of 2%, if Bombardier Capital Inc. is the servicer, or 3%, if
Bombardier Capital Inc. is not the servicer
S-36
<Page>
multiplied by the Invested Amount as of the last day of the second preceding
calendar month, provided that the Monthly Servicing Fee for the first
distribution date will be equal to $0 and the Monthly Servicing Fee for the
second distribution date will be equal to $[ ]. A portion of the Monthly
Servicing Fee, designated as the Net Servicing Fee, will be payable in the
priority set forth above in ' -- Distribution from the Collection Account;
Reserve Fund; Principal Account'. The Net Servicing Fee will be equal to
one-twelfth of the product of 1%, if Bombardier Capital Inc. is the servicer, or
2%, if Bombardier Capital Inc. is not the servicer, or for any distribution date
for which the Monthly Servicing Fee has been waived, 0% multiplied by the
Invested Amount as of the last day of the second preceding calendar month,
provided that the Net Servicing Fee for the first distribution date will be
equal to $0 and the Net Servicing Fee for the second distribution date will be
equal to $[ ].
The portion of the Monthly Servicing Fee in excess of the Net Servicing Fee
will be payable at a lower priority level after provision is made for any
required deposit to the reserve fund and for allocations for the portion of the
Defaulted Amount allocated to the Class A Certificates as set forth above in
' -- Distribution from the Collection Account; Reserve Fund; Principal Account.'
The remainder of the servicing fee not allocable to the Class A Certificates
will be paid by the holders of the variable funding certificate and the BCRC
Certificate and the holders of the certificates of other outstanding series. The
Monthly Servicing Fee will be payable to the servicer solely to the extent
amounts are available to it for distribution under the terms of the
Series 2003-3 supplement to the pooling and servicing agreement.
REPORTS
On each distribution date, the trustee will forward or cause to be forwarded
to the financial guaranty insurer and each Class A certificateholder of record
(which is expected to be only Cede & Co., as nominee for The Depository Trust
Company, unless definitive certificates are issued) a statement prepared by the
servicer setting forth information regarding the Class A Certificates and the
receivables including the following, which, where appropriate, will be stated on
the basis of an original principal amount of $1,000 per Class A Certificate:
(1) the aggregate amount of principal paid or distributed on the Class
A Certificates and the aggregate amount of interest paid or distributed on
those Class A Certificates on that distribution date;
(2) the average for the dates on which the servicer receives
collections in the relevant calendar month of the Floating Allocation
Percentage and the Principal Allocation Percentage;
(3) the portion of the Defaulted Amount allocated to the Class A
Certificates for that distribution date;
(4) the Required Subordination Draw Amount, if any, for that
distribution date;
(5) the amount of the Investor Charge-Offs and the amounts of
reimbursements of Investor Charge-Offs for the preceding calendar month;
(6) the Pool Balance;
(7) the outstanding principal amount of Class A Certificates after
giving effect to distributions on that date;
(8) the applicable Class A Certificate Rate;
(9) the amount of the Monthly Servicing Fee for the preceding calendar
month;
(10) a fraction expressed as a percentage calculated to eleven decimal
places, the numerator of which is the Invested Amount and the denominator of
which is the Adjusted Invested Amount as of that distribution date,
determined after taking into account any reduction in the Invested Amount
that will occur on that distribution date;
(11) the Available Subordinated Amount for that distribution date;
(12) the reserve fund balance for that distribution date;
S-37
<Page>
(13) the excess funding account balance;
(14) the collection account balance with respect to that distribution
date;
(15) the principal account balance;
(16) the amounts drawn on the policy with respect to that distribution
date; and
(17) whether an Early Amortization Event has occurred.
DESCRIPTION OF THE FINANCIAL GUARANTY INSURER
The following information has been supplied by the financial guaranty
insurer for inclusion in this prospectus supplement. No representation is made
by the issuer, the depositor, the servicer or the trustee as to the accuracy or
completeness of the information.
The financial guaranty insurer accepts no responsibility for the accuracy or
completeness of this prospectus supplement or any other information or
disclosure contained herein, or omitted herefrom, other than with respect to the
accuracy of the information regarding the financial guaranty insurer and its
affiliates set forth under this heading. In addition, the financial guaranty
insurer makes no representation regarding the Class A Certificates or the
advisability of investing in the Class A Certificates.
GENERAL
XL Capital Assurance Inc. (the 'financial guaranty insurer' or 'XLCA') is a
monoline financial guaranty insurance company incorporated under the laws of the
State of New York. The financial guaranty insurer is currently licensed to do
insurance business in, and is subject to the insurance regulation and
supervision by, the State of New York, forty-seven other states, the District of
Columbia, Puerto Rico, the U.S. Virgin Islands and Singapore. The financial
guaranty insurer has license applications pending, or intends to file an
application, in each of those states in which it is not currently licensed.
The financial guaranty insurer is an indirect wholly owned subsidiary of XL
Capital Ltd, a Cayman Islands corporation ('XL Capital Ltd'). Through its
subsidiaries, XL Capital Ltd is a leading provider of insurance and reinsurance
coverages and financial products to industrial, commercial and professional
service firms, insurance companies and other enterprises in a worldwide basis.
The common stock of XL Capital Ltd is publicly traded in the United States and
listed on the New York Stock Exchange (NYSE:XL). XL CAPITAL LTD IS NOT OBLIGED
TO PAY THE DEBTS OF OR CLAIMS AGAINST THE FINANCIAL GUARANTY INSURER.
The financial guaranty insurer was formerly known as The London Assurance of
America Inc. ('London'), which was incorporated on July 25, 1991 under the laws
of the State of New York. On February 22, 2001, XL Reinsurance America Inc. ('XL
Re') acquired 100% of the stock of London. XL Re merged its former financial
guaranty subsidiary, known as XL Capital Assurance Inc. (formed September 13,
1999) with and into London, with London as the surviving entity. London
immediately changed its name to XL Capital Assurance Inc. All previous business
of London was 100% reinsured to Royal Indemnity Company, the previous owner at
the time of acquisition.
REINSURANCE
The financial guaranty insurer has entered into a facultative quota share
reinsurance agreement with XL Financial Assurance Ltd ('XLFA'), an insurance
company organized under the laws of Bermuda, and an affiliate of the financial
guaranty insurer. Pursuant to this reinsurance agreement, the financial guaranty
insurer expects to cede up to 90% of its business to XLFA. The financial
guaranty insurer may also cede reinsurance to third parties on a
transaction-specific basis, which cessions may be any or a combination of quota
share, first loss or excess of loss. Such reinsurance is used by the financial
guaranty insurer as a risk management device and to comply with statutory and
rating agency requirements and does not alter or limit the financial guaranty
S-38
<Page>
insurer's obligations under any financial guaranty insurance policy. With
respect to any transaction insured by XLCA, the percentage of risk ceded to XLFA
may be less than 90% depending on certain factors including, without limitation,
whether XLCA has obtained third party reinsurance covering the risk. As a
result, there can be no assurance as to the percentage reinsured by XLFA of any
given financial guaranty insurance policy issued by XLCA, including the
financial guaranty insurance policy.
Based on the audited financials of XLFA, as of December 31, 2002, XLFA had
total assets, liabilities, redeemable preferred shares and shareholders' equity
of $611,791,000, $245,750,000, $39,000,000 and $327,041,000, respectively,
determined in accordance with generally accepted accounting principles in the
United States. XLFA's insurance financial strength is rated 'Aaa' by Moody's and
'AAA' by S&P and Fitch Inc. In addition, XLFA has obtained a financial
enhancement rating of 'AAA' from S&P.
The obligations of XLFA to the financial guaranty insurer under the
reinsurance agreement described above are unconditionally guaranteed by XL
Insurance (Bermuda) Ltd ('XLI'), a Bermuda company and one of the world's
leading excess commercial insurers. XLI is a wholly owned indirect subsidiary of
XL Capital Ltd. In addition to having an 'A+' rating from A.M. Best, XLI's
insurance financial strength rating is 'Aa2' by Moody's and 'AA' by Standard &
Poor's and Fitch. The ratings of XLFA and XLI are not recommendations to buy,
sell or hold securities, including the Class A Certificates and are subject to
revision or withdrawal at any time by Moody's, Standard & Poor's or Fitch.
Notwithstanding the capital support provided to the financial guaranty
insurer described in this section, the holders of the Class A Certificates will
have direct recourse against the financial guaranty insurer only, and neither
XLFA nor XLI will be directly liable to the holders of the Class A Certificates.
FINANCIAL STRENGTH AND FINANCIAL ENHANCEMENT RATINGS OF XLCA
The financial guaranty insurer's insurance financial strength is rated 'Aaa'
by Moody's and 'AAA' by Standard & Poor's and Fitch, Inc. ('Fitch'). In
addition, XLCA has obtained a financial enhancement rating of 'AAA' from
Standard & Poor's. These ratings reflect Moody's, Standard & Poor's and Fitch's
current assessment of the financial guaranty insurer's creditworthiness and
claims-paying ability as well as the reinsurance arrangement with XLFA described
under 'Reinsurance' above.
The above ratings are not recommendations to buy, sell or hold securities,
including the Class A Certificates and are subject to revision or withdrawal at
any time by Moody's, Standard & Poor's or Fitch. Any downward revision or
withdrawal of these ratings may have an adverse effect on the market price of
the Class A Certificates. The financial guaranty insurer does not guaranty the
market price of the Class A Certificates nor does it guaranty that the ratings
on the Class A Certificates will not be revised or withdrawn.
CAPITALIZATION OF THE FINANCIAL GUARANTY INSURER
Based on the audited statutory financial statements for XLCA as of December
31, 2001, XLCA had total admitted assets of $158,442,157, total liabilities of
$48,899,461 and total capital and surplus of $109,542,696 determined in
accordance with statutory accounting practices prescribed or permitted by
insurance regulatory authorities ('SAP'). Based on the audited statutory
financial statements for XLCA as of December 31, 2002 filed with the State of
New York Insurance Department, XLCA has total admitted assets of $180,993,189,
total liabilities of $58,685,217 and total capital and surplus of $122,307,972
determined in accordance with SAP.
For further information concerning XLCA and XLFA, see the financial
statements of XLCA and XLFA, and the notes thereto, incorporated by reference in
this prospectus supplement. The financial statements of XLCA and XLFA are
included as exhibits to the periodic reports filed with the Securities and
Exchange Commission (the 'Commission') by XL Capital Ltd and may be reviewed at
the EDGAR website maintained by the Commission. All financial statements of
S-39
<Page>
XLCA and XLFA included in, or as exhibits to, documents filed by XL Capital Ltd
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934 on or prior to the date of this prospectus supplement, or after the date of
this prospectus supplement but prior to termination of the offering of the Class
A Certificates, shall be deemed incorporated by reference in this prospectus
supplement. Except for the financial statements of XLCA and XLFA, no other
information contained in XL Capital Ltd's reports filed with the Commission is
incorporated by reference. Copies of the statutory quarterly and annual
statements filed with the State of New York Insurance Department by XLCA are
available upon request to the State of New York Insurance Department.
REGULATION OF THE FINANCIAL GUARANTY INSURER
The financial guaranty insurer is regulated by the Superintendent of
Insurance of the State of New York. In addition, the financial guaranty insurer
is subject to regulation by the insurance laws and regulations of the other
jurisdictions in which it is licensed. As a financial guaranty insurance company
licensed in the State of New York, the financial guaranty insurer is subject to
Article 69 of the New York Insurance Law, which, among other things, limits the
business of each financial guaranty insurer to financial guaranty insurance and
related lines, prescribes minimum standards of solvency, including minimum
capital requirements, establishes contingency, loss and unearned premium reserve
requirements, requires the maintenance of minimum surplus to policyholders and
limits the aggregate amount of insurance which may be written and the maximum
size of any single risk exposure which may be assumed. The financial guaranty
insurer is also required to file detailed annual financial statements with the
New York Insurance Department and similar supervisory agencies in each of the
other jurisdictions in which it is licensed.
The extent of state insurance regulation and supervision varies by
jurisdiction, but New York and most other jurisdictions have laws and
regulations prescribing permitted investments and governing the payment of
dividends, transactions with affiliates, mergers, consolidations, acquisitions
or sales of assets and incurrence of liabilities for borrowings.
THE FINANCIAL GUARANTY INSURANCE POLICIES ISSUED BY THE FINANCIAL GUARANTY
INSURER, INCLUDING THE FINANCIAL GUARANTY INSURANCE POLICY, ARE NOT COVERED BY
THE PROPERTY/CASUALTY INSURANCE SECURITY FUND SPECIFIED IN ARTICLE 76 OF THE NEW
YORK INSURANCE LAW.
The principal executive offices of the financial guaranty insurer are
located at 1221 Avenue of the Americas, New York, New York 10020 and its
telephone number at this address is (212) 478-3400.
THE FINANCIAL GUARANTY INSURANCE POLICY
On the closing date, XL Capital Assurance Inc. will issue a financial
guaranty insurance policy pursuant to the provisions of the Insurance Agreement
to be dated as of the closing date among the seller, the servicer, the
depositor, the financial guaranty insurer and the trustee on behalf of the
trust.
The financial guaranty insurance policy will irrevocably and unconditionally
guarantee payment to the trustee for the benefit of the Class A
Certificateholders of the timely, full and complete payment of (a) on each
distribution date, interest due on the Class A Certificates and (b) on the legal
final payment date, the outstanding principal balance of the Class A
Certificates together with interest thereon.
The financial guaranty insurance policy does not cover loss of any
prepayment or other acceleration payment, unless the financial guaranty insurer
elects, in its sole discretion, to pay such amounts in whole or in part, or any
shortfalls attributable to the liability of the issuer or the trustee for
withholding taxes (including interest and penalties in respect of any liability
for withholding taxes).
S-40
<Page>
The trustee will give written notice of any claims on the financial guaranty
insurance policy to the financial guaranty insurer. Delivery of notice of a
claim either on a day that is not a business day or after 10:00 a.m., New York
City time, will be deemed to be received by the financial guaranty insurer at
9:00 a.m., New York City time, on the next succeeding business day. Payment of
claims on the financial guaranty insurance policy to the trustee will be made by
the financial guaranty insurer following receipt by the financial guaranty
insurer of the appropriate notice for payment, not later than 2:00 p.m., New
York City time, on the later of (a) one business day following receipt of the
notice for payment or (b) the scheduled distribution date.
If payment of any amount guaranteed by the financial guaranty insurer
pursuant to the financial guaranty insurance policy is avoided as a preference
payment under applicable bankruptcy, insolvency, receivership or similar law in
the event of an insolvency of the servicer, the seller or the issuer, the
financial guaranty insurer will pay such amount pursuant to the series
supplement to the pooling and servicing agreement without regard to acceleration
and prepayment, upon payment of the avoided amount and following receipt by the
financial guaranty insurer from the trustee of:
(1) a certified copy of the order of the court or other governmental
body which exercised jurisdiction to the effect that the trustee is required
to return the amount of any interest or principal payment distributed with
respect to the Class A Certificates during the term of the financial
guaranty insurance policy because such distributions were avoidable
preference payments under applicable bankruptcy law, with respect to which
the appeal period has expired without an appeal having been filed;
(2) a notice for payment in the form specified by the financial guaranty
insurance policy; and
(3) an assignment duly executed and delivered by the Class A
Certificateholders, in such form as is reasonably required by the financial
guaranty insurer and provided to the Class A Certificateholders by the
financial guaranty insurer, irrevocably assigning to the financial guaranty
insurer all rights and claims of the Class A Certificateholders relating to
or arising under the Class A Certificates against the issuer.
Such payment will be disbursed to the receiver, conservator,
debtor-in-possession or trustee in bankruptcy named in the order and not to the
trustee or the Class A Certificateholders directly, as the case may be. However,
if the trustee or the Class A Certificateholders have made payment of the
preference amount to the receiver, conservator, debtor-in-possession or trustee
in bankruptcy named in the order, such payment will be made to the trustee for
distribution to the Class A Certificateholders.
The financial guaranty insurer's obligations under the financial guaranty
insurance policy in respect of guaranteed distributions will be discharged to
the extent funds are transferred to the trustee as provided in the financial
guaranty insurance policy or deposited into the collection account, whether or
not such funds are properly applied by the trustee.
The financial guaranty insurer will be subrogated to the rights of each
Class A Certificateholder to receive payments of principal and interest, as
applicable, with respect to distributions on the Class A Certificates to the
extent of any payment by the financial guaranty insurer under the financial
guaranty insurance policy.
The terms of the financial guaranty insurance policy cannot be modified,
altered or affected by any other agreement or instrument without the consent of
the trustee and the financial guaranty insurer. The financial guaranty insurance
policy by its terms may not be cancelled or revoked. The financial guaranty
insurance policy is governed by the laws of the State of New York.
THE INSURANCE POLICY IS NOT COVERED BY THE PROPERTY CASUALTY INSURANCE
SECURITY FUND SPECIFIED IN ARTICLE 76 OF THE NEW YORK INSURANCE LAW.
Unless the financial guaranty insurer has failed to make a required payment
after a payment is due under the financial guaranty insurance policy or the
financial guaranty insurer becomes the
S-41
<Page>
subject of certain insolvency events, the financial guaranty insurer will be
deemed to be the holder of the Class A Certificates for certain purposes (other
than with respect to payments on the Class A Certificates) and will be entitled
to exercise all rights of the Class A Certificateholders without the consent of
the Class A Certificateholders. In addition, the financial guaranty insurer is
an express third-party beneficiary of the series supplement to the pooling and
servicing agreement.
In the absence of payments under the financial guaranty insurance policy,
Class A Certificateholders will bear directly the credit and other risks
associated with their Class A Certificates.
UNDERWRITING
Subject to the terms and conditions of the Underwriting Agreement among the
depositor, Bombardier Capital Inc. and the underwriters named below relating to
the Class A Certificates, the depositor has agreed to sell to the underwriters,
and each underwriter has agreed to purchase the principal amount of Class A
Certificates set forth opposite its name below.
<Table>
<Caption>
PRINCIPAL AMOUNT
OF CLASS A
UNDERWRITERS CERTIFICATES
- ------------ ------------
Banc One Capital Markets, Inc............................... $ [ ]
JPMorgan Securities Inc..................................... $ [ ]
Citigroup Global Markets Inc................................ $ [ ]
BNP Paribas Securities Corp................................. $ [ ]
------------
Total................................................... $ [ ]
------------
------------
</Table>
The depositor has been advised that the underwriters propose initially to
offer the Class A Certificates to the public at the offering price set forth
below. The depositor has been advised that the underwriters propose initially to
offer the Class A Certificates to specified dealers at the offering price less a
selling concession not to exceed the percentage of the certificate denomination
set forth below, and that the underwriters may allow and these dealers may
reallow a reallowance discount not to exceed the percentage of the certificate
denomination set forth below:
<Table>
<Caption>
UNDERWRITING SELLING REALLOWANCE
CLASS OF CERTIFICATE PRICE TO PUBLIC DISCOUNT CONCESSION DISCOUNT
- -------------------- --------------- -------- ---------- --------
Class A.............................. 100.00% [ ]% [ ]% [ ]%
</Table>
After the initial public offering, the public offering price, these
concessions and this discount may be changed.
The depositor has been advised by each underwriter that it intends to make a
market in the Class A Certificates, but no underwriter has any obligation to do
so. There can be no assurance that a secondary market for the Class A
Certificates will develop or, if it does develop, that it will continue or that
the secondary market will provide sufficient liquidity to the Class A
certificateholders.
Until the distribution of the Class A Certificates is completed, rules of
the Securities and Exchange Commission may limit the ability of the underwriters
and specified selling group members to bid for and purchase the Class A
Certificates. As an exception to these rules, the underwriters are permitted to
engage in specified transactions that stabilize the price of the Class A
Certificates. These transactions consist of bids or purchases for the purpose of
pegging, fixing or maintaining the price of the Class A Certificates.
In general, purchases of a security for the purpose of stabilization or to
reduce a short position could cause the price of the security to be higher than
it might be in the absence of these purchases.
Neither the depositor nor any of the underwriters makes any representation
or prediction as to the direction or magnitude of any effect that the
transactions described above in this section
S-42
<Page>
may have on the price of the Class A Certificates. In addition, neither the
depositor nor any of the underwriters makes any representation that the
underwriters will engage in these transactions or that these transactions, once
commenced, will not be discontinued without notice.
The depositor and Bombardier Capital Inc. have agreed to indemnify the
underwriters against, or make contributions to the underwriters with respect to,
specified liabilities, including liabilities under the Securities Act of 1933,
as amended. There is no limitation on the obligation to indemnify for the
underwriter's liabilities.
LEGAL MATTERS
Specified legal matters will be passed upon for the depositor and the trust
by Sidley Austin Brown & Wood LLP, New York, New York and for the underwriters
by McKee Nelson LLP, New York, New York. Specified federal income tax matters
will be passed upon for the depositor and the trust by Sidley Austin Brown &
Wood LLP, New York, New York.
WHERE YOU CAN FIND MORE INFORMATION
We have filed a registration statement under the Securities Act of 1933, as
amended, with the Securities and Exchange Commission for the certificates
offered by this prospectus supplement and the accompanying prospectus. This
prospectus supplement and the accompanying prospectus, which form part of the
registration statement, do not contain all of the information contained in the
registration statement and the exhibits to the registration statement. For
further information, reference is made to the registration statement and
amendments and exhibits to the registration statement, which are available for
inspection without charge at the Public Reference Facilities maintained by the
Securities and Exchange Commission at 450 Fifth Street, N.W., Washington, D.C.
20549, and the Securities and Exchange Commission's Midwest Regional Office at
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661
and the Northeast Regional Office at 233 Broadway, New York, New York 10279.
Copies of the registration statement and amendments and exhibits to the
registration statement may be obtained from the Public Reference Section of the
Securities and Exchange Commission at 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. In addition, the Securities and Exchange Commission
maintains a public access site on the Internet through the World Wide Web at
which site reports, proxy and information statements and other information
regarding registrants, including all electronic filings, may be viewed. The
Internet address of the Securities and Exchange Commission's World Wide Web site
is http://www.sec.gov.
REPORTS TO CLASS A CERTIFICATEHOLDERS
Unless and until definitive certificates are issued, monthly and annual
unaudited reports, containing information concerning the trust, which reports
will be substantially based upon information provided by the servicer, will be
sent on behalf of the trust to Cede & Co., as nominee of The Depository Trust
Company and registered holder of the Class A Certificates. These reports may be
available to beneficial owners of Class A Certificates in accordance with the
regulations and procedures of The Depository Trust Company. See 'Description of
the Certificates -- Reports' and ' -- Evidence as to Compliance' in the
prospectus.
These reports will not constitute financial statements prepared in
accordance with generally accepted accounting principles.
The trust will file with the Securities and Exchange Commission those
periodic reports with respect to the trust as are required under the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission thereunder.
EXPERTS
The consolidated balance sheets of XLCA as of December 31, 2002 and December
31, 2001 and the related consolidated statements of operations and comprehensive
income, changes in shareholder's equity, and cash flows for each of the three
years in the period ended December 31, 2002, incorporated by reference in this
prospectus supplement, have been incorporated in this
S-43
<Page>
prospectus supplement in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
The balance sheets of XLFA as of December 31, 2002 and December 31, 2001 and
the related statements of operations and comprehensive income, changes in
shareholders' equity, and cash flows for each of the three years in the period
ended December 31, 2002, incorporated by reference in this prospectus
supplement, have been incorporated in this prospectus supplement in reliance on
the report of PricewaterhouseCoopers, independent accountants, given on the
authority of that firm as experts in accounting and auditing.
S-44
<Page>
GLOSSARY
'ACCOUNTS' means the accounts designated to the trust and identified in the
computer file or microfiche or written list delivered to the trustee on the date
of issuance of the first series of certificates under the pooling and servicing
agreement plus all Additional Accounts less any accounts which have been removed
from the trust.
'ACCUMULATION PERIOD COMMENCEMENT DATE' means July 2005, if the Accumulation
Period Length is five months; August 2005, if the Accumulation Period Length is
four months; September 2005, if the Accumulation Period Length is three months;
October 2005, if the Accumulation Period Length is two months; and November
2005, if the Accumulation Period Length is one month; provided, however, if the
Accumulation Period Length has been determined to be less than five months and,
after this determination, any outstanding series enters into an early
amortization period, the Accumulation Period Commencement Date shall be the
earlier of the date that this outstanding series entered into its early
amortization period and the Accumulation Period Commencement Date, as previously
determined.
'ACCUMULATION PERIOD LENGTH' means a number of months, not to exceed five
nor to be less than one, determined on the first business day of July 2005 and
determined again on the first business day of August 2005 and again on the first
business day of September 2005 and again on the first business day of October
2005; the Accumulation Period Length shall be the number of months derived by
rounding upwards to the next integer, but not to more than 5.0, the result
derived by dividing (i) 500,000,000, by (ii) the product of (x) a fraction the
numerator of which is the sum of the Invested Amount plus the invested amounts
as of such date of calculation of all other outstanding series whose respective
revolving periods are not scheduled to end before the last day of November 2005
and the denominator of which is the Invested Amount plus the invested amount for
all other outstanding series times (y) the average amount of principal
collections for each of the most recently ended three calendar months, provided
however that the Accumulation Period Length will be fixed at 5.0 if, as
calculated on the first business day of July 2005 it equals 5.0, will be fixed
at 4.0 if, as calculated on the first business day of August 2005 it equals 4.0,
will be fixed at 3.0 if, as calculated on the first business day of September
2005 it is equal to or greater than 3.0, and will be fixed at 2.0 if, as
calculated on the first business day of October 2005 it is equal to or greater
than 2.0; provided further that on any of the dates used in this definition, the
servicer may designate an Accumulation Period Length greater than required but
not to exceed the lesser of (x) five months and (y) the number of months
remaining from such date of determination until the last day of November 2005.
'ADDITIONAL ACCOUNTS' means any accounts designated by the depositor to be
included in the trust under the terms of the pooling and servicing agreement in
addition to those designated at the time of the first series of certificates.
'ADJUSTED INVESTED AMOUNT' means the initial principal amount of the Class A
Certificates plus the amount of any withdrawals from the excess funding account
in connection with an increase in receivables in the trust since the date of the
issuance of the Class A Certificates minus the amount of any additions to the
excess funding account in connection with a reduction in the receivables in the
trust since the date of the issuance of the Class A Certificates.
'ADJUSTMENT PAYMENT' means an amount payable by the depositor for deposit
into the collection account if the servicer adjusts downward the outstanding
principal balance of any Eligible Receivable because of a rebate, billing error,
refund or credit adjustment to an obligor, or because that receivable was
created in respect of a product which was refused or returned by an obligor, the
amount of this adjustment will be deducted from the Pool Balance; if the
adjustment reduces the Pool Balance below the Required Pool Balance on the
immediately preceding Determination Date, after giving effect to the
allocations, distributions, withdrawals and deposits to be made on the related
Distribution Date, the amount of the payment will be an amount equal to the
deficiency up to the amount of the adjustment.
S-45
<Page>
'AVAILABLE INVESTOR PRINCIPAL COLLECTIONS' for any distribution date means
the sum of
(1) the product of the Floating Allocation Percentage, for the Revolving
Period, or the Principal Allocation Percentage, for the Controlled
Accumulation Period or any Early Amortization Period, for each day in the
related calendar month multiplied by principal collections received by the
servicer during each day in the related calendar month,
(2) the amount, if any, of Investor Non-Principal Collections,
Investment Proceeds, funds in the reserve fund and Series 2003-3 Available
Retained Collections allocated to cover the portion of the Defaulted Amount
allocated to the Class A Certificates, any unpaid Adjustment Payments
allocated to the Class A Certificates or to reimburse Investor Charge-Offs,
(3) the Series 2003-3 Investor Allocation Percentage of Miscellaneous
Payments for that distribution date,
(4) Excess Principal Collections, if any, from other series allocated to
the Class A Certificates,
(5) if an Early Amortization Period began during the related calendar
month, any amounts on deposit in the excess funding account, and
(6) on the December 2005 distribution date or, following the occurrence
of an Early Amortization Event, at the direction of the financial guaranty
insurer, any funds remaining in the reserve fund, after the application of
funds in the reserve fund to cover shortfalls in Non-Principal Collections.
If the sum of the Floating Allocation Percentage during the Revolving Period
or the Principal Allocation Percentage (during the Early Amortization Period or
Controlled Accumulation Period), the floating allocation percentages for all
other outstanding series of investor certificates in their revolving periods and
the principal allocation percentages for all other outstanding series in their
amortization or early amortization periods and the variable funding percentage
exceeds 100%, then the principal collections will be allocated among all series
and the variable funding interest pro rata on the basis of these floating
allocation percentages, principal allocation percentages and the variable
funding percentage.
'AVAILABLE RETAINED COLLECTIONS' for any date on which the servicer receives
collections means the sum of the Available Retained Non-Principal Collections
for that date and the Available Retained Principal Collections for that date;
provided, however, that the Available Retained Collections will be zero for any
calendar month for which the Available Subordinated Amount is zero for the
distribution date occurring in that calendar month.
'AVAILABLE RETAINED NON-PRINCIPAL COLLECTIONS' for any date on which the
servicer receives collections means an amount equal to the product of the excess
of the Retained Percentage for that date over the Excess Retained Percentage for
that date and Non-Principal Collections for that date.
'AVAILABLE RETAINED PRINCIPAL COLLECTIONS' for any date on which the
servicer receives collections, means an amount equal to the product of the
excess of the Retained Percentage for that date over the Excess Retained
Percentage for that date and principal collections for that date.
'AVAILABLE SUBORDINATED AMOUNT' for any date of determination after the
first distribution date means an amount equal to the sum of:
the lesser of:
(1) the Available Subordinated Amount for the preceding distribution
date, minus, with some limitations, the Required Subordination Draw Amount
for the preceding distribution date or, if the date of determination is a
distribution date, that distribution date, minus the amount of any deposits
in the reserve fund from Series 2003-3 Available Retained Collections for
the purpose of reimbursing funds withdrawn from the reserve fund applied to
cover any portion of the Defaulted Amount allocated to the Class A
Certificates on the preceding distribution date or, if the date of
determination is a distribution date, that distribution date, minus an
amount equal to the Defaulted Amount for the immediately preceding calendar
month multiplied by a fraction, the numerator of which is the Available
Subordinated Amount
S-46
<Page>
as of the last day of the preceding calendar month (or in the case of the
first distribution date, the Required Subordinated Amount as of the day the
Class A Certificates are issued) and the denominator of which is the Pool
Balance as of the last day of the preceding calendar month (or in the case
of the first distribution date, the Pool Balance as of the date of issuance
of the Class A Certificates), plus the total amount of Excess Servicing paid
to the holder of the BCRC Certificate on the previous distribution date,
minus the Incremental Subordinated Amount for the second preceding
distribution date or if the date of determination is a distribution date,
the preceding distribution date, plus the Incremental Subordinated Amount
for the immediately preceding distribution date, or if the date of
determination is a distribution date, that distribution date, minus the MH
Incremental Subordinated Amount for the second preceding distribution date
or if the date of determination is a distribution date, the preceding
distribution date, plus the MH Incremental Subordinated Amount for the
immediately preceding distribution date or if the date of determination is a
distribution date, that distribution date, minus the Designated Manufacturer
Incremental Subordinated Amount for the second preceding distribution date
or if the date of determination is a distribution date, the preceding
distribution date, plus the Designated Manufacturer Incremental Subordinated
Amount for the immediately preceding distribution date, or if the date of
determination is a distribution date, that distribution date, minus the
Payment Rate Enhancement Amount for the second preceding distribution date
or if the date of determination is a distribution date, the preceding
distribution date, plus the Payment Rate Enhancement Amount for the
immediately preceding distribution date, or if the date of determination is
a distribution date, that distribution date, plus the percentage equivalent
of a fraction, the numerator of which is 8.5% and the denominator of which
is the excess of 100% over 8.5%, multiplied by the aggregate amount of any
increases in the Invested Amount resulting from any withdrawals from the
excess funding account since the preceding distribution date; and
(2) the Required Subordinated Amount for that date of determination; and
the amount of any optional increase in the Available
Subordinated Amount exercised by the depositor as described
in this prospectus supplement under 'Description of the
Class A Certificates -- Limited Subordination of Retained
Interest -- Available Subordinated Amount.'
The Available Subordinated Amount for any date of determination during the
period from the date the certificates are issued through the first distribution
date will equal the Required Subordinated Amount as of that date of
determination, which will equal at least $46,448,087 on the date the Class A
Certificates are issued.
'BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO' means the accounts
owned by Bombardier Capital Inc., whether or not they would be Eligible Accounts
and whether or not they have been added to the trust generating receivables as a
result of extensions of credit and advances made to dealers of consumer,
recreational and commercial products which dealers are located in the United
States.
'BCRC CERTIFICATE' means the certificate held by the depositor and
representing the Retained Interest.
'BUSINESS DAY' means any day other than (a) a Saturday or Sunday or (b)
another day on which banking institutions or trust companies in the State of New
York are authorized or obligated by law, executive order or governmental decree
to be closed.
'CLASS A CERTIFICATE RATE' means the annual rate at which interest accrues
on the principal balance of the Class A Certificates and will be equal to LIBOR
plus [ ]%.
'CLASS A MONTHLY INTEREST' for any distribution date means an amount equal
to the product of
the actual number of days elapsed in the related Interest
Period divided by 360 days and
the product of
(1) the Class A Certificate Rate and
S-47
<Page>
(2) the outstanding principal balance of the Class A Certificates as of
the close of business on the preceding distribution date, or for the first
distribution date, the date the Class A Certificates are issued, after
giving effect to any payments of principal on the Class A Certificates on
that preceding distribution date.
'COMMISSION' means the Securities and Exchange Commission.
'CONTROLLED ACCUMULATION AMOUNT' means for any distribution date an amount
sufficient together with a similar amount to be deposited on other distribution
dates in the Controlled Accumulation Period to pay the outstanding principal
balance of the Class A Certificates in full given the Accumulation Period
Length.
'CONTROLLED ACCUMULATION PERIOD' means, unless an Early Amortization Event
has occurred, the period beginning on the Accumulation Period Commencement Date
and ending upon the earliest to occur of:
(1) the start of an Early Amortization Period,
(2) payment in full of the outstanding principal balance of the Class A
Certificates, and
(3) the December 2005 distribution date.
'CONTROLLED DEPOSIT AMOUNT' means, for any distribution date, the sum of the
Controlled Accumulation Amount for that distribution date plus the amount by
which the sum of the Controlled Accumulation Amounts for all prior distribution
dates exceeds the amount on deposit in the principal account.
'DAILY ALLOCATION' means for any date the servicer receives collections:
(1) the product of the Floating Allocation Percentage for that date
multiplied by the aggregate amount of Non-Principal Collections on that
date, plus
(2) the Series 2003-3 Available Retained Collections for that date.
'DEFAULTED AMOUNT' for any calendar month means an amount which is not less
than zero equal to the aggregate principal amount of principal receivables that
became Defaulted Receivables during the preceding calendar month less the full
amount of the Defaulted Receivables which are subject to retransfer from the
trust to the depositor or purchased by the servicer for that calendar month
unless certain events of bankruptcy, insolvency, or receivership have occurred
with respect to either of the depositor or the servicer or unless an event of
bankruptcy, insolvency or receivership relating to Bombardier Capital Inc. or
the depositor has occurred, in which event the Defaulted Amount will not be
reduced for those Defaulted Receivables.
'DEFAULTED RECEIVABLES' on any distribution date are:
(1) all receivables other than receivables that were designated as
ineligible at the time of transfer to the trust that were charged off as
uncollectible in the preceding calendar month;
(2) all receivables originally secured by a security interest in a
related Eligible Product which have not been paid in full for more than 90
days after the sale of the related Eligible Product; and
(3) all receivables which, although they were Eligible Receivables when
transferred to the trust, arose in an Account which has become an Account
which is not an Eligible Account since this transfer and which were not
Eligible Receivables for any six consecutive distribution dates after this
Account became an Account which is not an Eligible Account.
Receivables are not Defaulted Receivables merely because they are no longer
Eligible Receivables.
'DEFICIENCY AMOUNT' means for each distribution date, the amount, if any, by
which
the sum of
(1) the Class A Monthly Interest for the distribution date,
(2) the Class A Monthly Interest accrued but not covered by the
financial guaranty insurance policy or paid with respect to prior
distribution dates and interest thereon,
(3) the Net Servicing Fee for the distribution date,
S-48
<Page>
(4) the premium due on the financial guaranty insurance policy and any
previously accrued and unpaid premium,
(5) the portion of the Defaulted Amount allocated to the Class A
Certificates for that distribution date, and
(6) the Series 2003-3 Investor Allocation Percentage of any Adjustment
Payment for the distribution date that has not been deposited in the
collection account as required under the pooling and servicing agreement,
exceeds
the sum of
(1) Investor Non-Principal Collections and Investment Proceeds for such
distribution date and
(2) if the amounts of Investor Non-Principal Collections and Investment
Proceeds are not sufficient to cover all amounts described above in (1)
through (6) of this definition, the amount of funds in the reserve fund on
such distribution date available to fund the remaining amounts.
'DESIGNATED MANUFACTURER' means (i) prior to the completion of the sale of
Bombardier Inc.'s recreational products division, Bombardier Inc. and its
subsidiaries and (ii) following the completion of the sale of Bombardier Inc.'s
recreational products division, Bombardier Recreational Products, Inc. or,
subject to satisfaction of the Rating Agency Condition, any other purchaser of
such division.
'DESIGNATED MANUFACTURER INCREMENTAL SUBORDINATED AMOUNT' means, for each
Distribution Date, an amount equal to the product of the Invested Amount
multiplied by the Designated Manufacturer Overconcentration Enhancement
Percentage.
'DESIGNATED MANUFACTURER OVERCONCENTRATION ENHANCEMENT PERCENTAGE' means, if
the Designated Manufacturer Percentage is greater than 30% as of such date, an
amount equal to the lesser of (i) one percent and (ii) the excess of the
Manufactured Housing Percentage over 30%.
'DESIGNATED MANUFACTURER OVERCONCENTRATIONS' on any distribution date means
the excess of the total amount of Eligible Receivables created in connection
with the financing of products manufactured by the Designated Manufacturer,
which Eligible Receivables are in the trust on the last day of the calendar
month immediately preceding that distribution date over 35% of the Pool Balance
on the last day of that immediately preceding calendar month. This percentage
and the manufacturers included in that calculation may be adjusted from time to
time without the consent of the Class A certificateholders, if the Rating Agency
Condition is satisfied.
'DESIGNATED MANUFACTURER PERCENTAGE' means, as of any date of determination,
the percentage equivalent of a fraction, the numerator of which is the aggregate
amount of Eligible Receivables created in connection with the financing of
products manufactured by the Designated Manufacturer as of such date, and the
denominator of which is the Pool Balance as of such date.
'DETERMINATION DATE' means, with respect to any distribution date, the day
that is two business days prior to that distribution date.
'EARLY AMORTIZATION EVENT' means any of the events so defined in the
prospectus and any of the following events:
(1) on any distribution date, the Available Subordinated Amount is less
than the Required Subordinated Amount, after giving effect to the
distributions to be made on that distribution date;
(2) on any distribution date, the balance of the reserve fund is less
than the Reserve Fund Required Amount, in each case after giving effect to
all deposits and distributions on that distribution date;
(3) the ratio, expressed as a percentage, of the average for each month
of the net losses on the receivables in the trust, that is, gross losses
less recoveries on any receivables, including, without limitation,
recoveries from security granted by obligors in addition to the
S-49
<Page>
products financed by the receivables, recoveries from manufacturers,
distributors or importers and insurance proceeds, during any three
consecutive calendar months to the average of the month-end Pool Balances
for that three-month period, exceeds 5% on an annualized basis; provided,
that this clause (3) may be revised or waived without the consent of the
Class A certificateholders if the Rating Agency Condition is satisfied;
(4) the percentage obtained by dividing the aggregate principal
collections for three consecutive calendar months by the average daily Pool
Balance for those three consecutive calendar months:
(a) for the three consecutive calendar months ended January through
March of any calendar year is less than 12% and
(b) for the three consecutive calendar months ended April of any
calendar year is less than 13% and
(c) for the three consecutive calendar months ended July through
August of any calendar year is less than 18% and
(d) for any other three consecutive calendar months is less than 14%,
provided, that this clause (4) may be revised or waived without the consent of
the Class A certificateholders if the Rating Agency Condition is satisfied;
(5) the failure to pay the outstanding principal amount of the class A
certificates on the December 2005 distribution date;
(6) the sum of all Eligible Investments and amounts on deposit in the
excess funding account for this series and excess funding accounts for all
other series represents more than 25% of the total assets of the trust on
each of three or more consecutive distribution dates, after giving effect to
all payments made or to be made on those distribution dates;
(7) during any four month period starting June 1, October 1 or February
1 of any year, more than 10% of the aggregate principal amount of
receivables that were originated and transferred to the trust during the
four month period starting sixteen months before the four month period
starting June 1, October 1 or February 1 which is under consideration and
are then owned by the trust have not been paid in full within 491 days
following the date of origination thereof; or
(8) an event of default shall occur and be continuing under the
Insurance Agreement, including, but not limited to, events relating to
certain breaches of representations, warranties and covenants of the
Depositor and the Seller under the Insurance Agreement, the occurrence of an
early amortization event with respect to other outstanding series, defaults
by the Depositor or the Seller on certain indebtedness, and the occurrence
of a change of control with respect to the Depositor, the Seller or the
Servicer, and, in each case, the financial guaranty insurer has declared
such event of default to be an Early Amortization Event; or
(9) any draw shall have been made under the financial guaranty insurance
policy.
'EARLY AMORTIZATION PERIOD' means the period beginning as of the day an
Early Amortization Event occurs and ending on the day on which payment in full
of the Invested Amount has been made to Class A certificateholders, unless the
Early Amortization Period shall terminate prior to that time as described under
'Description of the Class A Certificates -- Early Amortization Events' in this
prospectus supplement and under 'Description of the Certificates -- Early
Amortization Events' in the prospectus.
'ELIGIBLE ACCOUNT' means:
(1) each individual financing account established by Bombardier Capital
Inc. or established by an affiliate of Bombardier Capital Inc. or by a third
party -- but which satisfies Bombardier Capital Inc.'s customary
underwriting standards -- and acquired by Bombardier Capital Inc. or an
affiliate of Bombardier Capital Inc., with an obligor with respect to
Eligible Products pursuant to an inventory security agreement, in the
ordinary course of business, and
S-50
<Page>
(2) each individual line of credit or financing agreement extended by
Bombardier Capital Inc. (or an affiliate of Bombardier Capital Inc.) or by a
third party -- but which satisfies Bombardier Capital Inc.'s customary
underwriting standards -- and acquired by Bombardier Capital Inc. or an
affiliate of Bombardier Capital Inc. to an obligor for the purpose of
financing inventories and secured by assets of that obligor, which, in each
case, as of the date of determination thereof relates to an obligor that
satisfies the requirements of the pooling and servicing agreement and is in
existence and, after its establishment or acquisition by Bombardier Capital
Inc. or an affiliate of Bombardier Capital Inc., is maintained and serviced
by Bombardier Capital Inc.
'ELIGIBLE DEPOSIT ACCOUNT' means either (1) a segregated account with either
the corporate trust department of the trustee or with a depository institution
or trust company organized under the laws of the United States of America or any
one of the states thereof or the District of Columbia, or any domestic branch of
a foreign bank, which at all times has either a long-term unsecured debt rating
of A2 or better by Moody's and of AAA or better by Standard & Poor's or such
other rating that is acceptable to each Rating Agency, as evidenced by a letter
from such Rating Agency to the trustee or has a certificate of deposit rating of
P-1 by Moody's and A-1+ by Standard & Poor's or such other rating that is
acceptable to each Rating Agency, as evidenced by a letter from such Rating
Agency to the trustee and which at all times is a member of the FDIC or (2) a
segregated trust account with the corporate trust department of a depository
institution or trust company organized under the laws of the United States or
any one of the states thereof or the District of Columbia, or any domestic
branch of a foreign bank, having corporate trust powers and acting as trustee
for funds deposited in that account, so long as any of the securities of that
depository institution or trust company has a credit rating from each Rating
Agency in one of its generic rating categories which signifies investment grade.
'ELIGIBLE INVESTMENTS' means book-entry securities, negotiable instruments
or securities represented by instruments in bearer or registered form having
original or remaining maturities of thirty days or less, but in no event
occurring later than the distribution date next succeeding the trustee's
acquisition thereof, which evidence:
(1) obligations of or fully guaranteed by the United States,
(2) demand deposits, time deposits or certificates of deposit of
depository institutions or trust companies incorporated under the laws of
the United States or any state thereof or any domestic branch of a foreign
bank and subject to supervision and examination by Federal or state banking
or depository institution authorities, the commercial paper or other
short-term unsecured debt obligations -- other than this type of obligation
the rating of which is based on the credit of a person or entity other than
that depository institution or trust company -- of which at the time of the
trust's investment or contractual commitment to invest in such investments
has a credit rating of AAA/A-1+ by S&P and Aaa/P-1 by Moody's.
(3) commercial paper having a credit rating in the highest investment
category from each individual Rating Agency at the time of the trust's
investment,
(4) demand deposits, time deposits and certificates of deposit which are
fully insured by the FDIC and which are offered or insured by a financial
institution whose long-term debt is rated in the highest investment category
from each Rating Agency,
(5) bankers' acceptances issued by any depository institution or trust
company described in (2) above,
(6) investments in money market funds (including those managed by the
trustee), which have the highest rating from, or have otherwise been
approved in writing by, the financial guaranty insurer and each individual
Rating Agency,
(7) repurchase obligations entered into with depository institutions or
trust companies -- acting as principal -- described in (2) above, and
(8) other investments acceptable to the financial guaranty insurer and
each individual Rating Agency as being consistent with the then-current
rating of the Class A Certificates.
S-51
<Page>
'ELIGIBLE PRODUCTS' means consumer, recreational and commercial products,
including, but not limited to, boats, motors and trailers, snowmobiles,
snow-grooming equipment, personal watercraft, recreational vehicles,
manufactured housing, motorcycles, lawn and garden equipment, horse trailers,
personal computers, and consumer electronics and appliances and spare parts
relating to these products.
'ELIGIBLE RECEIVABLE' means each receivable:
(1) which was originated by Bombardier Capital Inc., by an affiliate of
Bombardier Capital Inc. or acquired by Bombardier Capital Inc. or an
affiliate of Bombardier Capital Inc. in each case in the ordinary course of
business,
(2) which arose under an Account that at the time the receivable was
transferred to the trust was an Eligible Account,
(3) which is owned by Bombardier Capital Inc. at the time of sale or
contribution by Bombardier Capital Inc. to the depositor,
(4) which represents the obligation of an obligor to repay an advance
made to or on behalf of that obligor, or credit extended for that obligor to
finance an Eligible Product,
(5) which, at the time of creation and, except for receivables that are
payable under a repayment schedule regardless of whether the related
Eligible Products have been sold or with respect to which the related
Eligible Products have then been sold, at the time of transfer to the trust,
is secured by a first priority perfected security interest in the Eligible
Product,
(6) which is not unenforceable as a result of any violation of
requirements of law applicable to it and the related inventory security
agreement is not unenforceable as a result of any violation of requirements
of law applicable to any party to the agreement,
(7) for which all consents and governmental authorizations required to
be obtained by Bombardier Capital Inc. or an affiliate of Bombardier Capital
Inc. or the depositor for the creation of the receivable or its transfer to
the depositor and the trust or the performance by Bombardier Capital Inc. or
an affiliate of Bombardier Capital Inc. of the inventory security agreement
have been duly obtained, effected or given and are in full force and effect,
(8) as to which at all times following the transfer of the receivable to
the trust, the trust will have good and marketable title to it, free and
clear of all liens arising prior to the transfer or arising at any time,
other than liens permitted pursuant to the pooling and servicing agreement,
(9) which has been the subject of a valid transfer and assignment from
the depositor to the trust of all the depositor's right, title and interest
in the receivable, including, with certain exceptions, any proceeds thereof,
(10) which will at all times be the legal and assignable payment
obligation of the obligor, enforceable against the obligor in accordance
with its terms, as modified or revised from time to time with the consent of
the servicer, except as enforceability may be limited by the bankruptcy code
or other applicable insolvency laws,
(11) which at the time of transfer to the trust is enforceable against
the obligor to the extent of the full principal amount of the receivable,
except as such enforceability may be limited by the bankruptcy code or other
applicable insolvency laws,
(12) as to which, at the time of transfer of the receivable to the
trust, Bombardier Capital Inc. or an affiliate of Bombardier Capital Inc.
and the depositor have satisfied all their obligations under the pooling and
servicing agreement for the receivable required to be satisfied at that
time,
(13) as to which, at the time of transfer of the receivable to the
trust, neither Bombardier Capital Inc. or any affiliate of Bombardier
Capital Inc. nor the depositor has taken any action or failed to take any
action required of it under the receivables purchase agreement or the
pooling and servicing agreement which would impair the rights of the trust
or the Series 2003-3 certificateholders in the receivable,
S-52
<Page>
(14) which constitutes `tangible chattel paper' as defined in Article 9
of the UCC as then in effect in the State of New York;
(15) the addition of which would not cause Eligible Receivables arising
from new Eligible Products to be less than 95% of the Pool Balance;
(16) the addition of which would not cause Eligible Receivables that are
generated under the pay-as-sold program to be less than 90% of the Pool
Balance;
(17) which, if such receivable arises out of the manufactured housing
sector, was generated under the pay-as-sold program; and
(18) the addition of which would not cause the Eligible Receivables
arising out of the manufactured housing sector and not covered by a
repurchase agreement from the applicable manufacturer to exceed 15% of the
Pool Balance.
This definition may be changed by amendment to the pooling and servicing
agreement from time to time without the consent of the Class A
certificateholders if the Rating Agency Condition is satisfied.
'EXCESS FUNDED AMOUNT' will be calculated for each business day and means an
amount equal to the product of:
(1) the excess, if any, of the Required Pool Balance over the Pool
Balance, each as of the end of the preceding day, and
(2) a fraction the numerator of which is the sum of the Available
Subordinated Amount and the product of 104 percent of the Adjusted Invested
Amount and the denominator of which is the aggregate of the required
balances for all series -- including the Series 2003-3 -- providing for
excess funding accounts or similar arrangements that are in their revolving
periods or, if applicable, their amortization periods. The depositor may
reduce or adjust the percentage above without the consent of the Class A
certificateholders if the Rating Agency Condition is satisfied.
'EXCESS PRINCIPAL COLLECTIONS' means, for the Class A Certificates, the
amount of Available Investor Principal Collections remaining after all payments
required to be made from Available Investor Principal Collections have been paid
and for any other series, the amount of any similar excess for any other series.
'EXCESS RESERVE FUND REQUIRED AMOUNT' for any distribution date for an Early
Amortization Period, means an amount equal to the greater of (a) 5.0% of the
initial principal amount of the Class A Certificates and (b) the excess of the
Required Pool Balance -- after giving effect to any changes to such amount on
that distribution date -- over the Pool Balance -- after giving effect to
changes to such balance on that distribution date; provided that clause (b)
shall in no event exceed the Available Subordinated Amount for that distribution
date.
'EXCESS RETAINED PERCENTAGE' means, for any date of determination, the
Retained Percentage for that date minus the percentage equivalent of a fraction,
the numerator of which is equal to the sum of the Available Subordinated Amount
and the aggregate available subordinated amounts for all other outstanding
series as of the end of the immediately preceding day and the denominator of
which is the Pool Balance as of the end of the immediately preceding day.
'EXCESS SERVICING' for any distribution date means the amount available
pursuant to clause (8) under 'Description of the Class A
Certificates -- Distribution from the Collection Account; Reserve Fund;
Principal Account -- Non-Principal Collections' in this prospectus supplement.
'FLOATING ALLOCATION PERCENTAGE' means the percentage, which shall never
exceed 100%, obtained for each day in a calendar month, by dividing an amount
equal to the Invested Amount as of the close of business on the preceding day by
the Pool Balance as of the close of business on that preceding day.
'FOREIGN PERSON' is an individual or entity that is not a United States
Person.
'INCREMENTAL SUBORDINATED AMOUNT' on any distribution date will equal the
product of a fraction, the numerator of which is the sum of the Invested Amount
on the last day of the
S-53
<Page>
immediately preceding calendar month or for the first distribution date, the
Invested Amount on the date the Class A Certificates are issued and the
Available Subordinated Amount for that distribution date, calculated without
subtracting or adding the Incremental Subordinated Amount for that distribution
date as described in clause (1) of the definition of Available Subordinated
Amount or clause (5) of the definition of Required Subordinated Amount, and the
denominator of which is the Pool Balance on that last day multiplied by the sum
of, without duplication, the Obligor Overconcentrations, the Manufacturer
Overconcentrations, the Designated Manufacturer Overconcentrations and the
Industry Overconcentrations on that distribution date.
'INDUSTRY OVERCONCENTRATIONS' on any distribution date means the excess of
(1) the total amount of Eligible Receivables created in connection with
the financing of products manufactured by manufacturing entities that are
part of the same industry, that is, producing the same principal product,
which Eligible Receivables are in the trust on the last day of the calendar
month immediately preceding that distribution date over
(2) an amount equal to the applicable percentage set forth opposite each
applicable industry of the Pool Balance on the last day of that immediately
preceding calendar month:
<Table>
<Caption>
INDUSTRY PERCENTAGE
-------- ----------
Marine Products........................... 45%
Powersports............................... 40%
Manufactured Housing...................... MH Overconcentration Percentage
Recreational Vehicles..................... 20%
Lawn and Garden........................... 10%
Consumer Electronics and Appliances....... 10%
Other..................................... 10%
</Table>
Some or all of the percentages specified in this description of Industry
Overconcentrations may be adjusted from time to time without the consent of the
Class A certificateholders, if the Rating Agency Condition is satisfied.
'INSURANCE AGREEMENT' means the insurance and indemnity agreement among the
financial guaranty insurer, the seller, the servicer, the depositor and the
trustee on behalf of the trust.
'INSURER DEFAULT' means the occurrence and continuance of any of the
following events:
(a) the financial guaranty insurer's failure to make a required policy
payment;
(b) the financial guaranty insurer's:
filing or commencing of a petition or any case or proceeding
under any provision or chapter of the United States
Bankruptcy Code or any other similar federal or state law
relating to insolvency, bankruptcy, rehabilitation,
liquidation or reorganization;
general assignment for the benefit of its creditors; or
having an order for relief entered against it under the
United States Bankruptcy Code or any other similar federal
or state law relating to insolvency, bankruptcy,
rehabilitation, liquidation or reorganization which is final
and nonappealable; or
(c) the entering of a final and nonappealable order, judgment or decree
by a court of competent jurisdiction, the New York Department of insurance
or other competent regulatory authority:
appointing a custodian, trustee, agent or receiver for the
financial guaranty insurer or for all or any material
portion of its property; or
authorizing a custodian, trustee, agent or receiver to take
possession of the financial guaranty insurer or to take
possession of all or any material portion of the property of
the financial guaranty insurer.
S-54
<Page>
'INTEREST PERIOD' means, with respect to any distribution date, the period
from and including the previous distribution date -- or, in the case of the
first distribution date, from and including the date of the issuance of the
Class A Certificates -- to but excluding that distribution date.
'INVESTED AMOUNT' means for any date an amount equal to the Adjusted
Invested Amount, minus (a) the principal amount on deposit in the principal
account, if any, (b) the amount, without duplication, of principal
payments -- except principal payments made (i) by the financial guaranty insurer
or (ii) from the excess funding account and any transfers from the excess
funding account to the collection account -- made on the Class A Certificates
prior to that date, and (c) the excess, if any, of the aggregate amount of
Investor Charge-Offs for all distribution dates preceding that date over the
aggregate amount of any reimbursements of Investor Charge-Offs for all
distribution dates preceding that date.
'INVESTMENT PROCEEDS' for any distribution date means an amount equal to the
sum of all interest and other investment earnings, net of losses and investment
expenses, on funds on deposit in the reserve fund, the excess funding account
and the principal account plus the Series 2003-3 Investor Allocation Percentage
of net investment earnings credited to the collection account on the second
business day prior to the distribution date for funds held in the collection
account.
'INVESTOR CHARGE-OFF' shall occur if the Available Subordinated Amount is
reduced to zero, and on any distribution date the Deficiency Amount is greater
than zero and means an amount equal to the excess of this Deficiency Amount over
any remaining Available Subordinated Amount on the related Determination Date,
but shall not exceed the portion of the Defaulted Amount allocated to the Class
A Certificates for that distribution date.
'INVESTOR NON-PRINCIPAL COLLECTIONS' for any distribution date means the
portion of Non-Principal Collections for the related calendar month allocated to
the Class A Certificates as described in this prospectus under the caption
'Description of the Class A Certificates -- Distributions from the Collection
Account; Reserve Fund; Principal Account.'
'LIBOR' means, with respect to any Interest Period, an interest rate based
on the offered rates for deposits in United States dollars having a maturity of
one month, commencing on the second day on which dealings in deposits in United
States dollars are transacted in the London interbank market preceding the first
day of the related Interest Period, which appears on the display page currently
designated as 'Telerate Page 3750' on the Bridge Telerate Markets Report, or any
other page as may replace that page on that service for the purpose of
displaying comparable rates or prices, as of 11:00 A.M., London time, on the
date of calculation. If this rate does not appear on Telerate Page 3750, LIBOR
with respect to the relevant Interest Period will be determined at approximately
11:00 A.M., London time, on that second day on which dealings in deposits in
United States dollars are transacted in the London interbank market preceding
the first day of the related Interest Period on the basis of the rates at which
deposits in United States dollars are offered by four major banks in the London
interbank market, selected by the trustee or by a party selected by the
depositor and acceptable to the trustee, to prime banks in the London interbank
market for a period equal to one month and in a principal amount equal to an
amount of not less than U.S. $1,000,000 and that is representative for a single
transaction in that market at that time. The principal London office of each of
those banks will be requested to provide a quotation of its rate. If at least
two of these quotations are provided, LIBOR will be the arithmetic
mean -- rounded up or down, as the case may be, to the nearest whole multiple of
0.0625% per annum; provided, however, that any amount falling in the middle
shall be rounded up to the nearest whole multiple of 0.0625% -- of these
quotations. If fewer than two quotations are provided, LIBOR with respect to
this Interest Period will be the arithmetic mean -- rounded upwards or downwards
as aforesaid -- of the rates quoted at approximately 11:00 A.M., New York City
time, on that second day on which dealings in deposits in United States dollars
are transacted in the London interbank market preceding the first day of the
related Interest Period by three major banks in New York, New York for loans in
United States dollars to leading European banks having a maturity of one month
and in a principal amount equal to an amount of not less than U.S. $1,000,000
and that is representative for a single transaction in that market at that time;
provided, however, that if the banks selected as aforesaid are not quoting as
mentioned in this
S-55
<Page>
sentence, LIBOR in effect for the applicable period will be LIBOR in effect for
the previous period.
'LONDON' means The London Assurance of America Inc., the name under which
the financial guaranty insurer was formerly known.
'MANUFACTURED HOUSING INDUSTRY OVERCONCENTRATION ENHANCEMENT PERCENTAGE'
means (a) if the Manufactured Housing Percentage is greater than 25% as of such
date, an amount equal to the lesser of (i) one percent and (ii) the excess of
the Manufactured Housing Percentage over 25%, and (b) if the Manufactured
Housing Percentage as of such date is greater than 27.50%, an amount equal to
the sum of (i) 1% and (ii) the lesser of (A) one percent and (B) the excess of
the Manufactured Housing Percentage for such date over 27.50%.
'MANUFACTURED HOUSING PAYMENT RATE' means the percentage obtained by
dividing the Aggregate Principal Collections of Eligible Receivables created in
connection with the financing of manufactured housing units for a calendar month
by the average daily Pool Balance for that calendar month, calculated on a
three-month rolling average basis.
'MANUFACTURED HOUSING PAYMENT RATE FLOOR' means 11% for calendar months
January through April and 13% for any other calendar month.
'MANUFACTURED HOUSING PERCENTAGE' means, as of any date of determination,
the percentage equivalent of a fraction, the numerator of which is the aggregate
amount of Eligible Receivables created in connection with the financing of
manufactured housing units as of such date, and the denominator of which is the
Pool Balance as of such date.
'MANUFACTURER OVERCONCENTRATIONS' on any distribution date means the sum
(without duplication) of
(1) the excess of the aggregate amount of Eligible Receivables created
in connection with the financing of products manufactured by any of the
three largest manufacturing entities (calculated by principal balance of
Eligible Receivables in the trust), other than the Designated Manufacturer,
which Eligible Receivables are in the trust on the last day of the calendar
month immediately preceding that distribution date over 12.50% of the Pool
Balance on the last day of that immediately preceding calendar month;
(2) for Eligible Receivables not in clause (1) above, the excess of the
aggregate amount of Eligible Receivables created in connection with the
financing of products manufactured by any single manufacturing entity
(calculated by principal balance of Eligible Receivables in the Trust),
other than the Designated Manufacturer, which Eligible Receivables are in
the trust on the last day of the calendar month immediately preceding that
distribution date over 7.50% of the Pool Balance on the last day of that
immediately preceding calendar month; and
(3) the excess of the aggregate amount of Eligible Receivables created
collectively in connection with the financing of products manufactured by
any four manufacturing entities, including the Designated Manufacturer,
which Eligible Receivables are in the trust on the last day of the calendar
month immediately preceding that distribution date over 60% of the Pool
Balance on the last day of that immediately preceding calendar month;
provided, however, that any of the percentages set forth in clauses (1), (2) or
(3) above may be adjusted from time to time without the consent of the Class A
certificateholders, if the Rating Agency Condition is satisfied.
'MH INCREMENTAL SUBORDINATED AMOUNT' means, for each Distribution Date, an
amount equal to the product of the Invested Amount multiplied by the
Manufactured Housing Industry Overconcentration Enhancement Percentage.
'MH OVERCONCENTRATION PERCENTAGE' means 20%; provided, however, that if the
Manufactured Housing Payment Rate is greater than or equal to the Manufactured
Housing Payment Rate Floor, the MH Overconcentration Percentage shall be 30%.
'MISCELLANEOUS PAYMENTS' for any calendar month means the sum of Adjustment
Payments and amounts required to be paid by the depositor in connection with a
transfer of receivables back to the depositor, in each case on deposit in the
collection account on the related distribution
S-56
<Page>
date received for that calendar month and any amounts not paid to the holder of
the BCRC Certificate because the Pool Balance does not exceed the Required Pool
Balance and which are available to be treated as Miscellaneous Payments as of
the distribution date following that calendar month as described in this
prospectus supplement under the caption 'Description of the Class A
Certificates -- Allocation Percentages'.
'MONTHLY PRINCIPAL' for any distribution date relating to the Controlled
Accumulation Period or Early Amortization Period will equal Available Investor
Principal Collections for that distribution date; provided that for any
distribution date during the Controlled Accumulation Period, Monthly Principal
will not exceed the Controlled Deposit Amount; provided further, that in any
case Monthly Principal will not exceed the applicable outstanding principal
balance of the Class A Certificates.
'MONTHLY SERVICING FEE' will be equal to one-twelfth of the product of 2%,
if Bombardier Capital Inc. is the Servicer, or 3% if Bombardier Capital Inc. is
not the Servicer or, for any distribution date in respect of which the Monthly
Servicing Fee has been waived, 0% multiplied by the Invested Amount as of the
last day of the second preceding calendar month; provided that the Monthly
Servicing Fee for the first distribution date will be equal to $0 and the
Monthly Servicing Fee for the second distribution date will be equal to $[ ].
'NET SERVICING FEE' will be equal to one-twelfth of the product of 1%, if
Bombardier Capital Inc. is the servicer, or 2%, if Bombardier Capital Inc. is
not the servicer, or for any distribution date for which the Monthly Servicing
Fee has been waived, 0% multiplied by the Invested Amount as of the last day of
the second preceding calendar month; provided that the Net Servicing Fee for the
first distribution date will be equal to $0 and the Net Servicing Fee for the
second distribution date will be equal to $[ ].
'NON-PRINCIPAL COLLECTIONS' means collections of interest and other
non-principal charges, including amounts recovered with respect to Defaulted
Receivables and insurance proceeds, with respect to the receivables.
'OBLIGOR OVERCONCENTRATIONS' on any distribution date means, with respect to
any Account, the excess of the aggregate principal amount of Eligible
Receivables in that Account on the last day of the calendar month immediately
preceding that distribution date over 2.0% of the Pool Balance for any obligor
of the first and second largest Accounts in the trust calculated on the basis of
the amount of principal receivables in that Account, over 1.0% of the Pool
Balance for any obligor of the third through sixth largest Accounts in the trust
calculated on the basis of the amount of principal receivables in that Account,
over 0.75% for any obligor of the seventh through twenty-second largest Accounts
in the trust calculated on the basis of the amount of principal receivables in
that Account, and 0.50% of the Pool Balance for all other obligors or group of
affiliated obligors, in each case on the last day of that immediately preceding
calendar month. The percentages set forth in this description of Obligor
Overconcentrations and the manner of determining to which obligors each rate
applies may be adjusted from time to time without the consent of the Class A
certificateholders if the Rating Agency Condition is satisfied.
'PARTICIPANTS' means the organizations for which The Depository Trust
Company holds securities to facilitate the clearance and settlement of
securities transactions among themselves.
'PAYMENT RATE ENHANCEMENT AMOUNT' means, for each Distribution Date, an
amount equal to the product of the Invested Amount multiplied by the Payment
Rate Enhancement Percentage.
'PAYMENT RATE ENHANCEMENT PERCENTAGE' means, (i) for each Distribution Date
during the Payment Rate Trigger Period, 1.50%, and (ii) for each other
Distribution Date, 0.
'PAYMENT RATE TRIGGER PERIOD' means the twelve month period following any
July or August, if the Three Month Payment Rate for such July or August is less
than 20%.
'POOL BALANCE' means the aggregate principal balances of the receivables in
the trust that are Eligible Receivables.
S-57
<Page>
'PRINCIPAL ALLOCATION PERCENTAGE' means the percentage which shall never
exceed 100% obtained by dividing the Invested Amount as of the last day of the
Revolving Period by the Pool Balance as of the close of business on the business
day preceding the day of calculation.
'RATING AGENCY' means for any series, the rating agencies which have been
requested to rate that series by the depositor.
'RATING AGENCY CONDITION' means, with respect to any action, if the terms of
the pooling and servicing agreement or any supplement, including the Series
2003-3 supplement, set forth a specific time in advance of the effectiveness of
the action that notice must be given to the Rating Agencies and the financial
guaranty insurer, notice shall have been given in accordance with this
requirement or if no advance notice is required or no specific time is stated
for the notice, the Rating Agencies and the financial guaranty insurer have
received written notice of the proposed action at least 10 days prior to the
proposed effective date of the action and either:
as of the proposed effective date of the action, no Rating
Agency shall have notified the depositor, the servicer or
the trustee in writing that the action will result in a
reduction or withdrawal of any rating of any outstanding
series or class with respect to which it is a Rating Agency,
or
each Rating Agency shall have confirmed in writing to the
depositor, the servicer or the trustee that the action will
not result in a reduction or withdrawal of the rating of any
outstanding series or class with respect to which it is a
Rating Agency, and
in each case, the financial guaranty insurer shall have
notified the depositor, the servicer and the trustee in
writing that it consents to such action.
'RECEIVABLES' means receivables arising from extensions of credit and
advances made to dealers of consumer, recreational and commercial products which
dealers are located in the United States.
'REMOVED ACCOUNTS' means any Accounts from which the depositor has ceased to
transfer newly originated receivables to the trust and any Account which is not
an Eligible Account which has been removed from the trust.
'REQUIRED POOL BALANCE' for any date means an amount calculated as of the
end of any business day equal to:
the sum of the amounts for each series obtained by
multiplying the required investor percentages -- including
the required investor percentage of this series which is 104
percent, but which may be reduced -- by the respective
adjusted invested amounts including the Adjusted Invested
Amount -- plus
the sum of the Available Subordinated Amount and the
aggregate available subordinated amounts for all other
outstanding series as of the end of that business day; minus
the positive difference, if any, between the amount on
deposit in the Reserve Fund and the Reserve Fund Required
Amount.
'REQUIRED SUBORDINATED AMOUNT' means, as of any date of determination, the
sum of
(1) 9.2896% of the Invested Amount;
(2) the MH Incremental Subordinated Amount;
(3) the Designated Manufacturer Incremental Subordinated Amount;
(4) the Payment Rate Enhancement Amount; and
(5) the Incremental Subordinated Amount for the immediately preceding
distribution date or, if the date of determination is a distribution date,
for that date;
provided, however, that for any date prior to the end of the Revolving Period,
the Required Subordinated Amount shall in no event be less than an amount equal
to the sum of 3.75% of the initial principal amount of the Class A Certificates
plus the Incremental Subordinated Amount for the immediately preceding
distribution date or, if the date of determination is a distribution date, for
that date; and
S-58
<Page>
provided further, that upon the commencement of the Controlled Accumulation
Period or if an Early Amortization Event occurs, the Required Subordinated
Amount for each date of determination after this commencement will equal the
Required Subordinated Amount as of the close of business on the day preceding
the first day of the Controlled Accumulation Period or the day on which the
Early Amortization Event occurs.
'REQUIRED SUBORDINATION DRAW AMOUNT' means the lesser of the Deficiency
Amount and the Available Subordinated Amount.
'RESERVE FUND REQUIRED AMOUNT' means an amount which will equal 0.50% of the
outstanding principal balance of the Class A Certificates on the date the Class
A Certificates are issued, or with respect to the Early Amortization Period, the
Excess Reserve Fund Required Amount.
'RETAINED INTEREST' means the ownership interest in the trust retained by
the depositor and which is that portion of the trust not represented by or
allocated to the certificateholders of any series or the interest represented by
the variable funding certificate.
'RETAINED PERCENTAGE' for any date of determination, means 100% minus
(1) when used with respect to Non-Principal Collections, the sum of
the aggregate of the floating allocation percentages for
each outstanding series, including the Class A Certificates,
and
the Variable Funding Percentage for the date of
determination and
(2) when used with respect to principal collections, the sum of
the aggregate of the floating allocation percentages for
each outstanding series, including the Class A Certificates,
if applicable, in its revolving period,
the aggregate of the principal allocation percentages for
each outstanding series, including the Class A Certificates,
if applicable, not in its revolving period, and
the Variable Funding Percentage for this date of
determination
but in each case the Retained Percentage shall not be less than 0%.
'REVOLVING PERIOD' means the period beginning on the date the Class A
Certificates are issued and ending on the earliest of:
(1) the last day of the collection period ending on the day prior to the
Accumulation Period Commencement Date; and
(2) the business day immediately preceding the day on which an Early
Amortization Event occurs.
If the Early Amortization Event resulted from the failure of the servicer to
make deposits to the trust or into any account and that event is cured and no
other Early Amortization Event has occurred and the scheduled end of the
Revolving Period has not occurred, then the Revolving Period may begin again.
'SERIES 2003-3 AVAILABLE RETAINED COLLECTIONS' means, for any date on which
the servicer receives collections, an amount equal to the product of the
Available Retained Collections for that day multiplied by a fraction, the
numerator of which is the Available Subordinated Amount and the denominator of
which is the sum of the Available Subordinated Amount and the aggregate
available subordinated amounts for all other outstanding series, in each case on
that day.
'SERIES 2003-3 INVESTOR ALLOCATION PERCENTAGE' means, for any calendar
month, the percentage obtained by dividing the Invested Amount as of the last
business day preceding that calendar month by the sum of the Invested Amount and
the invested amounts for all other outstanding series on that day.
'SUPPLEMENTAL CERTIFICATE' means a certificate issued in exchange for a
portion of the BCRC Certificate.
S-59
<Page>
'THREE MONTH PAYMENT RATE' means, for any calendar month, the percentage
obtained by dividing the aggregate principal collections for the three
consecutive calendar months ended on such calendar month by the average daily
Pool Balance for those three consecutive calendar months.
'TRANSFER DATE' means each business day on which receivables are created in
the Eligible Accounts provided that such date is prior to the earlier of the day
following the distribution date on which the aggregate invested amounts for all
series is zero, the day on which an event of bankruptcy, insolvency or
receivership relating to Bombardier Capital Inc. or the depositor occurs.
'UNITED STATES PERSON' is an individual or entity that for federal income
tax purposes is (i) a citizen or resident of the United States, (ii) a
corporation or partnership created or organized in or under the laws of the
United States, any state thereof or the District of Columbia, (iii) an estate,
the income of which is subject to United States federal income taxation
regardless of its source or (iv) certain trusts.
'VARIABLE FUNDING PERCENTAGE' for any date of determination, means a
percentage (which percentage will never be less than 0% nor more than 100%)
equal to the excess, if any, of the Pool Balance over the Required Pool Balance
as of that day divided by the Pool Balance as of the close of business on the
day preceding that day; provided, however, that for purposes of allocating
principal collections following the occurrence of an event of bankruptcy,
insolvency or receivership relating to Bombardier Capital Inc. or the depositor,
the Variable Funding Percentage will be calculated on the basis of the excess,
if any, of the Pool Balance over the Required Pool Balance as of the last day
immediately preceding the date of this event of bankruptcy, insolvency or
receivership relating to Bombardier Capital Inc. or the depositor; provided,
further, that following an event of bankruptcy, insolvency or receivership
relating to Bombardier Capital Inc. or the depositor, the relative interest of
the variable funding certificate in further allocations of Non-Principal
Collections will not be less than the relative interest thereof as of the event
of bankruptcy, insolvency or receivership relating to Bombardier Capital Inc. or
the depositor.
'XLCA' means XL Capital Assurance Inc., a stock insurance company
incorporated under the laws of the State of New York, and its successors.
'XLFA' means XL Financial Assurance Ltd., an insurance company organized
under the laws of Bermuda, and an affiliate of the financial guaranty insurer.
'XLI' means LX Insurance (Bermuda) Ltd., a Bermuda company, and provider of
an unconditional guarantee of the obligations of XLFA to the financial guaranty
insurer under the reinsurance agreement.
S-60
<Page>
ANNEX I
PRIOR SERIES
The Series 2003-3 Certificates will be the ninth series to be issued by the
trust. The table below summarizes some of the principal characteristics of the
Series 1996-1 Certificates, the Series 1997-2 Certificates, the Series 2003-1
Certificates and the Series 2003-2 Certificates, issued by the trust and
outstanding. The Series 2003-2 Certificates will be paid in full and terminated
by application of a portion of the net proceeds of the Series 2003-3
Certificates.
<Table>
SERIES 1996-1
Initial Principal Amount.................................... $100,000,000
Principal Amount as of October 31, 2003..................... $100,000,000
Class A Amortization Date................................... September 2004
(unless extended)
Class A Certificate Rate.................................... Commercial Paper Rate
Series 1996-1 Termination Date.............................. September 2004
(unless extended)
Series 1996-1 Issuance Date................................. May 14, 1996
Series 1996-1 Servicing Fee Rate............................ 2%
Initial Available Subordination Amount...................... $23,616,900
SERIES 1997-2
Initial Principal Amount.................................... $50,000,000
Principal Amount as of October 31, 2003..................... $90,000,000
Class A Amortization Date................................... December 2003 (unless
extended)
Class A Certificate Rate.................................... Commercial Paper Rate
Series 1997-2 Termination Date.............................. December 2003
Series 1997-2 Issuance Date................................. December 12, 1997
Series 1997-2 Servicing Fee Rate............................ 2%
Initial Available Subordinated Amount....................... $2,000,000
SERIES 2003-1
Initial Principal Amount.................................... $400,000,000
Principal Amount as of October 31, 2003..................... $400,000,000
Controlled Accumulation Period Commencement Date............ To be determined
Class A Certificate Rate.................................... One-Month LIBOR plus
0.34%
Series 2003-1 Termination Date.............................. August 15, 2007
Series 2003-1 Issuance Date................................. August 27, 2003
Series 2003-1 Servicing Fee Rate............................ 2%
Initial Available Subordinated Amount....................... $23,280,423
SERIES 2003-2 (1)
Initial Principal Amount.................................... $450,000,000
Principal Amount as of October 31, 2003..................... $450,000,000
Class A Certificate Rate.................................... Commercial Paper Rate
Series 2003-2 Termination Date.............................. March 2004
Series 2003-2 Issuance Date................................. September 26, 2003
Series 2003-2 Servicing Fee Rate............................ 2%
Initial Available Subordinated Amount....................... $35,190,476
</Table>
- ---------
(1) The Series 2003-2 Certificates will be paid in full and
terminated by application of a portion of the net proceeds
of the Series 2003-3 Certificates.
A-I-1
<Page>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<Page>
ANNEX II
RECEIVABLES IN ADDITIONAL ACCOUNTS CONVEYED TO THE TRUST BY THE DEPOSITOR
<Table>
<Caption>
PRINCIPAL AMOUNT
DATE RECEIVABLES OF RECEIVABLES IN
ASSIGNMENT TRANSFERRED RELEVANT NUMBER ADDITIONAL
NUMBER TO TRUST CUT-OFF DATE OF ACCOUNTS ACCOUNTS
------ -------- ------------ ----------- --------
1 Sept. 30, 1994 Sept. 26, 1994 277 $ 28,569,849
2 Jan. 30, 1996 Jan. 18, 1996 610 $ 86,817,128
3 Oct. 31, 1997 Oct. 22, 1997 51 $ 30,132,722
4 Feb. 26, 1998 Jan. 1, 1998 832 $ 98,371,236
5 Oct. 16, 1998 Aug. 28, 1998 457 $ 92,037,386
6 Mar. 19, 1999 Mar. 2, 1999 311 $126,143,143
7 Nov. 4, 1999 Sept. 30, 1999 392 $108,132,205
8 Oct. 26, 2000 Sept. 30, 2000 678 $186,983,354
9 Aug. 2, 2001 June 30, 2001 604 $ 86,681,468
10 Jan. 28, 2003 Dec. 31. 2002 1,018 $221,567,288
</Table>
A-II-1
<Page>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<Page>
ANNEX III
GLOBAL CLEARANCE, SETTLEMENT AND TAX DOCUMENTATION PROCEDURES
Except in limited circumstances, the globally offered certificates will be
available only in book-entry form. Investors in the globally offered
certificates may hold them through any of The Depository Trust Company,
Clearstream or Euroclear. The globally offered certificates will be tradeable as
home market instruments in both the European and U.S. domestic markets. Initial
settlements and all secondary trades will settle in same-day funds.
Secondary market trading between investors holding globally offered
certificates through Clearstream and Euroclear will be conducted in the ordinary
way in accordance with their normal rules and operating procedures and in
accordance with conventional eurobond practice (i.e., seven calendar day
settlement).
Secondary market trading between investors holding globally offered
certificates through The Depository Trust Company will be conducted according to
the rules and procedures applicable to U.S. corporate debt obligations and prior
asset-backed certificates issues.
Secondary cross-market trading between Clearstream or Euroclear and The
Depository Trust Company Participants holding certificates will be effected on a
delivery-against-payment basis through the respective depositaries of
Clearstream and Euroclear, in the capacity of depositaries and as The Depository
Trust Company Participants.
Non-U.S. holders of globally offered certificates will be subject to U.S.
withholding taxes unless these holders meet specific requirements and deliver
appropriate U.S. tax documents to the securities clearing organizations or their
participants.
INITIAL SETTLEMENT
All globally offered certificates will be held in book-entry form by The
Depository Trust Company in the name of Cede & Co. as nominee of The Depository
Trust Company. Investors' interests in the globally offered certificates will be
represented through financial institutions acting on their behalf as direct and
indirect Participants in The Depository Trust Company. As a result, Clearstream
and Euroclear will hold positions on behalf of their participants through their
respective depositaries, which in turn will hold these positions in accounts as
The Depository Trust Company Participants.
Investors electing to hold their globally offered certificates through The
Depository Trust Company will follow the settlement practices applicable to
prior asset-backed certificates issues. Investor securities custody accounts
will be credited with their holdings against payment in same-day funds on the
settlement date.
Investors electing to hold their globally offered certificates through
Clearstream or Euroclear accounts will follow the settlement procedures
applicable to conventional eurobonds, except that there will be no temporary
global security and no 'lock-up' or restricted period. Globally offered
certificates will be credited to the securities custody accounts on the
settlement date against payment in same-day funds.
SECONDARY MARKET TRADING
Since the purchaser determines the place of delivery, it is important to
establish at the time of the trade where both the purchaser's and seller's
accounts are located to ensure that settlement can be made on the desired value
date.
Trading between The Depository Trust Company Participants. Secondary market
trading between The Depository Trust Company Participants will be settled using
the procedures applicable to prior asset-backed certificates issues in same-day
funds.
A-III-1
<Page>
Trading between Clearstream and/or Euroclear participants. Secondary market
trading between Clearstream participants or Euroclear participants will be
settled using the procedures applicable to conventional eurobonds in same-day
funds.
Trading between The Depository Trust Company seller and Clearstream or
Euroclear purchaser. When globally offered certificates are to be transferred
from the account of The Depository Trust Company Participant to the account of a
Clearstream participant or a Euroclear participant, the purchaser will send
instructions to Clearstream or Euroclear through a Clearstream participant or
Euroclear participant at least one business day prior to settlement. Clearstream
or Euroclear will instruct their respective depositories to receive the globally
offered certificates against payment. Payment will include interest accrued on
the globally offered certificates from and including the last distribution date
(or if the transfer is prior to the first distribution date, the closing date)
to and excluding the settlement date, on the basis of actual days elapsed and a
year of 360 days. Payment will then be made by the respective depositary to The
Depository Trust Company Participant's account against delivery of the globally
offered certificates. After settlement has been completed, the globally offered
certificates will be credited to the respective clearing system and by the
clearing system, in accordance with its usual procedures, to the Clearstream
participant's or Euroclear participant's account. The securities credit will
appear the next day (European time) and the cash debt will be back-valued to,
and the interest on the globally offered certificates will accrue from, the
value date (which would be the preceding day when settlement occurred in New
York). If settlement is not completed on the intended value date (i.e., the
trade fails), the Clearstream or Euroclear cash debit will be valued instead as
of the actual settlement date.
Clearstream participants and Euroclear participants will need to make
available to the respective clearing systems the funds necessary to process
same-day funds settlement. The most direct means of doing so is to preposition
funds for settlement, either from cash on hand or existing lines of credit, as
they would for any settlement occurring within Clearstream or Euroclear. Under
this approach, they may take on credit exposure to Clearstream or Euroclear
until the globally offered certificates are credited to their accounts one day
later.
As an alternative, if Clearstream or Euroclear has extended a line of credit
to them, Clearstream participants or Euroclear participants can elect not to
preposition funds and allow that credit line to be drawn upon to finance
settlement. Under this procedure, Clearstream participants or Euroclear
participants purchasing globally offered certificates would incur overdraft
charges for one day, assuming they cleared the overdraft when the globally
offered certificates were credited to their accounts. However, interest on the
globally offered certificates would accrue from the value date. Therefore, in
many cases the investment income on the globally offered certificates earned
during that one-day period may substantially reduce or offset the amount of
these overdraft charges, although this result will depend on each Clearstream
participant's or Euroclear participant's particular cost of funds.
Since the settlement is taking place during New York business hours, The
Depository Trust Company Participants can employ their usual procedures for
sending globally offered certificates to the respective depositary for the
benefit of Clearstream participants or Euroclear participants. The sale proceeds
will be available to The Depository Trust Company seller on the settlement date.
Thus, to The Depository Trust Company Participant a cross-market transaction
will settle no differently than a trade between two The Depository Trust Company
Participants.
Trading between Clearstream or Euroclear seller and The Depository Trust
Company purchaser. Due to time zone differences in their favor, Clearstream
participants and Euroclear participants may employ their customary procedures
for transactions in which globally offered certificates are to be transferred by
the respective clearing system, through their respective depositories, to The
Depository Trust Company Participant. The seller will send instructions to
Clearstream or Euroclear through a Clearstream participant or Euroclear
participant at least one business day prior to settlement. In these cases,
Clearstream or Euroclear will instruct their respective depositories to deliver
the globally offered certificates to The Depository Trust Company Participant's
account against payment. Payment will include interest accrued on the globally
offered
A-III-2
<Page>
certificates from and including the last distribution date (or if the transfer
is prior to the first distribution date, the closing date) to and excluding the
settlement date on the basis of actual days elapsed and a year of 360 days. The
payment will then be reflected in the account of the Clearstream participant or
Euroclear participant the following day, and receipt of the cash proceeds in the
Clearstream participant's or Euroclear participant's account would be
back-valued to the value date (which would be the preceding day, when settlement
occurred in New York). Should the Clearstream participant or Euroclear
participant have a line of credit with its respective clearing system and elect
to be in debt in anticipation of receipt of the sale proceeds in its account,
the back-valuation will extinguish any overdraft incurred over that one-day
period. If settlement is not completed on the intended value date (i.e., the
trade fails), receipt of the cash proceeds in the Clearstream participant's or
Euroclear participant's account would instead be valued as of the actual
settlement date.
Finally, day traders that use Clearstream or Euroclear and that purchase
globally offered certificates from The Depository Trust Company Participants for
delivery to Clearstream participants or Euroclear participants should note that
these trades would automatically fail on the sale side unless affirmative action
were taken. At least three techniques should be readily available to eliminate
this potential problem:
(1) borrowing through Clearstream or Euroclear for one day (until the
purchase side of the day trade is reflected in their Clearstream or
Euroclear accounts) in accordance with the clearing system's customary
procedures;
(2) borrowing the globally offered certificates in the U.S. from The
Depository Trust Company Participant no later than one day prior to
settlement, which would give the globally offered certificates sufficient
time to be reflected in their Clearstream or Euroclear account in order to
settle the sale side of the trade; or
(3) staggering the value dates for the buy and sell sides of the trade
so that the value date for the purchase from The Depository Trust Company
Participant is at least one day prior to the value date for the sale to the
Clearstream participant or Euroclear participant.
MATERIAL U.S. FEDERAL INCOME TAX DOCUMENTATION REQUIREMENTS
A beneficial owner of globally offered certificates holding securities
through Clearstream or Euroclear (or through The Depository Trust Company if the
holder has an address outside the U.S.) will be subject to the 30% U.S.
withholding tax that generally applies to payments of interest (including
original issue discount) on registered debt issued by U.S. Persons (or, in the
case of a Foreign Investor holding the certificates through a partnership, such
other rate as is applicable), unless each clearing system, bank or other
financial institution that holds customers' securities in the ordinary course of
its trade or business in the chain of intermediaries between that beneficial
owner and the U.S. entity required to withhold tax complies with applicable
certification requirements and that beneficial owner takes one of the following
steps to obtain an exemption or reduced tax rate:
Exemption for Foreign Persons. Foreign Persons that are individuals or
entities treated as corporations for federal income tax purposes and are
beneficial owners of the certificates can obtain a complete exemption from the
withholding tax by filing Form W-8BEN (Certificate of Foreign Status of
Beneficial Owner for United States Tax Withholding). A Foreign Person, other
than an individual or an entity treated as a corporation for federal income tax
purposes, that beneficially owns a certificate may be subject to more complex
rules.
Exemption for Foreign Persons with Effectively Connected Income. Foreign
Persons, including non-United States corporations or banks with a United States
branch, that are beneficial owners of the certificates and for which the related
interest income is effectively connected with the conduct of a trade or business
in the United States can obtain a complete exemption from the withholding tax by
filing Form W-8ECI (Certificate of Foreign Person's Claim for Exemption from
Withholding on Income Effectively Connected with the Conduct of a Trade or
Business in the United States).
A-III-3
<Page>
Exemption or Reduced Rate for Foreign Persons Resident in Treaty Countries.
Foreign Persons that are individuals or entities treated as corporations for
federal income tax purposes and are beneficial owners of the certificates and
reside in a country that has a tax treaty with the United States can obtain an
exemption or reduced tax rate, depending on the treaty terms, by filing Form
W-8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax
Withholding). A Foreign Person, other than an individual or an entity treated as
a corporation for federal income tax purposes, that beneficially owns a
certificate may be subject to more complex rules.
Exemption for United States Persons. United States Persons that are
beneficial owners of the certificates can obtain a complete exemption from the
withholding tax by filing Form W-9 (Payer's Request for Taxpayer Identification
Number and Certification).
United States Federal Income Tax Reporting Procedure. The beneficial owner
of a certificate files by submitting the appropriate form to the person through
whom the beneficial owner holds the certificates, which person would be the
clearing agency in the case of persons holding directly on the books of the
clearing agency. Form W-8ECI and Form W-8BEN are effective from the date the
form is signed through the end of the third succeeding calendar year, unless a
change in circumstances causes any information in the form to become incorrect,
in which case such information must be updated within 30 days. If interest
payments are to be reported at least annually by the trust to the IRS, a Form
W-8BEN (but not a Form W-8ECI) that contains a taxpayer identification number
remains valid until a change in circumstances causes any information in the form
to become incorrect.
This summary does not deal with all aspects of U.S. Federal income tax
withholding that may be relevant to foreign holders of the globally offered
certificates. Investors are advised to consult their own tax advisors for
specific tax advice concerning their holding and disposing of the globally
offered certificates.
A-III-4
<Page>
PROSPECTUS [BOMBARDIER LOGO]
BOMBARDIER RECEIVABLES MASTER TRUST I
ISSUER
BOMBARDIER CREDIT RECEIVABLES CORPORATION
DEPOSITOR
BOMBARDIER CAPITAL INC.
SERVICER
-------------------
- --------------------------------------------------------------
The certificates represent obligations of the trust
only and do not represent interests in or obligations
of Bombardier Credit Receivables Corporation,
Bombardier Capital Inc. or any of their affiliates. The
certificates will not be insured or guaranteed by any
governmental agency. This prospectus may be used to
offer and sell certificates of a series only if it is
accompanied by the prospectus supplement for that series.
INVESTING IN THE CERTIFICATES INVOLVES RISKS.
YOU SHOULD CONSIDER CAREFULLY THE INFORMATION
UNDER THE CAPTION 'RISK FACTORS' BEGINNING ON PAGE 5.
- --------------------------------------------------------------
THE ISSUER --
is a master trust and may periodically issue asset
backed certificates in one or more series with one
or more classes; and
will own assets consisting of
-- a pool of receivables generated under
inventory security agreements entered into
with dealers under which the dealers receive
funds to purchase or finance consumer,
recreational and commercial product
inventory; and
-- the security or ownership interests in the
consumer products financed under the
issuer's receivables, any proceeds from
claims on certain related insurance
policies, amounts on deposit in the trust
accounts identified in the related
prospectus supplement and any credit
enhancements specified in the related
prospectus supplement.
THE CERTIFICATES --
will be obligations of the trust only;
will be paid only from the assets of the trust;
will represent the right to payments in the amounts
and at the times described in the prospectus
supplement for those certificates;
will be rated in an investment grade rating category
at the time of issuance by at least one nationally
recognized rating agency; and
may have the benefit of one or more forms of credit
enhancement.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is August 20, 2003.
<Page>
IMPORTANT NOTICE ABOUT THE INFORMATION IN THIS PROSPECTUS AND
EACH ACCOMPANYING PROSPECTUS SUPPLEMENT
Information about each series of certificates is contained in two separate
documents:
this prospectus, which provides general information, some of
which may not apply to a particular series; and
the accompanying prospectus supplement for a particular
series, which describes the specific terms of the securities
of that series.
If the terms of the certificates described in this prospectus vary with the
accompanying prospectus supplement, you should rely on the information in the
prospectus supplement.
You should rely only on the information contained in this document or to which
we have referred you. Bombardier Credit Receivables Corporation has not
authorized anyone to provide you with information that is different. This
document may only be used where it is legal to sell the securities. Bombardier
Credit Receivables Corporation is not offering the certificates in any state
where the offer is not permitted.
This prospectus and the accompanying prospectus supplement include
cross-references to captions in these materials where you can find further
discussions about related topics. The table of contents in the front of each
document provides the pages on which these captions are located.
WHERE YOU CAN FIND MORE INFORMATION
We filed a registration statement relating to the certificates with the SEC.
This prospectus is part of the registration statement, but the registration
statement includes additional information. The Servicer will file with the SEC
all required annual, monthly and special SEC reports and other information about
the trust. You may read and copy any reports, statements or other information we
file at the SEC's public reference room in Washington, D.C. You can request
copies of these documents, upon payment of a duplicating fee, by writing to the
SEC.
Please call the SEC at (800) SEC-0330 for further information on the operation
of the public reference rooms. Our SEC filings are also available to the public
on the SEC Internet site (http://www.sec.gov).
The SEC allows us to 'incorporate by reference' information we filed with it,
which means that we can disclose important information to you by referring you
to those documents. The information incorporated by reference is considered to
be part of this prospectus. Information that we file later with the SEC will
automatically update the information in this prospectus. In all cases, you
should rely on the later information over different information included in this
prospectus or the accompanying prospectus supplement. We incorporate by
reference any future annual, monthly and special SEC reports and proxy materials
filed by or on behalf of the Trust until we terminate our offering of the
certificates.
2
<Page>
TABLE OF CONTENTS
<Table>
<Caption>
PAGE
----
RISK FACTORS................................................ 5
CAPITALIZED TERMS........................................... 10
FORWARD-LOOKING STATEMENTS.................................. 10
ORIGINATION OF RECEIVABLES.................................. 10
THE DEPOSITOR AND THE TRUST................................. 10
The Depositor........................................... 10
The Trust............................................... 11
USE OF PROCEEDS............................................. 12
THE FLOORPLAN FINANCING BUSINESS............................ 13
General................................................. 13
Creation of the Receivables............................. 14
Credit Underwriting Process and Security................ 15
Payment Terms........................................... 16
Billing and Collection Procedures....................... 16
Revenue Experience...................................... 16
Relationship with Manufacturers, Importers and
Distributors........................................... 17
Monitoring.............................................. 18
Collection Activity..................................... 18
THE ACCOUNTS................................................ 19
General................................................. 19
BOMBARDIER CAPITAL INC...................................... 21
Inventory Finance....................................... 21
BOMBARDIER INC.............................................. 21
DESCRIPTION OF THE CERTIFICATES............................. 22
General................................................. 22
Interest................................................ 23
Principal............................................... 23
Subordination of Principal.............................. 24
Book-Entry Registration................................. 24
Definitive Certificates................................. 28
Retained Interest and Variable Funding Certificate...... 28
New Issuances........................................... 29
Supplemental Certificate................................ 31
Conveyance of Receivables and Collateral Security....... 32
Representations and Warranties.......................... 32
Eligible Accounts and Eligible Receivables.............. 34
Ineligible Receivables.................................. 36
Addition of Accounts.................................... 36
Removal of Accounts and Assignment of Receivables....... 38
Excluded Series......................................... 40
Credit Support for the Certificates; Collection Account
and Excess Funding Account............................. 40
Allocation of Collections............................... 41
Deposits in Collection Account.......................... 42
Limited Subordination of Retained Interest.............. 43
Enhancements............................................ 43
Limitations on Subordination and Enhancements........... 44
Defaulted Receivables and Recoveries.................... 44
Receivables are not Defaulted Receivables merely because
they are no longer Eligible Receivables................ 44
Optional Repurchase..................................... 45
Early Amortization Events............................... 45
Termination............................................. 47
</Table>
3
<Page>
<Table>
<Caption>
PAGE
----
Indemnification......................................... 48
Collection and Other Servicing Procedures............... 49
Servicer Covenants...................................... 49
Servicing Compensation and Payment of Expenses.......... 50
Matters Regarding the Servicer.......................... 50
Servicer Default........................................ 50
Reports................................................. 51
Evidence as to Compliance............................... 52
Amendments.............................................. 52
List of Certificateholders.............................. 53
The Trustee............................................. 53
DESCRIPTION OF THE RECEIVABLES PURCHASE AGREEMENT........... 53
Sale and Transfer of Receivables........................ 54
Representations and Warranties.......................... 55
Covenants............................................... 55
Termination............................................. 56
MATERIAL LEGAL ASPECTS OF THE RECEIVABLES................... 57
Transfer of Receivables and Certificates................ 57
Matters Related to Unfunded Receivables................. 58
Material Matters Relating to Bankruptcy................. 58
MATERIAL FEDERAL INCOME TAX CONSEQUENCES.................... 60
Characterization of the Certificates and the Trust...... 60
Possible Characterization of the Trust as a Partnership
other than a Publicly Traded Partnership............... 60
Possible Characterization of the Trust as a Publicly
Traded Partnership Taxable as a Corporation............ 61
Taxation of Interest Income to United States Persons.... 61
Sale, Exchange or other Disposition of Certificates..... 62
Foreign Investors....................................... 62
Information Reporting and Backup Withholding............ 64
State and Local Taxation................................ 64
ERISA CONSIDERATIONS........................................ 64
PLAN OF DISTRIBUTION........................................ 64
LEGAL MATTERS............................................... 65
REPORTS TO CERTIFICATEHOLDERS............................... 65
GLOSSARY.................................................... 66
</Table>
4
<Page>
RISK FACTORS
THE CERTIFICATES MAY LACK LIQUIDITY WHICH MAY LIMIT YOUR ABILITY TO SELL YOUR
CERTIFICATES
The underwriters intend to make a market for the purchase and sale of the
certificates but have no obligation to do so. There is no assurance that a
secondary market will develop or, if it develops, that it will continue.
Consequently, you may not be able to sell your certificates readily or at
desirable prices.
The secondary markets for asset-backed securities have experienced periods
of illiquidity and can be expected to do so in the future. Illiquidity could
have a severely adverse effect on the prices at which your certificates can be
sold.
YOU MAY NOT RECEIVE PAYMENTS OF YOUR CERTIFICATES WHEN YOU EXPECT OR YOUR
PAYMENTS MAY BE REDUCED IF THE TRANSFER OF RECEIVABLES TO THE TRUST IS NOT
CONSIDERED A SALE IN THE EVENT OF BANKRUPTCY
Bombardier Capital Inc. will treat the sale of the receivables to Bombardier
Credit Receivables Corporation as a sale and Bombardier Credit Receivables
Corporation will treat the transfer of the receivables to the trust as a sale,
although for consolidated accounting purposes the receivables will continue to
be treated as assets of Bombardier Capital Inc. Furthermore, the trust has been
created to be bankruptcy remote from Bombardier Capital Inc. However, in the
event that Bombardier Capital Inc. or Bombardier Credit Receivables Corporation
or one of their affiliates becomes bankrupt, a trustee in bankruptcy may argue
that the trust assets were not sold but were only pledged to secure a loan to
Bombardier Capital Inc. If that argument prevails, you could experience delays
or losses on your certificates. If that argument is successful, the trustee in
bankruptcy could elect to sell the receivables and pay down the certificates
early. Thus, you could lose the right to future payments of interest, and might
suffer reinvestment loss in a lower interest rate environment. In addition if
the servicer becomes bankrupt, a bankruptcy trustee or receiver may have the
power to prevent the trustee from appointing a successor servicer. Any related
delays in servicing could result in increased delinquencies or losses on the
receivables. See 'Material Legal Aspects of the Receivables -- Material Matters
Relating to Bankruptcy.'
DELAYED FUNDING RECEIVABLES MAY NOT BE COLLECTIBLE IF BOMBARDIER CAPITAL INC.
DOES NOT PAY MANUFACTURERS THUS INCREASING THE RISK OF LOSS ON YOUR CERTIFICATES
Bombardier Credit Receivables Corporation sells to the trust receivables in
which Bombardier Capital Inc. has not yet funded its obligation to the related
manufacturer, importer or distributor. If Bombardier Capital Inc. were to become
bankrupt, Bombardier Capital Inc. might be unable to pay the manufacturer,
importer or distributor. If for this or any other reason Bombardier Capital Inc.
does not pay, the unfunded receivables may not be collected from the dealer and
a manufacturer, importer or distributor might be able to delay or prevent
receipt by the trust of payments otherwise owing to the trust with respect to
these receivables. This could cause a loss on your certificates. See 'The
Floorplan Financing Business -- Creation of the Receivables.'
THE POSSIBILITY OF BANKRUPTCY EVENTS RELATED TO BOMBARDIER CAPITAL INC. OR
BOMBARDIER CAPITAL RECEIVABLES CORPORATION AND THE UNCERTAIN TIMING OF OBLIGOR
REPAYMENTS RENDER THE LIFE OF YOUR CERTIFICATES UNCERTAIN AND THEREFORE YOU MAY
RECEIVE PRINCIPAL ON DATES OTHER THAN WHEN YOU ANTICIPATE
If specified triggering events occur concerning the trust assets, the
servicer or Bombardier Credit Receivables Corporation you will receive each
month all principal collections allocable to your certificates until your
certificates are paid in full. This may cause you to receive principal payments
sooner than you anticipate. Thus you could lose the right to future payments of
interest, and might suffer reinvestment loss in a lower interest rate
environment. If bankruptcy events related to Bombardier Capital Inc. or
Bombardier Credit Receivables Corporation were to occur, then an early
amortization event would occur and additional receivables may no longer be
transferred to the trust. Therefore in the event of a bankruptcy of Bombardier
Credit Receivables Corporation or Bombardier Capital Inc. the timing of
principal payments to you may be subject to
5
<Page>
the actions of a bankruptcy trustee, receiver or conservator. See 'Material
Legal Aspects of the Receivables -- Transfer of Receivables and Certificates'
and ' -- Material Matters Relating to Bankruptcy.'
Receivables are generally payable by dealers either upon the sale by the
dealer of the product or, in some cases, according to a payment schedule. The
timing of the sale of the eligible products by dealers is uncertain. We cannot
assure you that there will be additional receivables created under the accounts
or that any particular pattern of repayments will occur. Because payment of
principal on the certificates depends on when the dealers pay Bombardier Capital
Inc., the certificates may not be fully paid by their expected final payment
date. This could delay the return of principal on your certificates thus
extending their maturity and increasing their exposure to losses in the trust.
See 'Description of the Certificates -- Termination.'
See 'Description of the Certificates -- Early Amortization Events' for a
discussion of other events which might lead to your receiving principal sooner
than you expect.
STATE AND FEDERAL LAW MAY LIMIT THE ABILITY OF THE SERVICER TO REALIZE ON
RECEIVABLES THUS CAUSING LOSSES ON YOUR CERTIFICATES
Application of federal and state bankruptcy and debtor relief laws could
affect your interest in the receivables if these or similar laws result in any
receivables being reduced or written off as uncollectible or result in delays in
payments due on these receivables. See 'Description of the
Certificates -- Defaulted Receivables and Recoveries.'
IF A DEALER FAILS TO REMIT AMOUNTS OWED FOR SOLD PRODUCTS THE SERVICER MAY FAIL
TO REALIZE ON THE RECEIVABLES THUS CAUSING LOSSES ON YOUR CERTIFICATES
Bombardier Capital Inc. and Bombardier Credit Receivables Corporation
represent and warrant that each eligible receivable originated by an inventory
security agreement is at the time of creation secured by a first priority
perfected security interest in the related product.
Generally, under applicable state laws, a security interest in consumer,
recreational and commercial goods which secure receivables may be perfected by
the filing of Uniform Commercial Code financing statements. Bombardier Capital
Inc. takes all actions necessary under applicable state laws to perfect these
security interest in the related eligible products. However, at the time any of
these products is sold by the dealer, the security interest in the product will
terminate. Therefore, if a dealer fails to pay Bombardier Capital Inc. amounts
owed for products that it has sold, the related receivables will no longer be
secured by those products.
If receivables that are not created by inventory security agreements are
added to the trust, they will be secured by a first priority perfected security
interest in goods, accounts, work in process, raw materials, component parts or
other assets of the dealer. In the event that these receivables are secured by
assets that are subsequently sold by the dealer, the same issues discussed above
about receivables created by inventory security agreements may exist.
ADDITIONAL ACCOUNTS MAY HAVE CHARACTERISTICS DIFFERENT FROM THE CURRENT ACCOUNTS
THUS LIMITING YOUR ABILITY TO ASSESS YOUR RISK OF LOSS ON YOUR CERTIFICATES
Bombardier Credit Receivables Corporation expects and in some cases will be
obligated, to designate additional accounts, the receivables in which will be
conveyed to the trust. Although these additional accounts must be eligible, they
may include accounts with underwriting criteria different from those which were
applied to the accounts previously added to the trust. In addition, there is no
limitation on the number of additional accounts which may be delinquent. These
additional accounts may also provide financing for types of products different
from those currently included in the trust and if the required conditions are
met, receivables not created by inventory security agreements may be added to
the trust. Consequently, we cannot assure you that accounts designated in the
future will relate to the same types of products or will be of the same credit
quality as previously designated accounts or that new product types, or other
forms of security, if any, that may secure the receivables in new accounts will
provide security that is as favorable as that provided by the eligible products
securing the receivables currently included in the trust.
6
<Page>
SOCIAL, ECONOMIC AND OTHER FACTORS MAY CAUSE DEALERS TO FAIL TO SELL PRODUCTS
SECURING RECEIVABLES CAUSING LOSSES ON RECEIVABLES AND THUS YOUR CERTIFICATES OR
ACCELERATING PAYMENTS OF PRINCIPAL TO YOU
Payment of the receivables created by inventory security agreements largely
depends upon the retail sale of the related products. Generation of new
receivables depends upon the general level of sales of eligible products or
expected need for eligible products. The level of sales of eligible products and
the manufacturing and acquisition of eligible products may change as the result
of a variety of social and economic factors. Economic factors include interest
rates, unemployment levels, the rate of inflation and customer perception of
economic conditions generally.
The use of incentive programs like manufacturers' rebate programs may affect
sales. If any of the manufacturers, importers, or distributors of the eligible
products were temporarily or permanently no longer in their respective
businesses, the rate of sales of eligible products generating receivables could
decrease, adversely affecting payment rates on the receivables and the
generation of new receivables. Moreover, if any of the manufacturers, importers
or distributors were temporarily or permanently no longer manufacturing,
importing or distributing the related eligible products, the loss experience on
the related receivables could be adversely affected, thus increasing the risk of
loss on your certificates.
IF BOMBARDIER CREDIT RECEIVABLES CORPORATION AND BOMBARDIER CAPITAL INC. ARE
UNABLE TO GENERATE AND TRANSFER SUFFICIENT RECEIVABLES TO THE TRUST YOU WILL
RECEIVE PRINCIPAL SOONER THAN YOU MAY EXPECT
Neither Bombardier Credit Receivables Corporation nor Bombardier Capital
Inc. or any affiliate thereof is obligated to make any payments on the
certificates or the receivables, other than the obligation of Bombardier Credit
Receivables Corporation or Bombardier Capital Inc. to purchase receivables from
the trust due to the failure to comply with specific covenants or the breach by
Bombardier Credit Receivables Corporation or Bombardier Capital Inc. of
representations and warranties, as described below under 'Description of the
Certificates -- Representations and Warranties' and ' -- Servicer Covenants,'
and other than affiliate support agreements relating to receivables described
under 'The Floorplan Financing Business -- Relationship with Manufacturers,
Importers and Distributors.'
However, the trust depends entirely upon Bombardier Capital Inc. for the
generation of new receivables. The ability of Bombardier Capital Inc. to
generate receivables in turn mostly depends on sales of eligible products as
well as competition from other lenders. We therefore cannot assure you that
Bombardier Capital Inc. will continue to generate receivables at the same rate
as in prior years. If sufficient sales do not occur an amortization event may
occur and you could receive principal sooner than you expect. Thus you could
lose the right to future payments of interest, and might suffer reinvestment
loss in a lower interest rate environment.
YOUR CERTIFICATES HAVE LIMITED CREDIT ENHANCEMENT INCREASING THE RISK OF LOSS ON
THE CERTIFICATES
The amount of credit enhancement available to your series of certificates is
limited and may be reduced from time to time as described in the prospectus
supplement. The available enhancement may decline or be depleted before the
securities are paid in full, and as a result, you may suffer losses. For
example, enhancement may be insufficient in cases of greater than anticipated
losses or where the enhancement provider is unable to meet its obligations. If
problems develop with the receivables, such as an increase in losses on the
receivables or if there are problems with the collection and transfer of the
receivables to the trust, it is possible that you may not receive the full
amount of interest and principal that you would otherwise receive and you may
suffer a loss. See 'Description of the Certificates -- Limited Subordination of
the Retained Interest.'
7
<Page>
EXISTENCE OF OTHER SERIES OF CERTIFICATES MAY LIMIT YOUR ABILITY TO TAKE ACTIONS
WITH RESPECT TO THE TRUST BENEFICIAL TO YOU
The consent or approval of the holders of a specified percentage of all
outstanding certificates of all outstanding series and certain third party
credit enhancement providers will be required to permit or to take specified
actions that affect all series, including amending the agreement which created
the trust in some circumstances and directing a reassignment of the entire
portfolio of the receivables. In addition, following the occurrence of an
insolvency event of Bombardier Credit Receivables Corporation or an early
amortization event with respect to any series as a result of Bombardier Credit
Receivables Corporation's violating its covenant not to create any lien on any
receivable, the holders of investor certificates evidencing more than 50% of the
aggregate unpaid principal amount of each series or, for series with two or more
classes, of each class will be required, together with the holder of the
variable funding certificate and certain third party credit enhancement
providers, to direct the trustee not to sell or otherwise liquidate the
receivables.
EXISTENCE OF OTHER SERIES OF CERTIFICATES MAY AFFECT WHEN YOU RECEIVE PRINCIPAL
The trust, as a master trust, may issue additional series of investor
certificates from time to time. Each series may be represented by different
classes within the series.
We cannot assure you that previously issued series or the issuance of any
future series might not adversely affect the timing or amount of payments
received by you. See 'Description of the Certificates -- New Issuances.'
Furthermore, principal collections from other series may be reallocated to
your certificates during a period when principal is paid or accumulated on your
certificates, which may shorten the maturity of your certificates. We may issue
an additional series without your consent.
CREDIT RATINGS OF YOUR CERTIFICATES REFLECT THE RATING AGENCY'S ASSESSMENT OF
THE LIKELIHOOD THAT YOU WILL RECEIVE YOUR PAYMENTS OF INTEREST AND PRINCIPAL
Unless we specify otherwise in the related prospectus supplement, it will be
a condition to the issuance of the certificates of each series offered by this
prospectus that they be rated in an investment grade rating category by at least
one nationally recognized rating agency.
A rating is based primarily on the credit underlying the receivables and the
interest we retain in the trust that is subordinate to your certificates and the
availability of any enhancement with respect to the series or class. The rating
addresses the likelihood of the ultimate payment of principal and timely payment
of interest on the certificates. A rating agency does not evaluate, and a rating
of the certificates does not address the likelihood that any amounts not paid to
you because of the interest rate cap on the certificates will be paid or the
likelihood of payment in full of the outstanding principal balance of the
certificates on their expected final payment dates. A rating is not a
recommendation to buy, sell or hold securities, inasmuch as it does not comment
as to the market price or suitability for a particular investor.
We cannot assure you that a rating will remain for any given period of time
or that a rating will not be lowered or withdrawn entirely by a rating agency if
in its judgment circumstances so warrant. Any suspension, reduction or
withdrawal in the ratings assigned to the certificates would probably reduce the
market value of the certificates and may affect your ability to sell them.
BOOK-ENTRY REGISTRATION WILL LIMIT YOUR ABILITY TO EXERCISE YOUR RIGHTS AND MAY
CAUSE DELAYS IN PAYMENT AND DIFFICULTIES IN PLEDGING
Unless we otherwise specify in the prospectus supplement relating to a
series of certificates, your certificates will be initially represented by one
or more certificates registered in the name of Cede & Co., the nominee for The
Depository Trust Company and will not be registered in your name or the name of
your nominee. Because of this you will not be recognized by the trustee as a
certificateholder. Unless definitive certificates are issued, you will only be
able to exercise your rights indirectly through The Depository Trust Company,
Clearstream, the Euroclear system and their participating organizations. See
'Description of the Certificates -- Book-Entry Registration' and ' -- Definitive
Certificates.'
8
<Page>
You may hold certificates in book-entry form only through The Depository
Trust Company, the Euroclear system or Clearstream. Your ability to pledge a
book-entry certificate to a person that does not participate in those systems
may be limited because of the lack of a physical certificate. In addition,
certificate payments will not be made directly to you. Instead, the trustee or
its paying agent will send all distributions to The Depository Trust Company,
which will then credit those distributions to the participating organizations.
Those organizations must in turn credit accounts you have either directly or
indirectly through indirect participants for you to receive your payments. This
may cause you to experience some delay in receiving payments on your
certificates.
COMMINGLING BY THE SERVICER MAY RESULT IN DELAYS AND REDUCTIONS IN PAYMENTS ON
THE CERTIFICATES
The Servicer may be permitted to retain collections on the receivables. So
long as Bombardier Capital Inc. remains the servicer, no servicing default has
occurred and is continuing, and if Bombardier Capital Inc. meets certain
requirements established by the rating agencies that have rated outstanding
series, the servicer does not have to deposit collections into the collection
account until the business day preceding the related distribution date.
Until the servicer deposits payments on the receivables into the collection
account or the principal account for the certificates, the servicer may use
those funds for its own benefits and will not aggregate those funds from its own
assets, and the proceeds of any investment of those funds will accrue to the
servicer. The servicer will pay no fee to the trust for any use by the servicer
of collections on the receivables. In the event of the bankruptcy of Bombardier
Capital Inc., the trust may not have a perfected interest in these collections.
In the event of this type of commingling, the amount so commingled at any given
time, and to which you would otherwise be entitled, may exceed the amount
distributable to you on the following distribution date and you may suffer a
loss.
POTENTIAL DELAYS IN PAYMENTS AND LOSSES ON THE CERTIFICATES DUE TO REMOVAL OF
ACCOUNTS
You may suffer delays in payments and losses on the certificates because of
the removal of accounts from the trust. Bombardier Credit Receivables
Corporation, as depositor, may, and in some cases will be obligated to, remove
accounts from the trust. In some cases receivables in those accounts may remain
in the trust, and in other cases receivables in those accounts will be removed
from the trust. Following the removal of an account, without the removal of the
related receivables, some receivables relating to the account will be outside of
the trust and other receivables relating to the account may remain in the trust.
If the servicer applies collections relating to an account to receivables that
are outside of the trust rather than to receivables that remain in the trust,
then delays in payments and losses on your certificates could occur.
THE CERTIFICATES ARE NOT SUITABLE INVESTMENTS FOR ALL INVESTORS
The certificates are not a suitable investment for any investor that
requires a regular or predictable schedule of payments or payments on specific
dates. The certificates are complex investments that should be considered only
by sophisticated investors. We suggest that only investors who, either alone or
with their financial, tax and legal advisors, have the expertise to analyze the
prepayment, reinvestment and default risks, the tax consequences of an
investment and the interaction of these factors should consider investing in the
certificates.
9
<Page>
CAPITALIZED TERMS
For purposes of clarity, a number of terms used in this prospectus have been
assigned specialized definitions. These terms appear throughout this prospectus
as capitalized words and phrases. Definitions for these terms may be found in
the glossary at the back of this prospectus.
FORWARD-LOOKING STATEMENTS
In this prospectus, Bombardier Credit Receivables Corporation uses
forward-looking statements. Forward-looking statements are also found elsewhere
in this prospectus and include words like 'expects,' 'intends,' 'anticipates,'
'estimates' and other similar words. These statements are inherently subject to
a variety of risks and uncertainties. Actual results differ materially from
those we anticipate due to changes in, among other things:
economic conditions and industry competition;
political, social and economic conditions;
the law and government regulatory initiatives; and
interest rate fluctuations.
Bombardier Credit Receivables Corporation will not update or revise any
forward-looking statements to reflect changes in its expectations or changes in
the conditions or circumstances on which the statements were originally based.
ORIGINATION OF RECEIVABLES
Bombardier Capital Inc. provides floorplan financing to dealers for eligible
products. The dealers are obligated to repay Bombardier Capital Inc. for
advances made by Bombardier Capital Inc. to or for the benefit of the dealer.
The dealers are also obligated to pay interest on the advances to the extent
required by the agreement with Bombardier Capital Inc. In addition to dealer
floorplan financing originated directly by Bombardier Capital Inc., Bombardier
Capital Inc. also acquires dealer floorplan accounts and the related receivables
originated by affiliates of Bombardier Capital Inc. or by nonaffiliated
entities. Bombardier Capital Inc. has selected accounts from its portfolio and
sold or contributed the receivables in the selected accounts to Bombardier
Credit Receivables Corporation as the depositor under the terms of a receivables
purchase agreement between Bombardier Capital Inc. and the depositor. The
receivables purchase agreement is dated as of January 1, 1994 and was amended by
Amendment Number 1 as of January 1, 1997 and Amendment Number 2 dated as of
September 1, 2002. Bombardier Capital Inc. expects that it will, from time to
time, select additional accounts and sell or contribute the receivables in the
additional accounts to the depositor.
THE DEPOSITOR AND THE TRUST
THE DEPOSITOR
Bombardier Credit Receivables Corporation is the depositor to the trust. The
depositor is a wholly-owned subsidiary of Bombardier Capital Inc. and an
indirect wholly-owned subsidiary of Bombardier Inc. The depositor was
incorporated on November 9, 1993. The depositor was organized for limited
purposes. The purposes include purchasing receivables, beneficial ownership
interests in receivables, debt obligations secured by receivables and other
forms of indebtedness and transferring these receivables, interests, debt
obligations and indebtedness to third parties. The purposes also include
activities incidental to and necessary or convenient for the accomplishment of
the primary purposes.
The depositor's mailing address is P.O. Box 5544, Burlington, Vermont 05402.
The depositor's telephone number is (802) 655-2824.
The depositor has taken steps intended to assure that the voluntary or
involuntary application with respect to Bombardier Corporation or Bombardier
Capital Inc. for relief under the United
10
<Page>
States bankruptcy code or other bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the enforcement of
creditors' rights generally will not result in the substantive consolidation of
the assets and liabilities of the depositor with those of Bombardier Corporation
or Bombardier Capital Inc. These steps include the creation of the depositor as
a separate, limited-purpose subsidiary. The depositor's certificate of
incorporation contains limitations on the nature of the depositor's business and
a restriction on the depositor's ability to commence a voluntary case or
proceeding under any insolvency law without the unanimous affirmative vote of
all of its directors. The depositor's certificate of incorporation requires that
at least one of its directors qualify under the certificate of incorporation as
an independent director. However, we cannot assure you that the activities of
the depositor would not result in a court concluding that the assets and
liabilities of the depositor should be substantively consolidated with those of
Bombardier Corporation or Bombardier Capital Inc. in a proceeding under any
insolvency law.
THE TRUST
The trust is the Bombardier Receivables Master Trust I. It was formed under,
and is administered in accordance with, the laws of the State of New York by a
pooling and servicing agreement dated as of January 1, 1994. The pooling and
servicing agreement was amended by Amendment Number 1 dated as of January 1,
1997, by Amendment Number 2 dated as of October 19, 1999, by Amendment Number 3
dated as of October 19, 1999, by Amendment Number 4 dated as of May 31, 2002 and
by Amendment Number 5 dated as of September 1, 2002. The depositor conveys
receivables to the trust without recourse.
The depositor has previously sold investor certificates representing
interests in the assets of the trust, and from time to time, the depositor may
offer other series of investor certificates representing interests in the assets
of the trust. The property of the trust consists of the receivables existing in
the Accounts on January 1, 1994 and all receivables generated in the Accounts
after the applicable cut-off date during the term of the trust. The property of
the trust will also include receivables generated in Accounts added to the trust
from time to time hereafter. In each case the receivables are reduced by
receivables paid or charged-off and exclude:
(1) Receivables generated in Removed Accounts after the date on which
the transfer of these receivables has ceased or receivables generated in any
Account which is not an Eligible Account after the removal of these
receivables has begun; and
(2) Receivables removed from the trust.
In addition to the receivables, the property of the trust includes:
the security granted to secure the receivables;
the depositor's rights, remedies, powers and privileges in
the receivables under the receivables purchase agreement;
except any repurchase or other agreements with
manufacturers, importers or distributors relating to the
obligors;
all funds collected or to be collected in respect of
receivables;
all funds on deposit in the collection account and the
accounts established for any series issued by the trust; and
any letter of credit, surety bond, financial guaranty
insurance policy, cash collateral account, spread account,
guaranteed rate agreement, maturity liquidity facility, tax
protection agreement, subordination, swap agreement,
including without limitation, currency swaps or other
interest rate protection agreement, repurchase obligation,
cash deposit or other enhancement issued for the benefit of
any series.
The holders of a series of certificates will not have any interest in any
series accounts created for any other series and will not have any interest in
any enhancement provided for the benefit of the investor certificate holders of
any other series.
The trust was formed for the transactions relating to the issuance of
certificates as contemplated by the pooling and servicing agreement, and prior
to formation had no assets or
11
<Page>
obligations. The trust has not engaged and will not engage in any business
activity, other than as described in this prospectus, but rather will only
acquire and hold the receivables and the other assets of the trust and proceeds
therefrom, issue series' of investor certificates, the BCRC Certificate and the
variable funding certificate, and make payments thereon and related activities.
As a consequence, the trust is not expected to have any need for, or source of,
capital resources other than the assets of the trust.
USE OF PROCEEDS
Unless otherwise provided in the related prospectus supplement, the net
proceeds from the sale of a series of certificates (after the funding of any
enhancement) will be paid to the depositor, which will generally use these
proceeds to repay amounts previously borrowed to purchase receivables, to repay
amounts owing to Bombardier Capital Inc. under the promissory note issued by the
depositor in favor of Bombardier Capital Inc. or to purchase receivables from
Bombardier Capital Inc. Bombardier Capital Inc. will use the portion of the
proceeds paid to it for general corporate purposes.
12
<Page>
THE FLOORPLAN FINANCING BUSINESS
GENERAL
The following discussion includes descriptions of the receivables all of
which will be receivables arising from extensions of credit and advances made to
dealers of consumer, recreational and commercial products which dealers are
located in the United States. The descriptions below of practices and procedures
apply to current practices and procedures; these practices and procedures may
change over time.
Without limiting the foregoing, Bombardier Capital Inc. expects to provide
financing to additional dealers, and directly to manufacturers and distributors.
In addition, Bombardier Capital Inc. expects that the financing needs of
obligors will change over time, whether as a result of seasonality or other
changes in the obligors' businesses. In some cases, designated Accounts and the
receivables arising thereunder transferred to the trust have been acquired by
Bombardier Capital Inc. or an affiliate of Bombardier Capital Inc. from another
lender and Accounts and the receivables arising thereunder may in the future be
acquired from other lenders. Accordingly, the types of credit arrangements
designated as Accounts and the receivables arising thereunder that are
transferred to the trust, the products or other assets financed by those
receivables and the security, if any, provided in connection with these types of
arrangements, are expected to change over time, and the relative proportions of
the various types of credit arrangements and collateral may change over time.
Consequently, there can be no assurance that Additional Accounts designated in
the future will relate to the same types of products or will be of the same
credit quality as previously designated Accounts or that the receivables in the
new Accounts will be supported by the same security that is currently provided
for the receivables. The designation of Additional Accounts is subject to
satisfaction of conditions described under 'Description of the
Certificates -- Addition of Accounts.'
The entities to which credit is extended are the obligors. The obligors
include entities engaged in the business of purchasing Eligible Products from a
manufacturer, importer or distributor for sale in the ordinary course of
business and entities that are manufacturers, importers or distributors of
Eligible Products.
Bombardier Capital Inc. services the receivables through its offices in
Colchester, Vermont.
No selection procedures believed by Bombardier Capital Inc. to be adverse to
the holders of the certificates were or will be used in selecting the
receivables to be sold or contributed to the trust.
The receivables are secured by products financed by Bombardier Capital Inc.
for these dealers and occasionally by, among other things, mortgages,
assignments of certificates of deposit or letters of credit. The types of
products covered by receivables may change over time, however, the receivables
and products are required to be located in the United States.
Bombardier Capital Inc. generally provides dealers with inventory financing
by paying to manufacturers, importers or distributors the wholesale cost of
inventory items purchased by these dealers. These dealers are located in the
United States and the receivables are denominated in U.S. dollars.
In most instances a manufacturer, importer or distributor may make a number
of financing sources other than Bombardier Capital Inc. available to its
dealers. Bombardier Capital Inc. has, however, in the past entered into, and may
in the future enter into, captive financing arrangements with manufacturers,
importers or distributors where Bombardier Capital Inc. is made the primary
source of financing for the relevant manufacturer's, importer's or distributor's
dealers. In some cases, Bombardier Capital Inc. has in the past offered, and it
may in the future offer, attractive financing rates in order to obtain captive
financing arrangements with some manufacturers, importers or distributors.
Bombardier Capital Inc. primarily provides secured financing to dealers
located principally in the United States for the purchase of recreational,
consumer and commercial products from
13
<Page>
specified manufacturers and distributors. The principal products for which
Bombardier Capital Inc. currently provides inventory financing, also referred to
as wholesale or floorplan financing, include:
(1) recreational products manufactured by Bombardier Inc. like
Ski-Doo'r' snowmobiles, Sea-Doo'r' personal watercraft, sport boats,
all-terrain vehicles, Evinrude'r' and Johnson'r' outboard engines and
related parts and accessories (see 'Bombardier Inc.' regarding the announced
divestiture by Bombardier Inc. of its Recreational Products Group which
manufactures these recreational products);
(2) marine products, like boats, motors and trailers, which are not
Bombardier Inc. products;
(3) manufactured housing;
(4) recreational vehicles, trailers and campers; and
(5) specialty vehicles and other recreational and consumer products not
manufactured by Bombardier Inc.
CREATION OF THE RECEIVABLES
Bombardier Capital Inc. typically finances 100% of the wholesale invoice
price of new inventory financed by U.S. dealers through Bombardier Capital Inc.
Receivables in respect of the inventory are generally originated concurrently
with the shipment of this inventory to the financed dealers. Bombardier Capital
Inc. generally will advance funds directly to the manufacturer, importer or
distributor on behalf of the dealer.
In most cases, although Bombardier Capital Inc. will have incurred the
obligation to make an advance, Bombardier Capital Inc. will negotiate a delay in
funding the advance for a period ranging, in most cases, from 0 to 40 days for
Eligible Products not manufactured by affiliates of Bombardier Capital Inc., and
ranging up to 30 days for Eligible Products manufactured by affiliates of
Bombardier Capital Inc., after the date of the invoices. Any receivable that is
funded on a delayed basis will be sold to, paid for by the trust and included as
a receivable on the date it is added to the trust even though it is not funded
by Bombardier Capital Inc. until a later date, namely, when Bombardier Capital
Inc. pays the advance to the manufacturer in payment of the invoice price. A
receivable funded on a delayed basis is included as an Eligible Receivable on or
after the date the product is shipped to the dealer for all purposes of the
pooling and servicing agreement.
Bombardier Capital Inc. and the manufacturer may also agree that Bombardier
Capital Inc. may discount the invoice price of the inventory ordered by the
dealer. Under this type of arrangement, the manufacturer will deem itself paid
in full upon receipt of the discounted amount.
In most cases, Bombardier Capital Inc. provides domestic inventory financing
for new products. However, in limited circumstances, Bombardier Capital Inc.
provides financing of used or trade-in inventory acquired by dealers for whom
Bombardier Capital Inc. provides inventory financing.
Once a dealer has commenced the floorplanning of a manufacturer's,
importer's or distributor's inventory through Bombardier Capital Inc., if
requested, Bombardier Capital Inc. will generally finance all purchases of
inventory by this dealer from the relevant manufacturer, importer or
distributor, up to the credit limits established from time to time for this
dealer. Bombardier Capital Inc. may limit or cancel this arrangement if the
dealer fails to perform its obligations under its agreement with Bombardier
Capital Inc., if the relevant manufacturer, importer or distributor fails to
perform its obligations under its repurchase agreement, if the aggregate
outstanding amount of receivables for any one manufacturer, importer or
distributor reaches Bombardier Capital Inc.'s predetermined limit or if the
dealer or manufacturer, importer or distributor is experiencing financial
difficulties.
14
<Page>
CREDIT UNDERWRITING PROCESS AND SECURITY
Bombardier Capital Inc.'s credit underwriting process begins with a credit
underwriting of the manufacturer, importer or distributor. Bombardier Capital
Inc. attempts to obtain a repurchase agreement from the manufacturer, importer
or distributor. Under the repurchase agreement, the manufacturer, importer or
distributor agrees for a specified period of time -- in most cases eighteen to
twenty-four months, depending on the type of goods financed, after the dealer
purchases the goods financed -- to repurchase any of its goods that were
financed by Bombardier Capital Inc. and which have been repossessed by
Bombardier Capital Inc. after a dealer defaults, subject to conditions which are
contained in the agreements. For further discussion of repurchase agreements,
see ' -- Relationship with Manufacturers, Importers and Distributors' below.
After this period, Bombardier Capital Inc. may assist the relevant
manufacturer, importer or distributor, in preparing and distributing promotional
material for the purpose of encouraging all eligible and credit worthy dealers
of the relevant manufacturer, importer or distributor to participate in the
program. In some cases, the manufacturer, importer or distributor is the primary
promoter of the program offered by Bombardier Capital Inc.
When available, a list of dealers together with the recommended credit line
limits for these dealers is obtained from the manufacturer, importer or
distributor. The dealers are then normally contacted by either Bombardier
Capital Inc.'s telemarketing department or personnel from Bombardier Capital
Inc.'s field force. If a dealer is interested in the program, an application for
financing is completed. After receipt of this application, Bombardier Capital
Inc. currently investigates the dealer by reviewing, among other things, the
dealer's financial statements, trade references, past actual performance and
anticipated future performance and personal credit history. Upon approval,
credit limits are established for approved dealers and the dealer executes an
inventory security agreement in favor of Bombardier Capital Inc. Credit limits
are subject to different levels of management approval generally based on the
amount of the proposed credit limit.
Domestic inventory financing originated by Bombardier Capital Inc. is
documented by an inventory security agreement providing for a security interest
in favor of Bombardier Capital Inc. in all inventory of the dealer which was
financed or floorplanned by Bombardier Capital Inc. and, in some cases, all
other personal property of the dealer. The agreements also set forth the
dealer's obligations for repayment, the maintenance and security, including
insurance, of the inventory, remedies of Bombardier Capital Inc. upon a default
by the dealer and other matters relating to the dealer's inventory and business
and Bombardier Capital Inc.'s rights. The inventory security agreements require
the dealer to maintain insurance for the benefit of Bombardier Capital Inc. on
the inventory being financed by Bombardier Capital Inc. Although Bombardier
Capital Inc.'s right to the proceeds of this insurance will not be transferred
by Bombardier Capital Inc. to the depositor, or by the depositor to the trust,
Bombardier Capital Inc. has agreed under the pooling and servicing agreement to
treat the insurance proceeds received by Bombardier Capital Inc. as collections
on the related receivables.
Bombardier Capital Inc. holds a security interest in each item financed
until it is sold by the dealer. The inventory security agreements also require
the dealer to take, or assist Bombardier Capital Inc. in taking, all actions
necessary for Bombardier Capital Inc. to perfect its security interest in the
financed products. Usually the dealer is required to repay the financed amount
upon sale of the inventory, or within a specified period of time. In some cases
a dealer may be permitted to extend its obligations for unsold inventory for
limited periods of time. In cases where the dealer is required to repay the
financed amount according to a payment schedule, the inventory being financed
may be sold before the scheduled payment date of the related receivable. As a
result, Bombardier Capital Inc. would no longer hold a security interest in the
sold inventory.
Bombardier Capital Inc. may also acquire receivables underwritten by
third-party lenders. Although these receivables may not arise in an account
under an inventory security agreement established by Bombardier Capital Inc.,
Bombardier Capital Inc. will re-underwrite the account.
15
<Page>
Bombardier Capital Inc. maintains an active and ongoing relationship with
the dealers to whom it provides floorplan financing and reevaluates individual
dealers' status:
(1) prior to increasing a credit limit;
(2) at least annually; and
(3) if a dealer is experiencing financial difficulties or is not
complying with its obligations under its inventory security agreement with
Bombardier Capital Inc.
Bombardier Capital Inc. reserves the right to deny any new or increased
credit requests. At times, based upon Bombardier Capital Inc.'s relationship
with the manufacturer, importer or distributor, Bombardier Capital Inc. may
establish a dealer line of credit that would otherwise not be granted on the
strength of dealer credit alone if the manufacturer provides additional security
or recourse that Bombardier Capital Inc.'s management deems appropriate. See
' -- Relationship with Manufacturers, Importers and Distributors.'
PAYMENT TERMS
Bombardier Capital Inc. is entitled to receive repayment in full of the
related loan upon sale of the inventory for which floorplan financing has been
provided unless the dealer is permitted to participate in a scheduled payment
program. This payment system is commonly known as the pay-as-sold program.
Interest is generally payable monthly. See ' -- Billing and Collection
Procedures' below.
A scheduled payment program is made available to some manufacturer's,
importer's and distributor's eligible dealers in limited instances where it is
impractical or not customary in the industry to require repayment upon sale.
These dealers may schedule the repayment of financed inventory over several
months, generally 30 to 180 days, whether sold or not. The first payment is
generally due 30 days from the invoice date and subsequent payments are
generally due each 30 days following the due date of the first payment. The sum
of all payments under the scheduled payment program will equal the advance to
the dealer, which advance in most cases will be the full price of the financed
product, rather than the discounted price which is paid to the manufacturer,
importer or distributor in scheduled payment situations, plus in some instances
interest on the amount advanced to the dealer. In some cases where there is a
scheduled payment program, there is no interest collected on the receivables,
since the advances were made at a discount from the face amount of the
receivables. See 'Description of the Certificates -- Discount Option.'
BILLING AND COLLECTION PROCEDURES
A statement setting forth billing and related account information is
prepared by Bombardier Capital Inc. and mailed or otherwise transmitted to each
dealer on a monthly basis. Each dealer's statement is generated and distributed
on the second or third day following Bombardier Capital Inc.'s month-end cut-off
date. Interest and other non-principal charges are usually required to be paid
by the fifteenth day of each month and in most cases prior to the month-end
cut-off date for the month in which those amounts are billed. Both interest and
other non-principal charges are billed in arrears. Where practical, dealers
remit payments to bank lock boxes. In cases where a manufacturer, importer or
distributor is responsible for a payment, like interest payments in specified
situations, billing goes to the manufacturer, importer or distributor.
Exceptions to the procedures described are made on a case by case basis with
management approval.
REVENUE EXPERIENCE
Bombardier Capital Inc. generally charges dealers interest at a floating
rate on each business day. Bombardier Capital Inc.'s policy is to charge a rate
equal to the 'prime rate' designated in the 'Wall Street Journal' or a rate
determined by Bombardier Capital Inc., plus a spread generally ranging from
- .05% to 8.5% per annum based on risk and/or other factors including the
manufacturer's, importer's or distributor's support of the dealer. The interest
rate for any given
16
<Page>
period is the average daily prime rate plus the applicable spread and is applied
to the average balances outstanding during the applicable period.
There is seasonality in the level of outstanding accounts included in the
Bombardier Capital Inc. Domestic Inventory Portfolio and in repayments of
principal. Dealer inventory financed by Bombardier Capital Inc. typically
increases during the fall and winter months reaching a peak during the late
winter or early spring, at which point the outstanding receivables then begin
liquidating during the spring and summer. In large part, this seasonality is
attributable to the accounts included in the Bombardier Capital Inc. Domestic
Inventory Portfolio related to marine products and Bombardier products. The
'Average Spread over Prime Rate' has decreased and may decrease further. This
decrease is in part attributable to increased competitive pressures from other
lenders. This decrease is in part attributable to an increase in the portion of
the Bombardier Capital Inc. Domestic Inventory Portfolio that consists of
accounts related to non-Bombardier related product. Other factors may have
contributed to this decrease and may contribute to further decreases.
RELATIONSHIP WITH MANUFACTURERS, IMPORTERS AND DISTRIBUTORS
Bombardier Capital Inc.'s primary marketing focus is the manufacturer,
importer or distributor of the financed product. Affiliates of Bombardier
Capital Inc. manufacture products, including Ski-Doo'r' snowmobiles, Sea-Doo'r'
personal watercraft sport boats, all-terrain vehicles, Evinrude'r' and
Johnson'r' outboard engines and related parts and accessories, which are
financed directly by Bombardier Capital Inc. (See 'Bombardier Inc.' regarding
the announced divestiture by Bombardier Inc. of its Recreational Products Group
which manufactures these products.)
In most instances, rates and terms are agreed upon at the manufacturer,
importer or distributor level, although for large dealers specific arrangements
may be made with the individual dealer.
In some situations, the manufacturer, importer or distributor will pay all
or a portion of the interest that would otherwise be payable for some period by
a dealer under a receivable. In these cases, the manufacturer, importer or
distributor makes the interest payment to Bombardier Capital Inc. and the dealer
has a corresponding interest moratorium.
In the past, most financing to dealers has involved a commitment by the
manufacturer, importer or distributor to repurchase the financed products if
Bombardier Capital Inc. repossesses their products after a dealer defaults. In
some cases, these repurchase obligations lapse when an unsold product reaches a
specified age. The repurchase price to be paid to Bombardier Capital Inc. is
generally equal to the unpaid loan balance for the repossessed goods plus
specified costs of repossession less in some circumstances, a scheduled amount
determined according to the age of the repossessed goods. In some cases,
manufacturers, importers and distributors are also subject to recourse
agreements which obligate the manufacturer, importer or distributor to
repurchase the receivables in the event of a dealer default. The obligations of
the manufacturer, importer or distributor do not relieve the dealers of any of
their obligations to Bombardier Capital Inc. However, in some cases, the
manufacturer, importer or distributor who makes a payment on a receivable due
from a dealer may become subrogated to the related claims by Bombardier Capital
Inc. against the dealer and may require a transfer of Bombardier Capital Inc.'s
corresponding claims against the dealer to the extent of the payment.
The terms of these repurchase commitments may vary, both by industry and by
manufacturer, importer or distributor. In some circumstances, the
manufacturer's, importer's or distributor's repurchase obligation may be limited
to a specified percentage of the amount financed. In addition, current trends in
the domestic inventory financing business indicate that repurchase commitments
may not always be available from manufacturers, importers and distributors or
may be replaced with a commitment by the manufacturer or distributor to remarket
the goods financed in the case of a dealer default.
To the extent repurchase agreements and other agreements are entered into
with manufacturers, importers or distributors relating to the dealers who are
being financed by
17
<Page>
receivables, these agreements will, under the receivables purchase agreement, be
assigned by Bombardier Capital Inc. to the depositor, but not by the depositor
to the trust. Bombardier Capital Inc. agrees under the pooling and servicing
agreement to use reasonable efforts to collect on behalf of the depositor under
these agreements with manufacturers, importers and distributors for the
receivables, and the depositor and Bombardier Capital Inc. agree to treat these
amounts as collections on the related receivables and to deposit all of these
collections into the trust.
MONITORING
Once the dealer credit line is established, the relevant manufacturer,
importer or distributor may, after obtaining Bombardier Capital Inc.'s approval
for each shipment, ship products to the dealer and receive payment for them, as
a loan to the dealer, from Bombardier Capital Inc. so long as the dealer's
Bombardier Capital Inc. financed inventory level remains within the limits of
that dealer's credit line. Provided the relevant account is in good standing,
performing under its inventory security agreement and the credit line has not
been withdrawn, approval will normally be given.
In order to ensure a dealer's compliance with the pay-as-sold program,
Bombardier Capital Inc. periodically conducts audit inspections of dealers. In
most cases, inventory is inspected from three to six times per year based upon
the performance of the related dealer and the size of outstanding receivables
for that dealer. Audits may be conducted as infrequently as once per year. The
audits are intended to ensure that the dealers are paying for floorplanned
products as they are sold. The inspections are performed by Bombardier Capital
Inc. field representatives or outside inspection service personnel who have been
specially trained to audit the inventory of dealers. The field audit may
include:
(1) check the actual inventory;
(2) inspect products for signs of use or excessive wear and tear;
(3) spot check dealer sales orders with respect to manufactured housing
related receivables and spot check contracts pending with respect to other
receivables;
(4) complete condition reports on product that is materially worn or
damaged;
(5) inspect the dealer's place of business and report unusual
conditions;
(6) attempt collection for principal as needed; and
(7) obtain the dealer's signature certifying the audit.
Should discrepancies in a dealer's inventory and payment schedule or other
problems be discovered by the auditing representative, Bombardier Capital Inc.'s
management is promptly apprised of the situation.
Bombardier Capital Inc. Outsources Some Activities
Bombardier Capital Inc. has delegated some of its servicing and
administrative duties to third parties and Bombardier Capital Inc. may from time
to time in the future delegate all or a portion of its servicing and
administrative duties for the receivables to third parties, provided that no
delegation of this sort will relieve Bombardier Capital Inc. of its
responsibility as servicer for these duties.
COLLECTION ACTIVITY
Bombardier Capital Inc. is responsible for all normal collection activity
for receivables. When it has been determined that any further collection
activity will require repossession, any remaining inventory is generally
repossessed by Bombardier Capital Inc. in conjunction with the applicable
manufacturer, importer or distributor.
In these instances, if the manufacturer, importer or distributor has entered
into a repurchase agreement, it is generally obligated under the repurchase
agreement to pay Bombardier Capital
18
<Page>
Inc. the sum of the unpaid principal amount of the receivables for the
repossessed product plus some of the costs of repossession and less, in some
circumstances, a scheduled amount determined according to the age of the
repossessed products. The dealer, however, remains obligated to pay Bombardier
Capital Inc. for any unpaid interest, other non-principal collections and any
amounts not otherwise collected from the manufacturer, importer or distributor.
Any payments collected by the servicer from a manufacturer, importer or
distributor under any recourse obligation of a defaulting dealer will be treated
under the pooling and servicing agreement as collections of the related
receivables. Any legal action against a dealer is generally initiated by
Bombardier Capital Inc. as servicer of the receivables.
All payments on the receivables are due when the related inventory is sold
or when payment is otherwise scheduled to be made and a default will exist if
payment is not made when due. Bombardier Capital Inc. has in the past entered
into, and may in the future agree to, an extended payment term arrangement with
a defaulted dealer. When a dealer is on a scheduled payment program and a
payment is missed or cannot be made, the usual course of action by Bombardier
Capital Inc. involves an inspection of the dealer's inventory. Based on this
inspection, a decision is generally made either to extend the payment due date
or to institute other collection measures.
THE ACCOUNTS
GENERAL
The Accounts consist of accounts in the Bombardier Capital Inc. Domestic
Inventory Portfolio that were Eligible Accounts at the time of their designation
as Accounts. In order to be an Eligible Account, each Account must meet criteria
provided in the pooling and servicing agreement. See 'Description of the
Certificates -- Representations and Warranties' and ' -- Eligible Accounts and
Eligible Receivables.'
All Eligible Accounts designated by Bombardier Capital Inc. in accordance
with the receivables purchase agreement to be included as Accounts will be
designated by the depositor as Accounts under the pooling and servicing
agreement and the receivables in the Accounts will be included in the trust. No
selection procedures believed by Bombardier Capital Inc. to be adverse to the
holders of the series have been or will be used by Bombardier Capital Inc. in
selecting the Accounts from which receivables will be transferred to the
depositor.
As long as an Account is an Eligible Account, the receivables in that
Account, which will be part of the trust's assets, may be performing or
non-performing receivables and may be Eligible Receivables or receivables that
are not eligible; however, only Eligible Receivables will be considered in
determining the Pool Balance and therefore in determining various amounts or
percentages which are based on the Pool Balance.
The Accounts under which the receivables have been or will be generated by
Bombardier Capital Inc. or an affiliate of Bombardier Capital Inc. are evidenced
by inventory security agreements entered into by dealers with Bombardier Capital
Inc. to finance the purchase by the dealers of inventory.
Under the pooling and servicing agreement, the depositor has the right,
subject to specified conditions, and in some circumstances is obligated, to
designate from time to time additional qualifying accounts to be included as
Accounts and to convey to the trust the receivables of these Additional
Accounts, including receivables created after this designation. These accounts
must meet the eligibility criteria to qualify as Eligible Accounts as of the
date these accounts are designated as Additional Accounts. Under the receivables
purchase agreement, Bombardier Capital Inc. will from time to time sell or
contribute the receivables then existing, with some exceptions, or later created
under the Accounts and under any Additional Accounts to the depositor, which
will transfer these receivables to the trust under the pooling and servicing
agreement. See 'Description of the Certificates -- Addition of Accounts' and
' -- Representations and Warranties.'
Eligible Receivables in the Bombardier Capital Inc. Domestic Inventory
Portfolio may consist of performing receivables which were previously
non-performing.
19
<Page>
Subject to conditions specified in the pooling and servicing agreement, the
depositor has the right to remove Accounts and receivables from the trust. See
'Description of the Certificates -- Removal of Accounts and Assignment of
Receivables.'
Throughout the term of the trust, the Accounts from which the receivables
arise will be the Accounts designated by the depositor on January 1, 1994 plus
any Additional Accounts, minus any Accounts removed from the trust.
Under the pooling and servicing agreement, the servicer, which is expected
to be Bombardier Capital Inc., or any subservicer, which may include a
Bombardier Capital Inc. affiliate, may, subject to specified conditions, change
the terms relating to the Accounts and the receivables. See 'Description of the
Certificates -- Collection and Other Servicing Procedures.'
Additional information about the accounts will be provided in the prospectus
supplement for each series.
20
<Page>
BOMBARDIER CAPITAL INC.
Bombardier Capital Inc. is a financial services company incorporated in
Massachusetts in January, 1974 and is a wholly-owned subsidiary of Bombardier
Corporation, an Idaho corporation. Bombardier Corporation is an indirect
wholly-owned subsidiary of Bombardier Inc. Bombardier Capital Inc.'s
administrative center is located at 12735 Gran Bay Parkway West, Suite 1000,
Jacksonville, Florida 32258. The telephone number of the administrative center
is (904) 288-1000.
Bombardier Capital Inc. offers secured financing and leasing solutions to
manufacturers, retailers and other commercial businesses in the United States.
Bombardier Capital Inc. derives its revenues primarily from interest and rental
income from lending and leasing activities. Bombardier Capital Inc. targets
industry sectors and asset classes related to its specialized core competencies,
and those of Bombardier's manufacturing segments. These core activities are
managed in three separate businesses: asset services, inventory finance and rail
car leasing.
On September 27, 2002, Bombardier Capital Inc. announced the decision to
reduce assets under management by approximately $5 billion, mainly through the
sale and gradual wind down of certain asset services portfolios. On April 3,
2003, Bombardier Inc. announced that Bombardier Capital Rail Inc., a
wholly-owned subsidiary of Bombardier Capital Inc., would cease the origination
of new rail leasing activities. On April 3, 2003 Bombardier Inc. further
announced that Bombardier Capital Inc.'s continuing origination activities will
be concentrated on inventory financing and providing interim financing support
for sales of Bombardier Aerospace regional commercial aircraft, with limitations
on the maximum amount and the number of aircraft financed.
Additional information about Bombardier Capital Inc. will be provided in the
prospectus supplement for each series.
INVENTORY FINANCE
Bombardier Capital Inc.'s inventory finance activities provide floorplan
financing on a secured basis to retailers located in the United States for the
purchase of recreational, consumer and commercial products. Primary products
currently include marine products, Bombardier manufactured recreational
products, manufactured housing and motorized recreational vehicles.
Bombardier Capital Inc. sells most of its inventory finance receivables as
part of the asset-backed securitization program carried on by the trust.
BOMBARDIER INC.
Bombardier Inc. was incorporated by letters patent under the laws of Canada
in 1902, was continued as a corporation under the Canada Business Corporation
Act by a certificate of continuance dated June 23, 1978, which was subsequently
the subject of certain amendments, and amalgamated with a wholly-owned
subsidiary on February 1, 2001.
Bombardier Inc., a diversified manufacturing and services company, is a
world leading manufacturer of business jets, regional aircraft, rail
transportation equipment and motorized recreational products. It also provides
financial services and asset management in business areas aligned with its core
expertise. On April 3, 2003, Bombardier Inc. announced the planned divestiture
of its Recreational Products Group which manufactures the motorized recreational
products.
Bombardier Inc.'s equity securities are publicly traded on The Toronto Stock
Exchange, on the Brussels Stock Exchange in Belgium and on the Frankfurt Stock
Exchange in Germany. Bombardier Inc. is a reporting issuer under the securities
laws of various provinces in Canada, including Quebec and Ontario, and therefore
makes various public filings with the securities commissions of those provinces,
as well as filings with the exchanges on which its securities are traded.
Bombardier Inc. does not have securities registered in the United States.
'Sea-Doo'r', 'Ski-Doo'r', 'Evinrude'r', 'Johnson'r' and various other words,
numbers and configurations used in this prospectus are trademarks and/or trade
names of various products of
21
<Page>
Bombardier Inc. and/or its affiliates and are registered and/or otherwise
protected under applicable law.
The registered office of Bombardier Inc. is at 800 Rene-Levesque Boulevard
West, Montreal, Quebec, Canada H3B 1Y8.
Additional information about Bombardier Inc. will be provided in the
prospectus supplement for each series.
DESCRIPTION OF THE CERTIFICATES
GENERAL
The certificates will be issued in accordance with the pooling and servicing
agreement filed as an exhibit to the registration statement of which this
prospectus is a part, as supplemented by the respective supplements for each
series of investor certificates and the variable funding certificate. The
pooling and servicing agreement provides that it is governed by New York law.
The following discussion is a summary of the material terms of the pooling and
servicing agreement and does not provide a complete description. For further
information, owners and prospective owners of certificates are advised to
examine the pooling and servicing agreement, copies of which, without specified
exhibits or schedules, will be made available by the trustee upon written
request.
The certificates will be issued in series. Each series of certificates will
evidence undivided beneficial ownership interests in the receivables
representing the right to receive from the trust, upon terms as further
described in this section, funds up to, but not in excess of, the amounts
required to make payments of interest on and principal of the certificates under
the pooling and servicing agreement. A series of certificates may consist of one
or more classes of certificates, and each class of certificates may have
subclasses.
Unless we otherwise specify in the prospectus supplement relating to a
series of certificates, the certificates will be available for purchase in
minimum denominations of $1,000 and integral multiples thereof in book-entry
form. No beneficial owner of a certificate will be entitled to receive a
certificate representing his or her beneficial interest in the certificates,
unless and until definitive certificates are issued under the limited
circumstances described under 'Definitive Certificates.' All references in this
prospectus to actions by 'certificateholders' shall refer to actions taken by
The Depository Trust Company upon instructions from its Participants, and all
references in this prospectus to distributions, notices, reports and statements
to certificateholders shall refer to distributions, notices, reports and
statements to Cede & Co., as the registered holder of the certificates. See
' -- Book-Entry Registration' and ' -- Definitive Certificates' below.
If we so specify in a supplement to this prospectus, the certificateholders
of one or more classes will have the benefit of a derivative agreement,
including an interest rate or currency swap, cap, collar, guaranteed investment
contract or other agreement for the exclusive benefit of that class or those
classes. We will describe any derivative agreement for the benefit of a class
and the financial institution that provides it in the applicable supplement to
this prospectus.
The issuer will pay principal of and interest on a class of certificates
solely from the portion of interest collections and principal collections
distributed on the collateral that are available to that class of certificates
after giving effect to all allocations and reallocations, amounts in any issuer
account relating to that class of certificates, and amounts received under any
derivative agreement or any enhancement relating to that class of certificates.
If those sources are not sufficient to pay the certificates of that class, those
certificateholders will have no recourse to any other assets of the issuer or
the assets of any other entity for the payment of principal of or interest on
those certificates other than any third party credit enhancement provider to the
extent specified in a prospectus supplement.
We will include the following terms of the certificates in a supplement to
this prospectus:
the series designation;
22
<Page>
the rate per annum at which the certificates will bear
interest, if any, or the formula or index on which that rate
will be determined and the date from which interest will
accrue;
the payment dates, if any, for the certificates;
the stated principal amount of each class of certificates
and, if there is more than one class of certificates, the
designation, seniority and any subclasses of any of those
classes;
the overcollateralization amount, if any, for that class of
certificates;
the expected principal payment date of the certificates;
the legal final maturity date of the certificates;
the times at which the certificates may, pursuant to any
optional or mandatory redemption provisions, be redeemed,
and the other terms and provisions of those redemptions;
any additional events of default or early amortization
events for the certificates of that series;
the terms of any enhancement for that series; and
other terms of the certificates.
Holders of certificates of any outstanding series or class will not have the
right to review or consent to any subsequent issuance of certificates. A series
or class of certificates may be issued privately, which series or class would
therefore not be offered pursuant to this prospectus and a prospectus
supplement.
INTEREST
Each certificate, except for any zero-coupon discount certificates, will
bear interest at either a fixed rate or a floating or variable rate, which will
be as specified in the related prospectus supplement. If your certificate bears
interest at a floating or variable rate, the related prospectus supplement will
describe how that rate is calculated. We will specify the interest accrual
period in the related prospectus supplement.
If a discount certificate is issued as part of a series of certificates,
until the expected principal payment date for the discount certificate, any
accreted interest will be capitalized as part of the principal balance of the
certificate and reinvested in the collateral certificate. The applicable
prospectus supplement will specify the interest rate to be borne by a discount
certificate after an event of default or after its expected principal payment
date.
Interest payments on a series of certificates will be derived primarily from
collections of non-principal receivables allocated to such series and
enhancement amounts applicable to interest. Unless otherwise specified in the
related prospectus supplement, amounts available to make interest payments on a
series of certificates will be distributed first in respect of any senior
classes of certificates and then to the subordinate classes of certificates, in
each case up to the accrued and unpaid interest thereon.
PRINCIPAL
We will specify the timing and the amount of payments of principal of a
certificate in the related supplement to this prospectus. Generally, each series
or class of certificates will begin with a revolving period during which no
principal payments will be made to the certificateholders. Following its
revolving period, each series or class of certificates is expected to begin to
accumulate principal or begin to distribute principal. The prospectus supplement
describes the conditions under which an accumulation or amortization period will
begin for your series or class.
For some certificates, the issuer expects to pay the stated principal amount
of each certificate in one payment on that certificate's expected principal
payment date, and the issuer is obligated to do so if funds are available for
that purpose. It is not an event of default if the principal of a certificate is
not paid on its expected principal payment date because funds are unavailable
for that purpose.
23
<Page>
Principal of a certificate may be paid earlier than its expected principal
payment date if an early redemption event or an event of default occurs or if an
interest in the receivables represented by all outstanding series is required to
be repurchased as described below under 'Representations and Warranties.'
Principal of a certificate may be paid later than its expected principal payment
date if sufficient funds are not allocated to the series or class of
certificates to be paid. If the stated principal amount of a certificate is not
paid in full on its legal final maturity date, an event of default will occur
with respect to that certificate.
A series of certificates may provide for the variable funding and
amortization of those certificates from time to time, the terms of which will be
described in the related prospectus supplement.
See 'Risk Factors -- The Possibility Of Bankruptcy Events Related To
Bombardier Capital Inc. or Bombardier Capital Receivables Corporation And The
Uncertain Timing Of Obligor Repayments Render The Life Of Your Certificates
Uncertain And Therefore You May Receive Principal On Dates Other Than When You
Anticipate' for a discussion of factors that may affect the timing of principal
payments on the certificates.
SUBORDINATION OF PRINCIPAL
If a series of certificates has more than one class, one or more classes may
be subordinate to one or more senior classes in the manner described in the
prospectus supplement. For each series having one or more classes of subordinate
certificates, the subordinate certificates of that series will serve as credit
enhancement for the senior certificates of that series. Such a series of
certificates may also have other forms of credit enhancement. The following
paragraphs under this subheading illustrate how this subordination works in the
case of a series that has Class A certificates and Class B certificates. The
prospectus supplement for a series may provide for different subordination
arrangements among the senior and subordinate classes of a series.
Principal payments on Class B certificates of a series are subordinated to
payments on Class A certificates of that series. Subordination of Class B
certificates of a series provides credit enhancement for Class A certificates of
that series.
In all series, principal collections that are allocable to subordinated
classes of certificates may be reallocated to pay interest on senior classes of
certificates of that series and, if so specified, on designated subordinated
classes of certificates of that series. In addition, charge-offs of defaulted
principal receivables are allocated first to the subordinated classes of a
series.
No principal payments will be made on a subordinated class of certificates
until all principal of the senior classes of certificates of that series has
been paid in full. However, there are several exceptions to this rule. Principal
may be paid to the holders of subordinated classes while certificates of senior
classes of that series are still outstanding under the following circumstances:
If a subordinated class has been reduced as a result of an
allocation of charge-offs of defaulted principal receivables
to that class or reallocation of principal collections from
that class to pay interest on senior classes, and that
reduction is later reimbursed from excess interest
collections, the amount of that reimbursement is no longer
subordinated to the senior classes of that series and may be
paid to the holders of the subordinated class while the
certificates of senior classes are still outstanding.
If principal collections have been reallocated from the
principal funding account for a subordinated class to the
principal funding account for a senior class of certificates
of the same series, then the subordinated classes of
certificates of that series may be paid.
BOOK-ENTRY REGISTRATION
The certificates will be book-entry certificates and, except as described
below, beneficial owners of the certificates will not be entitled to receive a
physical certificate representing their certificate. Beneficial owners of the
certificates may elect to hold their certificates through the Depository Trust
Company in the United States, or Clearstream or the Euroclear system in
24
<Page>
Europe, if they are participants in those systems, or indirectly through
organizations which clear through or maintain a custodial relationship with a
participant in those systems.
The certificates will initially be registered in the name of Cede & Co., the
nominee of The Depository Trust Company. Clearstream and Euroclear will hold
omnibus positions on behalf of their participants through customers' securities
accounts in Clearstream's and Euroclear's names on the books of their respective
depositaries, which in turn will hold such positions in customers' securities
accounts in the depositaries' names on the books of The Depository Trust
Company. Citibank, N.A. will act as depositary for Clearstream and JPMorgan
Chase Bank will act as depositary for Euroclear.
The Depository Trust Company is a limited-purpose trust company organized
under the laws of the State of New York, a member of the Federal Reserve System,
and a 'clearing corporation' within the meaning of the UCC and a 'clearing
agency' registered according to the provisions of Section 17A of the Securities
Exchange Act of 1934, as amended. The Depository Trust Company was created to
hold securities for its Participants and facilitate the clearance and settlement
of securities transactions between Participants through electronic book-entry
changes in their accounts, eliminating the need for physical movement of
certificates. Participants include the underwriters, securities brokers and
dealers, banks, trust companies and clearing corporations and may include other
organizations. Indirect access to The Depository Trust Company system also is
available to those entities such as banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a Participant,
either directly or indirectly.
If you are not a Participant or an entity that clears through or maintains a
custodial relationship with a Participant, but desire to purchase, sell or
otherwise transfer ownership of, or other interests in, certificates you can do
so only through Participants and entities that clear through or maintain a
custodial relationship with a Participant. In addition, you will receive all
distributions of principal of and interest on your certificates from the trustee
through The Depository Trust Company and its Participants. Under a book-entry
format, you will receive payments after the related distribution date because,
while payments are required to be forwarded to Cede & Co., as nominee for The
Depository Trust Company, on each of these dates, The Depository Trust Company
will forward these payments to its Participants which will then be required to
forward them to entities that clear through or maintain a custodial relationship
with a Participant, either directly or indirectly, or to you as the owner of an
interest in the certificates. It is anticipated that the only
'certificateholder', as defined in the pooling and servicing agreement, will be
Cede & Co., as nominee of The Depository Trust Company. You will not be
recognized by the trustee as 'certificateholders' under the pooling and
servicing agreement. You will only be permitted to exercise the rights of
certificateholders under the pooling and servicing agreement indirectly through
The Depository Trust Company and its Participants, who in turn will exercise
their rights through The Depository Trust Company.
The Depository Trust Company has advised the depositor that neither The
Depository Trust Company nor Cede & Co. will consent or vote with respect to any
action permitted to be taken by the certificateholders under the pooling and
servicing agreement or any other agreement. Under its usual procedures, The
Depository Trust Company mails an omnibus proxy to the issuer as soon as
possible after the record date. The omnibus proxy assigns Cede & Co.'s
consenting or voting rights to those Participants to whose accounts the
certificates are credited on the record date, identified in an attached listing.
Under the rules, regulations and procedures creating and affecting The
Depository Trust Company and its operations, The Depository Trust Company is
required to make book-entry transfers among Participants on whose behalf it acts
with respect to the certificates and is required to receive and transmit
distributions of principal of and interest on the certificates. Participants and
entities that clear through or maintain a custodial relationship with a
Participant, either directly or indirectly, and with which beneficial owners of
certificates have accounts with respect to the certificates similarly are
required to make book-entry transfers and receive and transmit distributions of
principal and interest on behalf of their respective beneficial owners of
certificates.
25
<Page>
Beneficial owners of certificates who are not Participants may transfer
ownership of their certificates only through Participants and entities that
clear or maintain a custodial relationship with a Participant, by instructing
such Participant or entity to transfer their certificate, by book-entry
transfer, through The Depository Trust Company for the account of the purchaser
of such certificate, which account is maintained with the purchaser's
Participant or with an entity that clears through or maintains a custodial
relationship with a Participant. In accordance with The Depository Trust
Company's normal rules and procedures, transfers of ownership of certificates
will be executed through The Depository Trust Company, and the accounts of the
respective Participants at The Depository Trust Company will be debited and
credited. Similarly, the Participants and entities that maintain a custodial
relationship with a Participant will make debits and credits, as the case may
be, on their records on behalf of the beneficial owners of certificates who are
selling and purchasing the certificates.
Because The Depository Trust Company can only act on behalf of Participants,
who in turn act on behalf of entities that clear through or maintain a custodial
relationship with them, either directly or indirectly and specified banks, the
ability of a beneficial owner of a certificate to pledge certificates to persons
or entities that do not participate in The Depository Trust Company system, or
otherwise take actions in respect of the certificates, may be limited due to the
lack of a physical certificate issued to the beneficial owner.
Transfers between Participants will occur in accordance with The Depository
Trust Company's rules. Transfers between participants in Clearstream and
participants in Euroclear will occur in accordance with their respective rules
and operating procedures.
Cross-market transfers between persons holding directly or indirectly
through The Depository Trust Company, on the one hand, and directly or
indirectly through participants in Clearstream or Euroclear, on the other, will
be effected in The Depository Trust Company in accordance with The Depository
Trust Company rules on behalf of the relevant European international clearing
system by the relevant depositary; however, such cross market transactions will
require delivery of instructions to the relevant European international clearing
system by the counterpart in such system in accordance with its rules and
procedures and within its established deadlines. The relevant European
international clearing system will, if the transaction meets its settlement
requirements, deliver instructions to the relevant depositary to take action to
effect final settlement on its behalf by delivering or receiving securities in
The Depository Trust Company, and making or receiving payment in accordance with
normal procedures for same day funds settlement applicable to The Depository
Trust Company. Participants in Clearstream and Euroclear may not deliver
instructions directly to the European depositaries.
Because of time zone differences, credits of securities received in
Clearstream or Euroclear as a result of a transaction with a Participant will be
made during subsequent securities settlement processing and dated the business
day following The Depository Trust Company's settlement date. Such credits or
any transactions in such securities, settled during such processing, will be
reported to the relevant participants in Euroclear or Clearstream on such
business day. Cash received in Clearstream or Euroclear, as a result of sales of
securities by or through a participant in Clearstream or Euroclear to a
Participant, will be received with value on the Depository Trust Company
settlement date but will be available in the relevant Clearstream or Euroclear
cash account only as of the business day following settlement in The Depository
Trust Company. For information with respect to tax documentation procedures
relating to the certificates, see 'Material Federal Income Tax
Consequences -- Foreign Investors'.
Clearstream, formerly known as Cedelbank, societe anonyme, is incorporated
under the laws of Luxembourg as a professional depository. Clearstream holds
securities for its participating organizations and facilitates the clearance and
settlement of securities transactions between its participants through
electronic book-entry changes in accounts of its participants, eliminating the
need for physical movement of certificates. Transactions may be settled in
Clearstream in any of at least 28 currencies, including United States dollars.
Clearstream provides to its participants, among other things, services for
safekeeping, administration, clearance and settlement of internationally traded
securities and securities lending and borrowing. Clearstream interfaces with
domestic
26
<Page>
markets in several countries. As a professional depository, Clearstream is
subject to regulation by the Luxembourg Monetary Institute. Participants in
Clearstream are recognized financial institutions around the world, including
underwriters, securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations. Indirect access to Clearstream is
also available to others, such as banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a participant in
Clearstream, either directly or indirectly.
The Euroclear system was created in 1968 to hold securities for participants
of Euroclear and to clear and settle transactions between its participants
through simultaneous electronic book-entry delivery against payment, eliminating
the need for physical movement of certificates and any risk from lack of
simultaneous transfers of securities and cash. Transactions may now be settled
in any of approximately 35 currencies, including United States dollars. The
Euroclear system includes various other services, including securities lending
and borrowing, and interfaces with domestic markets in several countries
generally similar to the arrangements for cross-market transfers with The
Depository Trust Company described above. The Euroclear system is currently
operated by Euroclear Bank S.A./N.V. All operations are currently conducted by
the Euroclear operator, and all Euroclear system securities clearance accounts
and the Euroclear system cash accounts are accounts with the Euroclear operator,
not the cooperative corporation. The cooperative corporation establishes policy
for the Euroclear system on behalf of participants of the Euroclear system.
Participants in the Euroclear system include banks (including central banks),
securities brokers and dealers and other professional financial intermediaries.
Indirect access to the Euroclear system is also available to other firms that
clear through or maintain a custodial relationship with a participant in
Euroclear, either directly or indirectly.
The Euroclear operator is the Belgian branch of a New York banking
corporation which is a member bank of the Federal Reserve System. For this
reason, it is regulated and examined by the Board of Governors of the Federal
Reserve System and the New York State Banking Department, as well as the Belgian
Banking Commission.
Securities clearance accounts and cash accounts with the Euroclear operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of the Euroclear system and applicable Belgian law.
These terms, conditions and procedures govern transfers of securities and cash
within the Euroclear system, withdrawals of securities and cash from the
Euroclear system, and receipts of payments with respect to securities in the
Euroclear system. All securities in the Euroclear system are held on a fungible
basis without attribution of specific certificates to specific securities
clearance accounts. The Euroclear operator acts only on behalf of participants
of the Euroclear system, and has no record of or relationship with persons
holding through participants in the Euroclear system.
Distributions with respect to the certificates held through Clearstream or
Euroclear will be credited to the cash accounts of participants in Clearstream
or Euroclear in accordance with the relevant system's rules and procedures, to
the extent received by their respective depositories. These distributions will
be subject to tax reporting in accordance with relevant United States tax laws
and regulations. See 'Material Federal Income Tax Consequences.'
Clearstream or the Euroclear operator, as the case may be, will take any
action permitted to be taken by a certificateholder under the pooling and
servicing agreement on behalf of a participant in Clearstream or Euroclear
respectively only in accordance with its relevant rules and procedures and
subject to the ability of its depositary to effect these actions on its behalf
through The Depository Trust Company.
Although The Depository Trust Company, Clearstream and the Euroclear system
have agreed to the foregoing procedures in order to facilitate transfers of
certificates among participants of The Depository Trust Company, Clearstream and
Euroclear, they are under no obligation to perform or continue to perform these
procedures and these procedures may be discontinued at any time. For a
discussion of issues concerning global clearance, settlement and tax
documentation procedures as they relate to certificates held by The Depository
Trust Company, please see the Annex with respect thereto in the related
prospectus supplement, which is incorporated by reference into this prospectus.
27
<Page>
DEFINITIVE CERTIFICATES
A class of certificates will be issued in fully registered, certificated
form to you or your nominees rather than to The Depository Trust Company or its
nominee, only if:
(1) we advise the trustee that The Depository Trust Company is no longer
willing or able to discharge properly its responsibilities under such
certificates and we are unable to locate a qualified successor;
(2) we, at our option, advise the trustee that we elect to terminate the
book-entry system for such certificates through The Depository Trust
Company; or
(3) after the occurrence of a Servicer Default under the pooling and
servicing agreement, beneficial owners of certificates representing not less
than 50% of the aggregate unpaid principal amount of such class of
certificates advise the trustee and The Depository Trust Company through
Participants in writing that the continuation of a book-entry system through
The Depository Trust Company, or its successor, is no longer in the best
interests of those beneficial owners of certificates.
If any of the events described in the immediately preceding paragraph
occurs, the trustee is required through The Depository Trust Company to notify
all beneficial owners of certificates of the availability through The Depository
Trust Company of definitive certificates. Upon surrender by The Depository Trust
Company of the certificate or certificates held by it or its nominee
representing the certificates and instructions for registration, the trustee
will issue the certificates in the form of definitive certificates, and after
this issuance the trustee will recognize the holders as certificateholders under
the pooling and servicing agreement.
Distributions of principal of and interest on the certificates will be made
by the trustee directly to holders in accordance with the procedures set forth
under the caption 'Description of the Certificates -- Book-entry Registration'
in this prospectus and in the pooling and servicing agreement. Distributions on
each distribution date will be made to holders in whose names the definitive
certificates were registered at the close of business on the last day of the
preceding month. Distributions will be made by wire transfer to the address of
each holder as it appears on the register maintained by the trustee. The final
distribution on any certificate, whether definitive certificates or the
certificate or certificates registered in the name of Cede & Co. representing
the certificates, however, will be made only upon presentation and surrender of
that certificate on the final payment date at the office or agency as is
specified in the notice of final distribution to certificateholders. The trustee
will provide this notice to registered certificateholders not later than the
fifth day of the month of the final distribution.
Definitive certificates will be transferable or exchangeable at the offices
of the trustee, which shall initially be Deutsche Bank Trust Company Americas.
No service charge will be imposed for any registration of transfer or exchange,
but the trustee may require payment of a sum sufficient to cover any tax or
other governmental charge imposed in connection therewith.
RETAINED INTEREST AND VARIABLE FUNDING CERTIFICATE
The trust's assets will be allocated in part to each series of investor
certificates that may be outstanding from time to time, and the remainder will
be allocated to the depositor as holder of the BCRC Certificate evidencing the
Retained Interest and to the holder, currently the depositor, of the variable
funding certificate evidencing the excess, if any, of the Pool Balance over the
Required Pool Balance.
The Retained Interest will consist of
(1) the undivided interest in the trusts' assets that will be
subordinated from time to time to the investor certificates of each
outstanding series, that is, on any date, the sum of the Available
Subordinated Amount and the aggregate available subordinated amounts for all
other outstanding series on that date after giving effect to the
allocations, distributions, withdrawals and deposits to be made on that
date; and
28
<Page>
(2) with respect to each series on any date of determination, a
percentage, to be specified in the related prospectus supplement, of the
related Adjusted Invested Amount of each series, which will not be
subordinated to the certificates.
The interest represented by the variable funding certificate will consist of
the excess, if any, of the Pool Balance over the Required Pool Balance which
generally will fluctuate and could be eliminated if the Pool Balance is less
than the Required Pool Balance. However, upon the occurrence of an event of
bankruptcy, insolvency or receivership relating to Bombardier Capital Inc. or
the depositor, the proportionate interest in the Pool Balance represented by the
variable funding certificate as of the date of the event of bankruptcy,
insolvency or receivership relating to Bombardier Capital Inc. or the depositor
will be fixed relative to the interests represented by the investor certificates
of each outstanding series for purposes of further allocations of principal
collections from the pool and the relative interest of the variable funding
certificate in further allocations of Non-Principal Collections will not be less
than the relative interest thereof as of the event of bankruptcy, insolvency or
receivership relating to Bombardier Capital Inc. or the depositor.
On each business day on which Non-Principal Collections and principal
collections are received by the servicer, the holder of the variable funding
certificate will be entitled to receive a distribution equal to the product of
the Variable Funding Percentage and all Non-Principal Collections and principal
collections.
In accordance with the pooling and servicing agreement, the BCRC Certificate
and the variable funding certificate have been issued to the depositor. The
depositor holds the BCRC Certificate and has pledged its interest in the
variable funding certificate to Bombardier Capital Inc. as security for the
promissory note issued by the depositor to Bombardier Capital Inc. as part of
the consideration for the sale of the receivables by Bombardier Capital Inc. to
the depositor. Amounts allocated to the depositor for the variable funding
certificate or the BCRC Certificate may be available to the depositor to pay
principal and interest on the promissory note issued to Bombardier Capital Inc.
See 'Description of the Receivables Purchase Agreement -- Sale and Transfer of
Receivables.' Except after the occurrence of an event of bankruptcy, insolvency
or receivership relating to Bombardier Capital Inc. or the depositor as
described in this prospectus under the caption ' -- Early Amortization Events'
below, the outstanding principal balance of the variable funding certificate
will fluctuate to reflect increases or decreases in the aggregate outstanding
principal balance of the receivables, including any increases due to the
transfer of additional receivables to the trust. The holder of the variable
funding certificate will own an undivided interest in the trust that will rank
pari passu with the interest of all series in the aggregate and the portion of
the Retained Interest that is not subordinated to the certificates or to the
investor certificates of any other series.
NEW ISSUANCES
The pooling and servicing agreement provides that, under one or more
supplements, the depositor may cause the trustee to issue one or more new
series. In the supplement, the depositor may specify, among other things, for
the new series:
its name or designation;
its initial principal amount, or the method for calculating
this amount, and the currency in which it is denominated;
its certificate rate or the method for determining its
certificate rate;
the payment date or dates and the date or dates from which
interest will accrue;
the method for allocating collections to certificateholders;
the issuer and terms of any form of enhancement;
the terms on which the investor certificates of that series
may be exchanged for investor certificates of a series other
than your series, repurchased by the depositor or remarketed
to other investors;
29
<Page>
the series termination date;
the designation of any accounts established for this series
and the terms governing the operation of the accounts;
the monthly servicing fee and the investors' servicing fee;
the number of classes of investor certificates of the series
and, if more than one class, the rights and priorities of
each class;
the extent to which the investor certificates of the series
will be issuable in temporary or permanent global form;
whether the investor certificates of this series may be
issued in bearer form and any limitations imposed on the
bearer certificates;
the priority of this series to any other series;
whether this series will be part of a group; and
any other terms permitted by the related supplement and the
pooling and servicing agreement.
The depositor may offer any series under a prospectus or other disclosure
document in transactions either registered under the Securities Act of 1933, as
amended, or exempt from registration under that act, directly or through the
underwriters or one or more other underwriters or placement agents. There is no
limit to the number of investor certificates that may be issued under the
pooling and servicing agreement.
As stated above, the pooling and servicing agreement provides that the
depositor may specify the terms of a new series so that each series has a
Controlled Amortization Period or Controlled Accumulation Period which may have
a different length and begin on a different date than the Controlled
Amortization Period or Controlled Accumulation Period for any other series.
Further, one or more series may be in their early amortization periods,
Controlled Amortization Period or Controlled Accumulation Periods while other
series are not. Thus, some series may be amortizing or accumulating principal,
while other series are not amortizing or accumulating principal. Moreover,
different series may have the benefits of different forms of enhancement issued
by different entities. Under the pooling and servicing agreement, the trustee
will hold each form of enhancement only on behalf of the series, or a particular
class within a series, to which it relates. The pooling and servicing agreement
also provides that the depositor may specify different certificate rates and
monthly servicing fees for each series, or a particular class within a series.
In addition, the depositor has the option under the pooling and servicing
agreement to vary between series, or classes within a series, the terms upon
which a series, or classes within a series, may be repurchased by the depositor.
A new series may be issued only upon the satisfaction of specified
conditions. The depositor may cause the issuance of a new series by notifying
the trustee at least five business days in advance of the applicable issuance
date. The notice must state the designation of any series and for that series:
(1) its initial principal amount,
(2) its currency and certificate rate,
(3) the issuer of any enhancement for that series, and
(4) the related series issuance date.
The pooling and servicing agreement further provides that the trust will
issue any series only upon delivery to it of the following:
(1) a supplement in form satisfactory to the trustee signed by the
depositor and the servicer and specifying the principal terms of that
series;
(2) any related enhancement agreement executed by each of the parties
other than the trustee; and
30
<Page>
(3) an opinion of counsel to the effect that, for federal income and
Vermont state income tax purposes,
(x) the issuance will not adversely affect the characterization of
the investor certificates of any outstanding series or class as debt of
the depositor,
(y) the issuance will not cause or constitute a taxable event for any
certificateholder or the trust, and
(z) the investor certificates of that new series will be
characterized as debt of the depositor.
The issuance of a new series is also subject to the conditions that:
(1) the depositor must have delivered to the trustee and any enhancement
provider a certificate of a vice president or more senior officer, dated the
related series issuance date, to the effect that the depositor reasonably
believes that the issuance will not cause an Early Amortization Event to
occur with respect to any series,
(2) after giving effect to the issuance, the depositor will have an
interest in the pool represented by the BCRC Certificate and the variable
funding certificate equal to at least 2% of the aggregate amount of
receivables included in the trust, in each case as of the series issuance
date and after giving effect to the issuance, and
(3) written notice of the proposed new issuance shall have been given to
each Rating Agency at least five business days before the series issuance
date and no Rating Agency shall have notified the depositor, Bombardier
Capital Inc. or the trustee that the issuance will result in a reduction or
withdrawal of the ratings of any outstanding series or class of investor
certificates.
Upon satisfaction of all these conditions, the trust will issue the new
series.
SUPPLEMENTAL CERTIFICATE
The pooling and servicing agreement provides that the BCRC Certificate must,
at all times, be beneficially owned by the depositor. Upon satisfaction of the
conditions described in this paragraph, however, the depositor may surrender the
BCRC Certificate to the trustee in exchange for a newly issued BCRC Certificate
and a Supplemental Certificate. The Supplemental Certificate is not required to
be beneficially owned by the depositor and may be delivered to or at the
direction of the depositor to any entity. It is a condition to delivery of the
Supplemental Certificate that, following delivery of the Supplemental
Certificate to another entity, the depositor shall, nevertheless, have an
interest in the trust, represented by the remaining BCRC Certificate and the
variable funding certificate, equal to at least 2% of the total amount of
receivables included in the trust. Additional conditions to the delivery of a
Supplemental Certificate are that the depositor shall have given the Rating
Agencies 10 days' prior notice and the Rating Agency Condition shall have been
satisfied for the exchange and that an opinion of counsel shall be delivered to
the trustee to the effect that, for federal income and Vermont state income tax
purposes, the issuance of a series will not adversely affect the
characterization of the investor certificates of any outstanding series or class
as debt of the depositor and that the issuance will not cause or constitute a
taxable event for any certificateholder or the trust. In addition, if the
supplement by which the Supplemental Certificate is issued amends any of the
terms of the pooling and servicing agreement, the supplement shall be subject to
the conditions described under the caption ' -- Amendments' below.
If any Supplemental Certificate is to be transferred or exchanged, it shall
be transferred or exchanged only upon satisfaction of the conditions described
in the preceding paragraph.
If a Supplemental Certificate is issued, all references in this prospectus
to the BCRC Certificate and distributions made on the BCRC Certificate will
include the Supplemental Certificate and distributions to be made on the
Supplemental Certificate and references to the holder of the BCRC Certificate or
to the depositor as holder of the BCRC Certificate will include the depositor
and the holder of the Supplemental Certificate.
31
<Page>
CONVEYANCE OF RECEIVABLES AND COLLATERAL SECURITY
The depositor has sold and assigned to the trust all of the depositor's
right, title and interest in and to the receivables under the Eligible Accounts
purchased from Bombardier Capital Inc. and the related collateral security
granted by the related obligors as of January 1, 1994, all receivables created
in those initial accounts after January 1, 1994 and the depositor's interest in
the related security granted by obligors and in the receivables purchase
agreement, other than repurchase agreements and other agreements with
manufacturers, importers or distributors, and the proceeds of all of the
foregoing.
To evidence the sale or contribution of the receivables then existing or
subsequently arising under the Accounts to the depositor by Bombardier Capital
Inc. and the transfer of these receivables by the depositor to the trust,
Bombardier Capital Inc. has indicated in its computer records that these
receivables and the related security granted by the related obligors have been
transferred to the depositor and that the depositor has transferred its interest
to the trust. In addition, Bombardier Capital Inc. provided to the depositor,
and the depositor has provided to the trustee, a computer file or microfiche or
written list containing a true and complete list of all the Eligible Accounts
and the outstanding balances of the receivables in these Accounts as of January
1, 1994 and as of the dates that Accounts were added to the trust. Bombardier
Capital Inc. has retained and will not deliver to the depositor or to the
trustee any other records or agreements for these receivables. Except as set
forth above, the records and agreements relating to the receivables in these
Eligible Accounts have not and will not be segregated from those relating to
other accounts and receivables of Bombardier Capital Inc., and the physical
documentation for these receivables will not be stamped or marked to reflect the
transfer of these receivables to the trust. The depositor has filed one or more
financing statements under Delaware law -- including financing statements under
revised Article 9 of the UCC that are 'in lieu of' financing statements
previously filed under Vermont law -- to perfect the trust's interest in these
receivables, the security granted by the related obligors, the receivables
purchase agreement and the proceeds thereof. See 'Risk Factors -- State and
Federal Law May Limit the Ability of the Servicer to Realize on Receivables Thus
Causing Losses on Your Certificates' and 'Material Legal Aspects of the
Receivables.'
As described below under 'Addition of Accounts,' the depositor has the
right -- subject to limitations and conditions -- and in some circumstances is
obligated, to designate from time to time additional accounts to be included as
Additional Accounts, to acquire from Bombardier Capital Inc. under the
receivables purchase agreement the receivables then existing or subsequently
created in the Additional Accounts and to convey to the trust the receivables
then existing or subsequently arising in the accounts. Each Additional Account
must be an Eligible Account at the time of its designation to the trust. For
conveyance of receivables in Additional Accounts, the depositor will follow the
procedures described in the preceding paragraph, except that the computer file
or microfiche or written list will show information for these Additional
Accounts as of the cutoff date for the addition.
REPRESENTATIONS AND WARRANTIES
The depositor may be required to add receivables to the trust or to remove
or repurchase receivables in designated Accounts from the trust. In addition,
the depositor may, if the conditions precedent are met, add or remove
receivables in designated Accounts to or from the trust. The following
paragraphs as well as those set forth under the captions 'Addition of Accounts'
and 'Removal of Accounts and Assignment of Receivables' in this prospectus
summarize the circumstances under which these actions must or may be taken and
the respective repurchase obligations of the depositor and Bombardier Capital
Inc.
The depositor has made representations and warranties to the trustee and
will on the date a series of certificates is issued make the following
representations and warranties about the Accounts, the receivables and the
security granted by the related obligors:
32
<Page>
as of January 1, 1994 and as of the date of the issuance of
the each series of certificates, each Account is an Eligible
Account and, in the case of Additional Accounts, as of the
date they are included as Accounts, and on each Transfer
Date, each Additional Account is an Eligible Account,
each receivable and all security granted by the related
obligors conveyed to the trust on January 1, 1994 or, in the
case of Additional Accounts, on the date they are included
as Accounts, and on each Transfer Date have been conveyed to
the trust free and clear of any liens, except for liens
created or permitted under the pooling and servicing
agreement, and
for each receivable and all security granted by the related
obligors transferred to the trust on January 1, 1994 or, in
the case of Additional Accounts, on the date they are
included as Accounts, and on each Transfer Date, all
appropriate consents and governmental authorizations
required to be obtained by the depositor in connection with
the conveyance have been duly obtained.
If the depositor breaches any representation and warranty described above
and this breach remains uncured for 30 days or a longer period as may be agreed
to by the trustee, after the earlier to occur of the discovery of this breach or
receipt of written notice of this breach by the depositor, and this breach has a
materially adverse effect on the holders of an outstanding series of
certificates or the interest represented by the variable funding certificate,
that receivable or, in the case of a breach relating to an Account, all
receivables in the related Account will be retransferred from the trust to the
depositor on the terms and conditions described in the following paragraph, and
in the case of an Account, that Account will no longer be designated for
inclusion in the trust.
Each of these receivables shall be retransferred from the trust to the
depositor on or before the end of the calendar month in which the retransfer
obligation arises, with a corresponding reduction in the Pool Balance. Unless an
event of bankruptcy, insolvency or receivership relating to Bombardier Capital
Inc. or the depositor has occurred, if this deduction would cause the Pool
Balance to be less than the Required Pool Balance on the preceding Determination
Date, after giving effect to the allocations, distributions, withdrawals and
deposits to be made on the related distribution date, on the date on which this
retransfer to the depositor is to occur, the depositor will be obligated to make
a deposit into the collection account in immediately available funds in an
amount equal to the amount by which the Required Pool Balance exceeds the Pool
Balance. If that amount is not deposited, the related receivables will not be
reassigned to the depositor and will remain part of the trust. The reassignment
of any receivable to the depositor and the payment of an amount equal to the
excess of the Required Pool Balance over the Pool Balance will be the sole
remedy for any breach of the representations and warranties described in the
preceding paragraph available to the certificateholders or the trustee on behalf
of the certificateholders.
In the pooling and servicing agreement, the depositor also makes
representations and warranties to the trustee to the effect, among other things,
that as of January 1, 1994 and each series issuance date:
(1) it is duly incorporated and in good standing and has the authority
to consummate the transactions contemplated by the pooling and servicing
agreement and the pooling and servicing agreement -- or in the case of
Additional Accounts, the related assignment -- constitutes a valid, binding
and enforceable agreement of the depositor, and
(2) the pooling and servicing agreement constitutes a valid sale,
transfer and assignment to the trust of all right, title and interest of the
depositor in the receivables and the security granted by the related
obligors, whether then existing or subsequently created, and the proceeds
thereof, under the UCC as then in effect in the State of Vermont and, for
each series issuance date, the State of Delaware, which is effective on the
date of the issuance of each series of certificates or as of the date
Accounts are added to the trust, if applicable.
In the event that:
any of the representations and warranties described in
paragraph (1) above has been breached,
33
<Page>
the representation and warranty about the pooling and
servicing agreement in paragraph (2) above has been breached
and the pooling and servicing agreement does not constitute
the grant of a perfected ownership or security interest in
the receivables and the security granted by the related
obligors and the proceeds thereof under the UCC as then in
effect in the relevant jurisdiction, or
other specific representations and warranties set forth in
the pooling and servicing agreement are breached,
and the breach has a material adverse effect on the interests of the holders of
investor certificates of each outstanding series, the holder of the variable
funding certificate or certain third party credit enhancement providers, either
the trustee, the holder of the variable funding certificate, or the holders of
investor certificates of all outstanding series evidencing not less than a
majority of the aggregate unpaid principal amount of all outstanding series of
investor certificates, by written notice to the depositor and the servicer, and
to the trustee and the issuer or provider of any enhancement if given by
certificateholders, may, unless an event of bankruptcy, insolvency or
receivership relating to Bombardier Capital Inc. or the depositor has occurred,
direct the depositor to repurchase the interest in the receivables represented
by each outstanding series or the variable funding certificate, or both, within
60 days of the notice, or within any longer period specified in the notice.
This repurchase will not be required to be made, however, if at the end of
the applicable period, either each breached representation and warranty has been
satisfied in all material respects or, in the case of a breach described in the
second item above, the pooling and servicing agreement then constitutes the
grant of a security interest in the receivables and the security granted by the
related obligors, and proceeds thereof, under the Uniform Commercial Code as
then in effect in the State of Delaware, and any material adverse effect on the
interest in the receivables represented by each outstanding series or the
variable funding certificate or both, as applicable, caused by the breach has
been cured.
The repurchase price for any outstanding series will be equal to the sum of
the total principal balance of the certificates of such series on the
distribution date on which the purchase is scheduled to be made and the accrued
and unpaid interest on the unpaid principal balance of the certificates at the
applicable certificate rate, plus any unpaid interest resulting from a cap on
the interest payable to any class of certificates with respect to such series,
plus interest on overdue interest, to the extent lawfully payable.
The deposit by or on behalf of the depositor with the trustee of the
repurchase price for all outstanding series or the variable funding certificate
or both, in immediately available funds, will be considered a payment in full of
that series or the variable funding certificate or both. If notice is given as
provided above, the obligation of the depositor to make this deposit will
constitute the sole remedy for a breach of the representations and warranties
available to the investor certificateholders or the holder of the variable
funding certificate or the trustee on behalf of the investor certificateholders.
ELIGIBLE ACCOUNTS AND ELIGIBLE RECEIVABLES
An Eligible Account is:
(1) an individual financing account established by Bombardier Capital
Inc. or established by an affiliate of Bombardier Capital Inc. or by a third
party but which satisfies Bombardier Capital Inc.'s customary underwriting
standards and acquired by Bombardier Capital Inc. or an affiliate of
Bombardier Capital Inc., with an obligor for Eligible Products under an
inventory security agreement in the ordinary course of business, and
(2) an individual line of credit or financing agreement extended by
Bombardier Capital Inc. or an affiliate of Bombardier Capital Inc. or by a
third party which satisfies Bombardier Capital Inc.'s customary underwriting
standards and acquired by Bombardier Capital Inc. or an affiliate of
Bombardier Capital Inc. to an obligor for the purpose of financing working
capital, manufacturing, production or inventories and secured by assets of
that obligor, which, in each
34
<Page>
case, as of the date its eligibility is determined is extended to an obligor
that satisfies the eligibility requirements of the pooling and servicing
agreement and is in existence and, after its establishment or acquisition by
Bombardier Capital Inc. or an affiliate of Bombardier Capital Inc., is
maintained and serviced by Bombardier Capital Inc.
Receivables arising under Accounts included in the trust shall, upon removal
for assignment to a third party or removal for any other purpose, no longer be
included in the trust's assets. The definition of Eligible Account may be
changed by amendment to the pooling and servicing agreement without the consent
of the certificateholders if the Rating Agency Condition is satisfied.
An obligor is eligible under the pooling and servicing agreement if it meets
the following requirements:
a dealer that is located in the United States of America,
including its territories and possessions; and
which obligor has not been identified by the servicer as
being the subject of any voluntary or involuntary
bankruptcy, insolvency, liquidation or receivership
proceedings.
An Eligible Receivable is a receivable:
(1) which was originated by Bombardier Capital Inc., by an affiliate of
Bombardier Capital Inc. or acquired by Bombardier Capital Inc. or an
affiliate of Bombardier Capital Inc., in each case in the ordinary course of
business,
(2) which arose under an Account that at the time the receivable was
transferred to the trust was an Eligible Account,
(3) which is owned by Bombardier Capital Inc. at the time of sale or
contribution by Bombardier Capital Inc. to the depositor,
(4) which represents the obligation of an obligor to repay an advance
made to or on behalf of that obligor, or credit extended for that obligor to
finance an Eligible Product,
(5) which at the time of creation and except for receivables that are
payable under a repayment schedule regardless of whether the related
Eligible Products have been sold, at the time of transfer to the trust, is
secured by a first priority perfected security interest in the related
Eligible Product,
(6) which is not unenforceable as a result of any violation of
requirements of law applicable to it and the related inventory security
agreement,
(7) for which all consents and governmental authorizations required to
be obtained by Bombardier Capital Inc. or an affiliate of Bombardier Capital
Inc., or the depositor for the creation of the receivable or its transfer to
the depositor and the trust or the performance by Bombardier Capital Inc. or
an affiliate of Bombardier Capital Inc. of the inventory security agreement
or the other floorplan financing agreement have been duly obtained, effected
or given and are in full force and effect,
(8) as to which at all times following the transfer of the receivable to
the trust, the trust will have good and marketable title to it free and
clear of all liens arising prior to the transfer or arising at any time,
other than liens permitted under the pooling and servicing agreement,
(9) which has been the subject of a valid transfer and assignment from
the depositor to the trust of all the depositor's right, title and interest
in the receivable including, with some exceptions, any proceeds thereof,
(10) which will at all times be the legal and assignable payment
obligation of the obligor, enforceable against the obligor in accordance
with its terms, as modified or revised from time to time with the consent of
the servicer, except as enforceability may be limited by the bankruptcy code
or other applicable insolvency laws,
(11) which at the time of transfer to the trust is enforceable against
the obligor to the extent of the full principal amount of the receivable,
except as enforceability may be limited by insolvency laws,
35
<Page>
(12) as to which, at the time of transfer of the receivable to the
trust, Bombardier Capital Inc. or an affiliate of Bombardier Capital Inc.
and the depositor have satisfied all their obligations under the pooling and
servicing agreement for the receivable required to be satisfied at that
time,
(13) as to which, at the time of transfer of the receivable to the
trust, neither Bombardier Capital Inc. or any affiliate of Bombardier
Capital Inc. nor the depositor has taken any action or failed to take any
action required of it under the receivables purchase agreement or the
pooling and servicing agreement which would impair the rights of the trust
or the certificateholders in the receivable, and
(14) which constitutes 'tangible chattel paper' as defined in Article 9
of the UCC as then in effect in the State of New York.
The foregoing definition of Eligible Receivables may be changed by amendment
to the pooling and servicing agreement without the consent of the
certificateholders if the Rating Agency Condition for that amendment is
satisfied and, if specified in the related prospectus supplement, with the
consent of any enhancement providers.
It is not required or anticipated that the depositor or the trustee will
make any initial or periodic general examination of the receivables or any
records about the receivables for the purpose of establishing the presence or
absence of defects, compliance with representations and warranties of Bombardier
Capital Inc. or for any other purpose. In addition, it is not anticipated or
required that the depositor or the trustee will make any initial or periodic
general examination of the servicer for the purpose of establishing the
compliance by the servicer with its representations or warranties, the
observation of its obligations under the pooling and servicing agreement or for
any other purpose.
INELIGIBLE RECEIVABLES
Any receivable that is not an Eligible Receivable is an ineligible
receivable. Although ineligible receivables existing or arising in Eligible
Accounts will from time to time be transferred to the trust, the Pool Balance
will for all purposes be calculated solely on the basis of the total principal
balance of receivables that are Eligible Receivables.
ADDITION OF ACCOUNTS
Subject to the conditions described in this section, the depositor has the
right to designate from time to time additional Eligible Accounts to be included
in the trust as Accounts. In addition, unless an event of bankruptcy, insolvency
or receivership relating to Bombardier Capital Inc. or the depositor has
occurred, the depositor is required to designate and to add to the trust the
receivables of additional Eligible Accounts if, as of the date for which the
following calculations are made, either:
(1) the Pool Balance is less than the Required Pool Balance or
(2) the aggregate interest in the trust represented by the BCRC
Certificate and the variable funding certificate held by the depositor is
less than 2% of the aggregate amount of receivables included in the trust.
In the case of either (1) or (2) immediately above, unless an event of
bankruptcy, insolvency or receivership relating to Bombardier Capital Inc. or
the depositor has occurred, the depositor under the receivables purchase
agreement will be required to purchase or acquire from Bombardier Capital Inc.,
but Bombardier Capital Inc. will have no obligation to sell to the depositor,
within 10 business days after the event described in (1) or (2) has occurred,
the receivables arising in Additional Accounts to the extent necessary to cure
the above deficiency.
Any provision under the pooling and servicing agreement and the receivables
purchase agreement requiring the depositor to designate Additional Accounts to
the trust means accounts of the same type, in other words, Accounts giving rise
to receivables.
36
<Page>
Any designation of Additional Accounts is subject to the following
conditions, among others:
(1) each Additional Account must be an Eligible Account at the time of
its designation and with respect to Additional Accounts designated at the
option of the depositor, the Rating Agency Condition must be satisfied and,
if specified in the related prospectus supplement, the consent of the
enhancement provider must be obtained; provided, that the Rating Agency
Condition need not be satisfied if the conditions described in the second
succeeding paragraph following this list of conditions are satisfied;
(2) the addition of the receivables arising in the Additional Accounts
shall not, in the reasonable belief of the depositor, cause an Early
Amortization Event to occur with respect to any series;
(3) the depositor shall not select the Additional Accounts in a manner
that it believes is adverse to the interests of the certificateholders or
any enhancement provider; and
(4) unless the Accounts are being designated in accordance with the
conditions described in the second succeeding paragraph following this list,
the depositor shall deliver legal opinions to the trustee and any
enhancement providers indicating that the trustee, on behalf of the trust,
will have a perfected security interest in the documents as required by the
pooling and servicing agreement.
Each Additional Account must be an Eligible Account at the time of its
designation. Additional Accounts, as well as receivables in general arising
under Accounts after July 1, 2002 or arising under Additional Accounts, may have
been originated or acquired by Bombardier Capital Inc. or its affiliates at a
later date using credit criteria, or having other characteristics, different
from those which were applicable to the Accounts and the receivables transferred
to the trust as the initial Accounts.
The requirement that the Rating Agency Condition be satisfied and that legal
opinions be delivered for the designation of Additional Accounts will not be
necessary if the following conditions are met:
(1) during the calendar quarter in which the addition occurs, the number
of new Accounts which have been designated, after taking the proposed
addition into account, will not exceed 5% of the number of all Accounts at
the end of the preceding calendar quarter and the total dollar amount of
principal receivables in these new Accounts designated under this paragraph
during the calendar quarter in which the addition occurs shall not exceed 5%
of the Pool Balance at the end of the preceding calendar quarter, and
(2) during the 12 consecutive calendar months ending with the calendar
month in which the addition is made and including the addition, the number
of these new Accounts does not exceed 20% of the number of all Accounts at
the beginning of the 12-month period in which the addition occurs and the
aggregate dollar amount of principal receivables in these new Accounts added
under this paragraph during this 12-month period shall not exceed 20% of the
Pool Balance at the beginning of this 12-month period.
When determining the amount of Accounts and principal receivables which have
been added to the trust for purposes of the tests set forth in (1) and (2)
above, only those Accounts which have been designated in accordance with the
conditions described in the paragraph above -- not therefore, requiring
satisfaction of the Rating Agency Condition or the delivery of legal opinions --
will be taken into consideration. Additions made under other provisions of the
pooling and servicing agreement will not be included. If Accounts have been
designated in accordance with the conditions described in the paragraph above, a
legal opinion indicating that the trustee, on behalf of the trust, will have a
perfected security interest in these Accounts is to be delivered to the trustee
every three months to the extent that the addition of these Accounts have not
been covered by legal opinions previously delivered to the trustee.
37
<Page>
REMOVAL OF ACCOUNTS AND ASSIGNMENT OF RECEIVABLES
The depositor has the right at any time to designate specific Accounts from
which it will stop transferring newly originated receivables to the trust and,
when the principal balance of these Accounts is reduced to zero, to remove these
Accounts from the trust. If the depositor specifies Accounts from which
receivables will no longer be transferred to the trust, these accounts will
constitute Removed Accounts. To cease transferring any newly originated
receivables in any Removed Account, the depositor or the servicer on its behalf
must, among other things:
(1) at least five business days prior to the date on which the transfer
of these receivables will stop, give notice to the trustee, any enhancement
provider and each Rating Agency;
(2) on or before the fifth business day after the date on which the
transfer of these receivables will stop, furnish to the trustee a computer
file, microfiche list or other list of the Removed Accounts, specifying for
each Removed Account its number, the total amount outstanding in that
Removed Account and the total amount of receivables in the Removed Account
as of the day immediately preceding the date on which the transfer of these
receivables will stop;
(3) represent and warrant that the removal of the relevant Removed
Accounts will not, in the reasonable belief of the depositor, cause an Early
Amortization Event to occur with respect to any series or cause the Pool
Balance to be less than the Required Pool Balance;
(4) represent and warrant that no selection procedures believed by the
depositor to be adverse to the holders of certificates of any series were
used in selecting the Removed Accounts;
(5) represent and warrant that the removal of the relevant Removed
Accounts will not result in a reduction or withdrawal of the ratings of any
outstanding series or class of investor certificates by any Rating Agency;
and
(6) on or before the related date on which the transfer of these
receivables will stop, deliver to the trustee and any enhancement provider
an officers' certificate confirming the representations in clauses (3), (4)
and (5) above.
Under specified conditions, the pooling and servicing agreement may be
amended without the consent of the certificateholders or any Rating Agency to
permit the depositor to also remove existing receivables in Removed Accounts,
including all amounts then held or subsequently received in respect of these
receivables. See ' -- Amendments.'
On the fifth business day after any date on which an Account becomes an
Account which is not an Eligible Account, the depositor will begin the removal
of the receivables of this Account from the trust by:
(1) furnishing to the trustee, any enhancement provider and the Rating
Agencies a notice specifying the date on which the removal of these
receivables will begin and the Accounts to be removed;
(2) on or before the fifth business day after the date on which the
removal of these receivables begins, furnishing to the trustee a computer
file, microfiche list or other list of the Accounts, specifying for each
Account which is no longer an Eligible Account its number and the total
amount and outstanding principal balance of the receivables in these
Accounts as of the date right before the date on which the removal of these
receivables began; and
(3) from and after the date on which the removal of these receivables
will begin, ceasing to transfer to the trust any receivables arising in the
Accounts which are no longer Eligible Accounts.
With respect to the removal of Accounts under either of the two immediately
preceding paragraphs, whether this removal occurs at the option of the depositor
before the time that the depositor is permitted to remove existing receivables
in Removed Accounts or upon a required removal of an Account which is no longer
an Eligible Account:
38
<Page>
(1) from and after the applicable date on which the transfer of the
relevant receivables stops or the removal of the relevant receivables
begins, as applicable, all principal collections for each Removed Account or
Account which is not an Eligible Account will be allocated first to the
oldest outstanding principal balance of that Account, until the
Determination Date on which the outstanding principal balance of receivables
in the Account is reduced to zero; and
(2) on each business day from and after the date on which the transfer
of the relevant receivables stops or the removal of the relevant receivables
begins, as applicable, until the Determination Date on which the outstanding
principal balance of receivables in the relevant Account is reduced to zero,
the depositor will allocate
to the trust, to be further allocated under the pooling and
servicing agreement, Non- Principal Collections for these
Accounts based on the ratio of the amount of principal
receivables in these Accounts on that business day that were
previously sold to the trust divided by the total amount of
principal receivables in these Accounts on that business
day, and
to the depositor, the remainder of the Non-Principal
Collections for these Accounts on that business day.
Upon satisfaction of the above conditions on the Determination Date on which
the outstanding principal balance of receivables thereof had been transferred to
the trust in the relevant Account is reduced to zero, the Removed Accounts or
Accounts which are no longer Eligible Accounts will be deemed to have been
removed from the trust and the depositor will be permitted to sell, transfer,
assign, set over and otherwise convey, without recourse, representation or
warranty, all the right, title and interest in and to the receivables remaining
and subsequently arising in the Removed Accounts or Accounts which are not
Eligible Accounts, all amounts received on these Accounts and all of their
proceeds.
The depositor may at any time remove specific receivables from the trust,
including all amounts then held or subsequently received on these receivables,
without removing any other receivables in the related Account then existing or
subsequently arising, and shall have the right to remove the related security
granted by obligors and other rights associated with these receivables, provided
the receivables are removed from the trust in connection with an assignment of
these receivables to a third party in return for payment for these receivables.
As a condition to the assignment and removal of these receivables, the payment
will be in an amount at least equal to the principal amount of the receivables
to be removed plus accrued interest to the removal date. All of these payments
will be included as collections. The depositor has agreed under the pooling and
servicing agreement that this type of removal will take place only if, in the
reasonable belief of the depositor, no Early Amortization Event will occur with
respect to any series as a result of the removal.
The depositor also has the right to cause the trustee to remove from the
trust and reassign to the depositor receivables -- and the related collateral
security -- that at any time during any four month period beginning on every
February 1, June 1 and October 1 are receivables that were originated and
transferred to the trust during the four month period beginning 16 months before
the start of the first mentioned four month period beginning on February 1, June
1 or October 1 and that continue to be unpaid in full 450 or more days following
their origination. The total amount of these receivables that may be so removed
and reassigned may not, however, exceed 10% of the total principal balance of
receivables originated and transferred to the trust during the four month period
beginning 16 months earlier. The depositor will effect this removal and
reassignment by depositing in the collection account for application as
collections on the receivables an amount equal to the principal amount of the
receivables to be removed plus accrued interest to the date of the reassignment.
The depositor has agreed under the pooling and servicing agreement that this
type of removal will take place only if, in the reasonable belief of the
deposition, no Early Amortization Event will occur as a result of the removal.
The trust will be under no obligation to hold any of these receivables for the
purpose of allowing the depositor to cause a reassignment of these receivables.
39
<Page>
EXCLUDED SERIES
A series of investor certificates may be designated as an Excluded Series
with respect to another Series of investor certificates previously issued by the
issuer as to which the Controlled Accumulation Period or Controlled Amortization
Period has commenced. The previously issued Series would then be designated as a
Paired Series with respect to such newly issued Excluded Series. The Excluded
Series' interest in the trust will increase as the related Paired Series
amortizes or accumulates principal. This allows a seller, in effect, to replace
an accumulating or amortizing series with a new series without waiting for the
accumulating or amortizing series to be paid in full.
Each Excluded Series will be prefunded with an initial deposit to a
prefunding account in an amount equal to the initial principal balance of the
Excluded Series. The source of funds will primarily be the proceeds of the
offering of the Excluded Series. Any prefunding account will be held for the
benefit of the Excluded Series and not for the benefit of the Paired Series. As
funds are accumulated in the Principal Funding Account for the Paired Series or
distributed to holders of certificates of the Paired Series, the trustee will
distribute to the seller an equal amount of funds from any prefunding account
for the Excluded Series, and the Excluded Series' interest in the trust will
increase by such amount.
CREDIT SUPPORT FOR THE CERTIFICATES; COLLECTION ACCOUNT AND EXCESS FUNDING
ACCOUNT
The following sections summarize the structure for allocating collections
made on the receivables and other amounts among the certificates, the other
series, the variable funding certificate and the BCRC Certificate.
Collection Account
The servicer has established and is required to maintain, or cause to be
established and maintained, the collection account.
Funds in the collection account generally will be invested in Eligible
Investments.
Any earnings, net of losses and investment expenses, on funds in the
collection account will be credited to the collection account. The servicer will
have the revocable power to instruct the trustee to make withdrawals and
payments from the collection account for the purpose of carrying out the
trustee's or the servicer's duties under the pooling and servicing agreement.
Excess Funding Account
Except as may be provided in the prospectus supplement for a series, the
servicer has established and is required to maintain, or, cause to be
established and maintained for the life of each series of certificates, an
excess funding account which will be an Eligible Deposit Account for the benefit
of the certificateholders of such series in the name of the trustee. The excess
funding account is intended to preserve for the benefit of the
certificateholders of a series principal collections allocated to the
certificates but otherwise payable to other series or the BCRC Certificate
during the Revolving Period and the Controlled Accumulation Period or Controlled
Amortization Period of such series.
On each business day during the Revolving Period of a series, if the Pool
Balance at the end of the preceding business day was less than the Required Pool
Balance also calculated as of the end of that preceding business day, the
servicer will cause principal collections allocable to each such series of
certificates to be deposited by the servicer in the applicable excess funding
account in an amount equal to the Excess Funded Amount calculated as of the end
of the preceding business day, minus the amount then held in the excess funding
account.
On each business day during the Controlled Amortization Period or Controlled
Accumulation Period of a series, if the Pool Balance at the end of the preceding
business day was less than the Required Pool Balance also calculated as of the
end of that preceding business day, the servicer will cause principal
collections allocable to the certificates of such series, which remain after
40
<Page>
making required deposits into the principal account, to be deposited by the
servicer in the excess funding account in an amount equal to the Excess Funding
Amount calculated as of the end of the preceding business day, minus the amount
then held in the excess funding account.
The Excess Funded Amount for a series will be calculated for each business
day and will be an amount equal to the product of:
(1) the excess, if any, of the Required Pool Balance over the Pool
Balance, each as of the end of the preceding day multiplied by
(2) a fraction the numerator of which is the sum of the Available
Subordinated Amount for such Series and the product of the percent set forth
in the related Prospectus Supplement of the Adjusted Invested Amount for
such Series and the denominator of which is the aggregate of the required
balances for all series providing for excess funding accounts or similar
arrangements that are in their revolving periods or, if applicable, their
amortization periods. The depositor may reduce or adjust the above
percentage from such percent set forth in the related Prospectus Supplement
without the consent of the certificateholders if the Rating Agency Condition
is satisfied.
On each business day during the Revolving Period or the Controlled
Accumulation Period or Controlled Amortization Period for a series, funds on
deposit in the excess funding account for such series, including the Excess
Funded Amount, will be withdrawn and paid or made available to the holder of the
BCRC Certificate or allocated to one or more series which are in amortization,
early amortization or accumulation periods to the extent that as of the end of
the preceding day, of the Pool Balance exceeds the Required Pool Balance.
Funds on deposit in the excess funding account for a series will be invested
at the direction of the servicer in Eligible Investments. On each distribution
date, all net investment income earned on amounts in an excess funding account
since the preceding distribution date will be withdrawn from the excess funding
account and applied on the same basis as Investor Non-Principal Collections.
ALLOCATION OF COLLECTIONS
This section describes the procedure for calculating each series of
certificates' allocable share of specified distributions and other payments made
on the receivables. Amounts not allocated to any series will be allocated to the
variable funding certificate or the BCRC Certificate.
Allocation to the Certificates
The servicer will allocate amounts to a series of certificates for each
calendar month as follows:
(1) Non-Principal Collections and the Defaulted Amount will be allocated
to the certificates based on the applicable Floating Allocation Percentage;
(2) during the Revolving Period for such series, principal collections
will be allocated to the certificates based on the applicable Floating
Allocation Percentage;
(3) during the Controlled Accumulation Period or Controlled Amortization
Period and any Early Amortization Period for such series, principal
collections will be allocated to the certificates based on the applicable
Principal Allocation Percentage; and
(4) Miscellaneous Payments will be allocated to the series of
certificates on the basis of the Series Investor Allocation Percentage for
such series.
When allocating principal collections, if the sum of:
(1) the sum of the Floating Allocation Percentages, for each series in
its revolving period,
(2) the sum of the Principal Allocation Percentages for each series in
its amortization, accumulation or early amortization period, and
(3) the Variable Funding Percentage
41
<Page>
exceeds 100%, then principal collections for the previous calendar month will be
allocated among the series and the variable funding certificate pro rata on the
basis of these allocation percentages after the pro rata reduction of these
percentages so that the sum of these percentages equals 100% for this period.
When allocating Non-Principal Collections, if the sum of:
(1) the sum of the Floating Allocation Percentages for each series, and
(2) the Variable Funding Percentage
exceeds 100%, then Non-Principal Collections for the previous calendar month
will be allocated among the series and the variable funding certificate on the
basis of these allocation percentages after the pro rata reduction of these
percentages so that the sum of these percentages equals 100% for that period.
DEPOSITS IN COLLECTION ACCOUNT
Except as otherwise provided in the following paragraphs, the servicer, no
later than two business days after the date of receipt of any collections on the
receivables, will deposit these collections, net of the Variable Funding
Percentage of these collections and the Excess Retained Percentage of these
collections, into the collection account.
If all of the following are true:
(1) Bombardier Capital Inc. remains the servicer under the pooling and
servicing agreement,
(2) no Servicer Default has occurred and is continuing, and
(3) Bombardier Capital Inc.:
is a subsidiary of Bombardier Corporation, which shall own
at least 80% of the voting common stock of Bombardier
Capital Inc., and Bombardier Capital Inc. has and maintains
a short-term debt rating of at least A-1 by Standard &
Poor's and P-1 by Moody's,
arranges for and maintains a letter of credit or other form
of enhancement in respect of the servicer's obligation to
make deposits of collections on the receivables in the
collection account that is acceptable in form and substance
to each Rating Agency, or
otherwise obtains confirmation that the change will not
cause a reduction or withdrawal of outstanding credit
ratings on any certificates,
then, subject to any limitations in the confirmations referred to below in this
paragraph, Bombardier Capital Inc. need not deposit collections into the
collection account on a daily basis but may use for its own benefit all these
collections until the business day immediately preceding the related
distribution date, at which time Bombardier Capital Inc. will make these
deposits in a single deposit into the collection account in an amount equal to
the net amount of these deposits and withdrawals which would have been made had
the conditions described in this paragraph not applied. Prior to ceasing daily
deposits as described above, Bombardier Capital Inc. must deliver to the trustee
written confirmation from each of the Rating Agencies that the failure by
Bombardier Capital Inc. to make daily deposits will not result in a reduction or
withdrawal of the ratings of your certificates or any other outstanding series
or class of investor certificates.
In addition, for any calendar month, the servicer will only be required to
deposit collections into the collection account up to the total amount of
collections required to be deposited into all series accounts or, without
duplication, distributed on the related distribution date to all investor
certificateholders and to each enhancement provider according to the terms of
any series supplement to the pooling and servicing agreement or the terms of any
enhancement agreement. If, at any time prior to a distribution date, the amount
of collections deposited in the collection account exceeds the amount required
to be deposited for that distribution date, the servicer will be permitted to
withdraw the excess from the collection account.
42
<Page>
The requirements of the preceding paragraphs are subject to the following
exceptions. On any date on which collections are received, the servicer may
distribute or make available directly, to the holder of the variable funding
certificate, an amount equal to the Variable Funding Percentage of these
collections and, to the holder of BCRC Certificate, the Excess Retained
Percentage of these collections.
LIMITED SUBORDINATION OF RETAINED INTEREST
A portion of the Retained Interest to the extent described in the related
prospectus supplement will be available to fund payment of principal and
interest on a series of certificates in the event that the proportionate
interests of the certificates in collections received on the receivables during
any particular calendar month are less than the required distributions thereon.
The amount of the subordination with respect to any series other than the BCRC
Certificate is the Available Subordinated Amount for the series. The Available
Subordinated Amount for any series will increase and decrease from time to time
if and to the extent described in the related prospectus supplement. The
prospectus supplement for each series will describe the manner in which the
servicer may draw upon collections attributable to the Available Subordinated
Amount for the series to make payments to or for the benefit of the holders of
certificates of the series. The Available Subordinated Amount for a series may
be available to more than one series of certificates.
ENHANCEMENTS
In addition to the subordination described above, any series may be entitled
to credit enhancements with respect to one or more classes of the series,
including one or more of the following:
letter of credit;
surety bond;
financial guaranty insurance policy;
cash collateral account;
spread account;
guaranteed rate agreement;
maturity liquidity facility;
tax protection agreement;
swap, including without limitation currency swaps, or other
interest protection agreement;
repurchase obligation;
cash deposit; or
another form of credit enhancement described in the related
prospectus supplement.
Enhancements to a series or class or classes of a series by subordination
provisions may require that distributions of principal and/or interest be made
with respect to the certificates of the series or the class or classes before
distributions are made to one or more series or one or more classes of the
series. If so provided in the related prospectus supplement, any form of
Enhancement may be available to more than one class or series.
If Enhancement is provided with respect to a series, the related prospectus
supplement will include a description of:
the amount payable under the Enhancement;
any conditions to payment not otherwise described in this
prospectus;
the conditions, if any, under the amount payable under the
Enhancement may be reduced and under which the Enhancement
may be terminated or replaced; and
43
<Page>
any material provisions of any agreement relating to the
Enhancement.
Additionally, the related prospectus supplement may set forth information
with respect to the applicable Enhancement provider, including:
a brief description of its principal business activities;
its principal place of business, place of incorporation and
the jurisdiction under which it is chartered or licensed to
do business;
if applicable, the identity of regulatory agencies which
exercise primary jurisdiction over the conduct of its
business; and
its total assets, and its stockholders' equity or
policyholders' surplus, if applicable, as of a date we state
in the prospectus supplement.
LIMITATIONS ON SUBORDINATION AND ENHANCEMENTS
The presence of an Available Subordinated Amount or Enhancement with respect
to a series or class is intended to enhance the likelihood of receipt by
certificateholders of the series or class of the full amount of principal and
interest and to decrease the likelihood that the certificateholders will
experience losses. However, unless otherwise stated in the prospectus supplement
for a series, neither subordination nor the Enhancement, if any, will provide
protection against all risks of loss or will guarantee repayment of the entire
principal balance of the certificates and interest on the certificates. If
losses exceed the amount covered by the subordination or Enhancement or are not
covered by the subordination or Enhancement, certificateholders will bear their
allocable share of deficiencies. In addition, if specific Enhancement is
provided for the benefit of more than one class or series, certificateholders of
that class or series will be subject to the risk that the Enhancement will be
exhausted by the claims of certificateholders of other classes or series.
DEFAULTED RECEIVABLES AND RECOVERIES
Defaulted Receivables on any distribution date are:
(1) all receivables other than receivables that were designated as
ineligible at the time of transfer to the trust that were charged off as
uncollectible in the preceding calendar month;
(2) all receivables originally secured by a security interest in a
related Eligible Product which have not been paid in full for more than 90
days after the sale of the related Eligible Product; and
(3) all receivables which, although they were Eligible Receivables when
transferred to the trust, arose in an Account which has become an Account
which is not an Eligible Account since this transfer and which were not
Eligible Receivables for any six consecutive distribution dates after this
Account became an Account which is not an Eligible Account.
RECEIVABLES ARE NOT DEFAULTED RECEIVABLES MERELY BECAUSE THEY ARE NO LONGER
ELIGIBLE RECEIVABLES
The Defaulted Amount for any calendar month will be an amount not less than
zero, equal to the aggregate principal amount of principal receivables that
became Defaulted Receivables during the preceding calendar month less the full
amount of any Defaulted Receivables subject to retransfer from the trust to the
depositor or to purchase by the servicer for that calendar month. If, however,
an event of bankruptcy, insolvency, or receivership has occurred with respect to
either of the depositor or the servicer or if an event of bankruptcy, insolvency
or receivership relating to Bombardier Capital Inc. or the depositor has
occurred, the Defaulted Amount will not be reduced for those Defaulted
Receivables retransferred from the trust or purchased by the servicer.
Receivables will be charged off as uncollectible in accordance with the written
policies of Bombardier Capital Inc. and its affiliates and otherwise in
accordance with procedures that are customary and usual in the industry. A
portion of the Defaulted Amount equal to the product of
44
<Page>
the Defaulted Amount for that calendar month multiplied by the applicable
Floating Allocation Percentage for that calendar month will be allocated to each
series of certificates.
If the servicer adjusts downward the outstanding principal balance of any
Eligible Receivable because of a rebate, billing error, refund, credit
adjustment or billing error to an obligor, or because that receivable was
created in respect of a product which was refused or returned by an obligor, the
amount of this adjustment will be deducted from the Pool Balance. Furthermore,
to the extent that the reduction in the Pool Balance would reduce the Pool
Balance below the Required Pool Balance on the immediately preceding
Determination Date, after giving effect to the allocations, distributions,
withdrawals and deposits to be made on the related distribution date, then
unless an event of bankruptcy, insolvency or receivership relating to Bombardier
Capital Inc. or the depositor has occurred, the depositor will be required to
deposit a cash amount equal to this deficiency up to the amount of this
adjustment into the collection account in immediately available funds on the day
on which this adjustment occurs.
OPTIONAL REPURCHASE
If so provided in the supplement to the pooling and servicing agreement
relating to a series of certificates, on any distribution date occurring on or
after the date on which the Invested Amount of the certificates of the series is
reduced to the percentage of the initial aggregate principal balance of the
series certificates set forth in the related prospectus supplement, the
depositor will have the option, subject to specified conditions, to repurchase
the entire amount of the certificates of such series. The purchase price will be
equal to the sum of the outstanding principal balance of the certificates of
such series on that distribution date, accrued and unpaid interest due on those
certificates together with interest on overdue interest to the extent lawfully
payable on the date of this repurchase and any other amounts set forth in the
related pooling and servicing agreement supplement. The purchase price will be
deposited in the collection account in immediately available funds on the
distribution date on which the depositor exercises this option. Following any
deposit of this type, the certificateholders of the related series will have no
further rights under the certificates, other than the right to receive the final
distribution on the certificates. In the event that the depositor fails for any
reason to deposit this purchase price, payments will continue to be allocated to
the certificates of the related series as described in the related prospectus
supplement.
EARLY AMORTIZATION EVENTS
Starting on the first distribution date following the calendar month in
which an Early Amortization Event has occurred with respect to any series,
principal collections allocable to the certificates will no longer be allocated
to any other series or to the BCRC Certificate but instead will be allocated to
the certificates of the affected series monthly on each distribution date,
except as described below in this section.
An Early Amortization Event for any series refers to any of the events
described in the related prospectus supplement, as well as each of the following
events:
1. a failure by the depositor to convey receivables in Additional
Accounts to the trust within five business days after the day on which it is
required to convey these receivables under the pooling and servicing
agreement;
2. failure on the part of the depositor, the servicer or Bombardier
Capital Inc., as applicable:
(a) to make any payment or deposit required by the terms of the
pooling and servicing agreement, including but not limited to any amount
required to be paid upon a transfer of receivables to the depositor or
Adjustment Payment, on or before the date occurring five (5) business
days after the date this payment or deposit is required to be made, which
failure is not cured within five business days after notice from the
trustee of this failure;
45
<Page>
(b) with respect to any series, to deliver a distribution date
statement within ten business days after notice from the trustee of the
failure to deliver this statement;
(c) to duly comply with, observe or perform in any material respect
the covenant of the depositor not to create any lien, other than liens
and interests permitted by the pooling and servicing agreement, on any
receivable which failure has a material adverse effect on the holders of
the investor certificates or the holder of the variable funding
certificate and which continues unremedied for a period of 60 days after
written notice of this failure, requiring the same to be remedied, has
been given to the depositor by the trustee or any enhancement provider;
provided, however, that an Early Amortization Event will not be deemed to
have occurred if the depositor has repurchased the related receivables
or, if applicable, all the receivables during this period in accordance
with the provisions of the pooling and servicing agreement; or
(d) to duly observe or perform in any material respect any other of
its covenants or agreements set forth in the pooling and servicing
agreement, which failure has a materially adverse effect on the holders
of the investor certificates or the holder of the variable funding
certificate and which continues unremedied for a period of 45 days after
written notice of this failure, requiring the same to be remedied, has
been given to the depositor by the trustee or any enhancement provider;
3. any representation or warranty made by the depositor in the pooling
and servicing agreement or any information required to be given by the
depositor to the trustee under the pooling and servicing agreement to
identify the Accounts proves to have been incorrect in any material respect
when made or when delivered and continues to be incorrect in any material
respect for a period of 60 days after written notice, or within any longer
period as may be specified in the notice, of this failure, requiring the
same to be remedied, has been given to the depositor by the trustee, and as
a result the interests of the holders of the investor certificates or the
holder of the variable funding certificate are materially and adversely
affected, excluding, however, any representation or warranty made by the
depositor that the pooling and servicing agreement constitutes, or the
transfer of the receivables to the trust is, a valid sale, transfer and
assignment to the trust of all right, title and interest of the depositor in
the receivables and the security granted by the related obligors if the
pooling and servicing agreement constitutes the grant of a security interest
in the receivables and security granted by the related obligors; except when
the depositor has repurchased the related receivables or all of these
receivables, if applicable, during this period in accordance with the
provisions of the pooling and servicing agreement;
4. the occurrence of specified events of bankruptcy, insolvency or
receivership relating to any of Bombardier Corporation, the depositor or the
servicer or Bombardier Capital Inc. if it is not the servicer;
5. the depositor or the trust becomes an investment company within the
meaning of the Investment Company Act of 1940, as amended; and
6. the occurrence of any Servicer Default.
Immediately upon the occurrence of any event described above, an Early
Amortization Event will be deemed to have occurred without any notice or other
action on the part of any other party. The Early Amortization Period will
commence as of the day on which the Early Amortization Event occurs. Monthly
distributions of principal on each series of certificates will begin on the
first distribution date following the calendar month in which an Early
Amortization Period has commenced.
If an Early Amortization Period results from the failure by the depositor to
convey receivables in Additional Accounts to the trust as described in clause
(1) above during the Revolving Period for a series of certificates and no other
Early Amortization Event has occurred with respect to such series, the Early
Amortization Period resulting from this failure will terminate and the Revolving
Period will recommence, unless the scheduled termination date of the Revolving
Period has occurred, as of the end of the first calendar month during which an
Early Amortization
46
<Page>
Event would no longer be deemed to exist as described in clause (1) above. An
Early Amortization Event would no longer be deemed to exist as described in
clause (1) above as a result of a reduction in the invested amounts of series'
of certificates occurring due to principal payments distributed on the
outstanding series during the Early Amortization Period or as a result of the
subsequent addition of receivables to the trust.
In addition to the consequences of an Early Amortization Event discussed
above, if an event of bankruptcy, insolvency or receivership relating to
Bombardier Capital Inc. or the depositor occurs, or the depositor violates its
covenant set forth in clause 2(c) above, and this violation becomes an 'Early
Amortization Event' as described in clause 2(c) above, on the day of the event
of bankruptcy, insolvency or receivership relating to Bombardier Capital Inc. or
the depositor or Early Amortization Event occurring because of this violation,
as applicable, the depositor will immediately cease to transfer receivables to
the trust and promptly give notice to the trustee of this event of bankruptcy,
insolvency or receivership relating to Bombardier Capital Inc. or the depositor
or Early Amortization Event occurring because of this violation, as applicable.
Furthermore, under the terms of the pooling and servicing agreement, within 15
days following an insolvency event with respect to the depositor or an Early
Amortization Event as described in the preceding sentence as a result of the
occurrence of a violation set forth in 2(c) above, the trustee will publish a
notice of the insolvency event or Early Amortization Event occurring because of
this violation stating that the trustee intends to sell, liquidate or otherwise
dispose of all receivables in the trust in a commercially reasonable manner and
on commercially reasonable terms and, unless within a specified period of time
holders of certificates of each outstanding series representing more than 50% of
the aggregate outstanding principal balance of each outstanding series, or, with
respect to any series with two or more classes, the certificates of each of
these classes, and the holder of the variable funding certificate, instruct the
trustee not to sell, liquidate or dispose of the receivables in the trust, the
trustee will proceed to dispose of the receivables.
In the event of any sale, liquidation or disposition of this type, the
related proceeds will be allocated pro rata, based on the applicable allocation
percentages for each series and the Variable Funding Percentage, among the
certificates of each outstanding series and the interest represented by the
variable funding certificate. If the portion of these proceeds allocated to a
series of certificates and the proceeds of any collections on the receivables in
the collection account allocable to such series of certificates are not
sufficient to pay the aggregate unpaid principal balance of that series
certificates in full plus accrued and unpaid interest, certificateholders of
that series will incur a loss. In the case of the violation of the covenant
described in clause 2(c) above, the trustee will not sell the receivables upon
an Early Amortization Event occurring because of this violation unless the
proceeds allocable to the certificates of each series are sufficient to pay the
aggregate unpaid principal balance of each series of certificates in full plus
accrued and unpaid interest.
TERMINATION
The trust and the respective obligations and responsibilities of the
depositor, the servicer and the trustee created by the pooling and servicing
agreement will terminate on the earlier to occur of the day following the
distribution date on which the sum of the invested amounts for all series is
zero and January 1, 2014. Upon termination of the trust, all right, title and
interest in the receivables and the security granted by obligors and other
related funds, other than amounts in the collection account for the final
distribution of principal and interest to certificateholders, will be conveyed
and transferred to the depositor.
In any event, the last payment of principal and interest on any series of
certificates will be due and payable no later than the Series Termination Date
specified in the related prospectus supplement. In the event that the Invested
Amount of a series of certificates is greater than zero on the applicable Series
Termination Date, the trustee will use its best efforts to sell or cause to be
sold an interest in the Pool Balance then represented by such series of
certificates. The net proceeds of this sale will be paid pro rata to
certificateholders of such series as of the Series
47
<Page>
Termination Date, up to the amount necessary to pay principal of and accrued and
unpaid interest on outstanding certificates, as the final payment of the
certificates of such series.
INDEMNIFICATION
The pooling and servicing agreement provides that the depositor will
indemnify the trust and the trustee from and against any loss, liability,
reasonable expense, damage or injury suffered or sustained by reason of any acts
or omissions or alleged acts or omissions arising out of or based upon the
arrangement created by the pooling and servicing agreement, including any
judgment, general settlement, reasonable attorneys' fees and other costs and
expenses incurred by the trustee in connection with the defense of any actual or
threatened action, proceeding or claim, other than any losses on receivables and
amounts due on these losses, and the servicer will indemnify
the trust and the trustee from and against any loss,
liability, reasonable expense, damage or injury suffered or
sustained by the trust or the trustee arising out of or
based upon the arrangement created by the pooling and
servicing agreement, including any judgment, general
settlement, reasonable attorney fees and other costs and
expenses incurred in connection with the defense of any
actual or threatened action, proceeding or claim, other than
losses on receivables and amounts due on these losses, and
the trustee and its officers, directors, employees and
agents from and against any loss, liability, reasonable
expense, damage or injury suffered or sustained by reason of
the acceptance of the trust by the trustee, the issuance by
the trust of the certificates or any of the other matters
contemplated in the pooling and servicing agreement or in
any supplement, other than losses on receivables and amounts
due on these losses;
provided that, in any case of this type, the trust, the trustee, and its
officers, directors, employees and agents will not be so indemnified if these
acts or omissions constitute, or the actual or threatened action, proceeding or
claim arises out of, or the loss, liability, expense, damage or injury is caused
by, fraud, gross negligence, breach of fiduciary duty or willful misconduct by
the trustee and provided further that neither the depositor nor the servicer
will be liable, directly or indirectly, for any indebtedness or obligation
evidenced or created by any certificate, recourse as to which is limited solely
to the assets of the trust allocated for the payment of the certificate as
provided in the pooling and servicing agreement and any applicable supplement.
In addition, neither the servicer nor the depositor will indemnify the
trust, the trustee or the certificateholders or any other beneficiaries of the
trust for any action taken by the trustee at the request of the
certificateholders to the extent, in the case of the servicer, the trustee is
fully indemnified by these certificateholders or other beneficiaries for this
action or for any federal, state or local income or franchise tax or any
interest or penalties on these taxes required to be paid by the trust or the
certificateholders or any other beneficiaries. Furthermore, any indemnification
of this type by the depositor will only be from assets of the depositor not
pledged to third parties or otherwise encumbered as permitted under the
depositor's certificate of incorporation and will be made only after the deposit
by the depositor of any amounts required to be made in the collection account.
Any indemnification by the servicer will not be payable from the assets of the
trust.
The pooling and servicing agreement provides that, except as described above
in this section and with other specified exceptions, neither the servicer nor
the depositor nor any of their affiliates, directors, officers, employees,
stockholders, agents, representatives or advisors will be under any liability to
the trustee or any other person for taking any action, or for refraining from
taking any action, in accordance with the pooling and servicing agreement or
otherwise. However, neither the servicer nor the depositor will be protected
against any liability which would otherwise be imposed by reason of their
willful misfeasance, bad faith or gross negligence.
In addition, the pooling and servicing agreement provides that the servicer
is not under any obligation to appear in, prosecute or defend any legal action
other than as part of the good faith performance of its servicing obligations.
The servicer may, in its sole discretion, undertake any legal action which it
may deem necessary or desirable for the benefit of the trust.
48
<Page>
COLLECTION AND OTHER SERVICING PROCEDURES
Under the pooling and servicing agreement, the servicer is responsible for
servicing, collecting, enforcing and administering the receivables in accordance
with procedures that are customary and usual in the industry for servicing
receivables comparable to these receivables, except where the failure to so act
would not materially and adversely affect the rights of the trust or any
beneficiaries of the trust. Bombardier Capital Inc. has delegated some of its
servicing, collection, enforcement and administrative duties to third parties
and Bombardier Capital Inc. may from time to time in the future delegate all or
a portion of these duties to third parties in accordance with the terms of the
pooling and servicing agreement, provided that no delegation of this sort will
relieve Bombardier Capital Inc. of its responsibilities as servicer for these
duties.
Subject to compliance with all requirements of law, the servicer or
Bombardier Capital Inc. and any affiliate of Bombardier Capital Inc. may change
the terms and provisions of the Accounts, including the inventory security
agreements and the financing guidelines, in any respect, including the
calculation of the amount or the timing of charge-offs and the rate of the
finance charge, only if, in the servicer's reasonable judgment, no Early
Amortization Event with respect to any series will occur as a result of the
change.
Servicing activities to be performed by the servicer include collecting and
recording payments, communicating with obligors, investigating payment
delinquencies, evaluating the increase of credit limits, and maintaining
internal records for each Account. Managerial and custodial services performed
by the servicer include providing assistance in any inspections of the documents
and records relating to the Accounts and receivables by the depositor or the
trustee on behalf of the certificateholders, maintaining the agreements,
documents and files relating to the Accounts and receivables as custodian and
providing related data processing and reporting services for holders of
certificates and on behalf of the trustee.
SERVICER COVENANTS
In the pooling and servicing agreement the servicer covenants that:
(1) it will duly satisfy all obligations on its part to be fulfilled
under the receivables and Accounts, will maintain in effect all
qualifications required in order to service properly the receivables and the
Accounts and will comply in all material respects with all requirements of
law in connection with servicing the receivables and the Accounts, except
where the failure to do any of the foregoing would not have a material
adverse effect on the beneficiaries of the trust;
(2) it will do nothing to impair the rights of the beneficiaries of the
trust in the receivables or in the certificates; and
(3) it will not reschedule, revise, defer, cancel or settle payments due
on any receivable except in accordance with sound industry practices for
servicing receivables comparable to the receivables.
Under the terms of the pooling and servicing agreement, if the depositor or
the servicer receives written notice from the trustee or any enhancement
provider that any covenant of the servicer set forth above has not been complied
with in all material respects and this noncompliance has not been cured within
30 days after this notice, or any longer period as the trustee may agree to, and
has a materially adverse effect on the interests of all certificateholders or
the holder of the variable funding certificate in any receivable or Account,
then, unless an event of bankruptcy, insolvency or receivership relating to
Bombardier Capital Inc. or the depositor has occurred, the servicer will
purchase that receivable or all receivables in that Account, as applicable. This
purchase will be made on the Determination Date following the expiration of the
30-day cure period by deposit into the collection account of an amount equal to
the amount of that receivable or receivables plus accrued and unpaid interest
thereon. The purchase by the servicer constitutes the sole remedy available to
certificateholders if the relevant covenant or warranty of the servicer is not
satisfied and the purchased receivables will be automatically assigned to the
servicer.
49
<Page>
SERVICING COMPENSATION AND PAYMENT OF EXPENSES
The servicer's compensation for its servicing activities under the pooling
and servicing agreement and reimbursement for its expenses will be a servicing
fee payable in arrears on each distribution date on or prior to the earlier to
occur of January 1, 2014 or the day after the distribution date on which the
invested amounts for all series is zero. The Servicing Fee equals the total of
the Monthly Servicing Fees in the supplements to the pooling and servicing
agreement executed for each series. The Monthly Servicing Fee for each series
will be set forth in the related prospectus supplement.
The remainder of the servicing fee not allocable to the certificates will be
paid by the holders of the variable funding certificate and the BCRC Certificate
and the holders of the certificates of other outstanding series. The Servicing
Fee will be payable to the servicer solely to the extent amounts are available
to it for distribution under the terms of the pooling and servicing agreement
and each related supplement thereto.
The servicer will be permitted to waive its right to receive the servicing
fee on any distribution date, so long as it believes that sufficient
Non-Principal Collections will be available on a future distribution date to pay
the servicing fee waived, in which case the Servicing Fee and the Monthly
Servicing Fee for that distribution date will be zero.
The servicer will pay from its servicing compensation specified expenses
incurred in servicing the Accounts and the receivables including payment of fees
and disbursements of the trustee and independent accountants and all other fees
and expenses which are not expressly stated in the pooling and servicing
agreement to be payable by the trust or the certificateholders, other than
federal, state and local income and franchise taxes, if any, of the trust or the
certificateholders.
MATTERS REGARDING THE SERVICER
The servicer may not resign from its obligations and duties under the
pooling and servicing agreement, except upon determination that these duties are
no longer permissible under applicable law. No resignation under these
circumstances will become effective until the trustee or a successor to the
servicer has assumed the servicer's responsibilities and obligations under the
pooling and servicing agreement.
Any person into which, under the pooling and servicing agreement, the
servicer may be merged or consolidated or any person resulting from any merger
or consolidation to which the servicer is a party, or any person succeeding to
the business of the servicer, will be the successor to the servicer under the
pooling and servicing agreement.
SERVICER DEFAULT
In the event and during the continuance of any Servicer Default, the trustee
by written notice to the servicer may terminate all of the rights and
obligations of the servicer, as servicer, under the pooling and servicing
agreement and in and to the receivables and the proceeds of the receivables and
appoint a new servicer. The trustee will as promptly as possible appoint a
successor servicer and if no successor servicer has been appointed by the
trustee and has accepted the appointment by the time the servicer stops acting
as servicer, all rights, authority, power and obligations of the servicer under
the pooling and servicing agreement will pass to and be vested in the trustee.
Before any transfer of the servicer's rights and obligations to a new servicer,
the trustee will review any bids obtained from potential servicers meeting the
eligibility requirements in the pooling and servicing agreement to serve as
successor servicer for servicing compensation not in excess of the Servicing
Fee. If all of these bids exceed the Servicing Fee, the depositor at its own
expense will pay when due the amount of any compensation in excess of the
Servicing Fee.
A Servicer Default refers to any of the following events:
(1) failure by the servicer to make any payment, transfer or deposit
into the trust, or into any account created for a series of certificates, on
or before the date the servicer is required
50
<Page>
to do so under the pooling and servicing agreement, which failure is not
cured within a five business day grace period after notice from the trustee
of this failure;
(2) failure by the servicer duly to observe or perform its covenant not
to create any lien on any receivable, which failure has a material adverse
effect on the certificateholders and which continues unremedied for a period
of 60 days after written notice to it of this breach of covenant; provided,
however, that a Servicer Default will not be deemed to have occurred if the
depositor or the servicer has repurchased the related receivables under the
terms of the pooling and servicing agreement, or failure by the servicer
duly to observe or perform any other covenants or agreements of the servicer
in the pooling and servicing agreement, exclusive of breaches of covenants
for which the servicer repurchases the related receivables, as described
above under ' -- Servicer Covenants', which failure has a materially adverse
effect on the certificateholders or the holder of the variable funding
certificate and which continues unremedied for a period of 30 days after
written notice to the servicer of this breach of covenant or agreement;
(3) any representation, warranty or certification made by the servicer
in the pooling and servicing agreement or in any certificate delivered under
the pooling and servicing agreement proves to have been incorrect when made
and continues to be incorrect in any material respect for a period of 60
days after written notice requiring the error to be remedied has been given
to the servicer by the trustee, and as a result the interests of the
certificateholders or the holder of the variable funding certificate are
materially and adversely affected; provided, however, that a Servicer
Default will not have occurred if the depositor has repurchased the related
receivables or, if applicable, all the receivables during this period in
accordance with the provisions of the pooling and servicing agreement; or
(4) the occurrence of an event of bankruptcy, insolvency or receivership
with respect to the servicer.
A delay in or failure of performance referred to under clause (1) above for
a period of up to ten business days after the applicable grace period or a delay
in or failure of performance or the continuance of a delay or failure referred
to under clauses (2) or (3) above for a period of up to 60 business days, will
not be a Servicer Default if this delay or failure or continuance was caused by
an act of God or other similar occurrence. Upon the occurrence of any event of
this nature, the servicer is not relieved from using its best efforts to perform
its obligations in a timely manner under the terms of the pooling and servicing
agreement. The servicer will provide the trustee, any enhancement provider and
the depositor prompt notice of this failure or delay by it, together with a
description of its efforts to perform its obligations. In addition, the servicer
will immediately notify the trustee in writing of any Servicer Default.
REPORTS
On each distribution date, the trustee will forward or cause to be forwarded
to each certificateholder of record of any series -- which is expected to be
only Cede & Co., as nominee for The Depository Trust Company, unless definitive
certificates are issued -- a statement prepared by the servicer setting forth
information regarding the certificates of such series and the receivables
including the following, which, where appropriate, will be stated on the basis
of an original principal amount of $1,000 per certificate:
(1) the aggregate amount of principal paid or distributed on the
certificates and the aggregate amount of interest paid or distributed on
those certificates on that distribution date;
(2) the Pool Balance;
(3) the outstanding principal amount of each class of certificates in
such series after giving effect to distributions on that date;
(4) the amount of the Monthly Servicing Fee for the preceding calendar
month;
(5) the collection account balance with respect to that distribution
date; and
(6) whether an Early Amortization Event has occurred.
51
<Page>
On or before January 31 of each calendar year, the trustee will furnish to
each person who at any time during the preceding calendar year was a
certificateholder of record, which is expected to be only Cede & Co., as nominee
for The Depository Trust Company, unless definitive certificates are issued, a
statement prepared by the servicer containing the information that is required
to be contained in the distribution date statement, aggregated for that calendar
year, together with information required to be provided by an issuer of
indebtedness under the Internal Revenue Code of 1986 for that preceding calendar
year or the applicable portion thereof during which this person was a
certificateholder, together with any other customary information as is necessary
to enable the certificateholders to prepare their tax returns. In addition, the
trustee from time to time will furnish to each certificateholder of record
information furnished by the servicer regarding material changes in the
servicing or crediting procedures required under the pooling and servicing
agreement. As long as the certificateholder of record is Cede & Co., as nominee
for The Depository Trust Company, beneficial owners of certificates will receive
tax and other information from Participants and entities that clear through or
maintain a custodial relationship with a Participant, either directly or
indirectly, rather than from the trustee. See 'Material Federal Income Tax
Consequences.'
EVIDENCE AS TO COMPLIANCE
The pooling and servicing agreement provides that on or before April 30 of
each calendar year the servicer will cause a firm of nationally recognized
independent public accountants, who may also render other services to the
servicer or the depositor, to furnish a report about the servicing of Bombardier
Capital Inc.'s portfolio of receivables.
The pooling and servicing agreement provides for delivery to the trustee on
or before April 30 of each calendar year of a statement signed by an officer of
the servicer to the effect that the servicer has fully performed, or caused to
be fully performed its obligations in all material respects under the pooling
and servicing agreement throughout the preceding year or, if there has been a
default in the performance of any of these obligations, specifying the nature
and status of the default.
Copies of all statements, certificates and reports furnished to the trustee
may be obtained by any certificateholder or any supplement, upon request in
writing delivered to the trustee.
AMENDMENTS
The pooling and servicing agreement or any supplement may be amended from
time to time, including in connection with the issuance of a Supplemental
Certificate, by the depositor, the servicer, the trustee and Bombardier Capital
Inc., if Bombardier Capital Inc. is not then the servicer, without additional
consent, so long as this action will not, as evidenced by an opinion of counsel,
adversely affect in any material respect the interests of the certificateholders
or the holder of the variable funding certificate. The trustee, with the consent
of any enhancement providers, may at any time and from time to time amend,
modify or supplement the form of distribution date statement.
The pooling and servicing agreement may also be amended by the depositor,
the servicer, the trustee and Bombardier Capital Inc., if it is not the
servicer, with the consent of the holder of the variable funding certificate, if
it would be adversely affected by the amendment, and holders of certificates
evidencing not less than a majority of the aggregate unpaid principal amount of
the certificates of all adversely affected series for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the pooling and servicing agreement or of modifying in any manner the rights of
the certificateholders. No amendment of this sort, however, may:
(1) reduce in any manner the amount of, or delay the timing of,
distributions required to be made on any certificate, including the variable
funding certificate, or the deposits to be made therefor,
(2) change the definition or the manner of calculating interest on any
certificate,
52
<Page>
(3) reduce the amount available under any enhancement,
(4) adversely affect the rating of any series or class by any Rating
Agency which rated that series or class or
(5) reduce the percentage of the unpaid principal balance of
certificates the holders of which are required to consent to any amendment,
without, in the case of (1), (2), (3) or (5) the consent of each affected
certificateholder or the variable funding certificate, as applicable and, in the
case of (4), the consent of the holders of certificates of the relevant series
or class evidencing not less than 66 2/3% of the total unpaid principal amount
of the certificates of that series or class. Promptly following the execution of
any amendment to the pooling and servicing agreement, other than an amendment
described in the first paragraph of this section, the trustee will furnish
notice of the substance of the amendment to each certificateholder.
The pooling and servicing agreement may not be amended in any manner which
materially adversely affects the interests of any enhancement provider without
its prior consent.
LIST OF CERTIFICATEHOLDERS
Upon written request of any three or more certificateholders of record, the
trustee will afford these certificateholders access during business hours to the
current list of registered certificateholders of a series or of all series, as
applicable, for purposes of communicating with other certificateholders about
their rights under the pooling and servicing agreement.
The pooling and servicing agreement does not provide for any annual or other
meetings of certificateholders.
THE TRUSTEE
Deutsche Bank Trust Company Americas, a New York banking corporation, is
trustee under the pooling and servicing agreement. The trustee is located at 100
Plaza One, Jersey City, New Jersey 07310. Bombardier Capital Inc. and the
depositor and their affiliates may from time to time enter into other banking
and trustee relationships with the trustee and its affiliates. The trustee may
hold certificates in its own name and may deal with the depositor, the servicer
or any enhancement provider with the same rights it would have if it were not
the trustee. In addition, for purposes of meeting the legal requirements of
local jurisdictions, the trustee will have the power to appoint a co-trustee or
separate trustees of all or a part of the trust. In the event of these
appointments, all rights, powers, duties and obligations will be conferred or
imposed upon the trustee and the separate trustee or co-trustee jointly, or, in
any jurisdiction in which the trustee shall be incompetent or unqualified to
perform specified acts, singly upon the separate trustee or co-trustee, who
shall exercise and perform these rights, powers, duties and obligations solely
at the direction of the trustee.
The trustee may resign at any time, in which event the depositor will be
obligated to appoint a successor trustee. The servicer may also remove the
trustee if the trustee ceases to be eligible to continue as trustee under the
pooling and servicing agreement or if the trustee becomes insolvent. In these
circumstances, the servicer may appoint a successor trustee. Any resignation or
removal of the trustee and appointment of a successor trustee does not become
effective until the acceptance of the appointment by the successor trustee.
The fees and expenses of the trustee will be paid by the servicer out of its
servicing compensation. See 'Description of the Certificates -- Servicing
Compensation and Payment of Expenses.'
DESCRIPTION OF THE RECEIVABLES PURCHASE AGREEMENT
The receivables transferred and to be transferred to the trust have been and
will be acquired by the depositor from Bombardier Capital Inc. in accordance
with the receivables purchase
53
<Page>
agreement, dated as of January 1, 1994, between Bombardier Capital Inc., as
seller, and the depositor, as purchaser, as amended by Amendment Number 1 dated
as of January 1, 1997 and by Amendment Number 2 dated as of September 1, 2002
and as otherwise supplemented or amended from time to time, filed as an exhibit
to the registration statement of which this prospectus is a part. The
receivables purchase agreement provides that it is governed by New York law. The
following discussion represents a summary of the material terms of the
receivables purchase agreement relating to the sale or contribution of the
receivables to the depositor and does not purport to provide a complete
description. For further information, owners and prospective owners of
certificates are advised to examine the receivables purchase agreement, a copy
of which, without specified exhibits or schedules, will be made available by the
trustee upon written request.
SALE AND TRANSFER OF RECEIVABLES
Under the receivables purchase agreement, Bombardier Capital Inc. has sold
and transferred to the depositor all of its right, title and interest in and to
all of the receivables and the security granted by obligors, and the related
repurchase agreements and other agreements with manufacturers, importers or
distributors, relating to the Accounts as of January 1, 1994 and from time to
time has sold and transferred and will sell or contribute and transfer to the
depositor receivables created after January 1, 1994 including the related
security granted by obligors with respect to the Accounts and Additional
Accounts.
Under the receivables purchase agreement, Bombardier Capital Inc. has
transferred and will continue to transfer the receivables to the depositor in
exchange for the net cash proceeds received by the depositor from the sale of
the investor certificates, which proceeds equals the proceeds, after expenses,
raised from the sale of the investor certificates, less any amounts deposited by
the depositor in the reserve fund and a promissory note issued by the depositor
in favor of Bombardier Capital Inc. The value of and the purchase price in the
case of sales of Eligible Receivables transferred will be deemed to equal the
principal amount of these receivables plus accrued and unpaid interest on these
receivables on the date of transfer. The value of and the purchase price in the
case of sales for ineligible receivables transferred will equal the net book
value of the receivables. The principal amount of the promissory note issued to
Bombardier Capital Inc. will be increased from time to time in connection with
the sale of additional receivables by Bombardier Capital Inc. to the depositor
for inclusion in the trust under the receivables purchase agreement to the
extent the purchase price for these receivables is not paid in cash by the
depositor.
As security for the promissory note issued to Bombardier Capital Inc., the
depositor has pledged to Bombardier Capital Inc. the variable funding
certificate held by the depositor. Principal and interest payable on the
promissory note may be paid by the depositor from time to time out of monies
available to the depositor from any source, including through the depositor's
interest in the BCRC Certificate and variable funding certificate. Interest on
the promissory note will accrue at a rate per annum equal to 15%. In the event
of a bankruptcy where the depositor and the trust are substantively consolidated
or in any other instance where the holder of the promissory note and the holders
of the investor certificates will be claiming against a common fund, the portion
of the amounts then due under the promissory note in excess of the amount by
which the excess, if any, of the Pool Balance over the Required Pool Balance
plus the Retained Interest exceeds the Available Subordinated Amount for all
series will be subordinate to the prior indefeasible payment in full of the
investor certificates. In addition to the sale of receivables by Bombardier
Capital Inc. to the depositor, Bombardier Capital Inc. may transfer the
receivables to the depositor as a capital contribution. When receivables are
transferred by contribution, the depositor will not be required to pay cash to
Bombardier Capital Inc. or to increase the amount of the promissory note as
consideration for these receivables.
In connection with the sale or contribution of the receivables to the
depositor, Bombardier Capital Inc. will indicate in its computer files that the
receivables have been transferred to the depositor, and that the depositor has
transferred its interest in the receivables to the trust. In addition,
Bombardier Capital Inc. will provide to the depositor and the trustee a computer
file or
54
<Page>
microfiche or written list containing a true and complete list of all Accounts,
identifying the balances of the receivables as of January 1, 1994 and
receivables in the Additional Account as of the applicable date on which such
Additional Accounts were designated to the trust. The records and agreements for
the Accounts and receivables have not been, and will not be, segregated by
Bombardier Capital Inc. from other documents and agreements for other accounts
and receivables and will not be stamped or marked to reflect the sale of the
receivables, but the computer records of Bombardier Capital Inc. have been
marked to evidence this transfer. Bombardier Capital Inc. has filed and will
file UCC financing statements for the sale or contribution of the receivables
meeting the requirements of Massachusetts state law. See 'Risk Factors -- State
and Federal Law May Limit the Abilities of the Servicer to Realize on
Receivables Thus Causing Losses on Your Certificates' and 'Material Legal
Aspects of the Receivables -- Transfer of Receivables and Certificates.'
REPRESENTATIONS AND WARRANTIES
Bombardier Capital Inc. makes representations and warranties to the
depositor to the effect that, among other things, as of the date of the issuance
of the first series of certificates and each series issuance date, it was duly
incorporated and in good standing and that it has the authority to consummate
the transactions contemplated by the receivables purchase agreement.
Bombardier Capital Inc. also makes representations and warranties to the
depositor about the receivables to the effect that, among other things, as of
January 1, 1994, the date of the issuance of the first series of certificates
and each series issuance date, each Account is an Eligible Account and, in the
case of Additional Accounts as of the date they are considered Accounts, each of
these Additional Accounts is an Eligible Account. In the event of a breach of
any representation and warranty set forth in this paragraph which results in the
requirement that the depositor accept retransfer of receivables from the trust
under the pooling and servicing agreement, then Bombardier Capital Inc. shall,
unless an event of bankruptcy, insolvency or receivership relating to Bombardier
Capital Inc. or the depositor has occurred, repurchase these receivables from
the depositor. The purchase price for these receivables shall be the principal
balance thereof, together with accrued interest, which amount shall be paid by
Bombardier Capital Inc. in immediately available funds on the business day
preceding the date of this retransfer.
Bombardier Capital Inc. also makes representations and warranties to the
depositor to the effect, among other things, that as of January 1, 1994, the
date of the issuance of the first series of certificates and each series
issuance date the receivables purchase agreement constitutes a legal, valid and
binding obligation of Bombardier Capital Inc. and the receivables purchase
agreement constitutes a valid sale to the depositor of all right, title and
interest of Bombardier Capital Inc. in and to the receivables, whether then
existing or subsequently created in the Accounts, the security granted by
obligors and, with some exceptions, the proceeds of the receivables and the
collateral security, which is effective as to each receivable upon its creation.
If the breach of any of the representations and warranties described in this
paragraph results in the obligation of the depositor under the pooling and
servicing agreement to repurchase an interest in receivables from the trust,
Bombardier Capital Inc. will be obligated to repurchase this interest
retransferred to the depositor for the amount which the depositor was required
to pay to the trust in connection with this retransfer.
COVENANTS
Bombardier Capital Inc. has covenanted that, except for the sale or
contribution and conveyances under the receivables purchase agreement,
Bombardier Capital Inc. will not sell, pledge, assign or transfer any interest,
except for specified tax and governmental and other statutory liens, in the
receivables being transferred to the depositor to any other person.
Bombardier Capital Inc. also has covenanted to defend and indemnify the
depositor for any loss, liability or expense incurred by the depositor in
connection with a breach by Bombardier
55
<Page>
Capital Inc. of some of its representations, warranties or covenants contained
in the receivables purchase agreement.
In addition, Bombardier Capital Inc. has expressly acknowledged and
consented to the depositor's assignment of its rights in the receivables under
the pooling and servicing agreement to the trustee.
TERMINATION
The receivables purchase agreement will terminate immediately after the
trust terminates. In addition, if Bombardier Capital Inc. becomes party to any
bankruptcy or similar proceeding, other than as a claimant, and, if this
proceeding either is voluntary or is involuntary and, in the case of an
involuntary proceeding, this involuntary proceeding is not dismissed within 60
days of its institution, Bombardier Capital Inc. will immediately cease to sell
or transfer receivables to the depositor and will promptly give notice of this
event to the depositor and the trustee.
56
<Page>
MATERIAL LEGAL ASPECTS OF THE RECEIVABLES
TRANSFER OF RECEIVABLES AND CERTIFICATES
In connection with any receivables sold or contributed and assigned by
Bombardier Capital Inc. to the depositor, Bombardier Capital Inc. represents and
warrants that the transfer constitutes a valid transfer and assignment to the
depositor of all right, title and interest in and to the receivables and that,
under the UCC, there exists in favor of the depositor a valid, subsisting and
enforceable first priority perfected ownership interest in the receivables
transferred to the depositor. Bombardier Capital Inc. has made this
representation and warranty under the UCC as then in effect in the State of
Vermont, and commencing with the issuance of this series of certificates and all
future assignments of Additional Accounts makes this representation and warranty
under the UCC as in effect in Massachusetts or Vermont (as applicable).
Bombardier Capital Inc. also represents and warrants with respect to any
receivables subsequently created in the Accounts or Additional Accounts
transferred to the depositor that there exists in favor of the depositor a
valid, subsisting and enforceable first priority perfected ownership interest in
all of these receivables subsequently created in these Accounts or Additional
Accounts on and after their creation. For a discussion of the depositor's rights
arising from these representations and warranties not being satisfied, see
'Description of the Certificates -- Representations and Warranties.'
Each of Bombardier Capital Inc. and the depositor represent that the
receivables are 'tangible chattel paper' for purposes of the UCC as in effect in
New York. If the receivables are deemed to be tangible chattel paper, the
transferee must either take possession of the chattel paper or file an
appropriate financing statement or statements, in order to perfect its interest
in the receivables. Financing statements relating to the transfer of the
receivables have been filed under the UCC as in effect in Massachusetts or
Delaware (as applicable) -- some of which are filed under revisions to the UCC
to be 'in lieu of' financing statements that continue financing statements
previously filed in Vermont and Florida -- by Bombardier Capital Inc. and the
depositor to perfect the interests of the depositor and the trust in the
receivables. Continuation statements will be filed as required to continue the
perfection of these interests. The receivables will not be stamped to indicate
the interest of the depositor or the trust.
In addition, in connection with any receivables conveyed to the trust
Bombardier Capital Inc. represents and warrants in the receivables purchase
agreement, and the depositor represents and warrants in the pooling and
servicing agreement, that except for specified liens permitted by the pooling
and servicing agreement each receivable included in the Pool Balance is and will
be secured by a first priority perfected security interest in the related
Eligible Product. However, when an Eligible Product is sold by an obligor,
Bombardier Capital Inc.'s security interest in the Eligible Product will
terminate in most instances. Therefore, if an obligor fails to remit to
Bombardier Capital Inc. amounts owed for Eligible Products that have been sold,
the related receivables may no longer be secured by Eligible Products, although
they may, in some circumstances, still be secured by the proceeds of these
Eligible Products.
There are limited circumstances under the UCC and applicable federal law in
which prior or subsequent transferees of receivables could have an interest in
these receivables with priority over the trust's interest. A purchaser of the
receivables who gives new value and takes possession of the instruments which
evidence the receivables in the ordinary course of that purchaser's business
may, under some circumstances, for instance, where the purchaser is without
notice of any adverse claim, have priority over the interest of the trust in the
receivables. The failure to stamp the receivables to indicate the interest of
the depositor and the trust, as described in the second preceding paragraph
above, could support a claim by a subsequent purchaser of the receivables that
this purchaser acted without notice of any claim by the depositor or the trust
in the receivables. A tax or other government lien or non-consensual lien on
property of Bombardier Capital Inc. or the depositor arising prior to the time a
receivable is conveyed to the trust may also have priority over the interest of
the trust in that receivable.
Under the receivables purchase agreement, in connection with any receivables
sold or contributed and assigned by Bombardier Capital Inc. to the depositor,
Bombardier Capital Inc.
57
<Page>
warrants to the depositor that the receivables have been transferred free and
clear of the lien of any third party. Under the pooling and servicing agreement,
the depositor warrants to the trust that, except for the conveyances
contemplated by the pooling and servicing agreement, the receivables have been
transferred to the trust free and clear of the lien of any third party, and the
depositor also has covenanted that it will not sell, pledge, assign, transfer or
grant any lien on any receivable included in the trust other than to the
depositor and the trust.
In addition, while Bombardier Capital Inc. is the servicer, cash collections
on the receivables may be commingled with the funds of Bombardier Capital Inc.
before each distribution date and, in the event of the bankruptcy of Bombardier
Capital Inc., the trust may not have a perfected interest in these collections.
In the event of this type of commingling, the amount so commingled at any given
time, and to which the certificateholders would otherwise be entitled, may
exceed the amount distributable to certificateholders on the following
distribution date.
The depositor has represented and warranted to the trustee that the transfer
of the receivables on January 1, 1994 constitutes, and the transfer of the
depositor's right to any subsequent receivables in the Accounts and in any
Additional Accounts will constitute, a valid transfer and assignment to the
trust of all right, title and interest of the depositor in and to the
receivables, including any additional receivables subsequently created in the
Accounts and in any Additional Accounts, except for specified tax and
governmental liens and claims, all monies due or to become due thereon and, with
some exceptions, the proceeds of the receivables which is effective as to each
receivable upon its transfer to the trust.
If Bombardier Capital Inc. or the depositor were to become a debtor under
federal bankruptcy law, a court could conclude that the accounts receivable sold
by such debtor prior to a filing for bankruptcy should remain the property of
the debtor's bankruptcy estate. Such a conclusion might result in the delay of
distributions of collections and reductions, which could be substantial, in the
amount of payments to certificateholders.
MATTERS RELATED TO UNFUNDED RECEIVABLES
Receivables are created on the books of Bombardier Capital Inc. and sold to
the depositor and assigned to the trust as early as the day products are shipped
by the manufacturer, importer or distributor to the dealer; however, Bombardier
Capital Inc. usually does not pay the manufacturer, importer or distributor for
the product for a period of time after this shipment. If Bombardier Capital Inc.
were to become insolvent or for any other reason did not or was not able to pay
the manufacturer for a product, it may not be possible to collect the unfunded
receivables from the dealer. In addition, the manufacturer, importer or
distributor might be able to delay or prevent the trust from receiving payments
otherwise owing to the trust for these receivables. See 'The Floorplan Financing
Business -- Creation of the Receivables.'
MATERIAL MATTERS RELATING TO BANKRUPTCY
In connection with any receivables sold or contributed and assigned by
Bombardier Capital Inc. to the depositor under the receivables purchase
agreement, Bombardier Capital Inc. warrants to the depositor in the receivables
purchase agreement that the sale or contribution and assignment of these
receivables by it to the depositor is a valid sale or contribution and
assignment of these receivables. In addition, Bombardier Capital Inc. and the
depositor have agreed to treat the transfer of receivables by Bombardier Capital
Inc. to the depositor under the receivables purchase agreement as a sale or
contribution and assignment of the receivables to the depositor, and Bombardier
Capital Inc. has or will take all actions that are required under Massachusetts
law to perfect the depositor's ownership interest in the receivables. If
Bombardier Capital Inc. were to become a debtor in a bankruptcy case and a
bankruptcy trustee for Bombardier Capital Inc. as debtor-in-possession or a
creditor of Bombardier Capital Inc. were to take the position that the sale of
receivables from Bombardier Capital Inc. to the depositor under the receivables
purchase agreement should be recharacterized as a pledge of these receivables to
secure a borrowing by Bombardier Capital Inc., then delays in payments of
collections of
58
<Page>
receivables to the depositor could occur or, should the court rule in favor of
that trustee, debtor in possession or creditor, reductions, which, in some
circumstances, could be substantial, in the amount of these payments could
result.
In addition, if Bombardier Capital Inc. were to become a debtor in a
bankruptcy case and a creditor or bankruptcy trustee of this debtor or this
debtor itself were to request a court to order that Bombardier Capital Inc.
should be substantively consolidated with the depositor, delays in payments on
the receivables and, accordingly, the certificates could result. Should the
bankruptcy court rule in favor of that creditor, bankruptcy trustee or this
debtor, reductions, which, in some circumstances could be substantial, in the
amount of these payments could result.
The depositor represents and warrants to the trustee in connection with the
transfer of any receivables to the trust that the transfer of these receivables
to the trust and of the depositor's right to additional receivables will
constitute a valid transfer and assignment to the trust of all right, title and
interest of the depositor in and to the receivables, including any additional
receivables subsequently created, except for specified tax and government liens
and claims, all monies due or to become due thereon and, with some exceptions,
the proceeds thereof which is effective as to each receivable upon the transfer
thereof to the trust.
The depositor's certificate of incorporation provides that the depositor is
required to have two independent directors and that it shall not file a
voluntary application for relief under the United States bankruptcy code without
the affirmative vote of its two independent directors. Under the pooling and
servicing agreement, Bombardier Capital Inc., the servicer and any enhancement
provider covenant that they will not at any time institute against the depositor
any bankruptcy, reorganization or other proceedings under any federal or state
bankruptcy or similar law. In addition, other steps have been taken to avoid the
depositor's becoming a debtor in a bankruptcy case. If, despite these steps, the
depositor were to become a debtor in a bankruptcy case, and a bankruptcy trustee
for the depositor or the depositor as debtor in possession or a creditor of the
depositor were to take the position that the transfer of the receivables from
the depositor to the trust should be recharacterized as a pledge of the
receivables, then delays in payments on the certificates or, should the court
rule in favor of that trustee, debtor in possession or creditor, reductions,
which, in some circumstances, could be substantial, in the amount of these
payments could result.
The depositor does not intend to file, and Bombardier Capital Inc. has
agreed that it will not cause the depositor to file, a voluntary or involuntary
petition for relief under the United States bankruptcy code or any similar
applicable state law with respect to the depositor so long as the depositor is
solvent and does not foresee becoming insolvent. If Bombardier Capital Inc. were
to become a debtor under the bankruptcy code, the applicable bankruptcy court
might hold unenforceable or invalid Bombardier Capital Inc.'s agreement not to
cause the depositor to file this type of petition and permit Bombardier Capital
Inc. as creditor of the depositor, on account of the promissory note issued by
the depositor to Bombardier Capital Inc. as partial consideration for the
transfer of the receivables to the depositor and on account of the related
pledge of the variable funding certificate as security for the promissory note,
to commence an involuntary petition against the depositor.
If Bombardier Capital Inc. or the depositor were to become a debtor in a
bankruptcy case causing an Early Amortization Event to occur, then, according to
the pooling and servicing agreement and the receivables purchase agreement, new
receivables would no longer be transferred to the depositor by Bombardier
Capital Inc. and, according to the pooling and servicing agreement, only
collections on receivables previously sold to the depositor and transferred to
the trust would be available to be applied to pay interest accruing on the
certificates and to pay the principal amount of the certificates. Under these
circumstances, the servicer is obligated to allocate all principal collections
on receivables to the oldest principal balance first. If this allocation method
were to be altered by the bankruptcy court, the rate of payment on the
certificates might be adversely affected.
The occurrence of specified events of bankruptcy, insolvency or receivership
with respect to the servicer will result in a Servicer Default, which Servicer
Default, in turn, will result in an
59
<Page>
Early Amortization Event. If no other Servicer Default other than the
commencement of this bankruptcy or similar event exists, a bankruptcy trustee of
the servicer may have the power to prevent either the trustee or the
certificateholders from appointing a successor servicer.
MATERIAL FEDERAL INCOME TAX CONSEQUENCES
The following discussion represents the opinion of Sidley Austin Brown &
Wood LLP, special U.S. tax counsel to the depositor and the trust as to the
material United States federal income tax consequences relating to the purchase,
ownership and disposition of the certificates. This discussion is based on
current law, which is subject to retroactive or prospective change. Both types
of changes could adversely affect the tax consequences described in this
section. The discussion does not address all of the tax consequences that may be
relevant to a particular certificateholder in light of its own circumstances.
Further, the following specific categories of certificateholders may be subject
to special tax rules and limitations which are not discussed in this section:
dealers or traders in securities, financial institutions, life-insurance
companies, tax-exempt entities, United States Persons that have a principal
place of business outside the United States, United States Persons whose
functional currency is not the United States dollar, United States persons who
hold the certificates as part of a straddle, hedge, conversion, synthetic
security or constructive sale transaction or specified Foreign Persons. It is
suggested that prospective purchasers consult their own tax advisors as to the
federal, state, local, foreign and other tax consequences to them of the
purchase, ownership and disposition of the certificates.
If a partnership (including for this purpose any entity treated as a
partnership for federal income tax purposes) is a beneficial owner of a
certificate, the treatment of a partner in the partnership will generally depend
upon the status of the partner and upon the activities of the partnership. A
certificateholder that is a partnership and partners in such partnership should
consult their tax advisors about the federal income tax consequences of holding
and disposing of the certificates, as the case may be.
CHARACTERIZATION OF THE CERTIFICATES AND THE TRUST
Although no transaction closely comparable to the issuance of the
certificates has been the subject of any Treasury regulation, public ruling or
judicial decision, for federal income tax purposes, Sidley Austin Brown & Wood
LLP is of the opinion that the certificates will be characterized as
indebtedness, and the trust will be treated as a mere security device (assuming
all of the trust's equity for tax purposes is owned by a single entity) and will
not be subject to an entity-level federal income tax. Opinions of counsel are
not binding, and no assurance can be given that the IRS would not successfully
assert that the certificates are not indebtedness but rather are interests in
the nature of equity interests and that the trust is not a security device but
rather is either a partnership between the depositor and some or all classes of
certificateholders, or a publicly traded partnership taxable as a corporation in
which the depositor owns common equity interests and some or all classes of
certificateholders own preferred equity interests.
POSSIBLE CHARACTERIZATION OF THE TRUST AS A PARTNERSHIP OTHER THAN A PUBLICLY
TRADED PARTNERSHIP
If, contrary to the views expressed above, some or all classes of
certificates of the trust are characterized as interests in the nature of equity
interests, or if the Supplemental Certificate is delivered to an entity other
than the depositor, then the trust could be characterized as a partnership or a
publicly traded partnership. The trust would not be subject to federal income
tax if the trust were treated as a partnership other than a publicly traded
partnership taxable as a corporation. Instead, each item of income, gain,
deduction and loss generated through the partnership's ownership and servicing
of the receivables would be taken into account directly in computing the taxable
income of the depositor, the holder of the Supplemental Certificate and the
certificateholders treated as partners, in accordance with their respective
ownership of the interests of the partnership. The amount and timing of the
items of income and deductions of the certificateholders could differ if the
certificates were held to constitute partnership interests rather
60
<Page>
than indebtedness. In addition, if a certificate were characterized as an equity
interest and the trust were treated as a partnership other than a publicly
traded partnership, income derived by a certificateholder that is a pension fund
or other tax-exempt entity treated as a partner may be treated as unrelated
business taxable income. Partnership characterization also may have adverse
state and local income or franchise tax consequences for a certificateholder.
POSSIBLE CHARACTERIZATION OF THE TRUST AS A PUBLICLY TRADED PARTNERSHIP TAXABLE
AS A CORPORATION
If the trust were treated in whole or in part as a partnership in which some
or all of the certificateholders were treated as partners rather than holders of
indebtedness, that deemed partnership could be classified as a publicly traded
partnership taxable as a corporation. In that event, the trust would be subject
to federal income tax at corporate rates on the taxable income that the trust
derives from the receivables. This tax would substantially reduce the amounts
available for distribution to the certificateholders. Cash distributions to the
certificateholders would be treated as dividends for tax purposes to the extent
of the trust's earnings and profits and, for corporate certificateholders, may
be eligible for the dividends-received deduction, subject to limitations.
The remainder of this section assumes that, for U.S. federal income tax
purposes, the certificates will be characterized as indebtedness. The depositor
and the certificateholders have agreed to treat the certificates as indebtedness
for federal income tax purposes and neither the trustee nor the depositor will
comply with the reporting requirements applicable to corporations, publicly
traded partnerships or partnerships.
TAXATION OF INTEREST INCOME TO UNITED STATES PERSONS
General
Stated interest, original issue discount and market discount received or
accrued on a certificate will be ordinary income, and principal payments on a
certificate, other than payments of discount, will be a return of capital to the
extent of the certificateholder's basis in the certificate allocable to those
payments.
Assuming that the certificates are treated as issued without original issue
discount, the stated interest on a certificate will be taxable to a
certificateholder as ordinary income when received or accrued, in accordance
with such certificateholder's method of tax accounting.
Original Issue Discount
Unless otherwise provided in the prospectus supplement, it is not
anticipated that the certificates will be issued with more than de minimis
original issue discount. However, because the failure to pay interest currently
on the certificates does not give rise to any remedy to compel payment, the IRS
may take the position on the basis of Treasury regulations yet to be issued that
all of the interest payments on the certificates should be treated as having
original issue discount. A holder of a certificate having more than de minimis
original issue discount must include original issue discount in ordinary income
as it accrues in advance of receipt of the cash attributable to the discount,
regardless of the holder's regular method of accounting.
The amount of original issue discount on a certificate is the excess of its
'stated redemption price at maturity' over its 'issue price.' The issue price of
a certificate in a particular class is the price at which a substantial amount
of the certificates of that class are first sold to the public. The stated
redemption price at maturity of a certificate is the total of all payments on
the certificate other than 'qualified stated interest' payments. A qualified
stated interest payment is stated interest that is unconditionally payable in
cash or in property at least annually at a single fixed rate, a single objective
rate or one or more qualified floating rates. As indicated above, the IRS may
take the position that some of the interest on a certificate is not 'qualified
stated interest.'
A certificateholder must include in gross income for any taxable year the
sum of the 'daily portions' of the original issue discount that accrue on the
certificate for each day during the
61
<Page>
certificateholder's taxable year on which the certificate is held. A calculation
will be made of the portion of the original issue discount that accrues on each
certificate during each 'accrual period,' which in general is the period
corresponding to the period between distribution dates. The original issue
discount accruing during any accrual period is divided by the number of days in
the period to determine the daily portion of original issue discount for each
day in the period. The amount of original issue discount that accrues in each
year will be computed under a constant yield method, with the consequence that a
United States holder will include in gross income progressively larger amounts
of original issue discount over time.
Market Discount
A certificateholder who purchases a certificate at more than a de minimis
discount may be subject to the 'market discount' rules of Section 1276 through
1278 of the Internal Revenue Code of 1986. These rules provide, in part, that
gain on the sale or other disposition of a certificate and partial principal
payments on a certificate are treated as ordinary income to the extent of
accrued market discount. Market discount will be considered to accrue ratably
during the period from the date of acquisition to the maturity date of the
certificate, unless the certificateholder elects to accrue market discount on
the basis of semiannual compounding. The market discount rules also provide for
deferral of a portion of interest deductions with respect to debt incurred to
purchase or carry a certificate that has market discount not previously included
in income. Alternatively, a certificateholder may elect to include market
discount in income as it accrues in lieu of the tax treatment described in the
two preceding sentences. Generally, such currently included market discount is
treated as ordinary interest for United States federal income tax purposes. Such
an election will apply to all debt instruments acquired by the certificateholder
on or after the first day of the first taxable year to which such election
applies and may be revoked only with the consent of the IRS.
Market Premium
A certificateholder who purchases a certificate for an amount in excess of
the sum of all amounts payable on the certificates after the purchase date other
than payments of qualified stated interest may elect to offset such excess
against interest income over the remaining term of the certificate in accordance
with the provisions of Section 171 of the Internal Revenue Code of 1986.
Any election to amortize market premium applies to all taxable debt
instruments acquired by the certificateholder on or after the first day of the
first taxable year to which such election applies and may be revoked only with
the consent of the IRS.
SALE, EXCHANGE OR OTHER DISPOSITION OF CERTIFICATES
Upon a sale, exchange or disposition of a certificate, a certificateholder
will recognize gain or loss equal to the difference between the amount realized
on the sale, exchange or disposition and the certificateholder's adjusted basis
in the certificate. The adjusted basis in the certificate will equal its cost,
increased by any original issue discount or market discount includible in income
with respect to the certificate prior to its sale, and reduced by any principal
payments previously received with respect to the certificate and any amortized
market premium. Gain or loss will be capital gain or loss if the certificate was
held as a capital asset, and will be long-term gain or loss if held for more
than one year. Generally, capital losses may be used only to offset capital
gains.
FOREIGN INVESTORS
A Foreign Person holding the certificate on its own behalf (a 'Foreign
Investor') that is an individual or a corporation generally will be exempt from
federal income taxes and withholding on payments of principal, premium, interest
or original issue discount on a certificate, unless such Foreign Investor is a
direct or indirect 10 percent or greater shareholder of the depositor, a
controlled foreign corporation related to the depositor or a bank extending
credit pursuant to a loan agreement entered into in the ordinary course of its
trade or business. To qualify for the
62
<Page>
exemption from taxation, the Withholding Agent, as defined below, must have
received a statement (generally made on IRS Form W-8BEN) from the individual or
corporation that: (i) is signed under penalties of perjury by the beneficial
owner of the certificate, (ii) certifies that such owner is not a United States
Person and (iii) provides the beneficial owner's name and address. Certain
securities clearing organizations and other entities who are not beneficial
owners, may be able to provide the signed statement to the Withholding Agent
instead of the beneficial owner. However, in such case, the signed statement may
require a copy of the beneficial owner's IRS Form W-8BEN (or a substitute form).
As used above, a 'Withholding Agent' is the last U.S. payor, qualified
intermediary, U.S. branch of a foreign person or withholding foreign partnership
in the chain of payment prior to payment to a Foreign Person (which itself is
not a Withholding Agent). Generally, an IRS Form W-8BEN is effective for the
remainder of the year of signature plus three full calendar years unless a
change in circumstances renders any information on the form incorrect.
Notwithstanding the preceding sentence, a W-8BEN with a U.S. taxpayer
identification number will remain effective until a change in circumstances
makes any information on the form incorrect, provided that the Withholding Agent
reports at least annually to the beneficial owner. The beneficial owner must
inform the Withholding Agent within 30 days of such change and furnish a new IRS
Form W-8BEN.
A Foreign Investor that is not an individual or corporation (or an entity
treated as a corporation for federal income tax purposes) holding the
certificate on its own behalf may have substantially increased reporting
requirements and should consult its tax advisor.
Any gain realized on the sale, redemption, retirement or, other taxable
disposition of a certificate by a Foreign Investor will be exempt from federal
income and withholding tax so long as: (i) the gain is not effectively connected
with the conduct of a trade or business in the United States by the Foreign
Investor; and (ii) in the case of a Foreign Investor that is an individual, the
Foreign Investor is not present in the United States for 183 days or more in the
taxable year.
If the interest, gain or income on a certificate held by a Foreign Investor
is effectively connected with the conduct of a trade or business in the United
States by the Foreign Investor, such certificateholder, although exempt from the
withholding tax previously discussed if an appropriate statement is furnished,
will generally be subject to United States federal income tax on the interest,
gain or income at regular federal income tax rates. In addition, if the Foreign
Investor is a foreign corporation, it may be subject to a branch profits tax
equal to 30 percent of its 'dividend equivalent amount' within the meaning of
the Internal Revenue Code of 1986 for the year, subject to adjustment, unless it
qualifies for a lower rate under an applicable tax treaty.
A certificate will not be includible in the estate of a Foreign Investor
unless the Foreign Investor is a direct or indirect 10 percent or greater
shareholder of the depositor.
If the certificates were treated as an interest in a partnership, the
recharacterization could cause a Foreign Investor to be treated as engaged in a
trade or business in the United States. In that event, the Foreign Investor
would be required to file a federal income tax return and would be subject to
U.S. federal income tax, including the branch profits tax, on its net income
from the partnership. Further, specific withholding obligations apply with
respect to income allocable or distributions made to a foreign partner. The
applicable rate of that withholding generally depends on whether the Foreign
Investor is treated, for U.S. federal income tax purposes, as a corporation or
as a taxpayer other than a corporation. If the certificates were treated as
stock in a corporation, distributions to a Foreign Investor, to the extent
treated as dividends, generally would be subject to withholding of tax at the
rate of 30 percent, unless that rate were reduced by an applicable tax treaty.
It is suggested that prospective Foreign Investors consult their tax
advisors concerning the tax consequences to them of the purchase, ownership and
disposition of the certificates.
63
<Page>
INFORMATION REPORTING AND BACKUP WITHHOLDING
Interest, including original issue discount, principal or proceeds of the
sale of a certificate may be subject to information reporting or to 'backup
withholding' of United States federal income tax at the applicable rate.
Information reporting and backup withholding generally do not apply to
corporations and other exempt recipients, which may be required to establish
their exempt status. Backup withholding applies if, among other circumstances, a
certificateholder that is not otherwise exempt fails to furnish that person's
correct social security number or other taxpayer identification number.
Information reporting and backup withholding do not apply to a Foreign Investor
who satisfies the applicable identification requirements.
STATE AND LOCAL TAXATION
The discussion above does not address the tax consequences of purchase,
ownership or disposition of the certificates under any state or local tax law.
It is recommended that all investors consult their own tax advisers regarding
the Federal, State, Local or Foreign Income or Estate Tax Consequences of the
Purchase, Ownership and Disposition of the certificates.
ERISA CONSIDERATIONS
Certificates may not be acquired by or for the account of any employee
benefit plan, trust or account, including an individual retirement account, that
is subject to the requirements of Title I of the Employee Retirement Income
Security Act of 1974, as amended, or that is described in Section 4975(e)(1) of
the Internal Revenue Code of 1986, or by or for the account of any entity whose
underlying assets include any assets subject to these laws by reason of
investment in that entity by such plans, trusts or accounts. By accepting and
holding any certificate, the holder of the certificate will be deemed to have
represented and warranted that it is not a plan or entity described above, and
that its acquisition and holding of the certificate are in compliance with the
foregoing restrictions.
PLAN OF DISTRIBUTION
The certificates will be offered in series from time to time through any of
the following methods:
by negotiated firm commitment underwriting and public
reoffering by underwriters;
by agency placements through one or more placement agents
primarily with institutional investors and dealers; and
by placement directly by the issuer with institutional
investors.
A prospectus supplement will be prepared for each series which will describe
the method of offering being used for that series and will set forth the
identity of any underwriters thereof and either the price at which such series
is being offered, the nature and amount of any underwriting discounts or
additional compensation to such underwriters and the proceeds of the offering to
the depositor, or the method by which the price at which the underwriters will
sell the certificates will be determined. Each prospectus supplement for an
underwritten offering will also contain information regarding the nature of the
underwriters' obligations, any material relationship between the depositor and
any underwriter and, where appropriate, information regarding any discounts or
concessions to be allowed or reallowed to dealers or others and any arrangements
to stabilize the market for the securities so offered. In firm commitment
underwritten offerings, the underwriters will be obligated to purchase all of
the certificates of such series if any such certificates are purchased.
Certificates may be acquired by the underwriters for their own accounts and may
be resold from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale.
Underwriters and agents may be entitled under agreements entered into with
the depositor to indemnification by the depositor against certain civil
liabilities, including liabilities under the
64
<Page>
Securities Act of 1933, as amended, or to contribution with respect to payments
which such underwriters or agents may be required to make in respect thereof.
If a series is offered other than through underwriters, the prospectus
supplement relating thereto will contain information regarding the nature of
such offering and any agreements to be entered into between the depositor and
purchasers of certificates of such series.
LEGAL MATTERS
Specified legal matters will be passed upon for the depositor and the trust
by Sidley Austin Brown & Wood LLP, New York, New York. Specified federal income
tax matters will be passed upon for the depositor and the trust by Sidley Austin
Brown & Wood LLP, New York, New York.
REPORTS TO CERTIFICATEHOLDERS
Unless and until definitive certificates are issued, monthly and annual
unaudited reports, containing information concerning the trust, which reports
will be substantially based upon information provided by the servicer, will be
sent on behalf of the trust to Cede & Co., as nominee of The Depository Trust
Company and registered holder of the certificates. These reports may be
available to beneficial owners of certificates in accordance with the
regulations and procedures of The Depository Trust Company. See 'Description of
the Certificates -- Reports' and ' -- Evidence as to Compliance.'
These reports will not constitute financial statements prepared in
accordance with generally accepted accounting principles.
The trust will file with the Securities and Exchange Commission those
periodic reports with respect to the trust as are required under the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission thereunder.
65
<Page>
GLOSSARY
'ACCOUNTS' means the accounts designated to the trust and identified in the
computer file or microfiche or written list delivered to the trustee on the date
of issuance of the first series of certificates under the pooling and servicing
agreement plus all Additional Accounts less any accounts which have been removed
from the trust.
'ADDITIONAL ACCOUNTS' means any accounts designated by the depositor to be
included in the trust under the terms of the pooling and servicing agreement in
addition to those designated at the time of the first series of certificates.
'ADJUSTED INVESTED AMOUNT' means, for any series of certificates, the
initial principal amount of the such series of certificates plus the amount of
any withdrawals from the related excess funding account in connection with an
increase in receivables in the trust since the date of the issuance of such
series minus the amount of any additions to the related excess funding account
in connection with a reduction in the receivables in the trust since the date of
the issuance of such series of certificates.
'ADJUSTMENT PAYMENT' means an amount payable by the depositor for deposit
into the collection account if the servicer adjusts downward the outstanding
principal balance of any Eligible Receivable because of a rebate, billing error,
refund or credit adjustment to an obligor, or because that receivable was
created in respect of a product which was refused or returned by an obligor, the
amount of this adjustment will be deducted from the Pool Balance; if the
adjustment reduces the Pool Balance below the Required Pool Balance on the
immediately preceding Determination Date, after giving effect to the
allocations, distributions, withdrawals and deposits to be made on the related
Distribution Date, the amount of the payment will be an amount equal to the
deficiency up to the amount of the adjustment.
'AVAILABLE SUBORDINATED AMOUNT' for any series for date of determination,
means the amount of the subordination for that series of certificates.
'BOMBARDIER CAPITAL INC. DOMESTIC INVENTORY PORTFOLIO' means the accounts
owned by Bombardier Capital Inc., whether or not they would be Eligible Accounts
and whether or not they have been added to the trust generating receivables as a
result of extensions of credit and advances made to dealers of consumer,
recreational and commercial products which dealers are located in the United
States.
'BCRC CERTIFICATE' means the certificate held by the depositor and
representing the Retained Interest.
'BUSINESS DAY' means any day other than (a) a Saturday or Sunday or (b)
another day on which banking institutions or trust companies in the State of New
York are authorized or obligated by law, executive order or governmental decree
to be closed.
'CONTROLLED ACCUMULATION PERIOD' means, for any applicable series of
certificates, unless an Early Amortization Event has occurred with respect to
such series, the period during which a portion of principal collections
allocated to such series are deposited into an account for the benefit of
certificateholders beginning on the date specified in or determined in the
manner specified in the related Series Supplement and ending on the earliest to
occur of:
(1) the start of an Early Amortization Period with respect to such
series,
(2) payment in full of the outstanding principal balance of the
certificates of such series, and
(3) the Series Termination Date for such series.
'CONTROLLED AMORTIZATION PERIOD' means, for any applicable series of
certificates, unless an Early Amortization Event has occurred with respect to
such series, the period during which a portion of principal collections
allocated to such series are paid to certificateholders on each
66
<Page>
distribution date beginning on the date specified in or determined in the manner
specified in the related Series Supplement and ending on the earliest to occur
of:
(1) the start of an Early Amortization Period with respect to such
series,
(2) payment in full of the outstanding principal balance of the
certificates of such series, and
(3) the Series Termination Date for such series.
'DEFAULTED AMOUNT' for any calendar month means an amount which is not less
than zero equal to the aggregate principal amount of principal receivables that
became Defaulted Receivables during the preceding calendar month less the full
amount of the Defaulted Receivables which are subject to retransfer from the
trust to the depositor or purchased by the servicer for that calendar month
unless certain events of bankruptcy, insolvency, or receivership have occurred
with respect to either of the depositor or the servicer or unless an event of
bankruptcy, insolvency or receivership relating to Bombardier Capital Inc. or
the depositor has occurred, in which event the Defaulted Amount will not be
reduced for those Defaulted Receivables.
'DEFAULTED RECEIVABLES' on any distribution date are:
(1) all receivables other than receivables that were designated as
ineligible at the time of transfer to the trust that were charged off as
uncollectible in the preceding calendar month;
(2) all receivables originally secured by a security interest in a
related Eligible Product which have not been paid in full for more than 90
days after the sale of the related Eligible Product; and
(3) all receivables which, although they were Eligible Receivables when
transferred to the trust, arose in an Account which has become an Account
which is not an Eligible Account since this transfer and which were not
Eligible Receivables for any six consecutive distribution dates after this
Account became an Account which is not an Eligible Account.
Receivables are not Defaulted Receivables merely because they are no longer
Eligible Receivables.
'DETERMINATION DATE' means, with respect to any distribution date, the day
that is two business days prior to that distribution date.
'EARLY AMORTIZATION EVENT' for any series refers to any of the events so
defined in the related Series Supplement, as well as each of the following
events:
1. a failure by the depositor to convey receivables in Additional
Accounts to the trust within five business days after the day on which it is
required to convey these receivables under the pooling and servicing
agreement;
2. failure on the part of the depositor, the servicer or Bombardier
Capital Inc., as applicable:
(a) to make any payment or deposit required by the terms of the
pooling and servicing agreement, including but not limited to any amount
required to be paid upon a transfer of receivables to the depositor or
Adjustment Payment, on or before the date occurring five (5) business
days after the date this payment or deposit is required to be made, which
failure is not cured within five business days after notice from the
trustee of this failure;
(b) with respect to any series, to deliver a distribution date
statement within ten business days after notice from the trustee of the
failure to deliver this statement;
(c) to duly comply with, observe or perform in any material respect
the covenant of the depositor not to create any lien, other than liens
and interests permitted by the pooling and servicing agreement, on any
receivable which failure has a material adverse effect on the holders of
the investor certificates or the holder of the variable funding
certificate and which continues unremedied for a period of 60 days after
written notice of
67
<Page>
this failure, requiring the same to be remedied, has been given to the
depositor by the trustee or any enhancement provider; provided, however,
that an Early Amortization Event will not be deemed to have occurred if
the depositor has repurchased the related receivables or, if applicable,
all the receivables during this period in accordance with the provisions
of the pooling and servicing agreement; or
(d) to duly observe or perform in any material respect any other of
its covenants or agreements set forth in the pooling and servicing
agreement, which failure has a materially adverse effect on the holders
of the investor certificates or the holder of the variable funding
certificate and which continues unremedied for a period of 45 days after
written notice of this failure, requiring the same to be remedied, has
been given to the depositor by the trustee or any enhancement provider;
3. any representation or warranty made by the depositor in the pooling
and servicing agreement or any information required to be given by the
depositor to the trustee under the pooling and servicing agreement to
identify the Accounts proves to have been incorrect in any material respect
when made or when delivered and continues to be incorrect in any material
respect for a period of 60 days after written notice, or within any longer
period as may be specified in the notice, of this failure, requiring the
same to be remedied, has been given to the depositor by the trustee, and as
a result the interests of the holders of the investor certificates or the
holder of the variable funding certificate are materially and adversely
affected, excluding, however, any representation or warranty made by the
depositor that the pooling and servicing agreement constitutes, or the
transfer of the receivables to the trust is, a valid sale, transfer and
assignment to the trust of all right, title and interest of the depositor in
the receivables and the security granted by the related obligors if the
pooling and servicing agreement constitutes the grant of a security interest
in the receivables and security granted by the related obligors; except when
the depositor has repurchased the related receivables or all of these
receivables, if applicable, during this period in accordance with the
provisions of the pooling and servicing agreement;
4. the occurrence of specified events of bankruptcy, insolvency or
receivership relating to any of Bombardier Corporation, the depositor or the
servicer or Bombardier Capital Inc. if it is not the servicer;
5. the depositor or the trust becomes an investment company within the
meaning of the Investment Company Act of 1940, as amended; and
6. the occurrence of any Servicer Default.
'EARLY AMORTIZATION PERIOD' means, for any series of certificates, the
period beginning as of the day an Early Amortization Event occurs with respect
to such series and ending on the day on which payment in full of the Invested
Amount of such series has been made to certificateholders, unless the Early
Amortization Period shall terminate prior to that time as described in the
related prospectus supplement and under 'Description of the
Certificates -- Early Amortization Events' in this prospectus.
'ELIGIBLE ACCOUNT' means:
(1) each individual financing account established by Bombardier Capital
Inc. or established by an affiliate of Bombardier Capital Inc. or by a third
party -- but which satisfies Bombardier Capital Inc.'s customary
underwriting standards -- and acquired by Bombardier Capital Inc. or an
affiliate of Bombardier Capital Inc., with an obligor with respect to
Eligible Products pursuant to an inventory security agreement, in the
ordinary course of business, and
(2) each individual line of credit or financing agreement extended by
Bombardier Capital Inc. (or an affiliate of Bombardier Capital Inc.) or by a
third party -- but which satisfies Bombardier Capital Inc.'s customary
underwriting standards -- and acquired by Bombardier Capital Inc. or an
affiliate of Bombardier Capital Inc. to an obligor for the purpose of
financing working capital, manufacturing, production or inventories and
secured by assets of
68
<Page>
that obligor, it which, in each case, as of the date of determination
thereof relates to an obligor that satisfies the requirements of the pooling
and servicing agreement and is in existence and, after its establishment or
acquisition by Bombardier Capital Inc. or an affiliate of Bombardier Capital
Inc., is maintained and serviced by Bombardier Capital Inc.
'ELIGIBLE DEPOSIT ACCOUNT' means either (1) a segregated account with either
the corporate trust department of the trustee or with a depository institution
or trust company organized under the laws of the United States of America or any
one of the states thereof or the District of Columbia, or any domestic branch of
a foreign bank, which at all times has either a long-term unsecured debt rating
of A2 or better by Moody's and of AAA or better by Standard & Poor's or such
other rating that is acceptable to each Rating Agency, as evidenced by a letter
from such Rating Agency to the trustee or has a certificate of deposit rating of
P-1 by Moody's and A-1+ by Standard & Poor's or such other rating that is
acceptable to each Rating Agency, as evidenced by a letter from such Rating
Agency to the trustee and which at all times is a member of the FDIC or (2) a
segregated trust account with the corporate trust department of a depository
institution or trust company organized under the laws of the United States or
any one of the states thereof or the District of Columbia, or any domestic
branch of a foreign bank, having corporate trust powers and acting as trustee
for funds deposited in that account, so long as any of the securities of that
depository institution or trust company has a credit rating from each Rating
Agency in one of its generic rating categories which signifies investment grade.
'ELIGIBLE INVESTMENTS' means book-entry securities, negotiable instruments
or securities represented by instruments in bearer or registered form having
original or remaining maturities of thirty days or less, but in no event
occurring later than the distribution date next succeeding the trustee's
acquisition thereof, which evidence:
(1) obligations of or fully guaranteed by the United States,
(2) demand deposits, time deposits or certificates of deposit of
depository institutions or trust companies incorporated under the laws of
the United States or any state thereof or any domestic branch of a foreign
bank and subject to supervision and examination by Federal or state banking
or depository institution authorities, the commercial paper or other
short-term unsecured debt obligations -- other than this type of obligation
the rating of which is based on the credit of a person or entity other than
that depository institution or trust company -- of which at the time of the
trust's investment or contractual commitment to invest in such investments
has a credit rating in the highest investment category from any individual
Rating Agency,
(3) commercial paper having a credit rating in the highest investment
category from any individual Rating Agency at the time of the trust's
investment or contractual commitment to invest in such paper,
(4) demand deposits, time deposits and certificates of deposit which are
fully insured by the FDIC and which are offered or insured by a financial
institution whose long-term debt is rated Baa3 or better by Moody's,
(5) bankers' acceptances issued by any depository institution or trust
company described in (2) above,
(6) investments in money market funds which have the highest rating
from, or have otherwise been approved in writing by, any individual Rating
Agency,
(7) repurchase obligations entered into with depository institutions or
trust companies -- acting as principal -- described in (2) above or whose
deposits are insured by the FDIC with respect to securities which are direct
obligations of or obligations guaranteed by the United States or any agency
or instrumentality thereof which is backed by the full faith and credit of
the United States, and
(8) other investments acceptable to any individual Rating Agency as
being consistent with the then-current rating of the class A certificates
and class B certificates.
69
<Page>
'ELIGIBLE PRODUCTS' means consumer, recreational and commercial products,
including, but not limited to, boats, motors and trailers, snowmobiles,
snow-grooming equipment, personal watercraft, recreational vehicles,
manufactured housing, motorcycles, lawn and garden equipment, horse trailers,
personal computers, and consumer electronics and appliances and spares and parts
relating to these products.
'ELIGIBLE RECEIVABLE' means each receivable:
(1) which was originated by Bombardier Capital Inc., by an affiliate of
Bombardier Capital Inc. or acquired by Bombardier Capital Inc. or an
affiliate of Bombardier Capital Inc. in each case in the ordinary course of
business,
(2) which arose under an Account that at the time the receivable was
transferred to the trust was an Eligible Account,
(3) which is owned by Bombardier Capital Inc. at the time of sale or
contribution by Bombardier Capital Inc. to the depositor,
(4) which represents the obligation of an obligor to repay an advance
made to or on behalf of that obligor, or credit extended for that obligor to
finance an Eligible Product,
(5) which, at the time of creation and, except for receivables that are
payable under a repayment schedule regardless of whether the related
Eligible Products have been sold or with respect to which the related
Eligible Products have then been sold, at the time of transfer to the trust,
is secured by a first priority perfected security interest in the Eligible
Product.
(6) which is not unenforceable as a result of any violation of
requirements of law applicable to it and the related inventory security
agreement is not unenforceable as a result of any violation of requirements
of law applicable to any party to the agreement,
(7) for which all consents and governmental authorizations required to
be obtained by Bombardier Capital Inc. or an affiliate of Bombardier Capital
Inc. or the depositor for the creation of the receivable or its transfer to
the depositor and the trust or the performance by Bombardier Capital Inc. or
an affiliate of Bombardier Capital Inc. of the inventory security agreement
have been duly obtained, effected or given and are in full force and effect,
(8) as to which at all times following the transfer of the receivable to
the trust, the trust will have good and marketable title to it, free and
clear of all liens arising prior to the transfer or arising at any time,
other than liens permitted pursuant to the pooling and servicing agreement,
(9) which has been the subject of a valid transfer and assignment from
the depositor to the trust of all the depositor's right, title and interest
in the receivable, including, with certain exceptions, any proceeds thereof,
(10) which will at all times be the legal and assignable payment
obligation of the obligor, enforceable against the obligor in accordance
with its terms, as modified or revised from time to time with the consent of
the servicer, except as enforceability may be limited by the bankruptcy code
or other applicable insolvency laws,
(11) which at the time of transfer to the trust is enforceable against
the obligor to the extent of the full principal amount of the receivable,
except as such enforceability may be limited by the bankruptcy code or other
applicable insolvency laws,
(12) as to which, at the time of transfer of the receivable to the
trust, Bombardier Capital Inc. or an affiliate of Bombardier Capital Inc.
and the depositor have satisfied all their obligations under the pooling and
servicing agreement for the receivable required to be satisfied at that
time,
(13) as to which, at the time of transfer of the receivable to the
trust, neither Bombardier Capital Inc. or any affiliate of Bombardier
Capital Inc. nor the depositor has taken any action or failed to take any
action required of it under the receivables purchase agreement or the
70
<Page>
pooling and servicing agreement which would impair the rights of the trust
or the certificateholders in the receivable, and
(14) which constitutes `tangible chattel paper' as defined in Article 9
of the UCC as then in effect in the State of New York.
This definition may be changed by amendment to the pooling and servicing
agreement from time to time without the consent of the certificateholders if the
Rating Agency Condition is satisfied.
'ENHANCEMENT' means, for any series of certificates, any credit enhancement
that is in addition to any subordination, as described in the prospectus
supplement.
'EXCESS FUNDED AMOUNT' will be calculated for each business day and means,
with respect to any series, an amount equal to the product of:
(1) the excess, if any, of the Required Pool Balance over the Pool
Balance, each as of the end of the preceding day, and
(2) a fraction the numerator of which is the sum of the Available
Subordinated Amount for such series and the product of the percent set forth
in the related Series Supplement of the Adjusted Invested Amount and the
denominator of which is the aggregate of the required balances for all
series providing for excess funding accounts or similar arrangements that
are in their revolving periods or, if applicable, their amortization
periods.
'EXCESS RETAINED PERCENTAGE' means, for any date of determination, the
Retained Percentage for that date minus the percentage equivalent of a fraction,
the numerator of which is equal to the sum of the Available Subordinated Amounts
for each outstanding series as of the end of the immediately preceding day and
the denominator of which is the Pool Balance as of the end of the immediately
preceding day.
'EXCLUDED SERIES' means a series of certificates so designated at issuance
and paired with a previously issued Series, the proceeds of which are deposited
in a prefunding account and disbursed to the seller as principal payments are
made on the series of certificates that has been designated as the Paired Series
with respect to that Excluded Series.
'FLOATING ALLOCATION PERCENTAGE' means, for any series of certificates, the
percentage, which shall never exceed 100%, obtained for each day in a calendar
month, by dividing an amount equal to the Invested Amount for such series as of
the close of business on the preceding day by the Pool Balance as of the close
of business on that preceding day.
'FOREIGN PERSON' is an individual or entity that is not a United States
Person.
'INVESTED AMOUNT' means for any series of certificates for any date an
amount equal to the Adjusted Invested Amount for such series, minus the amount,
without duplication, of principal payments -- except principal payments made
from the excess funding account and any transfers from the excess funding
account to the collection account -- made on the certificates of such series
prior to that date, minus the excess, if any, of the aggregate amount of
Investor Charge-Offs allocable to such series for all distribution dates
preceding that date over the aggregate amount of any reimbursements of Investor
Charge-Offs for all distribution dates preceding that date.
'INVESTOR ALLOCATION PERCENTAGE' means, for any series of certificates, for
any calendar month, the percentage obtained by dividing the Invested Amount of
such series of certificates as of the last business day preceding that calendar
month by the sum of the Invested Amounts for all other outstanding series on
that day.
'INVESTOR CHARGE-OFFS' for any series of certificates for any distribution
date means the amount of charge-offs allocated to such series resulting from the
application of the Defaulted Amount to a such series as set forth in the related
Series Supplement described in the related prospectus supplement.
'INVESTOR NON-PRINCIPAL COLLECTIONS' for any series of certificates for any
distribution date means the portion of Non-Principal Collections for the related
calendar month allocated to such
71
<Page>
series of certificates as set forth in the related Series Supplement described
in the related prospectus supplement.
'MISCELLANEOUS PAYMENTS' for any calendar month means the sum of Adjustment
Payments and amounts required to be paid by the depositor in connection with a
transfer of receivables back to the depositor, in each case on deposit in the
collection account on the related distribution date received for that calendar
month and any amounts not paid to the holder of the BCRC Certificate because the
Pool Balance does not exceed the Required Pool Balance and which are available
to be treated as Miscellaneous Payments as of the distribution date following
that calendar month.
'MONTHLY SERVICING FEE' means, unless a related Series Supplement or
prospectus supplement states otherwise, the share of the Servicing Fee allocable
to certificateholders of any series with respect to any payment date, which
shall generally be equal to one-twelfth of the product of (i) the Servicing Fee
Rate; and (ii) the Invested Amount of the series as of the last day of the
second preceding Collection Period.
'NON-PRINCIPAL COLLECTIONS' means collections of interest and other
non-principal charges, including amounts recovered with respect to Defaulted
Receivables and insurance proceeds, with respect to the receivables.
'PAIRED SERIES' means a series of certificates so designated with respect to
an Excluded Series of certificates upon the issuance of the Excluded Series,
which Excluded Series' interest in the trust increases as such Paired Series
amortizes or allocates principal to certificateholders.
'PARTICIPANTS' means the organizations for which The Depository Trust
Company holds securities to facilitate the clearance and settlement of
securities transactions among themselves.
'POOL BALANCE' means the aggregate principal balances of the receivables in
the trust that are Eligible Receivables.
'PRINCIPAL ALLOCATION PERCENTAGE' means, for any series of certificates, the
percentage which shall never exceed 100% obtained by dividing the Invested
Amount for such series as of the last day of the Revolving Period for such
series by the Pool Balance as of the close of business on the business day
preceding the day of calculation.
'RATING AGENCY' means for any series, the rating agencies which have been
requested to rate that series by the depositor.
'RATING AGENCY CONDITION' means, with respect to any action, if the terms of
the pooling and servicing agreement or any supplement, set forth a specific time
in advance of the effectiveness of the action that notice must be given to the
Rating Agencies, notice shall have been given in accordance with this
requirement or if no advance notice is required or no specific time is stated
for the notice, the Rating Agencies have received written notice of the proposed
action at least 10 days prior to the proposed effective date of the action and
either:
as of the proposed effective date of the action, no Rating
Agency shall have notified the depositor, the servicer or
the trustee in writing that the action will result in a
reduction or withdrawal of any rating of any outstanding
series or class with respect to which it is a Rating Agency,
or
each Rating Agency shall have confirmed in writing to the
depositor, the servicer or the trustee that the action will
not result in a reduction or withdrawal of the rating of any
outstanding series or class with respect to which it is a
Rating Agency.
'RECEIVABLES' means receivables arising from extensions of credit and
advances made to dealers of consumer, recreational and commercial products which
dealers are located in the United States.
'REMOVED ACCOUNTS' means any Accounts from which the depositor has ceased to
transfer newly originated receivables to the trust and any Account which is not
an Eligible Account which has been removed from the trust.
72
<Page>
'REQUIRED POOL BALANCE' for any date means an amount calculated as of the
end of any business day equal to:
the sum of the amounts for each series obtained by
multiplying the required investor percentages by the
respective adjusted invested amounts including the Adjusted
Invested Amount -- plus
the sum of the Available Subordinated Amounts for all other
outstanding series as of the end of that business day; minus
any excess of the applicable reserve fund required amount
over the amount on deposit in the applicable reserve fund.
'RETAINED INTEREST' means the ownership interest in the trust retained by
the depositor and which is that portion of the trust not represented by or
allocated to the investor certificateholders or the interest represented by the
variable funding certificate.
'RETAINED PERCENTAGE' for any date of determination, means 100% minus
(1) when used with respect to Non-Principal Collections, the sum of
the aggregate of the floating allocation percentages for
each outstanding series, including the certificates, and
the Variable Funding Percentage for the date of
determination and
(2) when used with respect to principal collections, the sum of
the aggregate of the floating allocation percentages for
each outstanding series, including the certificates, if
applicable, in its revolving period,
the aggregate of the principal allocation percentages for
each outstanding series, including the certificates, if
applicable, not in its revolving period, and
the Variable Funding Percentage for this date of
determination but in each case the Retained Percentage shall
not be less than 0%.
'REVOLVING PERIOD' means, for any series of certificates, the period
beginning on the date such series of certificates are issued and ending on the
earliest of:
(1) the last day of the collection period ending on the day prior to the
commencement date of the Controlled Accumulation Period or the Controlled
Amortization Period; and
(2) the business day immediately preceding the day on which an Early
Amortization Event occurs.
If the Early Amortization Event resulted from the failure of the servicer to
make deposits to the trust or into any account and that event is cured and no
other Early Amortization Event has occurred and the scheduled end of the
Revolving Period has not occurred, then the Revolving Period may begin again.
'SERIES TERMINATION DATE' means, for any series of certificates, the last
date on which the payment of principal and interest will be due and payable.
'SERVICER DEFAULT' refers to any of the following events:
(1) failure by the servicer to make any payment, transfer or deposit
into the trust, or into any account created for a series of certificates on
or before the date the servicer is required to do so under the pooling and
servicing agreement, which failure is not cured within a five business day
grace period after notice from the trustee of this failure;
(2) failure by the servicer duly to observe or perform its covenant not
to create any lien on any receivable, which failure has a material adverse
effect on the certificateholders and which continues unremedied for a period
of 60 days after written notice to it of this breach of covenant; provided,
however, that a Servicer Default will not be deemed to have occurred if the
depositor or the servicer has repurchased the related receivables under the
terms of the
73
<Page>
pooling and servicing agreement, or failure by the servicer duly to observe
or perform any other covenants or agreements of the servicer in the pooling
and servicing agreement, exclusive of breaches of covenants for which the
servicer repurchases the related receivables, as described under
'Description of the Certificates -- Servicer Covenants', which failure has a
materially adverse effect on the certificateholders or the holder of the
variable funding certificate and which continues unremedied for a period of
30 days after written notice to the servicer of this breach of covenant or
agreement;
(3) any representation, warranty or certification made by the servicer
in the pooling and servicing agreement or in any certificate delivered
pursuant to the pooling and servicing agreement proves to have been
incorrect when made and continues to be incorrect in any material respect
for a period of 60 days after written notice requiring the error to be
remedied has been given to the servicer by the trustee, and as a result the
interests of the certificateholders or the holder of the variable funding
certificate are materially and adversely affected; provided, however, that a
Servicer Default will not have occurred if the depositor has repurchased the
related receivables or, if applicable, all the receivables during this
period in accordance with the provisions of the pooling and servicing
agreement; or
(4) the occurrence of certain events of bankruptcy, insolvency or
receivership with respect to the servicer.
A delay in or failure of performance referred to under clause (1) above for
a period of up to ten business days after the applicable grace period or a delay
in or failure of performance or the continuance of a delay or failure referred
to under clauses (2) or (3) above for a period of up to 60 business days, will
not be a Servicer Default if this delay or failure or continuance was caused by
an act of God or other similar occurrence.
'SUPPLEMENTAL CERTIFICATE' means a certificate issued in exchange for a
portion of the BCRC Certificate.
'TRANSFER DATE' means each business day on which receivables are created in
the Eligible Accounts provided that such date is prior to the earlier of the day
following the distribution date on which the aggregate invested amounts for all
series is zero, the day on which an event of bankruptcy, insolvency or
receivership relating to Bombardier Capital Inc. or the depositor occurs.
'UNITED STATES PERSON' is an individual or entity that for federal income
tax purposes is (i) a citizen or resident of the United States, (ii) a
corporation or partnership created or organized in or under the laws of the
United States, any state thereof or the District of Columbia, (iii) an estate,
the income of which is subject to United States federal income taxation
regardless of its source or (iv) certain trusts.
'VARIABLE FUNDING PERCENTAGE' for any date of determination, means a
percentage (which percentage will never be less than 0% nor more than 100%)
equal to the excess, if any, of the Pool Balance over the Required Pool Balance
as of that day divided by the Pool Balance as of the close of business on the
day preceding that day; provided, however, that for purposes of allocating
principal collections following the occurrence of an event of bankruptcy,
insolvency or receivership relating to Bombardier Capital Inc. or the depositor,
the Variable Funding Percentage will be calculated on the basis of the excess,
if any, of the Pool Balance over the Required Pool Balance as of the last day
immediately preceding the date of this event of bankruptcy, insolvency or
receivership relating to Bombardier Capital Inc. or the depositor; provided,
further, that following an event of bankruptcy, insolvency or receivership
relating to Bombardier Capital Inc. or the depositor, the relative interest of
the variable funding certificate in further allocations of Non-Principal
Collections will not be less than the relative interest thereof as of the event
of bankruptcy, insolvency or receivership relating to Bombardier Capital Inc. or
the depositor.
74
<Page>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<Page>
BOMBARDIER RECEIVABLES MASTER TRUST I
$500,000,000 FLOATING RATE
CLASS A ASSET BACKED CERTIFICATES,
SERIES 2003-3
[BOMBARDIER LOGO]
BOMBARDIER CREDIT RECEIVABLES CORPORATION
DEPOSITOR
BOMBARDIER CAPITAL INC.
SERVICER
--------------------
PROSPECTUS SUPPLEMENT
--------------------
BANC ONE CAPITAL MARKETS, INC. JPMORGAN
CITIGROUP BNP PARIBAS
You should rely on the information contained or incorporated by reference in
this prospectus supplement and the attached prospectus. We have not authorized
anyone to provide you with different information.
We are not offering these Class A Certificates in any state where the offer
is not permitted.
We represent the accuracy of the information in this prospectus supplement
and the attached prospectus only as of the date of this prospectus supplement.
Dealers will be required to deliver a prospectus and prospectus supplement
when acting as underwriters of these Class A Certificates and with respect to
their unsold allotments or subscriptions. In addition, all dealers selling these
Class A Certificates will deliver a prospectus and prospectus supplement until
90 days after the date of this prospectus supplement.
December [ ], 2003
STATEMENT OF DIFFERENCES
------------------------
The registered trademark symbol shall be expressed as................... 'r'