Exhibit 10.1

EXECUTION COPY

 

 

 

NAVISTAR FINANCIAL DEALER NOTE

MASTER OWNER TRUST

as Issuer

and

THE BANK OF NEW YORK MELLON

as Indenture Trustee

SERIES 2010-VFN INDENTURE SUPPLEMENT

dated as of April 16, 2010

to

INDENTURE

dated as of June 10, 2004

 

 

 

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TABLE OF CONTENTS

 

              Page

ARTICLE I Definitions and Other Provisions of General Application

   1  

Section 1.01

  

Definitions

   1

ARTICLE II The Notes

   20  

Section 2.01

   Creation, Designation and Delivery.    20   Section 2.02    Incremental
Fundings    20   Section 2.03    Prepayments    20

ARTICLE III Allocations, Deposits and Payments

   21   Section 3.01    Series 2010-VFN Available Interest Amounts    21  
Section 3.02    Series 2010-VFN Available Principal Amounts    23   Section 3.03
   Reductions and Reinstatements    24   Section 3.04    Payment on the Series
2010-VFN Notes.    26   Section 3.05    Reserved    27   Section 3.06    Final
Payment of the Series 2010-VFN Notes    27   Section 3.07    Netting of Deposits
and Payments    27   Section 3.08    Reserved    27   Section 3.09   
Computation of Interest    27   Section 3.10    Accounts    27   Section 3.11   
Spread Account.    28   Section 3.12    Reserved    28   Section 3.13    Reports
and Statements to Series 2010-VFN Noteholders.    29

ARTICLE IV MISCELLANEOUS PROVISIONS

   29   Section 4.01    Ratification of Indenture    29   Section 4.02   
Counterparts    29   Section 4.03    GOVERNING LAW    29   Section 4.04   
Limitation of Owner Trustee Liability    29   Section 4.05    Amendment    30  
Section 4.06    No Registration of the Series 2010-VFN Notes under the
Securities Act    30   Section 4.07    Consent to Amendments    34

 

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EXHIBITS    EXHIBIT A   

FORM OF VARIABLE FUNDING NOTE

EXHIBIT B   

FORM OF MONTHLY SERVICER AND SETTLEMENT CERTIFICATE

 

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This SERIES 2010-VFN INDENTURE SUPPLEMENT (this “Indenture Supplement”), by and
between NAVISTAR FINANCIAL DEALER NOTE MASTER OWNER TRUST, a statutory trust
created under the laws of the State of Delaware (the “Issuer”), and THE BANK OF
NEW YORK MELLON, a New York banking corporation, as trustee (the “Indenture
Trustee”), is made and entered into as of April 16, 2010.

Pursuant to this Indenture Supplement, the Issuer shall create a new series of
Notes and shall specify the principal terms thereof.

ARTICLE I

Definitions and Other Provisions of General Application

Section 1.01 Definitions. For all purposes of this Indenture Supplement, except
as otherwise expressly provided or unless the context otherwise requires:

(1) the terms defined in this Article have the meanings assigned to them in this
Article, and include the plural as well as the singular;

(2) all other terms used but not defined herein which are defined in the
Indenture, the Series Supplement or the Pooling and Servicing Agreement, either
directly or by reference therein, have the meanings assigned to them therein;

(3) all accounting terms not otherwise defined herein have the meanings assigned
to them in accordance with generally accepted accounting principles and, except
as otherwise herein expressly provided, the term “generally accepted accounting
principles” with respect to any computation required or permitted hereunder
means such accounting principles as are generally accepted in the United States
of America at the date of such computation;

(4) all references in this Indenture Supplement to designated “Articles,”
“Sections” and other subdivisions are to the designated Articles, Sections and
other subdivisions of this Indenture Supplement. The words “herein,” “hereof”
and “hereunder” and other words of similar import refer to this Indenture
Supplement as a whole and not to any particular Article, Section or other
subdivision;

(5) in the event that any term or provision contained herein shall conflict with
or be inconsistent with any term or provision contained in the Indenture, the
terms and provisions of this Indenture Supplement shall be controlling;

(6) except as expressly provided herein, each capitalized term defined herein
shall relate only to the Series 2010-VFN Notes and no other series of Notes
issued by the Issuer; and

(7) “including” and words of similar import shall be deemed to be followed by
“without limitation.”

“Additional Amounts” shall have the meaning specified in the Note Purchase
Agreement.

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“Adjusted Series 2010-VFN Overcollateralization Percentage” means, as of any
date, a percentage equal to the result of (a) the Series 2010-VFN
Overcollateralization Percentage as of such date divided by (b) 100% minus the
Series 2010-VFN Overcollateralization Percentage as of such date.

“Administrative Agent” shall have the meaning specified in the Note Purchase
Agreement.

“Alternate Rate” shall have the meaning specified in the Note Purchase
Agreement.

“Amortization Period” means the period commencing on the Amortization Period
Commencement Date (unless an Early Redemption Period shall be in effect) and
ending upon the first to occur of (a) the commencement of an Early Redemption
Period, and (b) the Series 2010-VFN Termination Date.

“Amortization Period Commencement Date” shall mean the first day of the Due
Period occurring after the Purchase Expiration Date then in effect.

“Average Coverage Differential” shall be determined, on any Determination Date,
by reference to the Coverage Differentials for each of the related Due Period
and the three immediately preceding Due Periods, and shall equal the sum of the
three highest such Coverage Differentials divided by three. Average Coverage
Differential shall be expressed as a percentage and shall be rounded to the
nearest one-hundredth of a percentage point.

“Borrower” shall have the meaning specified in the Credit Agreement.

“Change in Control” and each defined term used therein shall have the meanings
specified in Section 1.01 of the Credit Agreement, provided however, if the
definition of “Change in Control” or any defined term used therein shall be
amended, supplemented, restated or modified in the Credit Agreement after the
Issuance Date, “Change in Control” and any such defined term used therein may,
at the unanimous direction of the Managing Agents, have the meaning as so
amended, supplemented, restated or modified.

“Collateral Amount” means, with respect to the Series 2010-VFN Notes, the Series
2010-VFN Collateral Amount.

“Commitment” shall have the meaning specified in the Note Purchase Agreement.

“Coverage Differential” shall mean, with respect to any Due Period, the result
of (a) the Portfolio Yield for such Due Period minus (b) the sum of (i) the
Series 2010-VFN Interest Rate for the related Interest Period and (ii) one
percent (1.0%). Coverage Differential shall be expressed as a percentage, and
shall be rounded to the nearest one-hundredth of a percentage point.

“CP Rate” shall have the meaning specified in the Note Purchase Agreement.

“Credit Agreement” means the Amended and Restated Credit Agreement, dated as of
December 16, 2009, among NFC, Navistar Financial, S.A. De C.V., Sociedad
Financiera de

 

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Objeto Multiple, Entidad No Regulada, a Mexican corporation, the Lenders party
thereto, JPMorgan Chase Bank, N.A., as administrative agent, Bank of America,
N.A., as syndication agent, and The Bank of Nova Scotia, as documentation agent,
as amended, supplemented, restated or otherwise modified from time to time.

“Dealcor Dealer” shall means a Dealer that is part of ITEC’s Dealcor system.

“Dealcor Dealer Notes Pool Percentage” shall mean the percentage equivalent of a
fraction, the numerator of which is the aggregate principal balance of Dealer
Notes relating to Dealcor Dealers, and the denominator of which is the sum of
the aggregate principal balance of Dealer Notes held by the Master Trust and the
aggregate principal amount of funds on deposit in the Excess Funding Account.

“Dealcor Dealer Notes Pool Percentage Limit” means 12.5%.

“Early Redemption Events” means, with respect to the Series 2010-VFN Notes, each
of the Early Amortization Events specified in Section 9.01 of the Pooling and
Servicing Agreement, plus each of the following:

 

  (A)

failure on the part of the Seller or the Servicer (i) to make any payment,
distribution or deposit required under the Pooling and Servicing Agreement, the
Series Supplement or the Note Purchase Agreement within five Business Days after
the date required or (ii) to observe or perform in any material respect any
other material covenants or agreements of the Seller or the Servicer, which
failure has a material adverse effect on the Series 2010-VFN Noteholders and
which continues unremedied for a period of 60 days after written notice of such
failure shall have been given to the Seller by the Indenture Trustee or to the
Seller and the Indenture Trustee by any Holder of the Series 2010-VFN Notes;

 

  (B)

any representation or warranty made by the Seller or the Servicer pursuant to
the Pooling and Servicing Agreement or the Note Purchase Agreement or any
information contained in the schedule of Dealer Notes delivered thereunder or
the Series Supplement shall prove to have been incorrect in any material respect
when made or when delivered, which representation, warranty or schedule, or the
circumstances or condition that caused such representation, warranty or schedule
to be incorrect, continues to be incorrect or uncured in any material respect
for a period of 60 days after written notice of such incorrectness shall have
been given to the Seller or the Servicer by the Indenture Trustee or to the
Seller or the Servicer and the Indenture Trustee by any Holder of the Series
2010-VFN Notes and as a result of which the interests of the Series 2010-VFN
Noteholders are materially and adversely affected; provided, however, that an
Early Redemption Event shall not be deemed to occur if the Seller has
repurchased the related Dealer Notes or all such Dealer Notes, if applicable,
during such period in accordance with the provisions of the Pooling and
Servicing Agreement;

 

  (C)

any of the Seller, ITEC, NIC or NFC shall file a petition commencing a voluntary
case under any chapter of the federal bankruptcy laws; or the Seller, ITEC, NIC
or

 

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  NFC shall file a petition or answer or consent seeking reorganization,
arrangement, adjustment or composition under any other similar applicable
federal law, or shall consent to the filing of any such petition, answer or
consent; or the Seller, ITEC, NIC or NFC shall appoint, or consent to the
appointment of, a custodian, receiver, liquidator, trustee, assignee,
sequestrator or other similar official in bankruptcy or insolvency of it or of
any substantial part of its property; or the Seller, ITEC, NIC or NFC shall make
an assignment for the benefit of creditors, or shall admit in writing its
inability to pay its debts generally as they become due;

 

  (D)

any order for relief against any of the Seller, ITEC, NIC or NFC shall have been
entered by a court having jurisdiction in the premises under any chapter of the
federal bankruptcy laws, and such order shall have continued undischarged or
unstayed for a period of 120 days; or a decree or order by a court having
jurisdiction in the premises shall have been entered approving as properly filed
a petition seeking reorganization, arrangement, adjustment, or composition of
the Seller, ITEC, NIC or NFC under any other similar applicable federal law, and
such decree or order shall have continued undischarged or unstayed for a period
of 120 days; or a decree or order of a court having jurisdiction in the premises
for the appointment of a custodian, receiver, liquidator, trustee, assignee,
sequestrator or other similar official in bankruptcy or insolvency of the
Seller, ITEC, NIC or NFC of any substantial part of their property, or for the
winding up or liquidation of their affairs, shall have been entered, and such
decree or order shall have remained in force undischarged or unstayed for a
period of 120 days;

 

  (E)

the Seller shall become legally unable for any reason to transfer Dealer Notes
to the Master Trust in accordance with the provisions of the Pooling and
Servicing Agreement;

 

  (F)

on any Transfer Date, after giving effect to allocations to be made on that
Transfer Date (including payments to be made on the related Payment Date), the
Series 2010-VFN Target Overcollateralization Amount exceeds the Series 2010-VFN
Overcollateralization Amount;

 

  (G)

any Servicer Termination Event shall occur for which the Servicer has received a
notice of termination;

 

  (H)

on any Determination Date, as of the last day of the preceding Due Period, the
aggregate principal balance of Dealer Notes owned by the Master Trust relating
to used vehicles exceeds 25.00% of the aggregate principal balance of Dealer
Notes held by the Master Trust on that last day;

 

  (I)

the average Monthly Payment Rate for any three consecutive Due Periods is less
than 16.00%;

 

  (J)

the Series 2010-VFN Outstanding Principal Amount is not repaid by the Expected
Principal Payment Date;

 

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  (K)

the Issuer becomes an “investment company” within the meaning of the Investment
Company Act of 1940, as amended, and is not exempt from compliance with that
Act;

 

  (L)

the occurrence of an Event of Default under the Indenture;

 

  (M)

the delivery by the Seller to the Master Trust Trustee of a notice stating that
the Seller shall no longer continue to sell Dealer Notes to the Master Trust
commencing on the date specified in such notice;

 

  (N)

the Average Coverage Differential shall be equal to or less than negative two
percent (-2.00%) on each of three consecutive Determination Dates;

 

  (O)

on any Determination Date, the quotient of (i) the sum of Dealer Note Losses for
each of the related Due Period and the five immediately preceding Due Periods
and (ii) the sum of Principal Collections for each of the related Due Period and
the five immediately preceding Due Periods, is greater than or equal to one
percent (1.00%);

 

  (P)

at the end of any Due Period, the Seller’s Invested Amount is reduced to an
amount less than the Minimum Seller’s Invested Amount and the Seller has failed
to assign additional Dealer Notes to the Master Trust or deposit cash into the
Excess Funding Account, the Series 2010-VFN Principal Funding Account or any
other principal funding account with respect to any other series in the amount
of such deficiency within ten Business Days following the end of such Due
Period; provided, however, that if such deficiency was caused by an increase in
the Minimum Seller’s Invested Amount as a result of the occurrence of an excess
cash collateral event with respect to any other Series of Notes, the Seller
shall have a period of six months grace period to increase the Seller’s Invested
Amount to the required level;

 

  (Q)

failure on the part of ITEC to make a deposit in the Interest Deposit Account
required by the terms of the Interest Deposit Agreement on or before the date
occurring five Business Days after the date such deposit is required by the
Interest Deposit Agreement to be made;

 

  (R)

upon an increase in the Spread Account Required Amount as a result of the
average Monthly Payment Rate for any three consecutive Due Periods being less
than 20.00%, the amount on deposit in the Series 2010-VFN Spread Account is less
than the Spread Account Required Amount for five (5) consecutive Business Days;

 

  (S)

the United States government or any agency or instrumentality thereof files a
notice of a lien under §6323 of the Code or any similar statutory provision
(including, but not limited to, §302(f) or §4068 of ERISA) on the assets of NFC
or the Seller which is or may in the future be prior to the lien of the Master
Trust Trustee or the assets of the Master Trust (including, without limitation,
proceeds of the Dealer Notes);

 

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  (T)

the occurrence of a Change in Control;

 

  (U)

NFC shall cease to be the “beneficial owner” (as defined in Rule 13d-3 under the
Securities Exchange Act of 1934) of 100% of the outstanding stock of the Seller;

 

  (V)

any Borrower shall fail to make any payment (whether of principal or interest
and regardless of amount) in respect of any Material Indebtedness, when and as
the same shall become due and payable and such failure shall continue beyond the
period of grace, if any, provided in the instrument or agreement under which
such Material Indebtedness was created;

 

  (W)

any event or condition occurs that (A) results in any Material Indebtedness
becoming due prior to its scheduled maturity or (B) solely in the case of the US
Borrower, enables or permits the holder or holders of any Material Indebtedness
or any trustee or agent on its or their behalf to cause any Material
Indebtedness to become due, or to require the prepayment, repurchase, redemption
or defeasance thereof, prior to its scheduled maturity; provided that this
paragraph (W) shall not apply to secured Indebtedness that becomes due as a
result of the voluntary sale or transfer of the property or assets securing such
Indebtedness;

 

  (X)

NFC shall fail to observe or perform any condition, covenant or agreement
contained in Section 8.01 of the Credit Agreement as in effect on the date
hereof; provided that if the Credit Agreement is terminated or Section 8.01 of
the Credit Agreement or any defined term or provision that affects any
calculation specified in Section 8.01 of the Credit Agreement is terminated,
amended, supplemented or modified, then Section 8.01 as used herein may, at the
unanimous direction of the Managing Agents, be similarly terminated, amended,
supplemented or modified;

 

  (Y)

either NIC or ITEC shall fail to pay when due, or within any applicable grace
period, any principal of or interest on its Indebtedness for Borrowed Money
which exceeds $50,000,000 in aggregate principal or face amount;

 

  (Z)

any Indebtedness for Borrowed Money of either NIC or ITEC which exceeds
$50,000,000 in aggregate principal or face amount shall become due prior to its
stated maturity, or any event or circumstance shall occur which permits one or
more Persons other than NIC or ITEC, as the case may be, to cause such
Indebtedness for Borrowed Money to become due prior to its stated maturity;

 

  (AA)

that portion of the Series 2010-VFN Outstanding Principal Amount allocable to a
Purchaser Group shall at any time exceed the Commitment of such Purchaser Group
(other than after the Purchase Expiration Date); and

 

  (BB)

the Dealcor Dealer Notes Pool Percentage, as reported on a Servicer Certificate,
shall exceed the Dealcor Dealer Notes Pool Percentage Limit and such Dealcor
Dealer Notes Pool Percentage shall not have been reduced to the Dealcor Dealer
Notes Pool Percentage Limit or lower (as evidenced by an Officer’s Certificate
of the Servicer delivered to each Managing Agent or as shown in the next
succeeding Servicer Certificate) on any date on or prior to the due date for
delivery of the next succeeding Servicer Certificate.

 

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In the case of any event described in clauses (A), (B) or (G) above, an Early
Redemption Event with respect to Series 2010-VFN Notes shall be deemed to have
occurred only if, after the applicable grace period described in those clauses,
if any, either the Indenture Trustee at the direction of or the Series 2010-VFN
Noteholders holding Series 2010-VFN Notes evidencing more than 50% of the Series
2010-VFN Outstanding Principal Amount by written notice to the Seller, the
Servicer, the Master Trust Trustee and, if given by Series 2010-VFN Noteholders,
the Indenture Trustee, declare that an Early Redemption Event has occurred as of
the date of that notice. In the case of any Early Redemption Event other than as
described in clauses (A), (B) or (G) above, an Early Redemption Event with
respect to the Series 2010-VFN Notes shall be deemed to have occurred without
any notice or other action on the part of the Indenture Trustee or the Series
2010-VFN Noteholders immediately upon the occurrence of that event.

“Early Redemption Period” means the period from and including the date on which
an Early Redemption Event occurs to but excluding the Series 2010-VFN
Termination Date.

“Eligible Investments” shall mean:

(a) book-entry securities, negotiable instruments or securities represented by
instruments in bearer or registered form having (except in the case of clauses
(iv) or (vii) below) remaining maturities occurring not later than the Payment
Date next succeeding the Master Trust Trustee’s acquisition thereof, except as
otherwise described herein or the related Supplement, that evidence:

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

(ii) demand deposits, time deposits or certificates of deposit of, or bankers’
acceptances issued by, any depository institution or trust company incorporated
under the laws of the United States of America 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; provided,
however, that at the time of the Master Trust’s investment or contractual
commitment to invest therein, the commercial paper or other short-term unsecured
debt obligations (other than such obligations the rating of which is based on
the credit of a person or entity other than such depository institution or trust
company) of such depository institution or trust company shall have a credit
rating not lower than the highest investment category for short term unsecured
debt obligations granted by Moody’s and S&P;

(iii) commercial paper having, at the time of the Master Trust’s investment or
contractual commitment to invest therein, a rating not lower than the highest
investment category for short term unsecured debt obligations granted by Moody’s
and S&P;

(iv) investments in money market funds or common trust funds having a rating not
lower than the highest investment category for short term unsecured debt
obligations granted by Moody’s and S&P or otherwise approved in writing by the
Administrative Agent (including funds for which the Master Trust Trustee or the
1990 Trust Trustee or any of their respective affiliates is investment manager
or advisor, so long as such fund shall have such rating);

 

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(v) repurchase obligations (x) with respect to any security that is a direct
obligation of, or fully guaranteed by, the United States of America or any
agency or instrumentality thereof the obligations of which are backed by the
full faith and credit of the United States of America, in either case, entered
into with a depository institution or trust company (acting as principal)
described in clause (ii) or (y) the counterparty for which has a rating not
lower than the highest investment category for short term unsecured debt
obligations granted by Moody’s and S&P, the collateral for which is held by a
custodial bank for the benefit of the Trust or the Indenture Trustee, is marked
to market daily and is maintained in an amount that exceeds the amounts of such
repurchase obligation, and which required liquidation of the collateral
immediately upon the amount of such collateral being less than the amount of
such repurchase obligation (unless the counterparty immediately satisfies the
repurchase obligation upon being notified of such shortfall);

(vi) commercial paper master notes where the issuer has, at the time of the
Master Trust’s investment or contractual commitment to invest therein, a rating
not lower than the highest investment category for short term unsecured debt
obligations granted by Moody’s and S&P; or

(vii) with respect to the Excess Funding Account only, obligations of a trust
(the assets of which consist solely of Investor Certificates issued by the
Master Trust and of one or more liquidity swap arrangements for the benefit of
investors in such trust) having, at the time of the Master Trust’s investment or
contractual commitment to invest therein, a rating not lower than the highest
rating category for short term unsecured debt obligations granted by Moody’s and
S&P; and

(b) any other investment consisting of a financial asset that by its terms
converts to cash within a finite period of time approved by the Administrative
Agent.

Unless approved by the Administrative Agent, Eligible Investments of funds in
the Series Principal Account and the Excess Funding Account will be subject to
the following additional restrictions: (x) no more than the greater of
(A) $1,000,000 and (B) 20% of the aggregate Eligible Investments in all such
accounts collectively shall be obligations of or investments in any single
issuer (except that such 20% limitation shall not apply to Eligible Investments
of the type specified in clause (a)(i) or, with respect to the Excess Funding
Account, Eligible Investments of the type specified in clauses (a)(iv) or
(a)(vii)); and (y) each Eligible Investment shall be denominated and be payable
solely in U.S. dollars, shall bear interest at a specified rate that is, or is
based upon, LIBOR or a commercial paper rate, shall entitle the holder to a
fixed principal amount at maturity and shall have a yield that is not inversely
or disproportionately affected by changes in interest rates.

For purposes of this definition of “Eligible Investments” and for the avoidance
of doubt, the highest investment category for short term unsecured debt
obligations granted by Standard & Poor’s is “A-1+” (or, in the case of money
market funds, “AAAm” or “AAAm-G”).

“Excess Available Interest Amounts” means, with respect to any Due Period,
either (i) the portion of Series 2010-VFN Available Interest Amounts, if any,
available after application pursuant to Section 3.01(a)(i) through (ix) or
(ii) the amounts available to the Series 2010-VFN Notes from the Notes of other
series that the applicable Indenture Supplements specify are to be treated as
“Excess Available Interest Amounts.”

 

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“Excess Available Principal Amounts” means, with respect to any Business Day,
either (a) the portion of Series 2010-VFN Available Principal Amounts, if any,
available after application pursuant to Section 3.02(a)(i) through (iii) or
(b) the amounts available to the Series 2010-VFN Notes from the Notes of other
series that the applicable Indenture Supplements specify are to be treated as
“Excess Available Principal Amounts” on the related Business Day.

“Expected Principal Payment Date” means the Payment Date in the calendar month
beginning six months after the Amortization Period Commencement Date.

“Hedging Agreement” has the meaning specified in Section 1.01 of the Credit
Agreement, provided however, if the definition of “Hedging Agreement” shall be
amended, supplemented or modified in the Credit Agreement after the Issuance
Date, “Hedging Agreement” as used herein may, at the unanimous direction of the
Managing Agents, have the meaning as so amended, supplemented or modified.

“Incremental Funded Amount” means the amount of the increase in the Series
2010-VFN Outstanding Principal Amount occurring as a result of any Incremental
Funding, which amount shall equal the aggregate amount of the purchase prices
paid with respect to such Incremental Funding pursuant to the Note Purchase
Agreement.

“Incremental Funding” shall have the meaning specified in the Note Purchase
Agreement.

“Incremental Overcollateralization Amount” means, with respect to any date on
which there is an Incremental Funding, the product of (i) the Incremental Funded
Amount for such date and (ii) the Adjusted Series 2010-VFN Overcollateralization
Percentage.

“Indebtedness” and each defined term used therein shall have the meanings
specified in Section 1.01 of the Credit Agreement, provided however, if the
definition of “Indebtedness” or any defined term used therein shall be amended,
supplemented or modified in the Credit Agreement after the Issuance Date,
“Indebtedness” and any such defined term used therein may, at the unanimous
direction of the Managing Agents, have the meaning as so amended, supplemented
or modified.

“Indebtedness for Borrowed Money” and each defined term used therein shall have
the meanings specified in Section 1.01 of the Credit Agreement, provided
however, if the definition of “Indebtedness for Borrowed Money” or any defined
term used therein shall be amended, supplemented or modified in the Credit
Agreement after the Issuance Date, “Indebtedness for Borrowed Money” and any
such defined term used therein may, at the unanimous direction of the Managing
Agents, have the meaning as so amended, supplemented or modified.

“Indenture” means the Indenture, dated as of June 10, 2004, between the Issuer
and The Bank of New York Mellon, as Indenture Trustee, as amended and
supplemented from time to time.

“Initial Series 2010-VFN Outstanding Principal Amount” means $0.

 

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“Interest Period” shall mean with respect to any Payment Date and any portion of
the Series 2010-VFN Outstanding Principal Amount, if the Series 2010-VFN Monthly
Interest is to be calculated on the basis of the CP Rate, the related Due Period
and, if the Series 2010-VFN Monthly Interest is to be calculated on the basis of
the Alternate Rate, the related Distribution Period.

“Investor Servicing Fee” has the meaning specified in the Series Supplement.

“Issuance Date” means, with respect to the Series 2010-VFN Notes, April 16,
2010.

“Legal Final Maturity Date” means the earlier of the Payment Date thirty six
(36) months after the Expected Principal Payment Date and the commencement of an
Early Redemption Period which has not been rescinded, waived or otherwise
terminated.

“Managing Agent” has the meaning specified in the Note Purchase Agreement.

“Material Indebtedness” means Indebtedness or obligations in respect of one or
more Hedging Agreements in an aggregate principal amount exceeding
(a) $10,000,000, in the case of the US Borrower, and (b) $5,000,000, in the case
of the Mexican Borrower. For purposes of determining Material Indebtedness, the
“principal amount” of the obligations of any Borrower in respect of any Hedging
Agreements at any time shall be the maximum aggregate amount (giving effect to
any netting agreements) that such Borrower would be required to pay if such
Hedging Agreement were terminated at such time; provided, however, if the
definition of “Material Indebtedness” as set forth in the Credit Agreement shall
be amended, supplemented or modified after the Closing Date, “Material
Indebtedness” as used herein may, at the unanimous direction of the Managing
Agents, be similarly amended, supplemented or modified.

“Maximum Funded Amount” shall have the meaning specified in the Note Purchase
Agreement.

“Mexican Borrower” shall have the meaning specified in the Credit Agreement;
provided, however, if the definition of “Mexican Borrower” as set forth in the
Credit Agreement shall be amended, supplemented or modified after the Closing
Date, “Mexican Borrower” as used herein may, at the unanimous direction of the
Managing Agents, be similarly amended, supplemented or modified.

“Monthly Payment Rate” means, on any Determination Date, the quotient of (1) the
sum of Dealer Note Principal Collections for the related Due Period and (2) the
daily average principal amount of Dealer Notes outstanding during the related
Due Period.

“New Vehicle Monthly Interest Rate” shall mean, with respect to any Due Period,
the product of (a) the per annum rate of interest and finance charges billed by
NFC during such Due Period on New Vehicle Dealer Notes and (b) the quotient of
(i) the number of days during such Due Period and (ii) the actual number of days
in the related calendar year.

“Nominal Liquidation Amount” means, with respect to the Series 2010-VFN Notes,
the Series 2010-VFN Nominal Liquidation Amount.

 

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“Nominal Liquidation Amount Deficit” means, with respect to the Series 2010-VFN
Notes as of any Transfer Date, the excess of the aggregate of the reallocations
and reductions made pursuant to Section 3.03 on or prior to such Transfer Date,
over the aggregate amount of all reinstatements pursuant to Section 3.03 on or
prior to such Transfer Date.

“Non-Use Fee” shall have the meaning specified in the Note Purchase Agreement.

“Note Purchase Agreement” shall mean the Note Purchase Agreement, dated as of
the Issuance Date, among the Seller, the Servicer, the Administrative Agent, the
Managing Agents and the other parties thereto, as amended, supplemented,
restated or otherwise modified from time to time.

“Overcollateralization Amount” means, with respect to the Series 2010-VFN Notes,
the Series 2010-VFN Overcollateralization Amount.

“Overcollateralization Amount Deficit” means, with respect to the Series
2010-VFN Notes as of any Transfer Date, the excess of the Series 2010-VFN Target
Overcollateralization Amount as of such Transfer Date over the Series 2010-VFN
Overcollateralization Amount as of such Transfer Date.

“Overcollateralization Reduction Amount” means, with respect to any payment of
principal of the Series 2010-VFN Notes, the product of (a) the amount of such
principal payment and (b) the Adjusted Series 2010-VFN Overcollateralization
Percentage.

“Payment Date” means the 25th day of each calendar month or, if such day is not
a Business Day, the next succeeding Business Day, commencing April 26, 2010.

“Portfolio Yield” means, with respect to any Due Period, the product of (a) the
quotient of (i) Finance Charges for such Due Period over (ii) the daily average
principal amount of Dealer Notes outstanding during such Due Period and (b) a
fraction, the numerator of which is 365 and the denominator of which is the
actual number of days elapsed during such Due Period. Portfolio Yield shall be
expressed as a percentage, and shall be rounded to the nearest one-hundredth of
a percentage point.

“Projected Dealer Note Income” shall mean, on any Transfer Date, an amount equal
to the sum of (a) the product of (i) the principal amount of Dealer Notes
financing new vehicles outstanding on the Business Day prior to the related
Determination Date, (ii) the New Vehicle Monthly Interest Rate for the related
Due Period and (iii) the Projected VFN Allocation Percentage for such Transfer
Date and (b) the product of (i) the principal amount of Dealer Notes financing
used vehicles outstanding on the Business Day prior to the related Determination
Date, (ii) the Used Vehicle Monthly Interest Rate for the related Due Period and
(iii) the Projected VFN Allocation Percentage for such Transfer Date.

“Projected Monthly Backup Servicing Fee” shall mean, on any Transfer Date, an
amount equal to one-twelfth of the product of (a) the Base Backup Servicing Fee
and (b) the Projected VFN Allocation Percentage for such Transfer Date.

 

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“Projected Monthly Backup Servicing Expenses” shall mean, on any Transfer Date,
an amount equal to the product of (a) the Backup Servicing Expenses with respect
to the related Due Period and (b) the Projected VFN Allocation Percentage for
such Transfer Date.

“Projected Monthly Servicing Fee” shall mean, on any Transfer Date, an amount
equal to one-twelfth of the product of (a) 1%, (b) the aggregate principal
amount of Dealer Notes as of the Business Day preceding the related
Determination Date and (c) the Projected VFN Allocation Percentage for such
Transfer Date.

“Projected VFN Allocation Percentage” means, with respect to any Transfer Date,
the quotient of (i) the Series 2010-VFN Nominal Liquidation Amount as of such
Transfer Date (after giving effect to any prepayment or incremental funding on
or prior to the related Payment Date), divided by (ii) the sum of the aggregate
principal amount of the Dealer Notes in the Master Trust and the aggregate
principal amount of the funds in the Excess Funding Account, each as of the
Business Day prior to the related Determination Date.

“Projected VFN Monthly Interest” shall mean, on any Transfer Date, an amount
equal to the product of (a) the Series 2010-VFN Interest Rate for the related
Payment Date, (b) the Series 2010-VFN Outstanding Principal Amount as of such
Transfer Date (after giving effect to any prepayment or incremental funding on
or prior to the related Payment Date), (c) the result of (i) the actual number
of days in the Interest Period following the Interest Period related to such
Transfer Date divided by (ii) 360 and (d) 1.25.

“Purchase Expiration Date” shall have the meaning specified in the Note Purchase
Agreement.

“Purchaser Group” shall have the meaning specified in the Note Purchase
Agreement.

“Reinstatement Amount” is defined in Section 3.01(a)(v).

“Required Seller’s Invested Amount” equals, for the Series 2010-VFN Notes, with
respect to any Business Day, the sum of (a) the Series 2010-VFN
Overcollateralization Amount as of that day and (b) 3.00% of the Series 2010-VFN
Nominal Liquidation Amount as of that day.

“Revolving Period” means the period beginning on the Issuance Date and ending
when an Amortization Period or Early Redemption Period begins.

“Series 2010-VFN Accounts” is defined in Section 3.10(a).

“Series 2010-VFN Allocated Dealer Note Losses” means, with respect to any Due
Period and the related Transfer Date, the product of the Series 2010-VFN
Variable Allocation Percentage for such Due Period and Noteholder Allocated
Dealer Note Losses for such Due Period.

“Series 2010-VFN Allocated Interest Amounts” means, with respect to any Due
Period and the related Transfer Date, the product of the Series 2010-VFN
Variable Allocation Percentage for such Due Period and Noteholder Available
Interest Amounts for such Due Period.

 

12

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“Series 2010-VFN Allocated Principal Amounts” means, with respect to any
Business Day in a Due Period and the related Transfer Date, the product of the
Series 2010-VFN Fixed Allocation Percentage for such Business Day and Noteholder
Available Principal Amounts for such Business Day.

“Series 2010-VFN Allocation Percentage” means, with respect to any Transfer
Date, the quotient of (i) the Series 2010-VFN Nominal Liquidation Amount as of
such Transfer Date, divided by (ii) the sum of the aggregate principal amount of
the Dealer Notes in the Master Trust and the aggregate principal amount of the
funds in the Excess Funding Account, each as of the last day of the related Due
Period.

“Series 2010-VFN Available Interest Amounts” means, with respect to any Due
Period and the related Transfer Date, the Series 2010-VFN Allocated Interest
Amounts for such Due Period:

 

  (i)

plus any net investment earnings for such Due Period on funds in the Series
2010-VFN Interest Funding Account, the Series 2010-VFN Principal Funding Account
and the Series 2010-VFN Spread Account;

 

  (ii)

plus the Series 2010-VFN Investment Income;

 

  (iii)

plus any Excess Available Interest Amounts allocated to Series 2010-VFN on the
related Transfer Date pursuant to Section 3.01(b);

 

  (iv)

plus any Excess Finance Charge Collections allocated to Series 2010-VFN on the
related Transfer Date pursuant to Section 3.01(b);

 

  (v)

plus any amount treated as Series 2010-VFN Available Interest Amounts pursuant
to Sections 3.01(c)(i) and (ii).

“Series 2010-VFN Available Principal Amounts” means, with respect to any
Business Day in a Due Period and the related Transfer Date, the Series 2010-VFN
Allocated Principal Amounts for such Business Day and, with respect to the
related Transfer Date:

 

  (i)

plus any Excess Available Principal Amounts allocated to Series 2010-VFN on such
Transfer Date pursuant to Section 3.02(b);

 

  (ii)

plus any Shared Principal Collections allocated to Series 2010-VFN on such
Transfer Date pursuant to Section 3.02(b);

 

  (iii)

plus any Series 2010-VFN Available Interest Amounts used to fund the Series
2010-VFN Noteholder Allocated Dealer Note Losses for the related Due Period on
such Transfer Date pursuant to Section 3.01(a)(iii);

 

  (iv)

plus any Series 2010-VFN Available Interest Amounts used to reinstate any
reduction in the Series 2010-VFN Collateral Amount for the related Due Period on
such Transfer Date pursuant to Sections 3.01(a)(v) and 3.03(c);

 

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  (v)

plus if the Series 2010-VFN Notes are in an Early Redemption Period, any Series
2010-VFN Available Interest Amounts treated as Series 2010-VFN Available
Principal Amounts pursuant to Section 3.01(a)(ix).

“Series 2010-VFN Backup Servicing Expenses” means, with respect to any Transfer
Date, the product of (a) the Backup Servicing Expenses, multiplied by (b) the
Series 2010-VFN Allocation Percentage for such Transfer Date.

“Series 2010-VFN Backup Servicing Fee” means, with respect to any Transfer Date,
the product of (a) 1/12 of the Base Backup Servicing Fee, multiplied by (b) the
Series 2010-VFN Allocation Percentage for such Transfer Date.

“Series 2010-VFN Collateral Amount” equals, as of any date of determination, the
sum of the Series 2010-VFN Nominal Liquidation Amount (calculated without
subtraction of amounts on deposit in the Principal Funding Account) and the
Series 2010-VFN Overcollateralization Amount; provided, however, that (a) for
purposes of calculating the Noteholder Floating Allocation Percentage, the
Series 2010-VFN Variable Allocation Percentage, the variable allocation
percentage for each other Series of Notes, and similar provisions, (i) during
the Revolving Period, the Collateral Amount for the Series 2010-VFN as of the
last day of any Due Period shall be deemed to be the average daily Series
2010-VFN Collateral Amount for each day in the Due Period following such last
day and (ii) during any Amortization Period or Early Redemption Period, the
Collateral Amount for the Series 2010-VFN as of the last day of any Due Period
shall be the Collateral Amount as of such last day and (b) for purposes of
calculating the Noteholder Principal Allocation Percentage, the Series 2010-VFN
Fixed Allocation Percentage, the fixed allocation percentage for each other
Series of Notes, and similar provisions, (i) the Collateral Amount for the
Series 2010-VFN as of the last day of any Due Period shall be deemed to be the
amount of the Series 2010-VFN Collateral Amount as of the date of determination
of the applicable allocation percentage (or, with respect to any day prior to
the Issuance Date, the Issuance Date) and (ii) the Collateral Amount as of the
last day of any Due Period ending prior to the commencement of an amortization,
repayment or accumulation period shall be deemed to be the Series 2010-VFN
Collateral Amount as of the last day prior to the commencement of such
amortization, repayment or accumulation period; provided further, that for
purposes of calculating the Series Allocation Percentage (and the Adjusted
Invested Amount used for purposes of such calculation) during the Revolving
Period, the Collateral Amount for the Series 2010-VFN as of the end of a
Distribution Date shall be deemed to be the average daily Series 2010-VFN
Collateral Amount for each day in the Due Period following such Distribution
Date; and provided further, that for purposes of calculating the Series
Allocation Percentage and other allocation percentages related to Series
2010-VFN, Series 2010-VFN shall be deemed to have been outstanding from
March 31, 2010, to the Issuance Date, with respect to the allocation of
Principal Collections and Finance Collections and related concepts, with a
Series 2010-VFN Collateral Amount of $0.

“Series 2010-VFN Fixed Allocation Percentage” means, with respect to any
Business Day, the percentage equivalent of a fraction never greater than 100% or
less than 0% equal to:

 

  (i)

the numerator of which is the Series 2010-VFN Collateral Amount as of such date
(or, with respect to any day prior to the Issuance Date, the Issuance Date) or,
if

 

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  the Amortization Period or an Early Redemption Period has commenced, as of the
last day prior to the commencement of the Amortization Period or the Early
Redemption Period, as applicable; and

 

  (ii)

the denominator of which is the sum of the amounts in clause (i) above and the
aggregate of the Collateral Amounts for all other series of Notes as of the last
day of the immediately preceding Due Period (or the issuance date of that series
if none), except that for any series of Notes that is amortizing, repaying or
accumulating principal, the Collateral Amount of that series shall be fixed as
of the last day of the Due Period ending prior to the commencement of such
amortization, repayment or accumulation.

“Series 2010-VFN Interest Funding Account” means the account designated as such
and established pursuant to Section 3.10(a).

“Series 2010-VFN Interest Rate” means for any Payment Date, the percentage
equivalent of a fraction (a) the numerator of which is the product of (i) the
Series 2010-VFN Monthly Interest to be paid on such Payment Date (excluding any
portion thereof consisting of the Series 2010-VFN Monthly Interest carried over
from the prior Payment Date and interest on such unpaid Series 2010-VFN Monthly
Interest) and (ii) a fraction, the numerator of which is 365 and the denominator
of which is the number of days for which such Series 2010-VFN Monthly Interest
was calculated and (b) the denominator of which is the weighted average Series
2010-VFN Outstanding Principal Amount for the related Interest Period.

“Series 2010-VFN Investment Income” means, with respect to any Due Period and
the Series 2010-VFN Notes, the product of the Series 2010-VFN Variable
Allocation Percentage for such Due Period and Investment Income allocated to the
Collateral Certificate for such Due Period.

“Series 2010-VFN Monthly Interest” shall have the meaning specified in the Note
Purchase Agreement.

“Series 2010-VFN Nominal Liquidation Amount” means, at any time, the Series
2010-VFN Outstanding Principal Amount:

 

  (i)

minus the amount (other than investment earnings) then on deposit in the Series
2010-VFN Principal Funding Account (after giving effect to any deposits,
allocations, reallocations or withdrawals to be made on that day);

 

  (ii)

minus the share of all reallocations of the Series 2010-VFN Available Principal
Amounts that is allocated to the Series 2010-VFN Nominal Liquidation Amount
pursuant to Section 3.03(b)(ii) (including amounts allocated pursuant to
Sections 3.03(a)(i) through 3.03(a)(iii)) on or prior to such date of
determination;

 

  (iii)

minus the share of the allocations of Series 2010-VFN Noteholder Allocated
Dealer Note Losses that is allocated to the Series 2010-VFN Nominal Liquidation
Amount pursuant to Section 3.03(b)(ii) on or prior to such date of
determination;

 

15

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  (iv)

plus all reinstatements of the Series 2010-VFN Nominal Liquidation Amount
pursuant to Section 3.03(d)(i) on or prior to such date of determination;

provided, however, the Series 2010-VFN Nominal Liquidation Amount may never be
greater than the Series 2010-VFN Outstanding Principal Amount or less than zero
and, provided further that for the purposes of calculating the Series Allocation
Percentage and other allocation percentages related to Series 2010-VFN, Series
2010-VFN shall be deemed to have been outstanding from March 31, 2010, to the
Issuance Date, with respect to the allocation of Principal Collections and
Finance Collections and related concepts, with a Series 2010-VFN Nominal
Liquidation Amount of $0.

“Series 2010-VFN Noteholder” means a Person in whose name a Series 2010-VFN Note
is registered in the Note Register.

“Series 2010-VFN Noteholder Allocated Dealer Note Losses” means, with respect to
any Due Period, the product of (a) Series 2010-VFN Allocated Dealer Note Losses
for such Due Period and (b) the quotient of (i) the Series 2010-VFN Nominal
Liquidation Amount as of the preceding Transfer Date, divided by (ii) the Series
2010-VFN Collateral Amount as of the preceding Transfer Date.

“Series 2010-VFN Notes” is defined in Section 2.01.

“Series 2010-VFN Outstanding Principal Amount” means, for any date of
determination, an amount equal to the Initial Series 2010-VFN Outstanding
Principal Amount, plus the aggregate of all Incremental Funded Amounts with
respect to the Variable Funding Notes for all Incremental Fundings occurring on
or prior to such date, minus any principal payments made to holders of the
Variable Funding Notes on or prior to such date. As applied to any particular
Variable Funding Note, the “Series 2010-VFN Outstanding Principal Amount” means
the portion of the overall Series 2010-VFN Outstanding Principal Amount
represented by that Variable Funding Note.

“Series 2010-VFN Overcollateralization Amount” means:

 

  (a)

with respect to the Issuance Date, $0; and

 

  (b)

with respect any subsequent date, an amount equal to the Series 2010-VFN
Overcolleralization Amount determined as of the immediately preceding Transfer
Date (or with respect to the initial Transfer Date, the Series 2010-VFN
Overcollateralization Amount as of the Issuance Date);

 

  (i)

plus an amount equal to the Incremental Overcollateralization Amount for each
Incremental Funding, if any, since such prior Transfer Date;

 

  (ii)

minus an amount equal to the Overcollateralization Reduction Amount for each
principal payment made to holders of the Series 2010-VFN Notes, if any, since
such prior Transfer Date; provided, however, that if an Early Redemption Period
has commenced, this clause (ii) shall not be given effect;

 

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  (iii)

plus an amount equal to the increase, if any, in the Series 2010-VFN Target
Overcollateralization Amount as a result of a change in the Series 2010-VFN
Overcollateralization Percentage since such prior Transfer Date;

 

  (iv)

minus an amount equal to the decrease, if any, in the Series 2010-VFN Target
Overcollateralization Amount as a result of a change in the Series 2010-VFN
Overcollateralization Percentage since such prior Transfer Date;

 

  (v)

minus all reallocations of the Series 2010-VFN Available Principal Amounts used
to pay the Series 2010-VFN Monthly Interest on the Series 2010-VFN Notes that
have been allocated to the Series 2010-VFN Overcollateralization Amount pursuant
to Section 3.03(b)(i) since such prior Transfer Date;

 

  (vi)

minus all allocations of Series 2010-VFN Noteholder Allocated Dealer Note Losses
that have been allocated to the Series 2010-VFN Overcollateralization Amount
pursuant to Section 3.03(b)(i) since such prior Transfer Date;

 

  (vii)

minus the amount, if any, deposited into the Series 2010-VFN Spread Account
pursuant to Section 3.02(a)(iii) that has been allocated to the Series 2010-VFN
Overcollateralization Amount pursuant to Section 3.03(b)(i) since such prior
Transfer Date;

 

  (viii)

plus all reinstatements of the Series 2010-VFN Overcollateralization Amount
pursuant to Section 3.03(d)(ii) since such prior Transfer Date;

provided, however, that for purposes of calculating the Series Allocation
Percentage and other allocation percentages related to the Series 2010-VFN, the
Series 2010-VFN shall be deemed to have been outstanding from March 31, 2010 to
the Issuance Date, with respect to the allocation of Principal Collections and
Finance Collections and related concepts, with a Series 2010-VFN
Overcollateralization Amount of $0.

“Series 2010-VFN Overcollateralization Percentage” means 28.25%; provided
however, that if any outstanding series of Notes issued by the Issuer rated in
the highest investment category by either Moody’s or S&P is downgraded, the
Series 2010-VFN Overcollateralization Percentage will be set at the level
reasonably determined by the Administrative Agent necessary to support a rating
in the highest investment category for long-term debt on the Variable Funding
Notes, subject to the consent of the Seller, or, if the Seller shall not so
consent, the Purchase Expiration Date shall be deemed to have occurred.

“Series 2010-VFN Principal Funding Account” means the trust account designated
as such and established pursuant to Section 3.10(a).

“Series 2010-VFN Servicing Fee” means, with respect to any Transfer Date, the
product of (a) the product of (i) 1/12, (ii) 1.0%, and (iii) the sum of the
aggregate principal amounts of the Dealer Notes in the Master Trust as of the
last day of the related Due Period, multiplied by (b) the Series 2010-VFN
Allocation Percentage.

“Series 2010-VFN Shared Principal Collections” shall be as defined in
Section 3.02(b).

 

17

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“Series 2010-VFN Spread Account” means the account designated as such and
established pursuant to Section 3.10(a).

“Series 2010-VFN Target Overcollateralization Amount” means, with respect to any
Transfer Date, the product of the Series 2010-VFN Overcollateralization
Percentage and Series 2010-VFN Collateral Amount as of such Transfer Date (after
giving effect to any paydown or Incremental Funding to occur on such date);
provided, however, that if an Early Redemption Period has commenced, the Series
2010-VFN Collateral Amount for the purpose of calculating the Series 2010-VFN
Target Overcollateralization Amount shall be the Series 2010-VFN Collateral
Amount as of the last day immediately preceding the Early Redemption Period.

“Series 2010-VFN Termination Date” means the earlier of (a) the Payment Date
after the Purchase Expiration Date on which the Series 2010-VFN Outstanding
Principal Amount and all Series 2010-VFN Monthly Interest, Non-Use Fees and
Additional Amounts have been paid in full or the Series 2010-VFN Collateral
Amount is reduced to zero and (b) the Legal Final Maturity Date.

“Series 2010-VFN Unreimbursed Amount” means, as of any Transfer Date, the sum of
the Nominal Liquidation Amount Deficit and the Overcollateralization Amount
Deficit both as of such Transfer Date.

“Series 2010-VFN Variable Allocation Percentage” means, with respect to any Due
Period, the percentage equivalent of a fraction never greater than 100% or less
than 0% equal to:

 

  (i)

the numerator of which is the average daily Series 2010-VFN Collateral Amount
for each date in such Due Period;

 

  (ii)

the denominator of which is the sum of the amount in clause (i) above and
aggregate of the Collateral Amounts for each other series of Notes as of the
last day of the immediately preceding Due Period (or the issuance date if none).

“Series Available Interest Amounts Shortfall” means, with respect to any
Transfer Date and the Series 2010-VFN Notes, the excess, if any, of (a) the
aggregate amount required to be applied pursuant to Sections 3.01(a)(i) through
(v) for such Transfer Date over (b) the Series 2010-VFN Available Interest
Amount (excluding amounts to be treated as part of the Series 2010-VFN Available
Interest Amount pursuant to clauses (iii) and (iv) of the definition thereof)
for such Transfer Date.

“Series Available Principal Amounts Shortfall” means, with respect to any
Business Day and the Series 2010-VFN Notes, an amount equal to the amount, if
any, by which (i) the sum of all payments of principal and other applications of
Series 2010-VFN Available Principal Amounts (other than as Excess Available
Principal Amounts) required to be made under Section 3.02 on such Business Day
exceeds (ii) the related Series 2010-VFN Available Principal Amounts (excluding
amounts to be treated as part of Series 2010-VFN Available Principal Amounts
pursuant to clauses (i) and (ii) of the definition thereof) on such Business
Day.

“Series Reassignment Amount” means, with respect to the Series 2010-VFN Notes
and a Transfer Date, the sum of (a) the Series 2010-VFN Nominal Liquidation
Amount, (b) all accrued and unpaid Series 2010-VFN Monthly Interest on the
Series 2010-VFN Notes, in each case as of that Transfer Date and (c) accrued and
unpaid Non-Use Fees and Additional Amounts.

 

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“Servicer Certificate” is defined in Section 3.13(a).

“Spread Account Deposit Amount” means, with respect to any Transfer Date prior
to the earlier of (a) the payment in full of the outstanding principal amount of
the Series 2010-VFN Notes and (b) the Legal Final Maturity Date, the amount, if
any, by which the Spread Account Required Amount for that Transfer Date exceeds
the amount of funds on deposit in the Series 2010-VFN Spread Account.

“Spread Account Initial Deposit” means $0.

“Spread Account Required Amount” means, with respect to any date prior to the
initial Transfer Date, $0, and with respect to any subsequent Transfer Date, the
sum of (a) the positive amount, if any, by which (i) the sum of (A) the
Projected VFN Monthly Interest as of such Transfer Date, (B) the Projected
Monthly Servicing Fee as of such Transfer Date, (C) the Projected Monthly Backup
Servicing Fee as of such Transfer Date and (D) the Projected Monthly Backup
Servicing Expenses as of such Transfer Date exceeds (ii) the Projected Dealer
Note Income as of such Transfer Date and (b) an amount equal to the product of
(i) the Spread Account Required Percentage and (ii)(x) during the Revolving
Period, the Series 2010-VFN Collateral Amount as of such Transfer Date (after
giving effect to any prepayment or Incremental Funding to be made on such date)
or (y) during an Amortization Period or Early Redemption Period, the Series
2010-VFN Collateral Amount as of the last day of the Revolving Period.

“Spread Account Required Percentage” means, with respect to any Transfer Date,
1.50%; provided, that, if and for so long as the average Monthly Payment Rate
for any three consecutive Due Periods is less than 20.0%, then the Spread
Account Required Percentage shall be equal to 3.00%; provided however, that if
any outstanding series of Notes issued by the Issuer rated in the highest
investment category by either Moody’s or S&P is downgraded, the Spread Account
Required Percentage will be set at the level reasonably determined by the
Administrative Agent necessary to support a rating in the highest investment
category for long-term debt on the Variable Funding Notes, subject to the
consent of the Seller, or, if the Seller shall not so consent, the Purchase
Expiration Date shall be deemed to have occurred.

“US Borrower” shall have the meaning specified in the Credit Agreement.

“Used Vehicle Monthly Interest Rate” shall mean, with respect to any Due Period,
the product of (i) the per annum rate of interest and finance charges billed by
NFC during such Due Period on Used Vehicle Dealer Notes and (ii) the quotient of
(a) a number equal to the number of days during such Due Period and (b) the
actual number of days in the related calendar year.

“Variable Funding Notes” means the Navistar Financial Dealer Note Master Owner
Trust Floating Rate Dealer Note Asset Backed Variable Funding Notes, Series
2010-VFN.

 

19

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ARTICLE II

The Notes

Section 2.01 Creation, Designation and Delivery.

(a) There is hereby created and designated a series of Notes to be issued
pursuant to the Indenture and this Indenture Supplement to be known as “Navistar
Financial Dealer Note Master Owner Trust Floating Rate Dealer Note Asset Backed
Variable Funding Notes, Series 2010-VFN” or the “Series 2010-VFN Notes.” The
Series 2010-VFN Notes shall be issued in one class, executed by the Issuer and
authenticated by or on behalf of the Indenture Trustee, substantially in the
form of Exhibit A.

(b) The Series 2010-VFN Notes are a series of variable funding notes, meaning
that the Series 2010-VFN Outstanding Principal Amount may be increased from time
to time during the Revolving Period as Incremental Fundings are made under the
Note Purchase Agreement and may be decreased from time to time as funds are
distributed to the Series 2010-VFN Noteholders for the purpose of paying
principal thereof. The Series 2010-VFN Outstanding Principal Amount may not at
any time exceed the Maximum Funded Amount.

(c) The Series 2010-VFN Notes shall be delivered in the form of Registered Notes
as provided in Sections 2.02, 2.03 and 3.01 of the Indenture, respectively.

(d) The Series 2010-VFN Notes shall be issued in minimum denominations of
$100,000 and integral multiples of $1,000.

(e) The Issuer shall execute and deliver the Series 2010-VFN Notes to the
Indenture Trustee for authentication, and the Indenture Trustee shall deliver
the Series 2010-VFN Notes when authenticated, each in accordance with
Section 3.03 of the Indenture.

Section 2.02 Incremental Fundings. Incremental Fundings may occur on any
Business Day to the extent provided in the Note Purchase Agreement. Upon any
Incremental Funding, the Series 2010-VFN Outstanding Principal Amount, the
Series 2010-VFN Nominal Liquidation Amount, the Series 2010-VFN
Overcollateralization Amount, the Series 2010-VFN Collateral Amount and other
terms will be reset to the extent provided herein and in the Note Purchase
Agreement.

Section 2.03 Prepayments.

(a) On any Payment Date occurring during the Revolving Period, the Issuer may
cause the principal portion of the Series 2010-VFN Notes to be prepaid in full
or in part, (x) if the aggregate principal amount of such prepayment is greater
than $150,000,000, on not less than five Business Days prior written notice by
the Servicer or (y) otherwise, on not less than three Business Days prior
written notice by the Servicer, in each case, to the Indenture Trustee and the
Administrative Agent in accordance with the Note Purchase Agreement; provided,
however that such prepayment shall not be permitted unless all due (or, if the
Series 2010-VFN Notes are paid in full and terminated, all accrued) and unpaid
Series 2010-VFN Monthly Interest, Additional Amounts and Non-Use Fees have been
paid in full.

 

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(b) In addition, on any Business Day, the Issuer may cause the principal portion
of the Series 2010-VFN Notes to be prepaid in full or in part, (x) if the
aggregate principal amount of such prepayment is greater than $150,000,000, on
not less than five Business Days prior written notice by the Servicer or
(y) otherwise, on not less than three Business Days prior written notice by the
Servicer, in each case, to the Indenture Trustee and the Administrative Agent,
with the proceeds from issuance of a new Series issued substantially
contemporaneously with such prepayment in accordance with the Note Purchase
Agreement; provided, however that such prepayment shall not be permitted unless
all due (or, if the Series 2010-VFN Notes are paid in full and terminated, all
accrued) and unpaid Series 2010-VFN Monthly Interest, Additional Amounts and
Non-Use Fees have been paid in full.

(c) The Servicer shall not give notice of any prepayment pursuant to
Section 2.03(a) unless the Navistar Financial Dealer Note Master Owner Trust has
funds sufficient to make such prepayment on the day notice is given and shall
not give notice of any prepayment pursuant to Section 2.03(b) unless the Issuer
has obtained binding commitments which may be subject to customary conditions
from one or more persons to purchase the new series in such amounts as will
yield the net proceeds necessary to make the prepayment.

ARTICLE III

Allocations, Deposits and Payments

Section 3.01 Series 2010-VFN Available Interest Amounts.

(a) Allocation of Series 2010-VFN Available Interest Amounts. On each Transfer
Date, the Indenture Trustee, at the written direction of the Servicer, shall
apply Series 2010-VFN Available Interest Amounts as follows:

 

  (i)

first, on a pro rata basis (a) to the Servicer, the Series 2010-VFN Servicing
Fee due on such Transfer Date (to the extent it has not been waived by the
Servicer for such Transfer Date, and if the Servicer shall waive any Series
2010-VFN Servicing Fee, the Servicer shall give notice of such waiver to the
Administrative Agent) and (b) to the Backup Servicer, the Series 2010-VFN Backup
Servicing Fee due on such Transfer Date;

 

  (ii)

second, to the Series 2010-VFN Interest Funding Account, first, in an amount
equal to the Series 2010-VFN Monthly Interest for such Payment Date, second, in
an amount equal to the Non-Use Fees for such Payment Date, and, third, in an
amount equal to the Additional Amounts for such Payment Date, but, in the case
of this clause third, not in excess of 0.40% of the Series 2010-VFN Collateral
Amount as of the Payment Date immediately preceding the related Due Period;

 

  (iii)

third, to the Series 2010-VFN Spread Account, an amount equal to the Spread
Account Deposit Amount for such Transfer Date;

 

  (iv)

fourth, any remaining Series 2010-VFN Available Interest Amounts shall be
treated as Series 2010-VFN Available Principal Amounts to the extent of the
amount of Series 2010-VFN Noteholder Allocated Dealer Note Losses for the
related Due Period;

 

21

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  (v)

fifth, any remaining Series 2010-VFN Available Interest Amounts shall be treated
as Series 2010-VFN Available Principal Amounts for the reinstatement of the
Series 2010-VFN Collateral Amount to the extent of the Series 2010-VFN
Unreimbursed Amount (the amount being reinstated is referred to as the
“Reinstatement Amount”);

 

  (vi)

sixth, to the Servicer, any Series 2010-VFN Servicing Fee which had been
previously waived unless that amount has been waived again;

 

  (vii)

seventh, to the Series 2010-VFN Interest Funding Account, an amount equal to any
Additional Amounts for the related Payment Date not paid pursuant to
Section 3.01(a)(ii);

 

  (viii)

eighth, to the Backup Servicer, the Series 2010-VFN Backup Servicing Expenses
due on such Transfer Date;

 

  (ix)

ninth, if the Series 2010-VFN Notes are in an Early Redemption Period, any
remaining Series 2010-VFN Available Interest Amounts shall be treated as Series
2010-VFN Available Principal Amounts to the extent of the Series 2010-VFN
Nominal Liquidation Amount (after taking into account any reductions due to
Series 2010-VFN Noteholder Allocated Dealer Note Losses or otherwise or
reinstatements due to recoveries); and

 

  (x)

tenth, any remaining Series 2010-VFN Available Interest Amounts shall be treated
as Excess Available Interest Amounts and allocated pursuant to Section 5.03 of
the Indenture.

(b) Excess Available Interest Amounts; Excess Finance Charge Collections. On
each Transfer Date, commencing with the initial Transfer Date, if
Series-2010-VFN Available Interest Amounts are insufficient to make the
allocations provided in Sections 3.01(a)(i) through (v) above, the Servicer
shall allocate Excess Available Interest Amounts, if any, allocated to Series
2010-VFN pursuant to Section 5.03 of the Indenture to cover the Series Available
Interest Amounts Shortfall. If, after the application of Excess Available
Interest Amounts, any Series Available Interest Amounts Shortfall remains, the
Indenture Trustee at the written direction of the Servicer shall allocate Excess
Finance Charge Collections, if any, allocated to Series 2010-VFN pursuant to
Section 5.03 of the Indenture to cover such remaining Series Available Interest
Amounts Shortfall.

(c) Spread Account Draws.

 

  (i)

On any Transfer Date, at the written direction of the Servicer and to the extent
that Series 2010-VFN Available Interest Amounts (without giving effect to clause
(v) of the definition thereof) are insufficient to pay in full the amounts set
forth in Section 3.01(a)(ii), the Indenture Trustee shall withdraw funds from
the Series 2010-VFN Spread Account in an amount

 

22

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  equal to the lesser of (A) the amount of such shortfall and (B) the amount on
deposit in the Series 2010-VFN Spread Account (after giving effect to any
withdrawals from the Series 2010-VFN Spread Account on such Transfer Date other
than a withdrawal pursuant to Sections 3.01(c)(i), (ii) and (iii) on such date)
and treat such funds as “Series 2010-VFN Available Interest Amounts.”

 

  (ii)

If the Series 2010-VFN Notes are in an Early Redemption Period, at the written
direction of the Servicer and to the extent that Series 2010-VFN Available
Interest Amounts (without giving effect to clause (v) of the definition thereof)
are insufficient to pay in full the amount described in Section 3.01(a)(iv), the
Indenture Trustee shall withdraw funds from the Series 2010-VFN Spread Account
in an amount equal to the lesser of (A) the amount of such shortfall and (B) the
amount on deposit in the Series 2010-VFN Spread Account (after giving effect to
any withdrawals from the Series 2010-VFN Spread Account on such Transfer Date)
and treat such funds as “Series 2010-VFN Available Interest Amounts.”

 

  (iii)

On the Legal Final Maturity Date, in addition, after applying funds on deposit
in the Spread Account pursuant to Sections 3.01(c)(i) and (ii), if the Series
2010-VFN Outstanding Principal Amount remains greater than zero, the Indenture
Trustee shall, at the written direction of the Servicer, apply funds from the
Spread Account to repay the Series 2010-VFN Outstanding Principal Amount in
full, together with any unpaid Non-Use Fees and Additional Amounts.

Section 3.02 Series 2010-VFN Available Principal Amounts.

(a) Allocation of Series 2010-VFN Available Principal Amounts. On each Business
Day, the Indenture Trustee, at the written direction of the Servicer, shall
apply Series 2010-VFN Available Principal Amounts as follows:

 

  (i)

first, if the Series 2010-VFN Available Interest Amounts are insufficient to
make the payments on the Series 2010-VFN Notes on each Payment Date pursuant to
Section 3.01(a)(ii), to the Series 2010-VFN Interest Funding Account, an amount
equal to the lesser of (i) the amount of that shortfall and (ii) the Series
2010-VFN Collateral Amount (after taking into account any reinstatements
pursuant to Section 3.03(d) and reductions due to Section 3.03(a)(ii));

 

  (ii)

second, if the Series 2010-VFN Notes are in an Early Redemption Period or in an
Amortization Period, to the Series 2010-VFN Principal Funding Account any
remaining Series 2010-VFN Available Principal Amounts to the extent of the
Series 2010-VFN Nominal Liquidation Amount (computed before giving effect to
such deposit but after giving effect to any reinstatements pursuant to
Section 3.03(d)(i) and reductions pursuant to Sections 3.03(a)(i) and (ii)) for
payment to the Series 2010-VFN Noteholders;

 

23

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  (iii)

third, if the Series 2010-VFN Notes are not in an Early Redemption Period or in
an Amortization Period, to the extent that the Spread Account Deposit Amount is
greater than zero (after giving effect to any other deposits to or withdrawals
from the Series 2010-VFN Spread Account on such Transfer Date, reductions to the
Series 2010-VFN Nominal Liquidation Amount in accordance with Sections
3.03(a)(i) and (ii) and reinstatements pursuant to Section 3.03(d)(i)), to the
Series 2010-VFN Spread Account an amount equal to such Spread Account Deposit
Amount (not taking into account any increase in the Spread Account Required
Amount as a result of a decrease in the Monthly Payment Rate); and

 

  (iv)

fourth, any remaining Series 2010-VFN Available Principal Amounts shall be
treated as Excess Available Principal Amounts and allocated pursuant to
Section 5.02 of the Indenture.

(b) Excess Available Principal Amounts; Shared Principal Collections.

 

  (i)

On each Transfer Date, commencing after the Issuance Date, if Series 2010-VFN
Available Principal Amounts are insufficient to make the allocations provided in
Sections 3.02(a)(i) through (iii) above, the Indenture Trustee shall allocate
Excess Available Principal Amounts, if any, allocated to Series 2010-VFN
pursuant to Section 5.02 of the Indenture to cover the Series Available
Principal Amounts Shortfall.

 

  (ii)

If, after the application of Excess Available Principal Amounts, any Series
Available Principal Amounts Shortfall remains, the Indenture Trustee shall
allocate Shared Principal Collections, if any, allocated to Series 2010-VFN
pursuant to Section 5.02 of the Indenture to cover such remaining Series
Available Principal Amounts Shortfall.

 

  (iii)

If any Shared Principal Collections remain after application to any other
Series, the Issuer may cause all or any portion of such Shared Principal
Collections to be retained and allocated to the Series 2010-VFN Noteholders and
deposited in the Series 2010-VFN Principal Funding Account on the related
Transfer Date to make any prepayment permitted by Section 2.03 hereof.

Section 3.03 Reductions and Reinstatements. The Series 2010-VFN Collateral
Amount, the Series 2010-VFN Overcollateralization Amount and the Series 2010-VFN
Nominal Liquidation Amount shall be calculated by the Servicer on each Transfer
Date or upon an Incremental Funding or repayment as provided in the Note
Purchase Agreement and shall be reduced and reinstated as described below.

(a) Reductions. The Series 2010-VFN Nominal Liquidation Amount and the Series
2010-VFN Overcollateralization Amount shall be reduced on any Transfer Date in
the

 

24

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order described in Section 3.03(b) below by the following amounts allocated on
that Transfer Date:

 

  (i)

the amount, if any, of the Series 2010-VFN Available Principal Amounts used to
pay Series 2010-VFN Monthly Interest on the Series 2010-VFN Notes as described
in Section 3.02(a)(i);

 

  (ii)

the amount of Series 2010-VFN Noteholder Allocated Dealer Note Losses for such
Due Period to the extent that they are not covered by Series 2010-VFN Available
Interest Amounts as described in Section 3.01(a)(iii); and

 

  (iii)

the amount, if any, deposited into the Series 2010-VFN Spread Account in
accordance with Section 3.02(a)(iii).

(b) Allocation of Reductions. On each Transfer Date, the amount of any reduction
in the Series 2010-VFN Collateral Amount due to Sections 3.03(a)(i), (ii) and
(iii) above shall be allocated as follows:

 

  (i)

first, the Series 2010-VFN Overcollateralization Amount (computed without giving
effect to any reductions due to Sections 3.03(a)(i) through (iii) on such date)
shall be reduced by the amount of such reduction until the Series 2010-VFN
Overcollateralization Amount is reduced to zero; and

 

  (ii)

second, the Series 2010-VFN Nominal Liquidation Amount (computed without giving
effect to any reductions due to Sections 3.03(a)(i) through (iii) on such date)
shall be reduced by any remaining amount until the Series 2010-VFN Nominal
Liquidation Amount is reduced to zero.

(c) Reinstatements. The Series 2010-VFN Nominal Liquidation Amount and the
Series 2010-VFN Overcollateralization Amount shall be reinstated on any Transfer
Date by the amount of the Series 2010-VFN Available Interest Amounts that are
applied to cover the Reinstatement Amount for that Transfer Date pursuant to
Section 3.01(a)(v).

(d) Allocation of Reinstatements. The Reinstatement Amount for any Transfer Date
specified in Section 3.03(c) shall be applied as follows:

 

  (i)

first, if the Series 2010-VFN Nominal Liquidation Amount has been reduced as
described in Section 3.03(b) above and is not fully reinstated, to the Series
2010-VFN Nominal Liquidation Amount until the Series 2010-VFN Nominal
Liquidation Amount equals the excess of (A) the Series 2010-VFN Outstanding
Principal Amount, over (B) the amount on deposit (other than investment
earnings) in the Series 2010-VFN Principal Funding Account on that Transfer Date
allocable to the Variable Funding Notes; and

 

25

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  (ii)

second, to the Series 2010-VFN Overcollateralization Amount until the Series
2010-VFN Overcollateralization Amount equals the Series 2010-VFN Target
Overcollateralization Amount.

Section 3.04 Payment on the Series 2010-VFN Notes. On each Transfer Date, the
Indenture Trustee, acting in accordance with written instructions from the
Servicer, shall transfer to the Series 2010-VFN Principal Funding Account and
Series 2010-VFN Interest Funding Account funds in accordance with this Indenture
Supplement. On each date of payment, after all allocations and reallocations
pursuant to Sections 3.01 and 3.02, the Indenture Trustee shall make or cause to
be made, without duplication, the following distributions to the extent of
available funds from the Series 2010-VFN Principal Funding Account and the
Series 2010-VFN Interest Funding Account:

(a) Interest Distributions. On each Payment Date (including the Expected
Principal Payment Date), the Series 2010-VFN Noteholders’ respective pro rata
shares (or as otherwise specified in accordance with the provisions of the Note
Purchase Agreement) of the following amounts shall be distributed to the
Variable Funding Noteholders: first, accrued and unpaid Series 2010-VFN Monthly
Interest on the Variable Funding Notes for that Payment Date, second, Non-Use
Fees, and third, Additional Amounts, in each case, to the extent of amounts on
deposit in the Series 2010-VFN Interest Funding Account for such purpose as of
such date.

(b) Revolving Period. On each day during the Revolving Period on which a
prepayment is to be made on the Series 2010-VFN Notes, the amounts on deposit in
the Series 2010-VFN Principal Funding Account for that purpose shall be
distributed as principal to the Variable Funding Noteholders (up to a maximum of
the Series 2010-VFN Outstanding Principal Amount on such date) pro rata (or
otherwise in accordance with the provisions of the Note Purchase Agreement).

(c) Amortization Period; Early Redemption Period. On each Payment Date during an
Amortization Period or an Early Redemption Period, including the Expected
Principal Payment Date, amounts on deposit in the Series 2010-VFN Principal
Funding Account with respect to the related Due Period shall be distributed as
principal, to the Variable Funding Noteholders (up to a maximum of the Series
2010-VFN Outstanding Principal Amount on such Payment Date) pro rata (or as
otherwise specified in accordance with the provisions of the Note Purchase
Agreement).

(d) Any installment of interest, principal or other amounts, if any, payable on
any Series 2010-VFN Note which is punctually paid or duly provided for by the
Issuer and the Indenture Trustee on the applicable date of payment shall be paid
by the Paying Agent to the Person in whose name such Series 2010-VFN Note (or
one or more predecessor Notes) is registered on the Note Record Date, by wire
transfer of immediately available funds to such Person’s account as has been
designated by written instructions received by the Paying Agent from such Person
not later than the close of business on the third Business Day preceding the
date of payment or, if no such account has been so designated, by check mailed
first-class, postage prepaid to such Person’s address as it appears on the Note
Register on such Note Record Date.

 

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(e) The right of the Series 2010-VFN Noteholders to receive payments from the
Issuer shall terminate on the first Business Day following the Series 2010-VFN
Termination Date.

Section 3.05 Reserved.

Section 3.06 Final Payment of the Series 2010-VFN Notes

(a) Series 2010-VFN Noteholders shall be entitled to payment of principal in an
amount equal to the Series 2010-VFN Outstanding Principal Amount. However,
Series 2010-VFN Available Principal Amounts shall be available to pay principal
on the Series 2010-VFN Notes only up to the Series 2010-VFN Nominal Liquidation
Amount.

(b) The Series 2010-VFN Notes shall be considered to be paid in full, the
holders of the Series 2010-VFN Notes shall have no further right or claim
against the Issuer, and the Issuer shall have no further obligation or liability
for principal, interest or other amounts, on the earlier to occur of:

 

  (i)

the date on which the Series 2010-VFN Outstanding Principal Amount and all
Series 2010-VFN Monthly Interest, Non-Use Fees, Additional Amounts and other
amounts on the Series 2010-VFN Notes are paid in full; or

 

  (ii)

the Legal Final Maturity Date of the Series 2010-VFN Notes, after giving effect
to all deposits, allocations, reallocations, sales of Dealer Notes and payments
to be made on that date.

Section 3.07 Netting of Deposits and Payments. The Issuer, in its sole
discretion, may make all deposits to the Series 2010-VFN Interest Funding
Account and the Series 2010-VFN Principal Funding Account with respect to any
Payment Date net of, and after giving effect to, all reallocations to be made
pursuant to Article III.

Section 3.08 Reserved.

Section 3.09 Computation of Interest. Unless otherwise specified in this
Indenture Supplement or the Note Purchase Agreement, interest for any period
shall be calculated from and including the first day of such period, to but
excluding the last day of such period.

Section 3.10 Accounts.

(a) Accounts; Deposits to and Distributions from Accounts. On or before the
Issuance Date, the Indenture Trustee shall cause to be established and
maintained three Eligible Accounts denominated as follows: the “Series 2010-VFN
Interest Funding Account,” the “Series 2010-VFN Principal Funding Account” and
the “Series 2010-VFN Spread Account” (collectively, the “Series 2010-VFN
Accounts”) in the name of the Indenture Trustee, bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Series 2010-VFN Noteholders. The Indenture Trustee shall possess all right,
title and interest to all funds on deposit from time to time in each of the
Series 2010-VFN Accounts and in all

 

27

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proceeds therefrom, for the benefit of the Secured Parties. The Series 2010-VFN
Accounts constitute Supplemental Accounts and shall be under the sole dominion
and control of the Indenture Trustee for the benefit of the Series 2010-VFN
Noteholders. If, at any time, the institution holding any Series 2010-VFN
Account ceases to be an Eligible Institution, the Issuer shall within 15
Business Days (or such longer period, not to exceed 30 calendar days, as to
which the Administrative Agent may consent) establish a new applicable Series
2010-VFN Account, that is an Eligible Account and shall transfer any cash and/or
investments to such new Series 2010-VFN Account. From the date such new Series
2010-VFN Account is established, it shall be a Series 2010-VFN Account, bearing
the name of the Series 2010-VFN Account it has replaced.

(b) All payments to be made from time to time by the Indenture Trustee to Series
2010-VFN Noteholders out of funds in the Series 2010-VFN Accounts pursuant to
this Indenture Supplement shall be made by the Indenture Trustee to the Paying
Agent not later than 12:00 noon on the applicable date of payment but only to
the extent of funds in the applicable Series 2010-VFN Account or as otherwise
provided in Article III.

Section 3.11 Spread Account.

(a) On the Issuance Date, the Seller shall deposit into the Series 2010-VFN
Spread Account an amount equal to the Spread Account Initial Deposit.

(b) Funds on deposit in the Series 2010-VFN Spread Account overnight or for a
longer period shall at all times be invested in Eligible Investments at the
written direction of the Servicer or its agent, subject to the restrictions set
forth in the Indenture and subject to the requirement that each such Eligible
Investment shall have a stated maturity on or prior to the following Transfer
Date. Net interest and earnings (less investment expenses) on funds on deposit
in the Series 2010-VFN Spread Account, if any, shall constitute Series 2010-VFN
Available Interest Amounts.

(c) On any Transfer Date on which the amount of funds on deposit in the Series
2010-VFN Spread Account is greater than the Spread Account Required Amount on
such Transfer Date, the Servicer shall withdraw the amount of such excess from
the Series 2010-VFN Spread Account and allocate and pay such excess to the
holders of the Seller’s Certificates.

(d) Upon payment in full of the Series 2010-VFN Outstanding Principal Amount,
together with any unpaid Series 2010-VFN Monthly Interest, Non-Use Fees and
Additional Amounts, any funds remaining on deposit in the Series 2010-VFN Spread
Account shall be distributed to the holders of the Seller’s Certificates.

(e) If the Spread Account Required Amount increases, to the extent that Series
2010-VFN Available Interest Amounts are insufficient to make the deposit
described in Section 3.01(a)(iii), the Seller may, in its sole discretion,
deposit the amount of such shortfall into the Spread Account.

Section 3.12 Reserved.

 

28

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Section 3.13 Reports and Statements to Series 2010-VFN Noteholders.

(a) On each Payment Date, the Indenture Trustee shall forward to each Series
2010-VFN Noteholder a statement substantially in the form of Exhibit B (the
“Servicer Certificate”) prepared by the Servicer.

(b) Not later than the Transfer Date, the Servicer shall deliver to the Master
Owner Trust Trustee, the Administrative Agent and the Indenture Trustee the
Servicer Certificate.

(c) On or before January 31 of each calendar year, beginning with January 31,
2011, the Indenture Trustee shall furnish or cause to be furnished to each
Person who at any time during the preceding calendar year was a Series 2010-VFN
Noteholder, a statement prepared by the Servicer containing the information
which is required to be contained in the statement to Series 2010-VFN
Noteholders, as set forth in paragraph (a) above, aggregated for such calendar
year or the applicable portion thereof during which such Person was a Series
2010-VFN Noteholder, together with other information as is required to be
provided by an issuer of indebtedness under the Internal Revenue Code. Such
obligation of the Indenture Trustee shall be deemed to have been satisfied to
the extent that substantially comparable information shall be provided by the
Servicer pursuant to any requirements of the Internal Revenue Code as from time
to time in effect.

ARTICLE IV

MISCELLANEOUS PROVISIONS

Section 4.01 Ratification of Indenture. As supplemented by this Indenture
Supplement, the Indenture is in all respects ratified and confirmed and the
Indenture as so supplemented by this Indenture Supplement shall be read, taken
and construed as one and the same instrument.

Section 4.02 Counterparts. This Indenture Supplement may be executed in two or
more counterparts (and by different parties on separate counterparts), each of
which shall be an original, but all of which together shall constitute one and
the same instrument.

Section 4.03 GOVERNING LAW. THIS INDENTURE SUPPLEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE
NEW YORK GENERAL OBLIGATIONS LAW) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

Section 4.04 Limitation of Owner Trustee Liability. Notwithstanding anything to
the contrary, this Indenture Supplement has been countersigned by Deutsche Bank
Trust Company Delaware, not in its individual capacity but solely in its
capacity as Master Owner Trust Trustee. In no event shall Deutsche Bank Trust
Company Delaware in its individual capacity or, except as expressly provided in
the Master Owner Trust Agreement, as Master Owner Trust Trustee have any
liability for the representations, warranties, covenants, agreement or other
obligations of Navistar Financial Dealer Note Master Owner Trust hereunder or in
any certificates, notices or agreements delivered pursuant hereto, as to all of
which recourse shall be had solely to the assets

 

29

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of Navistar Financial Dealer Note Master Owner Trust. For all purposes of this
Indenture Supplement, in the performance of its duties or obligations hereunder
or in the performance of any duties or obligations of Navistar Financial Dealer
Note Master Owner Trust hereunder, the Master Owner Trust Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of the
Master Owner Trust Agreement.

Section 4.05 Amendment. Notwithstanding anything to the contrary in Sections
10.1 and 10.2 of the Indenture, the Issuer and the Indenture Trustee acknowledge
that this Indenture Supplement may not be amended, waived, changed or otherwise
modified, without the prior written consent of the Managing Agents as provided
in the Note Purchase Agreement.

Section 4.06 No Registration of the Series 2010-VFN Notes under the Securities
Act.

(a) The Series 2010-VFN Notes have not been registered and will not be
registered under the Securities Act, or any state securities laws, and may not
be offered or sold within the United States or to, or for the account or benefit
of, U.S. Persons (as such terms are defined under the Securities Act), except
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and applicable state securities
laws.

(b) Each purchaser and any transferor, as applicable, of a Series 2010-VFN Note
will be deemed to represent and agree that:

(i) the purchaser and any transferee understand that the Series 2010-VFN Notes
are being offered only in a transaction not involving any public offering in the
United States within the meaning of the Securities Act, the Series 2010-VFN
Notes have not been and will not be registered under the Securities Act or any
state or other applicable securities laws, and, if in the future the purchaser
or any transferee decides to offer, resell, pledge or otherwise transfer the
Series 2010-VFN Notes, such Series 2010-VFN Notes may be offered, resold,
pledged or otherwise transferred only in accordance with the Indenture and this
Indenture Supplement and only (a) so long as such Series 2010-VFN Notes are
eligible for resale pursuant to Rule 144A, to a person whom the seller
reasonably believes is a Qualified Institutional Buyer acquiring the Series
2010-VFN Notes for its own account or as a fiduciary or agent for others (which
others must also be Qualified Institutional Buyers) to whom notice is given that
the resale or other transfer is being made in reliance on Rule 144A,
(b) pursuant to an effective registration statement under the Securities Act
(however, there is no undertaking to register the Series 2010-VFN Notes under
any United States federal or state securities laws or any securities laws of any
other jurisdiction on any future date), or (c) pursuant to an exemption from
registration under the Securities Act other than Rule 144A, and, in each case,
in accordance with applicable United States federal or state securities laws or
any securities laws of any other applicable jurisdiction. The purchaser and any
transferee acknowledge that no representation is made by the Issuer as to the
availability of any exemption under the Securities Act or any applicable state
securities laws for resale of the Series 2010-VFN Notes;

 

30

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(ii) unless the relevant legend set out below has been removed from the relevant
Series 2010-VFN Notes, the purchaser shall notify each transferee of the Series
2010-VFN Notes that (a) such Series 2010-VFN Notes have not been registered
under the Securities Act, (b) the holder of such Series 2010-VFN Notes is
subject to the restrictions on the resale or other transfer thereof described in
paragraph (i) above, (c) such transferee shall be deemed to have represented
(1) either (A) such transferee is a Qualified Institutional Buyer acquiring the
Series 2010-VFN Notes for its own account or as a fiduciary for others (which
are Qualified Institutional Buyers) or (B) that such transferee is acquiring
such Series 2010-VFN Notes in reliance on an exemption under the Securities Act
other than Rule 144A, and (2) that such transferee shall notify its subsequent
transferees as to the foregoing;

(iii) the purchaser and any transferee understand that an investment in the
Series 2010-VFN Notes involves certain risks, including the risk of loss of all
or a substantial part of its investment. The purchaser and any transferee have
had access to such financial and other information concerning the Issuer and the
Series 2010-VFN Notes as it deemed necessary or appropriate in order to make an
informed investment decision with respect to its purchase of the Series 2010-VFN
Notes, including an opportunity to ask questions of and request information from
the Servicer and the Issuer. The purchaser and any transferee have such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of its investment in the Series 2010-VFN Notes,
and the purchaser and any transferee and any accounts for which it is acting are
each able to bear the economic risk of its investment for an indefinite period
of time;

(iv) in connection with the purchase of the Series 2010-VFN Notes (a) none of
the Issuer, the Servicer, NFC, the Seller or the Indenture Trustee is acting as
a fiduciary or financial or investment adviser for the purchaser or any
transferee; (b) the purchaser or any transferee is not relying (for purposes of
making any investment decision or otherwise) upon any advice, counsel or
representations (whether written or oral) of the Issuer, the Servicer, NFC, the
Seller or the Indenture Trustee other than any representations expressly set
forth in a written agreement with such party; (c) none of the Issuer, the
Servicer, NFC, the Seller or the Indenture Trustee has given to the purchaser or
any transferee (directly or indirectly through any other person) any assurance,
guarantee, or representation whatsoever as to the expected or projected success,
profitability, return, performance, result, effect, consequence, or benefit
(including legal, regulatory, tax, financial, accounting, or otherwise) of its
purchase or the documentation for the Series 2010-VFN Notes; (d) the purchaser
or any

 

31

--------------------------------------------------------------------------------

transferee has consulted with its own legal, regulatory, tax, business,
investment, financial, and accounting advisers to the extent it has deemed
necessary, and it has made its own investment decisions (including decisions
regarding the suitability of any transaction pursuant to the Indenture) based
upon its own judgment and upon any advice from such advisers as it has deemed
necessary and not upon any view expressed by the Issuer, the Servicer, NFC, the
Seller or the Indenture Trustee; (e) the purchaser or any transferee has
determined that the rates, prices or amounts and other terms of the purchase and
sale of the Series 2010-VFN Notes reflect those in the relevant market for
similar transactions; (f) the purchaser or any transferee is purchasing the
Series 2010-VFN Notes with a full understanding of all of the terms, conditions
and risks thereof (economic and otherwise), and is capable of assuming and
willing to assume (financially and otherwise) these risks; and (g) the purchaser
or any transferee is a sophisticated investor familiar with transactions similar
to its investment in the Series 2010-VFN Notes;

(v) the purchaser and each transferee acknowledge that each Series 2010-VFN Note
will bear a legend to the following effect unless determined otherwise by the
Issuer:

THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR THE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES. THIS NOTE MAY NOT BE OFFERED, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED, EXCEPT (A) (1) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
UNDER THE SECURITIES ACT (A “QUALIFIED INSTITUTIONAL BUYER”) WHO IS EITHER
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER, IN A PRINCIPAL AMOUNT OF NOT LESS THAN $100,000 AND IN INTEGRAL MULTIPLES
OF $1,000 IN EXCESS THEREOF, FOR THE PURCHASER AND FOR EACH SUCH ACCOUNT, IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A SO LONG AS THIS NOTE IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, SUBJECT TO THE SATISFACTION OF
CERTAIN CONDITIONS SPECIFIED IN THE INDENTURE AND THE INDENTURE SUPPLEMENT,
(2) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OTHER
THAN RULE 144A IN A PRINCIPAL AMOUNT OF NOT LESS THAN $100,000 AND IN INTEGRAL
MULTIPLES OF $1,000 IN EXCESS THEREOF, SUBJECT TO THE SATISFACTION OF CERTAIN

 

32

--------------------------------------------------------------------------------

CONDITIONS SPECIFIED IN THE INDENTURE AND THE INDENTURE SUPPLEMENT, OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT
(HOWEVER, THERE IS NO UNDERTAKING TO REGISTER THE NOTES UNDER ANY UNITED STATES
FEDERAL OR STATE SECURITIES LAWS OR ANY SECURITIES LAWS OF ANY OTHER
JURISDICTION ON ANY FUTURE DATE), AND (B) IN ACCORDANCE WITH THE SECURITIES ACT
AND ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND ANY
OTHER APPLICABLE JURISDICTION. EACH PURCHASER AND TRANSFEREE WILL BE DEEMED TO
HAVE MADE CERTAIN REPRESENTATIONS AND AGREEMENTS SET FORTH IN THE INDENTURE AND
THE INDENTURE SUPPLEMENT. ANY TRANSFER IN VIOLATION OF THE FOREGOING WILL BE OF
NO FORCE AND EFFECT, WILL BE VOID AB INITIO, AND WILL NOT OPERATE TO TRANSFER
ANY RIGHTS TO THE TRANSFEREE, NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY
TO THE ISSUER, THE INDENTURE TRUSTEE OR ANY INTERMEDIARY.

EACH HOLDER OF A NOTE WILL BE DEEMED TO REPRESENT AND WARRANT THAT EITHER (i) IT
IS NOT ACQUIRING THE NOTE WITH THE ASSETS OF (A) AN “EMPLOYEE BENEFIT PLAN” AS
DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974,
AS AMENDED (“ERISA”) THAT IS SUBJECT TO THE PROVISIONS OF TITLE I OF ERISA,
(B) A “PLAN” DESCRIBED IN SECTION 4975(e)(1) OF THE U.S. INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE “CODE”), (C) AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE
PLAN ASSETS BY REASON OF INVESTMENT BY AN EMPLOYEE BENEFIT PLAN OR PLAN IN SUCH
ENTITY OR (D) ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW THAT IS SUBSTANTIALLY
SIMILAR TO ERISA OR SECTION 4975 OF THE CODE OR (ii) THE ACQUISITION AND HOLDING
OF THE NOTE WILL NOT GIVE RISE TO A NON-EXEMPT PROHIBITED TRANSACTION UNDER
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR A VIOLATION OF ANY
SUBSTANTIALLY SIMILAR APPLICABLE LAW.

(vi) each of the purchaser and any transferee either (x) is not an employee
benefit plan (as defined in Section 3(3) of ERISA) subject to the provisions of
Title I of ERISA, a plan as covered by Section 4975 of the Code, an entity whose
underlying assets include “plan assets” by reason of

 

33

--------------------------------------------------------------------------------

an employee benefit plan’s or plan’s investment in such entity or any other plan
that is subject to any law that is substantially similar to ERISA or
Section 4975 of the Code, or (y) its acquisition, holding and disposition of the
Series 2010-VFN Note will not result in a non-exempt prohibited transaction
under Section 406 of ERISA or Section 4975 of the Code or a violation of any
substantially similar law;

(vii) the purchaser and any transferee are not purchasing the Series 2010-VFN
Notes with a view to the resale, distribution or other disposition thereof in
violation of the Securities Act;

(viii) the purchaser and any transferee will provide notice to each person to
whom it proposes to transfer any interest in the Series 2010-VFN Notes of the
transfer restrictions and representations set forth in the Indenture and this
Indenture Supplement, including the exhibits thereto;

(ix) the purchaser or any transferee acknowledges that the Series 2010-VFN Notes
do not represent deposits with or other liabilities of the Indenture Trustee,
the Servicer, NFC, the Seller or any entity related to any of them. Unless
otherwise expressly provided in the Indenture or this Indenture Supplement, each
of the Indenture Trustee, the Servicer, NFC, the Seller or any entity related to
any of them shall not, in any way, be responsible for or stand behind the
capital value or the performance of the Series 2010-VFN Notes or the assets held
by the Master Trust or the Issuer; and

(x) the purchaser acknowledges that the Indenture Trustee, the Issuer, the
Servicer, NFC, the Seller and others will rely upon the truth and accuracy of
the foregoing acknowledgments, representations and agreements and agrees that,
if any of the acknowledgments, representations or warranties deemed to have been
made by it by virtue of its purchase of a Series 2010-VFN Note (or a beneficial
interest therein) is no longer accurate, then it shall promptly so notify NFC
and the Seller in writing.

Section 4.07 Consent to Amendments. By its purchase and acceptance of a Series
2010-VFN Note, each purchaser thereof shall be deemed to have consented to the
terms, provisions and limitations specified in Exhibit A to the Backup Servicing
Agreement which will be applicable upon the appointment of the Backup Servicer
as Successor Servicer under the Pooling and Servicing Agreement.

*    *    *    *    *

 

34

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties hereto have caused this Indenture Supplement to
be duly executed as of the day and year first above written.

 

NAVISTAR FINANCIAL DEALER NOTE

MASTER OWNER TRUST

By:

 

DEUTSCHE BANK TRUST COMPANY

DELAWARE, as Master Owner Trust

Trustee and not in its individual capacity

By:

 

/s/ Michele HY Voon

Name:

 

Michele HY Voon

Title:

 

Attorney-in-fact

By:

 

/s/ Susan Barstock

Name:

 

Susan Barstock

Title:

 

Attorney-in-fact

THE BANK OF NEW YORK MELLON, as

Indenture Trustee and not in its individual capacity

By:

 

/s/ Michael Burack

Name:

 

Michael Burack

Title:

 

Senior Associate

--------------------------------------------------------------------------------

EXHIBIT A

FORM OF VARIABLE FUNDING NOTE, SERIES 2010-VFN

THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) OR THE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES. THIS NOTE MAY NOT BE OFFERED, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED, EXCEPT (A) (1) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
UNDER THE SECURITIES ACT (A “QUALIFIED INSTITUTIONAL BUYER”) WHO IS EITHER
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER, IN A PRINCIPAL AMOUNT OF NOT LESS THAN $100,000 AND IN INTEGRAL MULTIPLES
OF $1,000 IN EXCESS THEREOF, FOR THE PURCHASER AND FOR EACH SUCH ACCOUNT, IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A SO LONG AS THIS NOTE IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, SUBJECT TO THE SATISFACTION OF
CERTAIN CONDITIONS SPECIFIED IN THE INDENTURE AND THE INDENTURE SUPPLEMENT,
(2) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OTHER
THAN RULE 144A IN A PRINCIPAL AMOUNT OF NOT LESS THAN $100,000 AND IN INTEGRAL
MULTIPLES OF $1,000 IN EXCESS THEREOF, SUBJECT TO THE SATISFACTION OF CERTAIN
CONDITIONS SPECIFIED IN THE INDENTURE AND THE INDENTURE SUPPLEMENT, OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT
(HOWEVER, THERE IS NO UNDERTAKING TO REGISTER THE NOTES UNDER ANY UNITED STATES
FEDERAL OR STATE SECURITIES LAWS OR ANY SECURITIES LAWS OF ANY OTHER
JURISDICTION ON ANY FUTURE DATE), AND (B) IN ACCORDANCE WITH THE SECURITIES ACT
AND ALL APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND ANY
OTHER APPLICABLE JURISDICTION. EACH PURCHASER AND TRANSFEREE WILL BE DEEMED TO
HAVE MADE CERTAIN REPRESENTATIONS AND AGREEMENTS SET FORTH IN THE INDENTURE AND
THE INDENTURE SUPPLEMENT. ANY TRANSFER IN VIOLATION OF THE FOREGOING WILL BE OF
NO FORCE AND EFFECT, WILL BE VOID AB INITIO, AND WILL NOT OPERATE TO TRANSFER
ANY RIGHTS TO THE TRANSFEREE, NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY
TO THE ISSUER, THE INDENTURE TRUSTEE OR ANY INTERMEDIARY.

EACH HOLDER OF A NOTE WILL BE DEEMED TO REPRESENT AND WARRANT THAT EITHER (i) IT
IS NOT ACQUIRING THE NOTE WITH THE ASSETS OF (A) AN “EMPLOYEE BENEFIT PLAN” AS
DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY

--------------------------------------------------------------------------------

ACT OF 1974, AS AMENDED (“ERISA”) THAT IS SUBJECT TO THE PROVISIONS OF TITLE I
OF ERISA, (B) A “PLAN” DESCRIBED IN SECTION 4975(e)(1) OF THE U.S. INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), (C) AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE PLAN ASSETS BY REASON OF INVESTMENT BY AN EMPLOYEE BENEFIT PLAN
OR PLAN IN SUCH ENTITY OR (D) ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW THAT IS
SUBSTANTIALLY SIMILAR TO ERISA OR SECTION 4975 OF THE CODE OR (ii) THE
ACQUISITION AND HOLDING OF THE NOTE WILL NOT GIVE RISE TO A NON-EXEMPT
PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR
A VIOLATION OF ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW.

THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT
SHALL NOT AT ANY TIME INSTITUTE AGAINST THE ISSUER, NAVISTAR FINANCIAL
SECURITIES CORPORATION, NAVISTAR FINANCIAL CORPORATION, OR THE NAVISTAR
FINANCIAL DEALER NOTE MASTER TRUST, OR JOIN IN ANY INSTITUTION AGAINST THE
ISSUER, NAVISTAR FINANCIAL SECURITIES CORPORATION, NAVISTAR FINANCIAL
CORPORATION, OR THE NAVISTAR FINANCIAL DEALER NOTE MASTER TRUST OF, ANY
BANKRUPTCY PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR
SIMILAR LAW IN CONNECTION WITH ANY OBLIGATIONS RELATING TO THE NOTES, THE
INDENTURE OR THE INDENTURE SUPPLEMENT.

THE HOLDER OF THIS NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A
BENEFICIAL INTEREST IN THIS NOTE, BY THE ACQUISITION OF A BENEFICIAL INTEREST
THEREIN, AGREE TO TREAT THE NOTES AS INDEBTEDNESS FOR APPLICABLE FEDERAL, STATE,
AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED
ON OR MEASURED BY INCOME.

--------------------------------------------------------------------------------

No. R-[    ] REGISTERED  

Commitment of $250,000,000.00

or such other amount as is specified in the Note

Purchase Agreement

NAVISTAR FINANCIAL DEALER NOTE MASTER OWNER TRUST

FLOATING RATE ASSET BACKED VARIABLE FUNDING NOTES, SERIES 2010-VFN

Evidencing the indebtedness of Navistar Financial Dealer Note Master Owner
Trust, a statutory trust created under the laws of the State of Delaware (herein
referred to as the “Issuer”), to [            ], as Managing Agent for the
[            ] Purchaser Group (as defined in the Note Purchase Agreement), due
and payable on the Legal Final Maturity Date or at such times and in such
amounts provided below or in the Indenture or Indenture Supplement. Interest
shall accrue on this Note as provided in the Indenture Supplement and the Note
Purchase Agreement. Such principal of and interest on this Note shall be paid in
the manner specified on the reverse hereof.

The principal of and interest on this Note are payable in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts. All payments made by the Issuer with
respect to this Note shall be applied first to interest due and payable on this
Note as provided above and then to the unpaid principal of this Note.

This Note evidences the portion of the Incremental Fundings made by the Conduit
Purchaser or the Committed Purchaser in its Purchaser Group represented by the
Managing Agent that is from time to time outstanding under the Note Purchase
Agreement, dated as of April 16, 2010 (the “Note Purchase Agreement”), among
Navistar Financial Corporation, as servicer, Navistar Financial Securities
Corporation, as seller, Bank of America, National Association, as administrative
agent, and the various other parties thereto. The Holder hereof shall and is
hereby authorized to record on the grid attached to this Note (or at such
Holder’s option, in its internal books and records) the date and amount of each
Incremental Funding made by it (or its Purchaser Group), the amount of each
repayment of the principal amount represented by this Note and any reductions to
the Series 2010-VFN Outstanding Principal Amount of this Note made pursuant to
the Indenture Supplement; provided, however, that failure to make any such
recordation on the grid or records or any error in the grid or records shall not
adversely affect the Holder’s rights with respect to its interest in the assets
of the Issuer and its right to receive Series 2010-VFN Monthly Interest in
respect of the outstanding principal amount of all Incremental Fundings made by
the Holder.

Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.

Unless the certificate of authentication hereon has been executed by the
Indenture Trustee whose name appears below by manual signature, this Note shall
not be entitled to any benefit under the Indenture referred to on the reverse
hereof, or be valid for any purpose.

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed, manually
or in facsimile.

 

NAVISTAR FINANCIAL DEALER NOTE MASTER OWNER TRUST, as Issuer

By:

 

DEUTSCHE BANK TRUST COMPANY DELAWARE, not in its individual capacity but solely
as Master Owner Trust Trustee under the Master Owner Trust Agreement

By:

 

 

Name:

 

Title:

 

Date: April 16, 2010

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION This is one of the Notes
designated above and referred to in the within-mentioned Indenture.

 

THE BANK OF NEW YORK MELLON, not in its individual capacity but solely as
Indenture Trustee

By:

 

 

Name:

 

Title:

 

Date: April 16, 2010

--------------------------------------------------------------------------------

[REVERSE OF NOTE]

This Series 2010-VFN Note is one of the Notes of a duly authorized issue of
Notes of the Issuer, designated as its Floating Rate Dealer Note Asset Backed
Variable Funding Notes, Series 2010-VFN (herein called the “Notes”), all issued
under an Indenture dated as of June 10, 2004 (such Indenture, as supplemented or
amended, is herein called the “Indenture”), as supplemented by an Indenture
Supplement dated as of April 16, 2010 (the “Indenture Supplement”), between the
Issuer and The Bank of New York Mellon, as Indenture Trustee (the “Indenture
Trustee”, which term includes any successor Indenture Trustee under the
Indenture), to which Indenture and Indenture Supplement reference is hereby made
for a statement of the respective rights and obligations thereunder of the
Issuer, the Indenture Trustee and the Holders of the Notes. The Notes are
subject to all terms of the Indenture and the Indenture Supplement. All terms
used in this Note that are defined in the Indenture or the Indenture Supplement,
each as supplemented or amended, shall have the meanings assigned to them in or
pursuant to the Indenture or the Indenture Supplement, as so supplemented or
amended.

Each Noteholder or Note Owner, by acceptance of a Note or, in the case of a Note
Owner, a beneficial interest in a Note, covenants and agrees that no recourse
may be taken, directly or indirectly, with respect to the obligations of the
Master Trust, the Master Trust Trustee, the Issuer, the Master Owner Trust
Trustee or the Indenture Trustee on the Notes or under the Indenture or any
certificate or other writing delivered in connection therewith, against (i) the
Master Trust Trustee, the Indenture Trustee or the Master Owner Trust Trustee in
its individual capacity, (ii) any owner of a beneficial interest in the Master
Trust Trustee, the Master Trust, the Issuer, the Master Owner Trust Trustee or
the Indenture Trustee, (iii) any partner, owner, beneficiary, agent, officer,
director or employee of the Master Trust, the Master Trust Trustee, the Issuer,
the Indenture Trustee or the Master Owner Trust Trustee in its individual
capacity, or (iv) any holder of a beneficial interest in the Master Trust
Trustee, the Master Trust, the Issuer, the Master Owner Trust Trustee or the
Indenture Trustee or of any successor or assign of the Master Trust Trustee, the
Indenture Trustee or the Master Owner Trust Trustee in its individual capacity,
except as any such Person may have expressly agreed and except that any such
partner, owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such entity.

Each Noteholder or Note Owner, by acceptance of a Note or, in the case of a Note
Owner, a beneficial interest in a Note, covenants and agrees that by accepting
the benefits of the Indenture that such Noteholder shall not at any time
institute against Navistar Financial Securities Corporation, Navistar Financial
Corporation, the Master Trust or the Issuer, or join in any institution against
Navistar Financial Securities Corporation, Navistar Financial Corporation, the
Master Trust or the Issuer of, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings, or other proceedings under any United
States Federal or state bankruptcy or similar law in connection with any
obligations relating to the Notes, the Indenture or the Indenture Supplement.

Prior to the due presentment for registration of transfer of this Note, the
Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Note (as of the day of
determination or as of such other date as may be

--------------------------------------------------------------------------------

specified in the Indenture) is registered as the owner hereof for all purposes,
whether or not this Note is overdue, and neither the Issuer, the Indenture
Trustee nor any such agent shall be affected by notice to the contrary.

THIS NOTE AND THE INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW)
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.

No reference herein to the Indenture or the Indenture Supplement and no
provision of this Note or of the Indenture or the Indenture Supplement shall
alter or impair the obligation of the Issuer, which is absolute and
unconditional, to pay the principal of and interest on this Note at the times,
place, and rate, and in the coin or currency herein prescribed.

--------------------------------------------------------------------------------

ASSIGNMENT

Social Security or taxpayer I.D. or other identifying number of assignee
                    

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
(name and address of assignee)                      the within Note and all
rights thereunder, and hereby irrevocably constitutes and appoints attorney, to
transfer said Note on the books kept for registration thereof, with full power
of substitution in the premises.

 

Dated:                    

   

 

 

*

Signature Guaranteed

 

--------------------------------------------------------------------------------

INCREMENTAL FUNDING AND REPAYMENT

 

Initial Series

2010-VFN

Outstanding

Principal

Balance

 

Incremental

Funded Amount

 

Repayments of

Principal

 

Series 2010-VFN

Outstanding

Principal

Balance

 

Date /

Incremental

Funding Date

               

--------------------------------------------------------------------------------

EXHIBIT B

FORM OF MONTHLY SERVICER AND SETTLEMENT CERTIFICATE

NAVISTAR FINANCIAL DEALER NOTE MASTER OWNER TRUST

SERIES 2010-VFN NOTES

Under the Series 2010-VFN Indenture Supplement dated as of April 16, 2010 (the
“Indenture Supplement”) by and among the Navistar Financial Dealer Note Master
Owner Trust (the “Master Owner Trust”) and The Bank of New York Mellon, as
trustee (the “Indenture Trustee”), the information which is required to be
prepared with respect to the Payment Date of                  ,     , the
Transfer Date of                  ,      and with respect to the performance of
the Master Owner Trust during the Due Period ended on                  ,     
and the Distribution Period ended on                  ,      is set forth below.
Certain of the information is presented on the basis of an original principal
amount of $1,000 per Note. Certain other information is presented based on the
aggregate amounts for the Master Owner Trust as a whole. Capitalized terms used
but not otherwise defined herein shall have the meanings assigned to such terms
in the Indenture Supplement.

 

5

  

Series 2010-VFN Notes Information

  

0.0

5.1

  

Series 2010-VFN Nominal Liquidation Amount as of the Transfer Date (after giving
effect to the transactions set forth in Article III of the Series 2010-VFN
Indenture Supplement and to payments made on the Payment Date).

  

0.0

  

Cumulative Reductions (Net of Reinstatements) of the Series 2010-VFN Nominal
Liquidation Amount, if any, as of the Transfer Date

  

0.0

5.2

  

Series 2010-VFN Collateral Amount as of the Transfer Date (after giving effect
to the transactions set forth in Article III of the Series 2010-VFN Indenture
Supplement and to payments made on the Payment Date).

  

0.0

  

Series 2010-VFN Target Overcollateralization Amount, if any, as of the Transfer
Date

  

0.0

  

Cumulative Reductions (Net of Reinstatements) of the Series 2010-VFN
Overcollateralization Amount Deficiency, if any, as of the Transfer Date

  

0.0

5.4

  

Series 2010-VFN Allocated Dealer Note Losses / (Recoveries) for the Due Period

  

0.0

--------------------------------------------------------------------------------

5.5

  

Series 2010-VFN Allocated Interest Amounts for the Due Period

   0.0

5.6

  

Series 2010-VFN Allocated Principal Amounts for the Due Period

   0.0

5.7

  

Series 2010-VFN Noteholders Allocated Dealer Note Losses / (Recoveries) for the
Due Period

   0.0

5.8

  

Series 2010-VFN Available Interest Amounts with respect to the Due Period

   0.0

5.9

  

Series 2010-VFN Available Principal Amounts with respect to the Due Period

   0.0

5.10

  

Shortfall in Series Available Principal Amounts, if any, for the Due Period

   0.0

5.11

  

Sellers Invested Amount for the Series 2010-VFN Notes for the Due Period

   0.0

5.12

  

Shortfall in Series Available Interest Amounts, if any, for the Due Period

   0.0

5.13

  

Unreimbursed reductions to the Series 2010-VFN Collateral Amount, if any, for
the Due Period

   0.0

5.14

  

Nominal Liquidation Amount plus Accrued and Unpaid Interest as of the Transfer
Date

   0.0

5.15

  

Series 2010-VFN Required Seller’s Invested Amount as of the Payment Date

   0.0

5.16

  

Series Variable Allocation Percentage for the Due Period

   0.0

5.17

  

Series Fixed Allocation Percentage for the Due Period

   0.0

5.18

  

Total amount to be distributed on the Series 2010-VFN Notes on the Payment Date

   0.0

5.19

  

Total amount, if any, to be distributed on the Series 2010-VFN Notes on the
Payment Date allocable to the Outstanding Principal Amount

   0.0

5.20

  

Total amount to be distributed on the Series 2010-VFN Notes on the Payment Date
allocable to interest on the Series 2010-VFN Notes

   0.0

--------------------------------------------------------------------------------

5.21.1

  

Series 2010-VFN Servicing Fee to be paid on the Payment Date

   0.0

5.21.2

  

Series 2010-VFN Backup Servicing Expenses to be paid on the Payment Date

   0.0

5.21.3

  

Series 2010-VFN Backup Servicing Fee to be paid on the Payment Date

   0.0

5.22.1

  

Series 2010-VFN Investment Income

   0.0

5.22.2

  

Series 2010-VFN Principal Funding Account investment income

   0.0

5.22.3

  

Series 2010-VFN Interest Funding Account investment income

   0.0

5.22.4

  

Series 2010-VFN Spread Account investment income

   0.0

5.23

  

Series Excess Available Interest Amounts for the Due Period

   0.0

5.24

  

Excess Available Interest Amounts for the Due Period allocated to other Series
of Notes

   0.0

5.25

  

Excess Available Interest Amounts for the Due Period allocated to Series of
Investor Certificates

   0.0

5.26

  

Excess Available Principal Collections allocated from other series of Notes to
Series 2010-VFN for the Due Period

   0.0

5.27

  

Amount of Shared Principal Collections allocated to Series 2010-VFN Collateral
Certificate for the Due Period

   0.0

5.28

  

Amount of Excess Available Principal Collections allocated to other Series of
Notes for the Due Period

   0.0

5.29

  

Reimbursement Amount for the Series 2010-VFN Notes for the Due Period

   0.0

5.30

  

Certain amounts and calculations referenced in the definition of Early
Redemption Event

   See Exhibit “A”

6

  

Account Information

   0.0

6.1

  

Series 2010-VFN Spread Account Balance as of the Payment Date after giving
effect to all withdrawals and deposits made on such Payment Date

   0.0

--------------------------------------------------------------------------------

  

Series 2010-VFN Spread Account Required Amount, if any, as of the Payment Date
after giving effect to all withdrawals and deposits made on such Payment Date

     0.0

6.2

  

Series 2010-VFN Principal Funding Account Balance as of the Payment Date after
giving effect to all withdrawals and deposits made on such Payment Date

     0.0

6.3

  

Series 2010-VFN Interest Funding Account Balance as of the Payment Date after
giving effect to all withdrawals and deposits made on such Payment Date

     0.0

7

  

Notes Information

     0.0

7.1

  

Outstanding Principal Amount as of the Payment Date after giving effect to the
transactions made on such Payment Date

     0.0

7.2

  

Nominal Liquidation Amount as of the Payment Date after giving effect to the
transactions made on such Payment Date

     0.0

7.3

  

Total amount to be distributed on the Notes on the Payment Date

     0.0

7.4

  

Total amount, if any, to be distributed on the Notes on the Payment Date
allocable to the Outstanding Principal Amount

     0.0

7.5

  

Total amount to be distributed on the Notes on the Payment Date allocable
interest on the Notes

     0.0

7.6

  

Monthly Interest for the Interest Period

     0.0

IN WITNESS WHEREOF, the undersigned has duly executed and delivered this
certificate this                  ,     .

 

NAVISTAR FINANCIAL CORPORATION, as Servicer

By:

 

 

Its: