Exhibit 10.1

EXECUTION COPY

NOTE PURCHASE AGREEMENT

dated as of

November 28, 2007

among

NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION,

as Seller

CAFCO, LLC and CRC FUNDING, LLC,

as Conduit Investors

CITIBANK, N.A.,

as Committed Investor

CITICORP NORTH AMERICA, INC.,

as Agent for the Investors

and

NAVISTAR FINANCIAL CORPORATION,

Individually and as Servicer

NAVISTAR FINANCIAL 2007-C OWNER TRUST,

Series 2007-C Floating Rate Asset Backed Notes

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TABLE OF CONTENTS

 

                 Page ARTICLE I   Definitions    1   SECTION   1.01.  

Defined Terms

   1   SECTION   1.02.  

Terms Generally

   10   SECTION   1.03.  

Computation of Time Periods

   10 ARTICLE II   Purchase of the Purchased Note    10   SECTION   2.01.  

Purchase of the Purchased Note

   10   SECTION   2.02.  

The Note; Etc.

   11   SECTION   2.03.  

Calculation of Interest; Etc.

   11   SECTION   2.04.  

Sharing of Payments, Etc.

   12 ARTICLE III   Representations and Warranties    13   SECTION   3.01.  

Representation and Warranties

   13 ARTICLE IV   Conditions    18   SECTION   4.01.  

Conditions Precedent

   18 ARTICLE V   Covenants of the Seller and Servicer    19   SECTION   5.01.  

Access

   19   SECTION   5.02.  

Information from NFC

   20   SECTION   5.03.  

Security Interests; Further Assurances

   21   SECTION   5.04.  

Conduct of Business

   21   SECTION   5.05.  

Compliance with Laws

   21   SECTION   5.06.  

Replacement of Trustee

   21   SECTION   5.07.  

Compliance with Opinion Assumptions

   21   SECTION   5.08.  

Further Covenants

   21   SECTION   5.09.  

Amendments

   21 ARTICLE VI   Indemnification    22   SECTION   6.01.  

Indemnities by the Seller, NFC and the Servicer

   22   SECTION   6.02.  

Increased Cost and Reduced Return

   22   SECTION   6.03.  

Other Costs and Expenses

   23 ARTICLE VII   The Agent    24   SECTION   7.01.  

Authorization and Action

   24

 

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TABLE OF CONTENTS

(continued)

 

                 Page   SECTION   7.02.  

Delegation of Duties

   24   SECTION   7.03.  

Liability of Agent

   24   SECTION   7.04.  

Reliance by Agent

   25   SECTION   7.05.  

Notice of Event of Default

   25   SECTION   7.06.  

Credit Decision; Disclosure of Information by the Agent

   25   SECTION   7.07.  

Indemnification of the Agent

   26   SECTION   7.08.  

Agent in Individual Capacity

   26   SECTION   7.09.  

Resignation of Agent

   27   SECTION   7.10.  

Payments by the Agent

   27 ARTICLE VIII   Miscellaneous    27   SECTION   8.01.  

Assignment

   27   SECTION   8.02.  

Notices

   29   SECTION   8.03.  

Waivers; Amendments

   29   SECTION   8.04.  

Survival

   30   SECTION   8.05.  

Counterparts; Integration; Effectiveness

   30   SECTION   8.06.  

Severability

   30   SECTION   8.07.  

Governing Law; Jurisdiction; Consent to Service of Process; Waiver of Jury Trial
Right

   31   SECTION   8.08.  

No Bankruptcy Petition Against the Conduit Investors

   31   SECTION   8.09.  

Benefits of Indenture

   31   SECTION   8.10.  

Headings

   31   SECTION   8.11.  

No Recourse Against Conduit Investors, Members, Officers or Directors

   31   SECTION   8.12.  

Waiver of Confidentiality

   32   SECTION   8.13.  

Confidentiality Agreement

   32   SECTION   8.14.  

Excess Funds

   32   SECTION   8.15.  

Limitation of Liability

   33

 

EXHIBITS Exhibit A -   Documents to be Delivered to the Agent on or before the
Closing Date Exhibit B -   Form of Notice of Funding

 

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NOTE PURCHASE AGREEMENT dated as of November 28, 2007 (as amended, supplemented
or otherwise modified from time to time, the “Agreement”), among:

NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION, a Delaware corporation, as
Seller (the “Seller”);

CAFCO, LLC and CRC FUNDING LLC, each a Delaware limited liability company, as
initial Conduit Investors (as defined below);

CITIBANK, N.A., a national banking association, as Committed Investor (the
“Committed Investor”);

CITICORP NORTH AMERICA, INC., a Delaware corporation (“CNAI”), as Agent for the
Investors; and

NAVISTAR FINANCIAL CORPORATION, a Delaware corporation, individually (“NFC”) and
as Servicer (together with its successors and assigns, the “Servicer”).

RECITALS

WHEREAS, the Trust and the Indenture Trustee are party to an Indenture dated as
of November 28, 2007 (as amended, restated, supplemented or otherwise modified
from time to time, the “Indenture”), pursuant to which the Seller has authorized
the issuance of the Series 2007-C Floating Rate Asset Backed Note (the “Note”);
and

WHEREAS, on the Closing Date, the Seller intends to sell the Purchased Note to
the Agent for the benefit of the Conduit Investors and the other Investors and
the Conduit Investors and the other Investors desire to acquire the Purchased
Note.

Accordingly, the parties hereto agree as follows:

ARTICLE I

Definitions

SECTION 1.01. Defined Terms. Terms used herein but not otherwise defined herein
have the respective meanings given to such terms in Part I of Appendix A to the
Pooling Agreement, dated as of November 28, 2007 (the “Pooling Agreement”),
between NFRRC (as defined below) and the Issuer, as amended, restated,
supplemented or otherwise modified from time to time. As used in this Agreement,
the following terms have the meanings specified below:

“Agent” means CNAI in its capacity as agent for the Investors, and its
successors and assigns appointed pursuant to Section 7.09.

“Agent-Related Person” means the Agent, together with its Affiliates, and the
officers, directors, employees, agents and attorneys-in-fact of such Persons and
their respective Affiliates.

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“Agreement” is defined in the preamble.

“Alternate Rate” for any Fixed Period for any Funding Tranche means an interest
rate per annum equal to the sum of (x) Applicable Margin per annum and (y) the
Eurodollar Rate for such Fixed Period; provided, however, that in the case of:

(i) any Fixed Period existing on or after the first day of which the Agent shall
have been notified by any Conduit Investor, the Committed Investor or any
Program Support Provider that:

(w) the introduction of or any change in or in the interpretation of any law or
regulation makes it unlawful, or any central bank or other Governmental
Authority asserts that it is unlawful, for such Conduit Investor, the Committed
Investor or such Program Support Provider to fund any Funding Tranche (based on
the Eurodollar Rate) set forth above (and such Conduit Investor, the Committed
Investor or such Program Support Provider shall not have subsequently notified
the Agent that such circumstances no longer exist),

(x) U.S. dollar deposits in the London interbank market in the relevant amounts
and for the relevant portion of such Fixed Period are not available,

(y) adequate and reasonable means do not exist for ascertaining LIBOR for such
Fixed Period, or

(z) LIBOR does not accurately reflect the cost to such Conduit Investor, the
Committed Investor or such Program Support Provider (as conclusively determined
by such Conduit Investor, the Committed Investor or such Program Support
Provider (or by the Agent on its behalf)) of maintaining the applicable Funding
Tranche during such Fixed Period;

(ii) any Fixed Period of one to (and including) 13 days,

(iii) any Fixed Period relating to a Funding Tranche which is less than
$1,000,000, or

(iv) any Fixed Period with respect to which the Alternate Rate, for any reason,
becomes applicable on notice to the Agent of less than three (3) Business Days,

the “Alternate Rate” for each such Fixed Period shall be an interest rate per
annum equal to the Corporate Base Rate in effect on each day of such Fixed
Period. The “Alternate Rate” for any day on or after the occurrence of an Event
of Default shall be an interest rate equal to 2.0% per annum above the Corporate
Base Rate in effect on such day.

“Applicable Margin” has the meaning specified in the Fee Letter.

“Assignee Rating Criteria” means a short term debt rating of “A-1” or higher
from Standard & Poor’s, “P-1” from Moody’s and, if applicable, “F-1” or higher
from Fitch.

 

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“Bankruptcy Code” means the Bankruptcy Reform Act of 1978, 11 U.S.C. §§ 101 et
seq.

“Breakage Payment” is defined in Section 2.03(b).

“Commission” is defined in Section 3.01(c).

“Committed Investor” means, if applicable, each bank or financial institution
designated as such with respect to a particular Conduit Investor on the
signature pages hereto (or on any assignment or similar agreement pursuant to
which such Person becomes a party hereto as a Committed Investor).

“Conduit Assignee” means any commercial paper conduit administered by CNAI or
any of its Affiliates and designated by CNAI from time to time to accept an
assignment from any Conduit Investor of all or a portion of its rights and
obligations hereunder.

“Conduit Investors” means, initially, CAFCO, LLC and CRC FUNDING, LLC, together
with their successors and assigns, including any of their Conduit Assignees. A
“Conduit Investor” may include one or more commercial paper conduits as long as
such commercial paper conduits are either (i) Affiliates of one another or
(ii) administered by the same Person or its Affiliates. If a “Conduit Investor”
consists of more than one commercial paper conduit, each such commercial paper
conduit will have the rights and obligations with respect to the Note as may be
determined between them from time to time.

“Corporate Base Rate” means, for any day a fluctuating rate per annum equal to
the higher of (a) the Federal Funds Rate for such day, plus 0.50% and (b) the
rate of interest in effect for such day as publicly announced from time to time
by the Agent as its “prime rate”. The “prime rate” is a rate set by the Agent
based upon various factors including the Agent’s costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in the prime rate announced by the Agent shall take effect at
the opening of business on the day specified in the public announcement of such
change.

“Corporate Services Provider” is defined in Section 8.11.

“Day Count Fraction” means, as to any Funding Tranche for any Fixed Period, a
fraction (a) the numerator of which is the number of days in such Fixed Period
and (b) the denominator of which is 360 (or, with respect to any Funding Tranche
which accrues interest by reference to the Corporate Base Rate, the actual
number of days in the related calendar year).

“Distribution Period” means, initially, the period from, and including, the
Closing Date to, but excluding, the first Distribution Date and thereafter the
period from, and including, each Distribution Date to, but excluding, the next
Distribution Date.

“Distribution Date” is defined in the Pooling Agreement.

“Eurodollar Rate” means, for any Fixed Period, an interest rate per annum
(rounded upward to the nearest 1/1000th of 1%) determined pursuant to the
following formula:

 

Eurodollar Rate =  

LIBOR

        1.00 - Eurodollar Reserve Percentage      

 

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Where,

“Eurodollar Reserve Percentage” means, for any Fixed Period, the maximum reserve
percentage (expressed as a decimal, rounded upward to the nearest 1/1000th of
1%) in effect on the date LIBOR for such Fixed Period is determined under
regulations issued from time to time by the Federal Reserve Board for
determining the maximum reserve requirement (including any emergency,
supplemental or other marginal reserve requirement) with respect to Eurocurrency
funding (currently referred to as “Eurocurrency liabilities”) having a term
comparable to such Fixed Period; and

“LIBOR” means the rate per annum equal to the applicable British Bankers’
Association Interest Settlement Rate for deposits in U.S. dollars appearing on
Reuters Screen FRBD as of 11:00 a.m. (London time) on the second Business Day
prior to the commencement of such Fixed Period in the approximate amount of the
portion of the Funded Amount associated with such Fixed Period, provided that,
(i) if Reuters Screen FRBD is not available to the Agent for any reason, LIBOR
for such Fixed Period shall instead be the applicable British Bankers’
Association Interest Settlement Rate for deposits in U.S. dollars as reported by
any other generally recognized financial information service as of 11:00 a.m.
(London time) on the second Business Day prior to the commencement of such Fixed
Period in the approximate amount of the portion of the Funded Amount associated
with such Fixed Period, and (ii) if no such British Bankers’ Association
Interest Settlement Rate is available to the Agent, LIBOR for such Fixed period
shall instead be the rate determined by the Agent to be the rate at which the
Agent offers to place deposits in U.S. dollars with first-class banks in the
London interbank market at approximately 11:00 a.m. (London time) on the second
Business Day prior to the commencement of such Fixed Period in the approximate
amount of the portion of the Funded Amount associated with such Fixed period.

“Event of Bankruptcy” means, with respect to any Person, (a) that such Person
(i) shall generally not pay its debts as such debts become due or (ii) shall
admit in writing its inability to pay its debts generally or (iii) shall make a
general assignment for the benefit of creditors; (b) any proceeding shall be
instituted by or against such Person seeking to adjudicate it as bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking the entry of an order for relief or the appointment of a receiver,
trustee or other similar official for it or any substantial part of its
property; or (c) such Person shall take any corporate, partnership or other
similar appropriate action to authorize any of the actions set forth in the
preceding clauses (a) or (b) .

“Facility Termination Date” means November 26, 2008, as such date may be
extended from time to time with the prior written consent, and in the sole
discretion of, the Agent.

 

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“Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) equal to the weighted average of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to the Agent on such
day on such transactions as determined by it.

“Fee Letter” means the agreement, dated as of the Closing Date, among the
Seller, the Servicer and the Agent.

“Fitch” means Fitch, Inc. and its successors in interest.

“Fixed Period” means, unless otherwise mutually agreed by the Agent and the
Conduit Investors, (a) with respect to any Funding Tranche funded by the
issuance of Promissory Notes, (i) initially the period commencing on (and
including) the date of the initial purchase or funding of such Funding Tranche
and ending on (and including) the last day of the current calendar month, and
(ii) thereafter, each period commencing on (and including) the first day after
the last day of the immediately preceding Fixed Period for such Funding Tranche
and ending on (and including) the last day of the current calendar month and
(b) with respect to any Funding Tranche not funded by the issuance of Promissory
Notes, (i) initially the period commencing on (and including) the date of the
initial purchase or funding of such Funding Tranche and ending on (but
excluding) the next following Distribution Date and (ii) thereafter, each period
commencing on (and including) the first day after the last day of the
immediately preceding Fixed Period for such Funding Tranche and ending on (and
excluding) the next following Distribution Date; provided, that

(i) any Fixed Period with respect to any Funding Tranche not funded by the
issuance of Promissory Notes which would otherwise end on a day which is not a
Business Day shall be extended to the next succeeding Business Day; provided,
however, if interest in respect of such Fixed Period is computed by reference to
the Eurodollar Rate, and such Fixed Period would otherwise end on a day which is
not a Business Day, and there is no subsequent Business Day in the same calendar
month as such day, such Fixed Period shall end on the next preceding Business
Day;

(ii) in the case of any Fixed Period for any Funding Tranche which commences
before the Final Scheduled Distribution Date and would otherwise end on a date
occurring after the Final Scheduled Distribution Date, such Fixed Period shall
end on such Final Scheduled Distribution Date and the duration of each Fixed
Period which commences on or after the Final Scheduled Distribution Date shall
be of such duration as shall be selected by the Agent; and

(iii) any Fixed Period in respect of which interest is computed by reference to
the Promissory Note Rate may be terminated at the election of, and upon notice
thereof to the Seller by, the Agent any time, in which case the Funding Tranche
allocated to such terminated Fixed Period shall be allocated to a new Fixed
Period commencing on (and including) the date of such termination and ending on
(but excluding) the next following Distribution Date, and shall accrue interest
at the Corporate Base Rate.

 

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“Funded Amount” means on any Business Day, an amount equal to the result of
(a) the Initial Invested Amount, plus (b) any Subsequent Invested Amount of any
Incremental Funding, minus (c) the aggregate principal amount of principal
payments made to the Noteholder prior to such day; provided, that the Funded
Amount shall be restored or reinstated to the extent any such principal payment
so received and applied is at any time rescinded, returned or refunded for any
reason.

“Funding Date” means, each date on which an advance or a funding is made
hereunder by any Investor in respect of the Note.

“Funding Limit” means with respect to any Investor, the amount set forth with
respect to such Investor on the signature pages hereto or on any assignment
agreement or similar document pursuant to which such Person became a party
hereto as an Investor.

“Funding Period Expiration Date” means March 18, 2008.

“Funding Rate” means, with respect to any Fixed Period and any Funding Tranche,
(a) to the extent a Conduit Investor is funding such Funding Tranche during such
Fixed Period through the issuance of Promissory Notes, the Promissory Note Rate,
and (b) to the extent any Investor is not funding such Funding Tranche through
the issuance of Promissory Notes, a rate per annum (expressed as a percentage
and an interest yield equivalent and calculated on the basis of a 360-day year
and the actual days elapsed) equal to the Alternate Rate.

“Funding Tranche” means, any time, each portion of the Funded Amount allocated
to the same Fixed Period and accruing interest by reference to the same Funding
Rate at such time.

“Governmental Actions” means any and all consents, approvals, permits, orders,
authorizations, waivers, exceptions, variances, exemptions or licenses of, or
registrations, declarations or filings with, any Governmental Authority required
under any Governmental Rules.

“Governmental Authority” means the United States of America, any state or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government
and having jurisdiction over the applicable Person.

“Governmental Rules” means any and all laws, statutes, codes, rules,
regulations, ordinances, orders, writs, decrees and injunctions, of any
Governmental Authority and any and all legally binding conditions, standards,
prohibitions, requirements and judgments of any Governmental Authority.

“Incremental Funding” means all loans or advances made hereunder from time to
time on any Funding Date following the Closing Date.

“Indemnified Amounts” has the meaning specified in Section 6.01.

 

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“Indemnified Parties” has the meaning specified in Section 6.01.

“Indenture” is defined in the first paragraph of the recitals.

“Indenture Trustee” is defined in the Indenture.

“Initial Invested Amount” means $387,366,325.06.

“Investors” means the Conduit Investors, the Committed Investor and/or the
Program Support Providers, as the context may require.

“Issuer” or “Trust” means Navistar Financial 2007-C Owner Trust, a Delaware
statutory trust.

“Material Adverse Effect” means a material adverse effect on (i) the business,
assets or financial condition of NFC or NFRRC, (ii) the ability of NFC or NFRRC
to perform its obligations hereunder or under any other Transaction Document or
(iii) the interests of the Agent or any Investor hereunder and under the other
Transaction Documents.

“Maximum Net Investment” means $500,000,000.

“Moody’s” means Moody’s Investors Service, Inc., or any successor that is a
nationally recognized statistical rating organization.

“NFC” is defined in the preamble.

“NFRRC” means Navistar Financial Retail Receivables Corporation, a Delaware
corporation, and its successors and permitted assigns.

“Note” is defined in the first paragraph of the recitals.

“Noteholders’ Interest Distributable Amount” means, with respect to any
Distribution Date, the sum of:

(A) the sum of (i) the summation of the amount of interest accrued on each day
during the related Monthly Period on each Funding Tranche funded at the
Promissory Note Rate, determined by multiplying (a) the applicable Funding Rate
on such day times (b) the Funded Amount for such Funding Tranche on such day
divided by (c) 360 and (ii) any Noteholders’ Interest Distributable Amount
calculated in accordance with clause (A)(i) above due but not paid with respect
to the prior Monthly Period, plus interest on such unpaid amount calculated as
the product of (x) the weighted average Funding Rate for all Funding Tranches
funded at the Promissory Note Rate during the most recent Monthly Period, times
(y) the amount of such unpaid Noteholders’ Interest Distributable Amount, times
(z) the quotient of the number of days in the related Monthly Period divided by
360,

plus

 

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(B) the sum of (i) the summation of the amount of interest accrued on each day
during the related Distribution Period on each Funding Tranche not funded at the
Promissory Note Rate, determined by multiplying (a) the applicable Funding Rate
on such day times (b) the Funded Amount for such Funding Tranche on such day
divided by (c) 360 and (ii) any Noteholders’ Interest Distributable Amount
calculated in accordance with clause (B)(i) above due but not paid with respect
to the prior Distribution Period, plus interest on such unpaid amount calculated
as the product of (x) the weighted average Funding Rate for all Funding Tranches
not funded at the Promissory Note Rate during the most recent Distribution
Period, times (y) the amount of such unpaid Noteholders’ Interest Distributable
Amount, times (z) for Funding Tranches that do not accrue interest by reference
to the Corporate Base Rate, the quotient of the number of days in the related
Distribution Period divided by 360 (and otherwise, the actual number of days in
the related calendar year).

plus

(C) on any Distribution Date on which the Funded Amount is reduced to zero and
on the Final Scheduled Distribution Date, any amounts which accrue in clause
(A) above (together with all fees which accrue pursuant to paragraph 1 of the
Fee Letter) from (and excluding) the last day of the related Monthly Period
through (and including) such Distribution Date.

“Note Interest” means, with respect to any Investor at any time, the undivided
interest in the Note owned by such Investor at such time.

“Notice of Funding” means each notice of an Incremental Funding delivered
pursuant to Section 2.01 (b) and in the form of Exhibit B attached hereto.

“Other Obligations” means the fees under the Fee Letter and any other amounts
payable to the Agent or any Investor under or in connection with this Agreement
or any other Transaction Document (other than principal or interest in respect
of the Notes), including, without limitation, all Breakage Payments and all
amounts payable from time to time pursuant to Article VI.

“Participant” has the meaning set forth in the definition of “Promissory Note
Rate” herein.

“Pooling Agreement” is defined in Section 1.01.

“Program Support Agreement” means and includes any agreement entered into by any
Program Support Provider providing for the issuance of one or more letters of
credit for the account of a Conduit Investor, the issuance of one or more surety
bonds for which a Conduit Investor is obligated to reimburse the applicable
Program Support Provider for any drawings thereunder, the sale by a Conduit
Investor to any Program Support Provider of the Purchased Notes (or portions
thereof or participations therein) and/or the making of loans and/or other
extensions of credit to a Conduit Investor in connection with such Conduit
Investor’s commercial paper program, together with any letter of credit, surety
bond or other instrument issued thereunder, whether any of the foregoing is for
the purpose of providing credit support or liquidity to such Conduit Investor.

 

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“Program Support Provider” means and includes any Person now or hereafter
extending credit or having a commitment to extend credit to or for the account
of, or to make purchases from, a Conduit Investor or issuing a letter of credit,
surety bond or other instrument to support any obligations arising under or in
connection with such Conduit Investor’s commercial paper program.

“Promissory Note Rate” means, for any Fixed Period and any Funding Tranche
relating to a Conduit Investor, the per annum rate equal to the weighted average
of the per annum rates paid or payable by such Conduit Investor from time to
time as interest on or otherwise (by means of interest rate hedges or otherwise)
in respect of the Promissory Notes that are allocated, in whole or in part, by
the Agent (on behalf of a Conduit Investor) to fund or maintain such Conduit
Investor’s Funding Tranche during such Fixed Period, as determined by the Agent
(on behalf of such Conduit Investor) and reported to the Servicer, which rates
shall reflect and give effect to the commissions of placement agents and dealers
in respect of Promissory Notes, to the extent such commissions are allocated, in
whole or in part, to such Promissory Notes by the Agent (on behalf of such
Conduit Investor); provided, however, that if any component of such rate is a
discount rate, in calculating the “Promissory Note Rate” for such Fixed Period,
the Agent shall for such component use the rate resulting from converting such
discount rate to an interest bearing equivalent rate per annum ; provided,
further, that the Promissory Note Rate with respect to Funding Tranches or
portions thereof, interests or participations in which have been sold or
assigned by such Conduit Investors to any Person (each, a “Participant”)
pursuant to Section 8.01(b) (other than to any Program Support Provider) shall
be the same rate as in effect from time to time on Funding Tranches or portions
thereof that are not funded by a Participant; provided, further, that if all of
the Funding Tranches maintained by such Conduit Investor are funded by
Participants, then the Promissory Note Rate shall be such Conduit Investor’s
pool funding rate in effect from time to time for its largest size pool of
transactions which settles with a frequency corresponding to such Fixed Period.

“Promissory Notes” means, collectively, (i) promissory notes issued by the
Conduit Investors and (ii) participations or assignments sold by the Conduit
Investors pursuant to Section 8.01(b); provided that the term “Promissory Notes”
shall not include the interests sold by the Conduit Investors under a Program
Support Agreement.

“Purchased Note” means the Note, in the maximum aggregate principal amount of
$500,000,000 to be issued to the Agent (or its nominee) on behalf of the
Investors pursuant to the Indenture and Section 2.01 hereof.

“Recipient” has the meaning specified in Section 2.04.

“Seller” is defined in the preamble .

“Servicer” is defined in the preamble .

“Standard & Poor’s” or “S&P” means Standard & Poor’s, a division of The
McGraw-Hill Companies, Inc., or any successor that is a nationally recognized
statistical rating organization.

 

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“Subsequent Invested Amount” means the amount of all loans or advances made
hereunder from time to time in respect of any Incremental Funding following the
Initial Invested Amount.

“Transaction Documents” means the “Basic Documents” as defined in Part I of
Appendix A to the Pooling Agreement.

SECTION 1.02. Terms Generally. All terms defined directly or by incorporation
herein shall have the defined meanings when used in any certificate or other
document delivered pursuant hereto unless otherwise defined therein. For
purposes of this Agreement and all such certificates and other documents, unless
the context otherwise requires: (a) accounting terms not otherwise defined
herein, and accounting terms partly defined herein to the extent not defined,
shall have the respective meanings given to them under, and shall be construed
in accordance with, generally accepted accounting principles in effect in the
United States from time to time; (b) terms used in Article 9 of the applicable
UCC as in effect from time to time, and not specifically defined herein, are
used herein as defined in such Article 9; (c) references to any amount as on
deposit or outstanding on any particular date means such amount at the close of
business on such day; (d) the words “hereof,” “herein” and “hereunder” and words
of similar import refer to this Agreement (or the certificate or other document
in which they are used) as a whole and not to any particular provision of this
Agreement (or such certificate or document); (e) references to any Article,
Section, Schedule or Exhibit are references to Articles, Sections, Schedules and
Exhibits in or to this Agreement (or the certificate or other document in which
the reference is made) and references to any paragraph, subsection, clause or
other subdivision within any Section or definition refer to such paragraph,
subsection, clause or other subdivision of such Section or definition; (f) the
term “including” means “including without limitation”; (g) references to any law
refer to that law as amended from time to time and include any successor law;
(h) references to any agreement refer to that agreement as from time to time
amended or supplemented or as the terms of such agreement are waived or modified
in accordance with its terms; (i) references to any Person include that Person’s
successors and permitted assigns; and (j) headings are for purposes of reference
only and shall not otherwise affect the meaning or interpretation of any
provision hereof.

SECTION 1.03. Computation of Time Periods. Unless otherwise stated in this
Agreement, in the computation of a period of time from a specified date to a
later specified date, the word “from” means “from and including”, the words “to”
and “until” each means “to but excluding”, and the word “within” means “from and
excluding a specified date and to and including a later specified date”.

ARTICLE II

Purchase of the Purchased Note

SECTION 2.01. Purchase of the Purchased Note. (a) On the terms and subject to
the conditions set forth in this Agreement, and in reliance on the covenants,
representations, warranties and agreements herein and therein set forth
(including Article IV), the Seller shall cause to be issued, and shall cause the
Indenture Trustee to authenticate and deliver to the Agent and the Agent shall
purchase the Purchased Note, issued on the Closing Date, on

 

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behalf of the Investors. The purchase price payable for the Purchased Note shall
be equal to the Initial Invested Amount. The Agent (or its nominee) shall hold
the Purchased Note on behalf of the Investors pro rata in accordance with their
respective outstanding portions (if any) of the Funded Amount funded by them
from time to time. The Purchased Note so issued shall be dated the Closing Date,
registered in the name of the Agent (or its nominee) and duly authenticated in
accordance with the provisions of the Indenture. Without limiting any other
provision of this Agreement, the issuance of the Purchased Note and the funding
of the Funded Amount thereunder on the Closing Date is subject to the
satisfaction of the conditions precedent set forth in Article IV. Upon such
issuance, (i) the Agent shall thereby acquire the Purchased Note, and (ii) the
Agent and the Investors shall become subject to the terms and conditions set
forth herein and the Indenture.

(b) Incremental Fundings. Subject to the terms and conditions of this Agreement
and the other Transaction Documents (including, without limitation,
Section 4.01(c)), from time to time prior to the Funding Period Expiration Date
(and in any event not later than the Facility Termination Date) upon receipt by
the Agent of a Notice of Funding, the Agent, on behalf of the Investors (ratably
based on their respective Funding Limits), shall make Incremental Fundings to
the Seller in the amounts so requested in any such Notice of Funding (but in no
event shall the Funded Amount after giving effect to such Incremental Funding
exceed the Maximum Net Investment) within 5 (five) Business Days of receipt of
such Notice of Funding or on such date as specified in such Notice of Funding
and upon such request, each Investor severally agrees to make available to the
Agent the amount necessary to fund its ratable portion of such Incremental
Funding; provided, however, that neither the Agent nor any Investor shall be
required to fund any portion of any Incremental Funding exceeding its Funding
Limit if, after giving effect thereto, its ratable share of the Funded Amount
would exceed its Funding Limit. Notwithstanding anything to the contrary herein,
in no event shall any Conduit Investor be committed or obligated to make any
funding under Section 2.01(a) or (b). In the event any such Conduit Investor
elects (in its sole discretion) not to make any funding in respect of the
Initial Invested Amount or any Subsequent Invested Amount, then the Committed
Investor relating to such Conduit Investor shall, subject to all of the other
terms and conditions set forth herein (including Article IV), make the funding
that which the related Conduit Investor elected not to fund.

SECTION 2.02. The Note; Etc. The funding of the Initial Invested Amount and each
Subsequent Invested Amount shall be evidenced by the Purchased Note and shall be
governed by and subject to the Indenture. All payments to be made on the Note
shall be made in accordance with the Indenture and the terms of this Agreement.
The sole Holder of the Purchased Note shall be the Agent, which shall hold such
Note for the benefit of the Investors. Except as otherwise required in the
Indenture, all payments to be made on the Note shall be made by wire transfer of
immediately available funds to the account set forth below the Agent’s signature
to this Agreement (or to such other account as the Agent may specify from time
to time in writing to the Seller and the Indenture Trustee).

SECTION 2.03. Calculation of Interest; Etc.

(a) On or before the second Business Day after the end of each Monthly Period,
the Agent shall calculate for the related Distribution Date, the Noteholders’
Interest

 

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Distributable Amount payable on such Distribution Date and provide such
calculation to the Servicer in writing. If any Funding Tranche begins to accrue
interest at a Funding Rate other than the Promissory Note Rate after the date
the Agent provides the Noteholders’ Interest Distributable Amount calculation
for any Distribution Date, the Agent shall promptly provide the Servicer a
calculation of the interest that will accrue on such Funding Tranche and be
included in the definition of “Noteholders’ Interest Distributable Amount” for
such Distribution Date. The parties acknowledge that the interest calculation
set forth in clause (C) of the definition of “Noteholders’ Interest
Distributable Amount” shall be an estimate. If the estimated accruals exceed the
actual accruals, the Agent shall reimburse such excess. If the actual accruals
exceed the estimated accruals, the Seller shall reimburse the Agent.

(b) If (i) any distribution of principal is made with respect to any Funding
Tranche with a Fixed Period and a fixed interest rate other than on a
Distribution Date or any Notice of Funding is delivered by the Seller but not
drawn and (ii) as a consequence of such distribution or failure to draw the
interest paid by an Investor to providers of funds to it to fund that Funding
Tranche exceeds returns earned by such Investor with respect to such Funding
Tranche, factoring in actual returns earned during the Fixed Period and assuming
redeployment of such funds in highly rated short-term money market instruments
from the date of principal distribution (or failure to draw) through the end of
the Fixed Period, then, upon written notice (including a detailed calculation of
such Breakage Payment) from the Agent to the Servicer, such Investor shall be
entitled to receive additional amounts in the amount of such excess (each, a
“Breakage Payment”) on the second Business Day after the Servicer receives such
notice or, if later, on the date of such distribution.

(c) On each date the principal amount of the Purchased Note is reduced, a duly
authorized officer, employee or agent of the Agent (or its nominee) shall make
appropriate notations in its books and records of the applicable rates of
interest and the amount of each such reduction, as applicable. Each of the
Servicer, the Seller and each Investor authorizes each duly authorized officer,
employee and agent of the Agent (or its nominee) to make such notations on the
books and records as aforesaid and such notation made in accordance with the
foregoing authority shall be binding on the Servicer, the Seller and each
Investor absent manifest error.

(d) Whenever any amount is paid pursuant to the Indenture to the Agent in
connection with the Purchased Note, the Agent shall promptly allocate such
amounts among the applicable Investors and pay, or cause to be paid, out of such
funds received by it, to each applicable Investor, its applicable share of such
amount; provided, that if any such amount paid to the Agent is insufficient to
pay the amount due to each Investor in respect of such amounts, the Agent shall
distribute the amount it has received to each Investor pro rata based on the
amounts owed to each Investor and forthwith report the amount of such deficiency
to the Seller, the Indenture Trustee and the Servicer.

SECTION 2.04. Sharing of Payments, Etc. If any Investor (for purposes of this
Section only, being a “Recipient”) shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of setoff, or otherwise) on
account of any Note Interest owned by it in excess of its ratable share of
payments on account of the applicable Funded Amount obtained by the Investors
entitled thereto, such Recipient shall forthwith purchase from the Investors
entitled to a share of such amount participations in the applicable Note
Interests owned

 

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by such Persons as shall be necessary to cause such Recipient to share the
excess payment ratably with each such other Person entitled thereto; provided,
that if all or any portion of such excess payment is thereafter recovered from
such Recipient, such purchase from each such other Person shall be rescinded and
each such other Person shall repay to the Recipient the purchase price paid by
such Recipient for such participation to the extent of such recovery, together
with an amount equal to such other Person’s ratable share (according to the
proportion of (a) the amount of such other Person’s required payment to (b) the
total amount so recovered from the Recipient) of any interest or other amount
paid or payable by the Recipient in respect of the total amount so recovered.

ARTICLE III

Representations and Warranties

SECTION 3.01. Representation and Warranties.

(a) The Seller hereby makes the following representations and warranties to the
Agent and the Investors as of the Closing Date and as of each subsequent Funding
Date and the Investors and the Agent shall be deemed to have relied on such
representations and warranties in purchasing the Purchased Note on the Closing
Date and making any Incremental Fundings on any Funding Date:

(i) the Seller repeats and reaffirms that the representations and warranties of
the Seller set forth in Section 2.05 and Section 3.01 the Pooling Agreement and
represents and warrants that such representations and warranties are true and
correct;

(ii) each of the Transaction Documents executed by the Seller has been duly
authorized, executed and delivered by the Seller, and is the valid and legally
binding obligation of the Seller, enforceable against the Seller in accordance
with its terms, except that the enforcement thereof may be subject to
(x) bankruptcy, insolvency, reorganization, moratorium or other similar laws now
or hereafter in effect relating to creditors’ rights generally and (y) general
principles of equity and the discretion of the court before which any proceeding
therefor may be brought;

(iii) the Purchased Note has been duly and validly authorized, and, when
executed and authenticated in accordance with the terms of the Indenture, and
delivered to and paid for in accordance with this Agreement, will be duly and
validly issued and outstanding and will be entitled to the benefits of the
Indenture, except that the enforcement thereof may be subject to (x) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors’ rights generally and (y) general principles of
equity and the discretion of the court before which any proceeding therefor may
be brought;

(iv) there is no pending or, to the Seller’s knowledge, threatened action, suit
or proceeding by or against the Seller before any Governmental Authority or any
arbitrator (w) asserting the invalidity of this Agreement, any other Transaction
Document or the Purchased Note, (x) seeking to prevent the issuance of the
Purchased Note or the

 

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consummation of any of the transactions contemplated by this Agreement or any
other Transaction Document, (y) that might materially and adversely affect the
performance by the Seller or the Trust of its obligations under, or the validity
or enforceability of, this Agreement, any other Transaction Document or the
Purchased Note or (z) that if determined adversely as to the Seller or the Trust
would have a Material Adverse Effect;

(v) except for those caused by the failure of NFC and its affiliates to deliver
its financial statements and related financial information for the fiscal years
ended October 31, 2005, October 31, 2006 and October 31, 2007, or for the fiscal
quarters ended January 31, April 30 and July 31 of 2006, the fiscal quarters
ended January 31, April 30 and July 31 of 2007 or the fiscal quarters ended
January 31, April 30 and July 31 of 2008, in each case, prior to the earliest of
(1) November 30, 2008, (2) five (5) Business Days after the filing thereof with
the Commission and (3) the date on which such financial statements are (or any
of them is) required to be delivered pursuant to the Credit Agreement, the
Seller (x) is not in violation of its Certificate of Incorporation or By-Laws
and (y) is not in breach or violation of any of the terms or provisions of, or
with the giving of notice or lapse of time, or both, would be in default under,
any contract, indenture, mortgage, deed of trust, loan agreement, note, lease,
partnership agreement, or other agreement or instrument to which the Seller is a
party or by which it may be bound or to which any of its properties or assets
may be subject, except for such violations or defaults that would not have a
Material Adverse Effect;

(vi) any taxes, fees and other charges of Governmental Authorities applicable to
the Seller in connection with the execution, delivery and performance by the
Seller of the Transaction Documents or otherwise applicable to the Seller in
connection with the Trust have been paid or will be paid by the Seller at or
prior to the Closing Date or any subsequent Funding Date, as applicable, to the
extent then due, except for any such failures to pay which, individually and in
the aggregate, would not have a Material Adverse Effect;

(vii) the Trust has been duly created and is validly existing under the laws of
the State of Delaware and the Seller has authorized the Trust to issue and sell
the Purchased Note;

(viii) on the date hereof and on each subsequent Funding Date, the Seller is not
insolvent or the subject of any voluntary or involuntary bankruptcy proceeding;

(ix) no proceeds of a purchase hereunder will be used by the Seller (x) for a
purpose that violates or would be inconsistent with Regulations T, U or X
promulgated by the Board of Governors of the Federal Reserve System from time to
time or (y) to acquire any security in any transaction in violation of
Section 13 or 14 of the Securities Exchange Act of 1934, as amended;

(x) assuming the accuracy of the representations and warranties of the Investors
set forth herein, the sale of the Purchased Note pursuant to the terms of this
Agreement and the Indenture will not require registration of the Purchased Note
under the Act;

 

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(xi) neither the Trust nor the Seller is an “investment company” or is
controlled by an “investment company” within the meaning of the Investment
Company Act of 1940, as amended;

(xii) no written information furnished or to be furnished by the Seller or any
of its Affiliates, agents or representatives to the Investors or the Agent for
purposes of or in connection with this Agreement, including, without limitation,
any reports delivered pursuant to Section 5.02 and any information relating to
the Receivables and NFC’s retail receivables financing business, is or shall be
inaccurate in any material respect, or contains or shall contain any material
misstatement of fact, or omits or shall omit to state a material fact or any
fact necessary to make the statements contained therein not misleading, in each
case as of the date such information was or shall be stated or certified and as
of the date such information was delivered by the Seller or any of its
Affiliates, agents or representatives to the Investors or the Agent;

(xiii) the Indenture is not required to be qualified under the Trust Indenture
Act;

(xiv) (x) the Seller’s chief executive office and principal place of business
is, and has been at all times during the five years preceding the date of this
Agreement, located in the State of Illinois and (y) the Seller is a “registered
organization” (as defined in Section 9-102 of the UCC) incorporated in the State
of Delaware and, for purposes of Article 9 of the UCC, NFC is, and has been at
all times during the five years preceding the date of this Agreement, located in
the State of Delaware;

(b) NFC hereby makes the following representations and warranties to the
Investors and the Agent as of the Closing Date and as of each subsequent Funding
Date (except as to the Designated Receivables, which are made as of the date
such Designated Receivables were sold to the Seller) and the Investors and the
Agent shall be deemed to have relied on such representations and warranties in
purchasing the Purchased Note on the Closing Date and in making (or committing
to make) Incremental Fundings on any Funding Date:

(i) NFC repeats and reaffirms to the Investors and the Agent the
representations, warranties and covenants of the Servicer set forth in
Section 5.01 of the Servicing Agreement and the representations and warranties
of NFC set forth in the Section 5.01 and 5.03 of the Purchase Agreement and the
representations and warranties of NFC set forth in Section 3.01 and 3.02 the
Purchase Agreement and represents and warrants that all such representations and
warranties are true and correct as of such date;

(ii) no Governmental Action which has not been obtained is required by or with
respect to NFC in connection with any of the Transaction Documents, except any
such failure which would not have a Material Adverse Effect;

(iii) each of the Transaction Documents has been duly authorized, executed and
delivered by NFC, and is the valid and legally binding obligation of NFC,
enforceable against NFC in accordance with its terms, except that the
enforcement thereof may be subject to (x) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors’ rights generally and (y) general principles of equity and
the discretion of the court before which any proceeding therefor may be brought;

 

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(iv) the Purchased Note has been duly and validly authorized, and, when executed
and authenticated in accordance with the terms of the Indenture, and when
delivered to and paid for in accordance with this Agreement, will be duly and
validly issued and outstanding and will be entitled to the benefits of the
Indenture, except that the enforcement thereof may be subject to (x) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors’ rights generally and (y) general principles of
equity and the discretion of the court before which any proceeding therefor may
be brought;

(v) there is no pending or, to NFC’s knowledge, threatened action, suit or
proceeding by or against NFC or the Seller before any Governmental Authority or
any arbitrator (w) asserting the invalidity of this Agreement, any other
Transaction Document or the Purchased Note, (x) seeking to prevent the issuance
of the Purchased Note or the consummation of any of the transactions
contemplated by this Agreement or any other Transaction Document, (y) that might
materially and adversely affect the performance by any of NFC, the Seller or the
Trust of its obligations under, or the validity or enforceability of, this
Agreement, any other Transaction Document or the Purchased Note or (z) that if
determined adversely as to NFC, the Seller or the Trust would have a Material
Adverse Effect;

(vi) except for those caused by the failure of NFC and its affiliates to deliver
its financial statements and related financial information for the fiscal years
ended October 31, 2005, October 31, 2006 and October 31, 2007, or for the fiscal
quarters ended January 31, April 30 and July 31 of 2006, the fiscal quarters
ended January 31, April 30 and July 31 of 2007 or the fiscal quarters ended
January 31, April 30 and July 31 of 2008, in each case, prior to the earliest of
(1) November 30, 2008, (2) five (5) Business Days after the filing thereof with
the Commission and (3) the date on which such financial statements are (or any
of them is) required to be delivered pursuant to the Credit Agreement, NFC
(x) is not in violation of its Certificate of Incorporation or By-Laws and
(y) is not in breach or violation of any of the terms or provisions of, or with
the giving of notice or lapse of time, or both, would be in default under, any
contract, indenture, mortgage, deed of trust, loan agreement, note, lease,
partnership agreement, or other agreement or instrument to which NFC is a party
or by which it may be bound or to which any of its properties or assets may be
subject, except for such violations or defaults that would not have a Material
Adverse Effect;

(vii) any taxes, fees and other charges of Governmental Authorities applicable
to NFC in connection with the execution, delivery and performance by NFC of the
Transaction Documents or otherwise applicable to NFC in connection with the
Trust have been paid or will be paid by NFC at or prior to the Closing Date or
subsequent Funding Date, as applicable, to the extent then due, except for any
such failures to pay which, individually and in the aggregate, would not have a
Material Adverse Effect;

 

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(viii) the Trust has been duly created and is validly existing under the laws of
the State of Delaware;

(ix) on the date hereof, neither of the Trust or NFC is insolvent or the subject
of any insolvency proceeding;

(x) no written information furnished or to be furnished by NFC or its
Affiliates, agents or representatives to the Investors or the Agent for purposes
of or in connection with this Agreement, including, without limitation, any
reports delivered pursuant to Section 5.02 and any information relating to the
Receivables and NFC’s retail receivable financing business, is or shall be
inaccurate in any material respect, or contains or shall contain any material
misstatement of fact, or omits or shall omit to state a material fact or any
fact necessary to make the statements contained therein not misleading, in each
case as of the date such information was or shall be stated or certified, and
such information heretofore furnished remains true and correct in all material
respects as of the date such information was delivered by NFC or any of its
Affiliates, agents or representatives to the Investors or the Agent.

(xi) (x) NFC’s chief executive office and principal place of business is, and
has been at all times during the five (5) years preceding the date of this
Agreement, located in the State of Illinois and (y) NFC is a “registered
organization” (as defined in Section 9-102 of the UCC) incorporated in the State
of Delaware and, for purposes of Article 9 of the UCC, NFC is, and has been at
all times during the five years preceding the date of this Agreement, located in
the State of Delaware.

(c) The Note purchased by the Agent on behalf of the Investors pursuant to this
Agreement will be acquired for investment only and not with a view to any public
distribution thereof, and no Investor will offer to sell or otherwise dispose of
its interest in the Note so acquired by it (or any interest therein) in
violation of any of the registration requirements of the Act or any applicable
state or other securities laws. The Agent and each Investor acknowledges that it
has no right to require the Seller to register under the Act or any other
securities law the Note to be acquired by the Agent on behalf of such Investor
pursuant to this Agreement.

The Investors and the Agent have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of an
investment in the Note and the Investors are able to bear the economic risk of
such investment. The Investors and the Agent have reviewed the Pooling
Agreement, the Servicing Agreement and the Indenture (including the schedule and
exhibits thereto) and have had the opportunity to perform due diligence with
respect thereto and to ask questions of and receive answers from the Seller and
its representatives concerning the Seller, the Trust and the Note. Each of the
Investors and the Agent is an “accredited investor” as defined in Rule 501,
promulgated by the Securities and Exchange Commission (the “Commission”) under
the Securities Act of 1933, as amended.

(d) None of the Investors or the Agent is required to register as an “investment
company” nor are the Investors or the Agent controlled by an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.

 

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ARTICLE IV

Conditions

SECTION 4.01. Conditions Precedent.

(a) The obligation of the Agent, for the benefit of the Investors to purchase
the Purchased Note or to make any Incremental Fundings is subject to the
conditions precedent that (i) the Agent shall have received on or before the
Closing Date each of the Transactions Documents, (ii) the Agent shall have
received the certificates, opinions, lien searches and other items listed on
Exhibit A hereto, (iii) the Agent shall have received all fees and expenses
required to be paid on such date pursuant to the terms of this Agreement and the
Fee Letter and (iv) all conditions precedent under the Indenture and the other
Transaction Documents shall have been satisfied.

(b) The funding of the Initial Invested Amount shall be subject to the further
conditions precedent that:

(i) the Agent has received copies of all settlement statements and all reports
required to be delivered by the Servicer to the pursuant to Section 2.17 of the
Servicing Agreement;

(ii) each of the representations and warranties of the Seller and the Servicer
made herein and of the Trust made in the Transaction Documents shall be true and
correct in all material respects as of the Closing Date (except to the extent
they expressly relate to an earlier or later time);

(iii) the Seller, the Trust and the Servicer shall be in compliance in all
material respects with all of their respective covenants contained in the
Transaction Documents;

(iv) no Event of Default shall have occurred and be continuing and no Event of
Default shall occur as a result of funding the Initial Invested Amount, and no
event shall have occurred and be continuing or shall occur as a result of
funding such Initial Invested Amount which has had or is reasonably likely to
have a Material Adverse Effect with respect to the Seller, the Servicer, the
Trust or NFC; and

(v) the Aggregate Starting Receivables Balance shall equal or exceed
$414,295,534.82.

(c) The funding of any Incremental Funding shall be subject to the condition
precedent that:

(i) the Agent has received copies of all settlement statements and all reports
required to be delivered by the Servicer to the pursuant to Section 2.17 of the
Servicing Agreement;

(ii) each of the representations and warranties of the Seller and the Servicer
made herein and of the Trust made in the Transaction Documents shall be true and
correct in all material respects as of such Funding Date (except to the extent
they expressly relate to an earlier or later time);

 

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(iii) the Seller, the Trust and the Servicer shall be in compliance in all
material respects with all of their respective covenants contained in the
Transaction Documents;

(iv) no Event of Default shall have occurred and be continuing and no Event of
Default shall occur as a result of funding such Incremental Funding; and no
event shall have occurred and be continuing or shall occur as a result of
funding such Incremental Funding which has had or is reasonably likely to have a
Material Adverse Effect with respect to the Seller, the Servicer, the Trust or
NFC;

(v) the aggregate Funded Amount (after giving effect to any such Incremental
Funding) shall not exceed the Maximum Net Investment;

(vi) the Agent shall have received (1) opinions of legal counsel for each of
Truck Retail Instalment Paper Corp., NFC, NFRRC and the Issuer (which may
include in-house counsel) reasonably acceptable to the Agent which address UCC,
bankruptcy and such other matters as the Agent may reasonably request in form
and substance substantially similar as given on the Closing Date, (2) copies of
proper financing statements or releases with respect to previously filed
financing statements, duly filed on or before the date of such Incremental
Funding under the UCC of all jurisdictions that the Agent may deem necessary or
desirable in order to perfect the ownership and security interests contemplated
by this Agreement and the other Transaction Documents and (3) such other
certificates or documentation reasonably requested by the Agent;

(vii) neither the Funding Period Expiration Date nor the Facility Termination
Date shall have occurred; and

(viii) the Indenture Trustee shall have delivered to the Agent and the Servicer,
on or prior to such Funding Date, a certificate signed by one or more of its
officers and stating that each of the representations and warranties of the
Indenture Trustee set forth in Section 6.13 of the Indenture are true and
correct in all material respects as of such Funding Date (as if made on such
date).

ARTICLE V

Covenants of the Seller and Servicer

SECTION 5.01. Access. Notwithstanding anything to the contrary contained in any
Transaction Document, so long as the Purchased Note remains outstanding, each of
NFC and the Seller will, at any time from time to time during regular business
hours with reasonable notice to the Seller and NFC, permit the Investors or the
Agent, or their agents or representatives to:

(a) examine all books, records and documents (including computer tapes and
disks) in the possession or under the control of the Seller or NFC relating to
the Receivables, and

 

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(b) visit the offices and property of the Seller or NFC for the purpose of
examining such materials described in clause (a) above;

it being understood that except as provided in Section 8.12, any information
obtained by an Investor or the Agent pursuant to this Section 5.01 shall be held
in confidence by the Investors and the Agent unless and to the extent such
information (i) has become available to the public, (ii) is required or
requested by any Governmental Authority or in any court proceeding or (iii) is
required by any Governmental Rule. In the case of any disclosure permitted by
clause (ii) or (iii) an Investor and the Agent shall use commercially reasonable
efforts to (x) provide the Seller with advance notice of any such disclosure and
(y) cooperate with the Seller in limiting the extent or effect of any such
disclosure.

SECTION 5.02. Information from NFC. So long as the Purchased Note remains
outstanding, NFC will furnish to the Agent:

(a) a copy of each certificate, opinion, report, statement, notice or other
communication (other than investment instructions) furnished by or on behalf of
NFC or the Seller to the Indenture Trustee under any Transaction Document,
concurrently therewith, and promptly after receipt thereof, a copy of each
notice, demand or other communication received by or on behalf of NFC or the
Seller under any Transaction Document;

(b) such other information (including financial information), documents, records
or reports respecting the Trust, the Receivables, the Seller or, to the extent
it relates to the origination of Receivables or the servicing of the Trust, NFC,
as the Investors or Agent may from time to time reasonably request;

(c) (I) except as provided in immediately succeeding clause (II), as soon as
available and in any event within (i) 45 days after the end of each of the first
three fiscal quarters of any fiscal year and (ii) 120 days after the end of the
last fiscal quarter of any fiscal year, copies of the interim or annual, as
applicable, financial statements of NFC, prepared in conformity with generally
accepted accounting principles consistently applied (and, solely in the case of
the financial statements described in clause (ii), above, prepared by a
nationally recognized independent accounting firm) and (II) on or before the
earliest of (1) November 30, 2008, (2) five (5) Business Days after the filing
thereof with the Commission and (3) the date on which such financial statements
are (or any of them is) required to be delivered pursuant to the Credit
Agreement, copies of the interim or annual, as applicable, financial statements
of NFC for the fiscal years ended October 31, 2005, October 31, 2006 and
October 31, 2007, for the fiscal quarters ended January 31, April 30 and July 31
of 2006, the fiscal quarters ended January 31, April 30 and July 31 of 2007 and
the fiscal quarters ended January 31, April 30 and July 31 of 2008, in each
case, prepared in conformity with generally accepted accounting principles
consistently applied; and

(d) as soon as possible and in any event within two Business Days after
knowledge thereof by a Responsible Officer of NFC, notice of each Event of
Default or event which with the giving of notice or the passage of time or both
would constitute an Event of Default.

 

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SECTION 5.03. Security Interests; Further Assurances. The Seller will take all
action reasonably necessary to maintain the Indenture Trustee’s first priority
perfected security interest in the Receivables and the other Collateral (to the
extent it constitutes Code Collateral) granted pursuant to the Indenture. The
Seller agrees to take any and all acts and to execute any and all further
instruments necessary or reasonably requested by the Investors or the Agent to
more fully effect the purposes of this Agreement.

SECTION 5.04. Conduct of Business. The Seller and the Servicer shall do all
things necessary to remain duly incorporated, validly existing and in good
standing as a domestic corporation (or other business entity) in its
jurisdiction of incorporation (or formation) and the Seller will cause the Trust
to do all things necessary to remain duly organized, validly existing and in
good standing as a statutory trust in the State of Delaware. The Servicer shall
maintain all requisite authority to conduct its business in each jurisdiction in
which its business requires such authority except, in each case, where the
failure to do so does not, and is not reasonably expected to, have a Material
Adverse Effect.

SECTION 5.05. Compliance with Laws. The Seller and the Servicer shall comply in
all material respects with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject or which
are applicable to the Collateral except where the failure to so comply does not,
and is not reasonably expected to, have a Material Adverse Effect.

SECTION 5.06. Replacement of Trustee. If at any time the identity of the Owner
Trustee and the Indenture Trustee is such that the Trust Indenture Act would
require the replacement of the Owner Trustee and/or the Indenture Trustee
(assuming for this purpose that the Indenture were required to be qualified
thereunder), then the Seller shall (or shall cause the Issuer to) so replace the
Owner Trustee and/or the Indenture Trustee, as applicable, in each case, within
180 days following the event which precipitated such replacement, with an Owner
Trustee and/or Indenture Trustee, as applicable, reasonably satisfactory to the
Agent.

SECTION 5.07. Compliance with Opinion Assumptions. Each of the Seller and NFC
shall at all times (as to itself) conduct its affairs in all material respects
in accordance with the factual assumptions applicable to it set forth in, and
forming the basis of, the bankruptcy opinion(s) of Kirkland & Ellis delivered
pursuant to Section 4.01(a).

SECTION 5.08. Further Covenants. Each of the Seller and NFC will duly observe
and perform each of its covenants set forth in the other Transaction Documents
in all material respects.

SECTION 5.09. Amendments. Neither the Seller nor NFC will make, or permit any
Person to make, any amendment, modification or change to, or provide any waiver
under any Transaction Document without the prior written consent of the Agent.

 

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ARTICLE VI

Indemnification

SECTION 6.01. Indemnities by the Seller, NFC and the Servicer. Without limiting
any other rights that the Agent or any Investor may have hereunder or under
applicable law, (A) the Seller and NFC (in its capacity as seller under the
Purchase Agreement) hereby agree to indemnify (and pay upon demand to) the Agent
and each Investor and their respective assigns, officers, directors, agents and
employees (each an “Indemnified Party”) from and against any and all damages,
losses, claims, taxes, liabilities, costs, expenses and for all other amounts
payable, including reasonable attorneys’ fees (which attorneys may be employees
of the Agent or such Investor) and disbursements (all of the foregoing being
collectively referred to as “Indemnified Amounts”) awarded against or incurred
by any of them arising out of or as a result of this Agreement or the
acquisition, either directly or indirectly, by an Investor of the Notes (or any
interest therein), and (B) the Servicer hereby agrees to indemnify (and pay upon
demand to) each Indemnified Party for Indemnified Amounts awarded against or
incurred by any of them arising out of the Servicer’s activities as Servicer
excluding, however, in all of the foregoing instances under the preceding
clauses (A) and (B):

(i) Indemnified Amounts to the extent such Indemnified Amounts resulted from
gross negligence or willful misconduct on the part of the Indemnified Party
seeking indemnification;

(ii) Indemnified Amounts to the extent arising from the acts or omissions of a
successor Servicer;

(iii) Indemnified Amounts to the extent the same includes losses in respect of
Receivables that are uncollectible as a result of credit worthiness of the
related Obligors; or

(iv) taxes imposed by any jurisdiction in which such Indemnified Party is or
would be subject to tax (unless such tax arises solely as a result of the
transactions contemplated by this Agreement) on or measured by the overall net
income of such Indemnified Party to the extent that the computation of such
taxes is consistent with the characterization for income tax purposes of the
acquisition by the Investors of interests in the Purchased Note as a loan or
loans by the Investors to Seller secured by the Receivables;

provided, however, that nothing contained in this sentence shall limit the
liability of the Seller or NFC or limit the recourse of the Agent or the
Investors to the Seller or NFC for amounts otherwise specifically provided to be
paid by the Seller or NFC under the terms of this Agreement or any other
Transaction Document.

SECTION 6.02. Increased Cost and Reduced Return. If after the date hereof, any
Investor shall be charged any fee, expense or increased cost on account of the
adoption of any applicable law, rule or regulation (including any applicable
law, rule or regulation regarding capital adequacy) or any change therein, or
any change in the interpretation

 

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or administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof or
any accounting board or authority (whether or not part of government) which is
responsible for the establishment or interpretation of national or international
accounting principles, or compliance with any request or directive (whether or
not having the force of law) of any such authority, central bank or comparable
agency or accounting board or authority (a “Regulatory Change”): (i) that
subjects any Investor to any charge, increased capital costs or withholding on
or with respect to this Agreement or any Program Support Agreement or an
Investor’s obligations under this Agreement or a Program Support Agreement, or
on or with respect to the Receivables, or changes the basis of taxation of
payments to any Investor of any amounts payable under this Agreement or any
Program Support Agreement (except for changes in the rate of tax on the overall
net income of an Investor) or taxes excluded by Section 6.01 or (ii) that
imposes, modifies or deems applicable any reserve, assessment, insurance charge,
special deposit or similar requirement against assets of, deposits with or for
the account of an Investor, or credit extended by an Investor pursuant this
Agreement or a Program Support Agreement or (iii) that imposes any other
condition the result of which is to increase the cost to an Investor of
performing its obligations under this Agreement or a Program Support Agreement,
or to reduce the rate of return on an Investor’s capital as a consequence of its
obligations under this Agreement or a Program Support Agreement, or to reduce
the amount of any sum received or receivable by an Investor under this Agreement
or a Program Support Agreement or to require any payment calculated by reference
to the amount of interests or loans held or interest received by it, then, upon
demand by the Agent, Seller shall pay to the Agent, for the benefit of the
relevant Investor, such amounts charged to such Investor or such amounts to
otherwise compensate such Investor for such increased cost or such reduction.

SECTION 6.03. Other Costs and Expenses. In addition to its obligations under
Section 6.01 and 6.02, Seller agrees to pay within three Business Days of
demand:

(a) all reasonable out-of-pocket costs and expenses incurred by the Agent and
the Investors in connection with due diligence, negotiation, preparation,
execution and delivery, the amendment to, or waiver of, or the enforcement of,
or any breach by NFC or NFRRC of, this Agreement and the other Transaction
Documents, including, without limitation (i) the reasonable fees and expenses of
outside counsel to any of such Persons incurred in connection with any of the
foregoing or in advising such Persons as to their respective rights and remedies
under any of the Transaction Documents in connection with any of the foregoing,
and (ii) all reasonable out-of-pocket expenses (including reasonable fees and
expenses of independent accountants (it being understood that if no Event of
Default has occurred, the Seller shall be responsible for the reasonable
out-of-pocket costs and expenses of one audit of its financial records per year
related to the transactions contemplated herein or in the other Basic Documents
and if an Event of Default has occurred, the Seller shall be responsible for the
reasonable out-of-pocket costs and expenses of such audits of its financial
records related to the transactions contemplated herein or in the other Basic
Documents as the Agent may request)), incurred in connection with any review of
the books and records of the Seller, NFC or their Affiliates either prior or
subsequent to the execution and delivery hereof; and

(b) all stamp and other taxes and fees payable or determined to be payable in
connection with the execution, delivery, filing and recording of this Agreement
or the other Transaction Documents, and agrees to indemnify each Indemnified
Party against any liabilities with respect to or resulting from any delay in
paying or omission to pay such taxes and fees.

 

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ARTICLE VII

The Agent

SECTION 7.01. Authorization and Action. Each Investor hereby irrevocably
appoints, designates and authorizes the Agent to take such action on its behalf
under the provisions of this Agreement and each other Transaction Document and
to exercise such powers and perform such duties as are expressly delegated to
the Agent by the terms of this Agreement and any other Transaction Document,
together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere in this
Agreement or in any other Transaction Document, the Agent shall not have any
duties or responsibilities, except those expressly set forth in this Agreement,
nor shall the Agent have or be deemed to have any fiduciary relationship with
any Investor, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other
Transaction Document or otherwise exist against the Agent. Without limiting the
generality of the foregoing sentence, the use of the term “agent” in this
Agreement with reference to the Agent is not intended to connote any fiduciary
or other implied (or express) obligations arising under agency doctrine of any
applicable law. Instead, such term is used merely as a matter of market custom,
and is intended to create or reflect only an administrative relationship between
independent contracting parties.

SECTION 7.02. Delegation of Duties. The Agent may execute any of its duties
under this Agreement or any other Transaction Document by or through agents,
employees or attorneys-in-fact and shall be entitled to the advice of counsel
concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agent or attorney-in-fact
that it selects with reasonable care.

SECTION 7.03. Liability of Agent. No Agent-Related Person shall (i) be liable
for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Transaction Document or the
transactions contemplated hereby (except for its own gross negligence or willful
misconduct), or (ii) be responsible in any manner to any Investor for any
recital, statement, representation or warranty made by the Seller, the Servicer,
the Indenture Trustee, or any officer thereof, contained in this Agreement or in
any other Transaction Document, or in any certificate, report, statement or
other document referred to or provided for in, or received by the Agent under or
in connection with, this Agreement or any other Transaction Document, or the
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Transaction Document, or for any failure of the Seller,
the Servicer, the Indenture Trustee, or any other party to any Transaction
Document to perform its obligations hereunder or thereunder. No Agent-Related
Person shall be under any obligation to any Investor to ascertain or to inquire
as to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Transaction Document, or to inspect
the properties, books or records of the Seller, the Servicer, the Indenture
Trustee, or any of their respective Affiliates.

 

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SECTION 7.04. Reliance by Agent.

(a) The Agent shall be entitled to rely, and shall be fully protected in
relying, upon any writing, resolution, notice, consent, certificate, affidavit,
letter, telegram, facsimile, telex or telephone message, statement or other
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by or on behalf of the proper Person or Persons, and
upon advice and statements of legal counsel (including counsel to the Seller,
the Servicer and the Indenture Trustee), independent accountants and other
experts selected by the Agent. The Agent shall be fully justified in failing or
refusing to take any action under this Agreement or any other Transaction
Document unless it shall first receive such advice or concurrence of the Conduit
Investors (and, if required by any Program Support Agreement, the requisite
Program Support Providers) as it deems appropriate and, if it so requests, it
shall first be indemnified to its satisfaction by the Investors against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or any
other Transaction Document in accordance with a request or consent of the
Conduit Investors (and, if required by any Program Support Agreement, the
requisite Program Support Providers) or, if required hereunder, all Investors
and such request and any action taken or failure to act pursuant thereto shall
be binding upon all of the Investors.

(b) For purposes of determining compliance with the conditions specified in
Article IV on the Closing Date or any subsequent Funding Date, each Investor
that has executed this Agreement or transferred funds to the Agent in the case
of a Funding Date shall be deemed to have consented to, approved or accepted or
to be satisfied with, each document or other matter either sent by the Agent to
such Investor for consent, approval, acceptance or satisfaction, or required
thereunder to be consented to or approved by or acceptable or satisfactory to
such Investor.

SECTION 7.05. Notice of Event of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of an Event of Default or an event which,
with the giving of notice or passage of time, or both, would constitute an Event
of Default unless the Agent has received written notice from an Investor
referring to this Agreement, describing such Event of Default or event which,
with the giving of notice or passage of time, or both, would constitute an Event
of Default stating that such notice is a “Notice of Event of Default”. The Agent
will notify the Investors of its receipt of any such notice. The Agent shall
(subject to Section 7.04) take such action with respect to such Event of Default
or event which, with the giving of notice or passage of time, or both, would
constitute an Event of Default as may be requested by the Conduit Investors
(and, if required by any Program Support Agreement, the requisite Program
Support Providers), provided, that, unless and until the Agent shall have
received any such request, the Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Event of
Default or event which, with the giving of notice or passage of time, or both,
would constitute an Event of Default as it shall deem advisable or in the best
interest of the Investors.

SECTION 7.06. Credit Decision; Disclosure of Information by the Agent. Each
Investor acknowledges that none of the Agent-Related Persons has made any
representation or warranty to it, and that no act by the Agent hereinafter
taken, including any consent to and

 

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acceptance of any assignment or review of the affairs of the Seller, the
Servicer, the Indenture Trustee, or any of their respective Affiliates, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Investor as to any matter, including whether the Agent-Related Persons
have disclosed material information in their possession. Each Investor,
including any Investor by assignment, represents to the Agent that it has,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of the Seller, the
Servicer or the Indenture Trustee, or their respective Affiliates, and all
applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to the Seller hereunder. Each Investor also represents that it shall,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Transaction Documents, and
to make such investigations as it deems necessary to inform itself as to the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Seller, the Servicer or the Indenture Trustee. Except
for notices, reports and other documents expressly herein required to be
furnished to the Investors by the Agent herein, the Agent shall not have any
duty or responsibility to provide any Investor with any credit or other
information concerning the business, prospects, operations, property, financial
and other condition or creditworthiness of the Seller, the Servicer, the
Indenture Trustee, or their respective Affiliates which may come into the
possession of any of the Agent-Related Persons.

SECTION 7.07. Indemnification of the Agent. Whether or not the transactions
contemplated hereby are consummated, the Program Support Providers shall
indemnify upon demand each Agent-Related Person, pro rata, and hold harmless
each Agent-Related Person from and against any and all damages, losses, claims,
liabilities, costs and expenses, including reasonable attorneys’ fees (which
such attorneys may be employees of the Program Support Providers or the Agent)
and disbursements awarded against or incurred by it; provided, that no Program
Support Provider shall be liable for the payment to any Agent-Related Person of
any portion of such amounts resulting from such Person’s gross negligence or
willful misconduct; provided, further, that no action taken in accordance with
the directions of the Conduit Investors (and, if required by any Program Support
Agreement, the requisite Program Support Providers) shall be deemed to
constitute gross negligence or willful misconduct for purposes of this Section.
Without limitation of the foregoing, each Program Support Provider shall
reimburse the Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including attorney’s fees) incurred by the Agent in
connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Transaction Document, or any
document contemplated by or referred to herein. The undertaking in this Section
shall survive payment in full of the Note and the resignation or the replacement
of the Agent.

SECTION 7.08. Agent in Individual Capacity. CNAI (and any successor acting as
Agent) and its Affiliates may make loans to, issue letters of credit for the
account of, accept deposits from, acquire equity interests in and generally
engage in any kind of banking, trust, financial advisory, underwriting or other
business with any of the Seller, the Servicer, the

 

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Indenture Trustee, or any of their Affiliates as though CNAI were not the Agent
hereunder and without notice to or consent of the Investors. The Investors
acknowledge that, pursuant to such activities, CNAI or its Affiliates may
receive information regarding the Seller, the Servicer, the Indenture Trustee,
or their respective Affiliates (including information that may be subject to
confidentiality obligations in favor of such Person) and acknowledge that the
Agent shall be under no obligation to provide such information to them.

SECTION 7.09. Resignation of Agent. The Agent may resign as Agent upon thirty
(30) days’ notice to the Investors. If the Agent resigns under this Agreement,
the Investors shall appoint from among the Program Support Providers a successor
agent for the Investors. If no successor agent is appointed prior to the
effective date of the resignation of the Agent, the Agent may appoint, after
consulting with the Investors, a successor agent from among the Program Support
Providers. Upon the acceptance of its appointment as successor agent hereunder,
such successor agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term “Agent” shall mean such successor agent and the
retiring Agent’s appointment, powers and duties as Agent shall be terminated.
After any retiring Agent’s resignation hereunder as Agent, the provisions of
this Section 7.09 and Sections 7.03 and 7.07 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was the Agent under this
Agreement. If no successor agent has accepted appointment as Agent by the date
which is thirty (30) days following a retiring Agent’s notice of resignation,
the retiring Agent’s resignation shall nevertheless thereupon become effective
and the Program Support Providers shall perform all of the duties of the Agent
hereunder until such time, if any, as the Investors appoint a successor agent as
provided for above; provided that until such time as a successor agent shall
have been appointed, the resigning Agent shall continue to hold the Purchased
Note as “nominee” for the Investors.

SECTION 7.10. Payments by the Agent. Unless specifically allocated to an
Investor pursuant to the terms of this Agreement, all amounts received by the
Agent on behalf of the Investors shall be paid by the Agent to the Investors pro
rata in accordance with their respective outstanding funded portions of the
Funded Amount on the Business Day received by the Agent, unless such amounts are
received after 12:00 noon on such Business Day, in which case the Agent shall
use its reasonable efforts to pay such amounts to the Investors on such Business
Day, but, in any event, shall pay such amounts to the Investors not later than
the following Business Day.

ARTICLE VIII

Miscellaneous

SECTION 8.01. Assignment.

(a) This Agreement shall be binding on the parties hereto and their respective
successors and assigns; provided, that the Seller may not assign any of its
rights or delegate any of its duties hereunder without the prior written consent
of the Agent. Each Conduit Investor may only assign, participate, grant security
interest in, or otherwise transfer any portion of its Note Interest as provided
in clauses (b) or (c) below. No provision of this Agreement shall in any manner
restrict the ability of any Program Support Provider to assign, participate,
grant security

 

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interests in, or otherwise transfer any portion of its Note Interest, provided
that any such transfer shall be in accordance with the terms of the Indenture.
All costs and expenses of the Agent incurred in connection with any assignment
hereunder shall be borne by the Seller.

(b) The Conduit Investors may, from time to time, in one transaction or a series
of transactions, assign, participate, grant security interests in, or otherwise
transfer all or a portion of its Note Interest and its rights and obligations
under this Agreement and any other Transaction Document to which it is a party
(x) without the consent of the Seller or any other Person, (i) to a Conduit
Assignee, (ii) to any Program Support Provider or (iii) to any other commercial
paper conduit which satisfies the Assignee Rating Criteria and (y) with the
consent of the Seller (such consent not to be unreasonably withheld or delayed),
to any Person not described in preceding clause (x); provided, that, the Conduit
Investors may, during the continuance of an Event of Default, assign,
participate, grant security interests in, or otherwise transfer all or a portion
of its Note Interest and its rights and obligations under this Agreement and any
other Transaction Document to which it is a party, in each case, without the
consent of the Seller or any other Person. Subject to the transfer restrictions
set forth in the Indenture, upon and to the extent of such assignment or other
transfer by a Conduit Investor, (i) such assignee shall be the owner of the
assigned or transferred portion of the Note Interest, (ii) if such assignee is a
Conduit Assignee (or another commercial paper conduit), such Conduit Assignee
(or other commercial paper conduit) and its liquidity support provider(s) and
credit support provider(s) and other related parties shall have the benefit of
all the rights and protections provided to the applicable Conduit Investor and
its Program Support Provider(s) herein and in the other Transaction Documents
(including any limitation on recourse against such Conduit Assignee (or other
commercial paper conduit) or related parties, any agreement not to file or join
in the filing of a petition to commence an insolvency proceeding against such
Conduit Assignee (or other commercial paper conduit), and the right to assign or
otherwise transfer to another Conduit Assignee (or commercial paper conduit) as
provided in this paragraph), (iii) such assignee shall assume all (or the
assigned or assumed portion) of the applicable Conduit Investor’s obligations,
if any, hereunder or under any other Transaction Document, and such Conduit
Investor shall be released from such obligations, in each case to the extent of
such assignment, and the obligations of such Conduit Investor and such assignee
shall be several and not joint, (iv) all distributions in respect of its Note
Interest shall be made to the Agent, on behalf of the applicable Conduit
Investor and such assignee according to their respective Note Interests, (v) the
defined terms and other terms and provisions of this Agreement and the other
Transaction Documents shall be interpreted in accordance with the foregoing, and
(vi) if requested by the Agent with respect to the assignee, the parties will
execute and deliver such further agreements and documents and take such other
actions as the Agent may reasonably request to evidence and give effect to the
foregoing.

(c) Notwithstanding any other provision of this Section 8.01 or otherwise in
this Agreement, any Investor (or any Program Support Provider of any Investor)
may at any time pledge or grant a security interest in all or any portion of its
rights (including, without limitation, rights to payment of interest and
repayment of Note) under this Agreement to secure obligations of such Investor
or Program Support Provider to a Federal Reserve Bank, without notice to or
consent of any Person; provided, that no such pledge or grant of a security
interest shall release a Investor or Program Support Provider from any of its
obligations hereunder or substitute any such pledgee or grantee for such
Investor or Program Support Provider as a party hereto.

 

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SECTION 8.02. Notices. Except in the case of notices and other communications
expressly permitted to be given by telephone, all notices and other
communications provided for herein shall be in writing and shall be delivered by
hand or overnight courier service or sent by telecopy or by e-mail (if the
recipient has provided an e-mail address), as follows:

(a) if to the Seller or the Servicer, at its address or telecopy number set
forth in Appendix B to the Pooling Agreement;

(b) if to the Conduit Investor or Committed Investor:

 

  CAFCO, LLC/CRC FUNDING, LLC         c/o Citicorp North America, Inc.        
388 Greenwich Street, 19th Floor         New York, New York 10013        
Attention: James Huddleston         Email:   james.r.huddleston@citi.com        
  Phone:   (212) 816-0674           Fax:   (646) 843-3657        

(c) if to the Agent:

 

  Citicorp North America, Inc.         388 Greenwich Street, 19th Floor        
New York, New York 10013         Attention: James Huddleston         Email:  
james.r.huddleston@citi.com           Phone:   (212) 816-0674           Fax:  
(646) 843-3657        

All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on the
date of receipt.

SECTION 8.03. Waivers; Amendments.

(a) No waiver of any provision of this Agreement or consent to any departure by
the Seller therefrom shall in any event be effective unless the same shall be
permitted by Section 8.03(b), and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which given. Without
limiting the generality of the foregoing, the Funding of the Purchased Note
shall not be construed as a waiver of any Event of Default, regardless of
whether the Indenture Trustee, the Seller, the Servicer, the Agent or the
Conduit Investors may have had notice or knowledge of such Event of Default at
the time.

(b) Any provision of the Agreement may be amended or waived by (x) the Seller or
Servicer if, but only if, it is in writing and signed by such Person and (y) the
Agent and

 

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the Investors, if, but only if, it is in writing and signed by the Agent and the
Conduit Investors. Any consent or other election or action to be taken by an
Investor pursuant to the Indenture shall be taken by the Agent as registered
Holder of the Purchased Note, in each case with the consent of the applicable
Investors (the Seller shall have no obligation to inquire as to such consent and
may rely on any consent, election or action taken by the Agent as such Holder).

(c) No waiver, amendment or modification of the Transaction Documents or any
other agreement referred to herein or therein to which the Seller is a party
(other than this Agreement) shall affect any of the rights or obligations under
this Agreement of any party hereto unless such party has given its written
consent to such waiver, amendment or modification.

(d) A failure or delay in exercising any right, power or privilege in respect of
this Agreement will not be presumed to operate as a waiver, and a single or
partial exercise of any right, power or privilege will not be presumed to
preclude any subsequent or further exercise, of that right, power or privilege
or the exercise of any other right, power or privilege.

SECTION 8.04. Survival. All covenants, agreements, representations and
warranties made by the Seller and the Servicer herein and in the certificates or
other instruments delivered in connection with or pursuant to this Agreement
shall be considered to have been relied upon by the other parties hereto and
shall survive the execution and delivery of this Agreement and the funding of
the Purchased Note, regardless of any investigation made by any such other party
or on its behalf and notwithstanding that the Indenture Trustee, the Agent or
the Conduit Investors may have had notice or knowledge of any Event of Default
or incorrect representation or warranty at the time any credit is extended
hereunder, and shall continue in full force and effect as long as the Note or
any amount payable under this Agreement is outstanding and unpaid.

SECTION 8.05. Counterparts; Integration; Effectiveness. This Agreement may be
executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when
taken together shall constitute a single contract. This Agreement, the Indenture
and the other Transaction Documents constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof. This Agreement shall become effective when it shall have been executed
by each of the parties hereto and thereafter this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. Delivery of an executed counterpart of a signature page
of this Agreement by telecopy shall be effective as delivery of a manually
executed counterpart of this Agreement.

SECTION 8.06. Severability. Any provision of this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction.

 

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SECTION 8.07. Governing Law; Jurisdiction; Consent to Service of Process; Waiver
of Jury Trial Right.

(a) This Agreement shall be construed in accordance with the laws of the State
of Illinois, without reference to its conflict of laws provisions (other than
735 ILCS 105/5-5), and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.

(b) TO THE EXTENT PERMITTED BY LAW, EACH OF THE PARTIES TO THIS AGREEMENT HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

(c) EACH OF THE PARTIES HERETO HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION
OF THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS AND OF
ANY ILLINOIS STATE COURT SITTING IN THE CITY OF CHICAGO FOR PURPOSES OF ALL
LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, ANY OBJECTION WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING
BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A
COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING IN THIS SECTION 8.07(c)
SHALL AFFECT THE RIGHT OF ANY PARTY TO BRING ANY ACTION OR PROCEEDING AGAINST
ANY OTHER PARTY OR ITS RESPECTIVE PROPERTIES IN THE COURTS OF OTHER
JURISDICTIONS.

SECTION 8.08. No Bankruptcy Petition Against the Conduit Investors. Each of the
Investors, the Agent, the Seller and the Servicer hereby covenants and agrees
that, prior to the date which is one year and one day (or the then applicable
preference period) after the payment in full of all outstanding Promissory Notes
or other rated indebtedness of all Conduit Investors, it will not institute
against, or join any other Person in instituting against, any Conduit Investor
any proceeding of a type referred to in the definition of Event of Bankruptcy.

SECTION 8.09. Benefits of Indenture. Each of the Seller and the Servicer hereby
acknowledges and confirms that each representation, warranty, covenant and
agreement made pursuant to the Indenture by the Seller and the Servicer is also
made herein, all for the benefit and security of the Investors and the Agent.

SECTION 8.10. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

SECTION 8.11. No Recourse Against Conduit Investors, Members, Officers or
Directors. Notwithstanding anything to the contrary contained in this Agreement,
the obligations of each Conduit Investor under this Agreement and all other
Transaction Documents are solely the corporate obligations of such Conduit
Investor and shall be payable solely to the extent of funds received in
accordance herewith or from any party to any Transaction Document in accordance
with the terms thereof in excess of funds necessary to pay matured and maturing

 

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Promissory Notes. No recourse under any obligation, covenant or agreement of any
Conduit Investors contained in this Agreement shall be had against any
stockholder, member, employee, officer, director or incorporator of such Conduit
Investor or any beneficial owner of any of them, as such, by the enforcement of
any assessment or by any legal or equitable proceeding, by virtue of any statute
or otherwise; it being expressly agreed and understood that this Agreement is
solely a corporate obligation of such Conduit Investor, and that no personal
liability whatsoever shall attach to or be incurred by the any stockholder,
member, employee, officer, director or incorporator of such Conduit Investor or
any beneficial owner of any of them, as such, under or by reason of any of the
obligations, covenants or agreements of such Conduit Investor contained in this
Agreement, or implied therefrom, and that any and all personal liability for
breaches by the Conduit Investor of any of such obligations, covenants or
agreements, either at common law or at equity, or by statute or constitution, of
every such stockholder, member, employee, officer, director or incorporator of
such Conduit Investor or any beneficial owner of any of them, as such, is hereby
expressly waived as a condition of and consideration for the execution of this
Agreement; provided, that this Section 8.11 shall not relieve any such
stockholder, member, employee, officer, director or incorporator of the Conduit
Investor or any beneficial owner of any of them, as such, of any liability it
might otherwise have for its own intentional misrepresentation or willful
misconduct.

SECTION 8.12. Waiver of Confidentiality. Each of the Seller and the Servicer
hereby consents to the disclosure of any non-public information with respect to
it received by the Agent or any Investor to (i) the Agent, any nationally
recognized statistical rating organization rating a Conduit Investor’s
Promissory Notes, any Program Support Provider or other Person providing
financing to, or any member or other Person holding equity interests in, a
Conduit Investor or any of the foregoing Person’s counsel or accountants in
relation to this Agreement or any other Transaction Document (as long as each of
the foregoing Persons has been advised to keep such information confidential);
and (ii) with the Seller’s and the Servicer’s consent (such consent not to be
unreasonably withheld or delayed), any other Investor or potential Investor.

SECTION 8.13. Confidentiality Agreement. Each of the Seller and the Servicer
hereby agrees that it will not disclose the contents of this Agreement or any
other Transaction Document or any other proprietary or confidential information
of or with respect to any Investor, the Agent or any Program Support Provider to
any other Person except (a) its auditors and attorneys, employees or financial
advisors (other than any commercial bank) and any nationally recognized
statistical rating organization, provided such auditors, attorneys, employees,
financial advisors or rating agencies are informed of the highly confidential
nature of such information, (b) as otherwise required by applicable law or order
of a court of competent jurisdiction, including its regulators, (c) in
connection with any proceeding brought by or against it with respect to this
Agreement or the related transactions contemplated hereby, (d) in any offering
circular prepared for the issuance and sale of the Note, if such disclosure has
been reviewed and agreed to by the Investors and the Agent and (e) that the
Seller and Servicer may file copies of the Transaction Documents (other than the
Fee Letter) with the Commission.

SECTION 8.14. Excess Funds. Notwithstanding any provisions contained in this
Agreement to the contrary, a Conduit Investor shall not, and shall not be
obligated to, pay any amount pursuant to this Agreement unless (i) the Conduit
Investor has received funds which

 

32

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may be used to make such payment and which funds are not required to repay its
Promissory Notes when due and (ii) after giving effect to such payment, either
(x) the Conduit Investor could issue Promissory Notes to refinance all of its
outstanding Promissory Notes (assuming such outstanding Promissory Notes matured
at such time) in accordance with the program documents governing the Conduit
Investor’s securitization program or (y) all of such Conduit Investor’s
Promissory Notes are paid in full. Any amount which the Conduit Investor does
not pay pursuant to the operation of the preceding sentence shall not constitute
a claim (as defined in § 101 of the United States Bankruptcy Code) against or
corporate obligation of the Conduit Investor for any such insufficiency unless
and until the Conduit Investor satisfies the provisions of clauses (i) and
(ii) above. This Section shall survive the termination of this Agreement.

SECTION 8.15. Limitation of Liability. No claim may be made by the Issuer,
Seller, NFC, the Servicer, any of their Affiliates, or any other Person against
the Agent, the Investors, any Program Support Provider, or their respective
Affiliates, directors, officers, employees, attorneys or agents for any special,
indirect, consequential or punitive damages in respect of any claim for breach
of contract or any other theory of liability arising out of or related to the
transactions contemplated by this Agreement or the other Transaction Documents,
or any act, omission or event occurring in connection therewith and each of the
Issuer, the Seller, the Servicer and NFC, to the extent permitted by law, hereby
waives, releases, and agrees not to sue upon any claim for any such damages,
whether or not accrued and whether or not known or suspected to exist in its
favor.

[Signature Pages Follow]

 

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

 

CONDUIT INVESTOR: CAFCO, LLC By:  

/s/ James Huddleston

Name:   James Huddleston Title:   Attorney-in-fact CRC FUNDING, LLC By:  

/s/ James Huddleston

Name:   James Huddleston Title:   Attorney-in-fact COMMITTED INVESTOR TO CAFCO,
LLC and CRC FUNDING, LLC: CITIBANK, N.A., as Committed Investor By:  

/s/ James Huddleston

Name:   James Huddleston Title:   Vice President Funding Limit: $500,000,000

 

S-1

[Signature Page to 2007-C Note Purchase Agreement]

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SELLER: NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION, as Seller By:  

/s/ John V. Mulvaney, Sr.

Name:   John V. Mulvaney, Sr. Title:   V.P., CFO & Treasurer INDIVIDUALLY AND AS
SERVICER: NAVISTAR FINANCIAL CORPORATION, individually and as Servicer By:  

/s/ John V. Mulvaney, Sr.

Name:   John V. Mulvaney, Sr. Title:   V.P., CFO & Treasurer

 

S-2

[Signature Page to 2007-C Note Purchase Agreement]

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AGENT: CITICORP NORTH AMERICA, INC., as Agent By:  

/s/ James Huddleston

Name:   James Huddleston Title:   Vice President Payment Information: Citibank,
N.A. ABA: 021-000-089 Account Number: 4051-7805 Account Name: CRC Redemption
Account Ref: Navistar

 

S-3

[Signature Page to 2007-C Note Purchase Agreement]

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EXHIBIT A

DOCUMENTS TO BE DELIVERED TO THE AGENT

ON OR PRIOR TO THE CLOSING DATE

 

1. Copies of the Resolutions of the board of Directors of each of Truck Retail
Instalment Paper Corp., NFC and NFRRC certified by its Secretary authorizing its
execution, delivery and performance of each Transaction Document to which it is
a party.

 

2. Articles or Certificate of Incorporation or Formation for each of Truck
Retail Instalment Paper Corp., NFC, NFRRC and the Issuer certified by the
Secretary of State of its jurisdiction of incorporation or formation on or
within thirty (30) days prior to the Closing Date.

 

3. Good Standing Certificates for each of Truck Retail Instalment Paper Corp.,
NFC, NFRRC and the Issuer issued by the Secretary of State of Delaware.

 

4. A certificate of the Secretary of each of Truck Retail Instalment Paper
Corp., NFC and NFRRC certifying (i) the names and signatures of the officers
authorized on its behalf to execute each Transaction Documents to which it is a
party and (ii) a copy of By-Laws of NFC, NFRRC and Truck Retail Instalment Paper
Corp.

 

5. A favorable opinion of legal counsel for each of Truck Retail Instalment
Paper Corp., NFC, NFRRC and the Issuer (which may include in-house counsel)
reasonably acceptable to the Agent which addresses the following matters and
such other matters as the Agent may reasonably request:

 

  - authorization, execution and delivery of the Transaction Documents

 

  - enforceability of the Transaction Documents against Truck Retail Instalment
Paper Corp., NFC, NFRRC and the Issuer

 

  - perfection and priority of security interests

 

  - true sale of the Receivables from Truck Retail Instalment Paper Corp. to NFC
and of the Receivables from NFC to the Seller, and non-consolidation of the
Seller with NFC

 

  - treatment of the Note as debt for tax purposes

 

6. (i) UCC lien search reports (in Delaware) dated a date reasonably near the
Closing Date listing all effective financing statements which name Truck Retail
Instalment Paper Corp., NFC, NFRRC or the Issuer (under its respective present
or previous names), as debtor, together with copies of all such financing
statements and (ii) tax lien search reports (in Delaware and Illinois) dated a
date reasonably near the Closing Date listing all effective federal tax liens
which name Truck Retail Instalment Paper Corp., NFC or NFRRC (under its
respective present or previous names), as debtor.

 

A-1

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7. UCC-1 financing statements filed in Delaware (i) naming Truck Retail
Instalment Paper Corp., as seller or debtor and NFC, as purchaser or secured
party, identifying the Receivables and Related Security sold by it to NFC as
collateral, (ii) naming NFC, as seller or debtor and NFRRC, as purchaser or
secured party, identifying the Designated Receivables and Related Security as
collateral, (iii) naming NFRRC, as debtor, the Issuer, as assignor secured
party, and the Indenture Trustee, as secured party, identifying the Receivables
and Related Security as collateral and (iv) naming the Issuer, as debtor and the
Indenture Trustee, as secured party, identifying the Collateral as collateral.

 

8. UCC-3 financing statements for filing in all appropriate jurisdictions to the
extent necessary to terminate or release as a matter of record any security
interest in the Receivables, Related Security and Collections.

 

9. A fully executed Retail Note Bill of Sale and Assignment, dated as of the
Closing Date, duly executed by Truck Retail Instalment Paper Corp., relating to
the Receivables and Related Security sold by it to NFC, together with the
related Release, dated as of the Closing Date, duly executed by The Bank of New
York, as Indenture Trustee under the Indenture, dated as of October 16, 2000,
between Truck Retail Instalment Paper Corp. and The Bank of New York, as
Indenture Trustee.

 

10. Certificates and opinions with respect to the Indenture Trustee and the
Owner Trustee as are customary in transactions of the type contemplated in the
Transaction Documents, the form and substance of which shall be reasonably
satisfactory to the Agent.

 

A-2