**Exhibit 10.71**

 

 

 

**NAVISTAR FINANCIAL SECURITIES CORPORATION**

 

**Seller**

 

**NAVISTAR FINANCIAL CORPORATION**

 

**Servicer**

 

**and**

 

**THE BANK OF NEW YORK**

 

**Master Trust Trustee**

 

**on behalf of the Series 2000-VFC Certificateholders**

 

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**SERIES 2000-VFC SUPPLEMENT**

 

**Dated as of January 28, 2000**

 

**to**

 

**POOLING AND SERVICING AGREEMENT**

 

**Dated as of June 8, 1995**

 

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**Floating Rate**

**Dealer Note Asset Backed Certificates, Series 2000-VFC**

 

 

**DEALER NOTE MASTER TRUST**

 

 

 

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**TABLE OF CONTENTS**

 

 
| ARTICLE  I   |                                                                                                                                                |
|--------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|
|         | CREATION  OF SERIES 2000-VFC ANDTHE SERIES 2000-VFC CERTIFICATES                                                                                    |   |
|         | SECTION 1.01  Designation                                                                                                                      |   |
|         | SECTION 1.02 Incremental Fundings                                                                                                              |   |
|         | SECTION 1.03 Optional Early Pay Out                                                                                                            |   |
|         |                                                                                                                                                |   |
| ARTICLE  II  |                                                                                                                                                |
|         | DEFINITIONS                                                                                                                                         |   |
|         | SECTION  2.01  Definitions                                                                                                                     |   |
|         |                                                                                                                                                |   |
| ARTICLE  III |                                                                                                                                                |
|         | SERVICING  FEE                                                                                                                                      |   |
|         | SECTION  3.01  Servicing Compensation                                                                                                          |   |
|         |                                                                                                                                                |   |
| ARTICLE  IV  |                                                                                                                                                |
|         | RIGHTS OF SERIES 2000-VFC  CERTIFICATEHOLDERS AND ALLOCATION AND APPLICATION OF COLLECTIONS                                                         |   |
|         | SECTION 4.01 Rights of the Series 2000-VFC  Certificateholders                                                                                      |   |
|         | SECTION 4.02 Establishment of Series  Principal Account, Spread Account, Liquidity Reserve Account and Incremental  Funding Reserve Account.        |   |
|         | SECTION 4.03 [Reserved]                                                                                                                             |   |
|         | SECTION 4.04 Application of Available  Certificateholder Interest Collections                                                                       |   |
|         | SECTION 4.05 Application of Available  Seller’s Finance Charge Collections, Spread Account and Liquidity Reserve  Account to Deficiency Amount |   |
|         | SECTION 4.06 Investor Charge-Offs                                                                                                                   |   |
|         | SECTION 4.07 Application of Seller’s  Finance Charge Collections                                                                               |   |
|         | SECTION 4.08 Application of Series  Allocable Principal Collections                                                                                 |   |
|         | SECTION 4.09 Shared Principal Collections                                                                                                           |   |
|         | SECTION 4.10 Distributions to Series  2000-VFC Certificateholders                                                                                   |   |
|         | SECTION 4.11  [Reserved]                                                                                                                       |   |
|         | SECTION 4.12  Partial Month Due Period                                                                                                         |   |
|         | SECTION 4.13 Additional Rights upon the  Occurrence of Certain Events                                                                               |   |
|         |                                                                                                                                                |   |
| ARTICLE  V   |                                                                                                                                                |
|         | DISTRIBUTIONS AND REPORTSTO SERIES 2000-VFC  CERTIFICATEHOLDERS                                                                                     |   |
|         | SECTION 5.01 Distributions.                                                                                                                         |   |
|         | SECTION 5.02 Monthly and Annual Certificateholders’  Statement                                                                                 |   |

 

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| ARTICLE  VI   |                                                                                                                                                        |
|---------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          | EARLY  AMORTIZATION EVENTS                                                                                                                                  |   |
|          | SECTION  6.01 Additional Early Amortization Events                                                                                                          |   |
|          |                                                                                                                                                        |   |
| ARTICLE  VII  |                                                                                                                                                        |
|          | OTHER  SERIES PROVISIONS                                                                                                                                    |   |
|          | SECTION  7.01 Conveyance of Dealer Notes                                                                                                                    |   |
|          | SECTION  7.02 Tax Treatment                                                                                                                                 |   |
|          |                                                                                                                                                        |   |
| ARTICLE  VIII |                                                                                                                                                        |
|          | FINAL DISTRIBUTIONS                                                                                                                                         |   |
|          | SECTION 8.01 Sale of Investors’ Interest  Pursuant to Section 2.07 of the Agreement; Distributions Pursuant to Section  2.03 or 12.03 of the Agreement |   |
|          | SECTION 8.02 Distribution of Proceeds of  Sale, Disposition or Liquidation of the Dealer Notes Pursuant to Section 9.02  of the Agreement                   |   |
|          |                                                                                                                                                        |   |
| ARTICLE  IX   |                                                                                                                                                        |
|          | MISCELLANEOUS  PROVISIONS                                                                                                                                   |   |
|          | SECTION  9.01 Ratification of Agreement                                                                                                                     |   |
|          | SECTION  9.02 Counterparts                                                                                                                                  |   |
|          | SECTION  9.03 GOVERNING LAW                                                                                                                                 |   |
|          |                                                                                                                                                        |   |
| SIGNATURES    |                                                                                                                                                        |

 
| EXHIBITS  |
|-----------|
|      |   |   |
| Exhibit A | - | Form of Investor  Certificate |
|      |   |   |
| Exhibit B | - | Form of Monthly Servicer  and Settlement Statement |

 

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SERIES2000-VFC SUPPLEMENT

TOPOOLING AND SERVICING AGREEMENT

 

SERIES 2000-VFC SUPPLEMENTdated as of January 28, 2000 (the “Series Supplement”), by and among NAVISTARFINANCIAL SECURITIES CORPORATION, a Delaware corporation, as Seller (the “Seller”),NAVISTAR FINANCIAL CORPORATION, a Delaware corporation, as Servicer (the “Servicer”),and THE BANK OF NEW YORK, a New York banking corporation, as trustee (togetherwith its successors in trust thereunder as provided in the Agreement referredto below, the “Master Trust Trustee”) under the Pooling and ServicingAgreement, dated as of June 8, 1995 (as amended and supplemented, the “Agreement”)among the Seller, the Servicer, the Master Trust Trustee and The ChaseManhattan Bank (formerly know as Chemical Bank), as trustee under the 1990Trust Agreement.

 

Section 6.09 of theAgreement provides that the Seller may from time to time direct the MasterTrust Trustee to issue, on behalf of the Master Trust, one or more new Seriesof Investor Certificates representing fractional undivided interests in theMaster Trust.  The Principal Terms of anynew Series are to be set forth in a Supplement to the Agreement.

 

Pursuant to this SeriesSupplement, the Seller and the Master Trust Trustee shall create a new Seriesof Investor Certificates and specify the Principal Terms thereof.

 

ARTICLE I

CREATIONOF SERIES 2000-VFC AND

THESERIES 2000-VFC CERTIFICATES

 

SECTION                                            1.01  Designation.

 

(a)                                  There is hereby created a new Series pursuantto the Agreement and this Series Supplement to be known as the “Floating RateDealer Note Asset Backed Certificates Series 2000-VFC.”  The interest of the InvestorCertificateholders in Series 2000-VFC shall be represented by the Series 2000-VFCCertificates.  The Series 2000-VFCCertificates are a series of variable funding certificates, meaning that theirFunded Amount may be increased from time to time during the Revolving Period asIncremental Fundings are made under the Certificate Purchase Agreement and maybe decreased from time to time, as Investor Principal Collections or certainother funds are distributed to the Series 2000-VFC Certificateholders for thatpurpose.  The Funded Amount of the Series2000-VFC may not at any time exceed the Maximum Funded Amount.

 

(b)                                 If any term or provision contained hereinshall conflict with or be inconsistent with any term or provision contained in theAgreement, the terms and provisions of this Series Supplement shall govern withrespect to Series 2000-VFC.

 

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SECTION                                         1.02  Incremental Fundings.  Incremental Fundings may occur on anyDistribution Date to the extent provided in the Certificate PurchaseAgreement.  Upon any Incremental Funding,the Funded Amount, the Series Allocation Percentage, the Floating AllocationPercentage and other terms will be reset to the extent provided herein and inthe Certificate Purchase Agreement.

 

SECTION                                         1.03  Optional Early Pay Out.

 

(a)                                  On any Funding Change Date falling in theRevolving Period, the Seller may cause the principal portion of theCertificates to be prepaid in full or in part, (x) if the aggregate principalamount of such prepayment is greater than $150,000,000, on not less than fiveBusiness days prior written notice by the Servicer or (y) otherwise, on notless than three Business Days prior written notice by the Servicer to theMaster Trust Trustee and the Administrative Agent, with Shared PrincipalCollections as provided in Section 4.03(e) of the Agreement; *provided, however* that such prepaymentshall not be permitted unless all due (or if the Certificates are paid in full,all accrued) and unpaid Monthly Interest, Additional Amounts and Non-Use Feeshave been paid in full.

 

(b)                                 In addition, on any Business Day, the Sellermay cause the principal portion of the Certificates to be prepaid in full or inpart, (x) if the aggregate principal amount of such prepayment is greater than$150,000,000, on not less than five Business Days prior written notice by theServicer or (y) otherwise, on not less than three Business Days prior writtennotice by the Servicer to the Master Trust Trustee and the AdministrativeAgent, with the proceeds from issuance of a new Series issued substantiallycontemporaneously with such prepayment; *provided,however* that such prepayment shall not be permitted unless all due(or, if the Certificates are paid in full, all accrued) and unpaid MonthlyInterest, Additional Amounts and Non-Use Fees have been paid in full.

 

(c)                                  Servicer shall not give notice of anyprepayment pursuant to Section 1.03(a) unless the Master Trust has fundssufficient to make such prepayment on the day notice is given and shall notgive notice of any prepayment pursuant to Section 1.03(b) unless the Seller hasobtained binding commitments which may be subject to customary conditions fromone or more persons to purchase the new series in such amounts as will yieldthe net proceeds necessary to make the prepayment.

 

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ARTICLE II

DEFINITIONS

 

SECTION 2.01  Definitions.

 

(a)                                  Whenever used in this Series Supplement, thefollowing words and phrases shall have the following meanings:

 

*“Accrual Period”*shall mean with respect to any Distribution Date, if Monthly Interestis to be calculated on the basis of the CP Rate, the related Due Period and ifMonthly Interest is to be calculated on the basis of the Alternate Rate, therelated Distribution Period.

 

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

 

“*Adjusted Invested Amount*” shall mean, with respect to anyDistribution Date, an amount (which shall never be less than zero) equal to theInitial Invested Amount as of the related Determination Date, plus theAvailable Subordinated Amount as of the end of the related Transfer Date, plusthe amount of any Incremental Funding to be made on that Distribution Date, ifany, minus the aggregate amount of Investor Charge-Offs since the end of theRevolving Period not reimbursed on or prior to such Distribution Date; *provided* that, for purposes of calculatingthe Series Allocation Percentage, the Series 2000-VFC shall be deemed to havebeen outstanding as of January 25, 2000 with respect to allocations ofPrincipal Collections and related concepts and as of December 26, 1999 withrespect to Finance Charge Collections and related concepts, in each case withan Adjusted Invested Amount of $346,500,000.

 

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

 

“*Amortization Period*” shall mean, unless an EarlyAmortization Event shall have occurred prior thereto, the period commencing onthe Amortization Period Commencement Date, and ending upon the first to occurof (a) the commencement of an Early Amortization Period, (b) the payment infull to Series 2000-VFC Certificateholders of the outstanding Funded Amount and(c) the Series Termination Date.

 

“*Amortization Period Commencement Date*” shall mean the firstday of the Due Period occurring after the Purchase Expiration Date then ineffect.

 

“*Amortizing Due Period*” shall have the meaning specified inSection 4.12.

 

“*Available Certificateholder Interest Collections*” shallmean, with respect to any Due Period, the sum of (a) Investor Finance ChargeCollections for such Due Period and (b) Investment Income for that Due Period.

 

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“*Available Draw Funds”*shall have the meaning specified inSection 4.05(b).

 

“*Available Seller’s Finance Charge Collections*” shall mean,with respect to any Due Period, an amount equal to the product of (a) theexcess of (i) the Seller’s Percentage for such Due Period over (ii) the result(if positive) of the Excess Seller’s Percentage for such Due Period minus theRequired Excess Seller Interest Percentage and (b) Series Allocable FinanceCharge Collections for such Due Period; *provided*,*however*, that Available Seller’sFinance Charge Collections shall be zero for any Due Period to the extent theAvailable Subordinated Amount equals or is reduced to zero on the Transfer Daterelated to such Due Period.

 

“*Available Seller’s Principal Collections*” shall mean, withrespect to any Business Day, an amount equal to the product of (a) the excessof (i) the Seller’s Percentage for the Due Period in which such BusinessDay occurs over (ii) the Excess Seller’s Percentage for such Due Periodand (b) Series Allocable Principal Collections for such Business Day; *provided*, *however*,that Available Seller’s Principal Collections shall be zero for any BusinessDay to the extent the Available Subordinated Amount equals or is reduced tozero on the Transfer Date immediately preceding such Business Day.

 

“*Available Subordinated Amount*” shall mean for each TransferDate (before giving effect to all adjustments in the Available SubordinatedAmount thereto on such Transfer Date), the lesser of (i) the MaximumSubordinated Amount as of such Transfer Date (or, in the case of the firstTransfer Date after the Closing Date $46,500,000) and (ii) the sum of (a) theAvailable Subordinated Amount as of the end of the preceding Transfer Date and(b) any Incremental Subordinated Amount with respect to the Distribution Daterelated to such preceding Transfer Date, if any.

 

*“Average Coverage Differential”* shall be determined, on any DeterminationDate, by reference to the Coverage Differentials for each of the related DuePeriod and the three immediately preceding Due Periods, and shall equal the sumof the three highest such Coverage Differentials *divided**by*three.  Average Coverage Differentialshall be expressed as a percentage, and shall be rounded to the nearestone-hundredth of a percentage point.

 

*“Business Day”* shall mean, with respect to Series 2000-VFC, any day other than aSaturday, a Sunday, or a day on which banking institutions in New York, NewYork, Chicago, Illinois, or the city in which the Corporate Trust Office islocated, or in connection with the determination of LIBOR, London, England, areauthorized or obligated by law or executive order to be closed or remainclosed.

 

*“Certificate Purchase Agreement”*shall mean the Certificate PurchaseAgreement, dated as of the Closing Date, among the Seller, the Servicer and theother parties thereto, as amended, supplemented or otherwise modified from timeto time.

 

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*“Certificate Rate”* shall mean, for any Distribution Date, the percentage equivalent of afraction (a) the numerator of which is the product of (i) Monthly Interest tobe paid on the Distribution Date (excluding any portion thereof consisting ofMonthly Interest carried over from the prior Distribution Date and interest onsuch unpaid Monthly Interest), and (ii) a fraction, the numerator of which is365 and the denominator of which is the number of days in which such MonthlyInterest was calculated and (b) the denominator of which is the weightedaverage Funded Amount for such Accrual Period.

 

“*Closing Date*” shall mean January 28, 2000.

 

*“Coverage Differential”* shall mean, with respect to any Due Period,the result of (a) the Portfolio Yield for such Due Period minus (b) thesum of (i) the Certificate Rate for the related Distribution Date and(ii) one percent (1%).  CoverageDifferential shall be expressed as a percentage, and shall be rounded to thenearest one-hundredth of a percentage point.

 

“*Deficiency Amount*” shall have the meaning specified inSection 4.05(a).

 

“*Draw Amount*” shall mean, with respect to any Transfer Date,the least of (a) the Deficiency Amount for such Transfer Date, (b) theAvailable Subordinated Amount as of the end of the preceding Transfer Date plusany Incremental Subordinated Amount with respect to the Distribution Daterelated to such preceding Transfer Date, if any, and (c) Available Draw Fundsfor such Transfer Date.

 

“*Early Amortization Event*” shall mean, with respect to Series2000-VFC, any event specified in Section 9.01(c) of the Agreement, togetherwith any additional Early Amortization Event specified in Section 6.01 of thisSeries Supplement, but shall not mean any other event specified in Section 9.01of the Agreement.

 

“*Early Amortization Period*” shall mean an Early AmortizationPeriod with respect to Series 2000-VFC that occurs as a result of any eventspecified in Section 9.01(c) of the Agreement or any Early Amortization Eventspecified in Section 6.01 of this Series Supplement.

 

*“Early Amortization Period Shortfall Amount”* shall have the meaning specified in Section4.08(e).

 

*“Eligible Investments”* shall mean

 

(a)                                  book-entry securities, negotiable instrumentsor securities represented by instruments in bearer or registered form having(except in the case of clause (iv) below) remaining maturities occurring notlater than the Distribution Date next succeeding the Master Trust Trustee’sacquisition thereof, except as otherwise described herein, that evidence:

 

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

 

(ii)                                  demand deposits, time deposits orcertificates of deposit of, or bankers’ acceptances issued by, any depositoryinstitution or trust company incorporated under the laws of the United Statesof America or any state thereof (or any domestic branch of a foreign bank) andsubject to supervision and examination by federal or state banking ordepository institution authorities; *provided,however,* that at the time of the Master Trust’s investment orcontractual commitment to invest therein, the commercial paper or othershort-term unsecured debt obligations (other than such obligations the ratingof which is based on the credit of a person or entity other than suchdepository institution or trust company) of such depository institution ortrust company shall have a credit rating not lower than the highest investmentcategory for short term unsecured debt obligations granted by Moody’s andS&P;

 

(iii)                               commercial paper having, at the time of theMaster Trust’s investment or contractual commitment to invest therein, a ratingnot lower than the highest investment category for short term unsecured debtobligations granted by Moody’s and S&P;

 

(iv)                              investments in money market funds or commontrust funds having a rating not lower than the highest investment category forshort term unsecured debt obligations granted by Moody’s and S&P orotherwise approved in writing by the Administrative Agent (including funds forwhich the Master Trust Trustee or any of its affiliates is investment manageror advisor, so long as such fund shall have such rating);

 

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

 

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collateral being less thanthe amount of such repurchase obligation (unless the counterparty immediatelysatisfies the repurchase obligation upon being notified of such shortfall); or

 

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

 

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

 

Unless approved by theAdministrative Agent, Eligible Investments of funds in the Series PrincipalAccount and the Liquidity Reserve Account will be subject to the followingadditional restrictions: (x) no more than the greater of (A) $1,000,000 and (B)20% of the aggregate Eligible Investments in all such accounts collectivelyshall be obligations of or investments in any single issuer (except that such20% limitation shall not apply to Eligible Investments of the type specified inclause (a)(i)); and (y) each Eligible Investment shall be denominated and bepayable solely in U.S. dollars, shall bear interest at a specified rate thatis, or is based upon, LIBOR or a commercial paper rate, shall entitle theholder to a fixed principal amount at maturity and shall have a yield that isnot inversely or disproportionately affected by changes in interest rates.

 

“*Excess Seller’s Percentage*” shall mean, with respect to anyDue Period, a percentage (which percentage shall never be less than 0% nor morethan 100%) equal to the excess of (a) the Seller’s Percentage for such DuePeriod, over (b) the percentage equivalent (which percentage shall never beless than 0% nor more than 100%) of a fraction, the numerator of which is theAvailable Subordinated Amount as of the end of the related Transfer Date, plusany Incremental Subordinated Amount with respect to the Distribution Daterelated to such Transfer Date, if any, and the denominator of which is theproduct of (x) the sum of the aggregate principal amount of Dealer Notesin the Master Trust and the aggregate principal amount of funds on deposit inthe Excess Funding Account, both as of the end of the immediately preceding DuePeriod and (y) the Series 2000-VFC Allocation Percentage for the Due Period forwhich the Excess Seller’s Percentage is being calculated.

 

“*Excess Seller’s Principal Collections*” shall mean, withrespect to any Business Day during a Due Period, the product of (a) SeriesAllocable Principal Collections for such Business Day and (b) the Excess Seller’sPercentage for such Due Period.

 

“*Expected Payment Date*” shall mean the Distribution Date inthe calendar month beginning six months after the Amortization PeriodCommencement Date.

 

“*Floating Allocation Percentage*” shall mean, with respect toany Due Period , the percentage equivalent (which percentage shall never exceed100%) of a fraction, the numerator

 

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ofwhich is the Invested Amount as of the immediately preceding Distribution Date(after giving effect to all increases and reductions thereof on suchDistribution Date) and the denominator of which is the product of (a) the sumof the aggregate principal amount of Dealer Notes in the Master Trust and theaggregate principal amount of funds on deposit in the Excess Funding Account,both as of the end of the immediately preceding Due Period, and (b) the Series2000-VFC Allocation Percentage for the Due Period for which the FloatingAllocation Percentage is being calculated.

 

“*Funded Amount*” shall have the meaning specified in theCertificate Purchase Agreement.

 

“*Funding Change Date*” shall mean any Distribution Date.

 

“*Incremental Funded Amount*” shall mean the amount of theincrease in the Funded Amount occurring as a result of any Incremental Funding,which amount shall equal the aggregate amount of the purchase prices paid withrespect to such Incremental Funding pursuant to the Certificate PurchaseAgreement.

 

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

 

“*Incremental Funding Reserve Account*” shall have the meaningspecified in Section 4.02(d)(i).

 

“*Incremental Funding Reserve Deposit Amount*” shall mean (a)zero, with respect to any Distribution Date on which the Incremental FundedAmount is zero; and (b) with respect to any Distribution Date on which theIncremental Funded Amount is greater than zero, the positive difference of (x)the product of (i) the Incremental Funded Amount, (ii) the Certificate Rate forsuch Distribution Date, (iii) 1.25 and (iv) a fraction, the numerator of whichis the actual number of days remaining in the Due Period in which suchDistribution Date occurs, including such Distribution Date, and the denominatorof which is 360; and (y) the balance in the Incremental Funding Reserve Accountafter giving effect to any withdrawals therefrom on such Distribution Date.

 

*Incremental Subordinated Amount”* shall mean, with respect to any DistributionDate on which there is an Incremental Funding, the product of (i) theIncremental Funded Amount on such Distribution Date and (ii) the SubordinatedPercentage.

 

“*Initial Funded Amount”* shall mean $300,000,000.

 

“*Initial Invested Amount*” shall mean, on any DeterminationDate (for purposes of any reference in the Pooling and Servicing Agreement tothe “Initial Invested Amount” or the “initial invested amount” of a Series),(a) during the Revolving Period, the Invested Amount as of

 

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suchdate or (b) during an Amortization Period or an Early Amortization Period, theInvested Amount as of the last day of the Revolving Period.

 

“*Initial Spread Account Required Amount*” shall mean$3,750,000.

 

“*Invested Amount*” shall mean, with respect to any DistributionDate, an amount (which shall never be less than zero) equal to the FundedAmount minus the sum of (i) the aggregate amount, if any, of unreimbursedInvestor Charge-Offs and (ii) the aggregate amount of Series Principal AccountLosses on or prior to such Distribution Date.

 

*“Investment Income”* shall mean, for any Due Period with respect to Series 2000-VFC, thesum of (i) income during such Due Period from the investment of funds ondeposit in the Series Principal Account and the Spread Account and (ii) theproduct of (a) the Series Allocation Percentage for such Due Period and (b)income from the investment of funds on deposit in the Collections Account andthe Excess Funding Account.

 

*“Investor Charge-Off”* shall have the meaning specified in Section 4.06.

 

“*Investor Dealer Note Losses*” shall mean, with respect to anyDue Period, the product of (a) the Floating Allocation Percentage for such DuePeriod and (b) Series Allocable Dealer Note Losses for such Due Period.

 

“*Investor Finance Charge Collections*” shall mean, withrespect to any Due Period,  an amountequal to the product of (a) the Floating Allocation Percentage for such DuePeriod and (b) Series Allocable Finance Charge Collections for such DuePeriod.

 

“*Investor Principal Collections*” shall mean, with respect toany Business Day, the sum of (a) the product of (i) with respect to theRevolving Period, the Floating Allocation Percentage and with respect to theAmortization Period or any Early Amortization Period, the Principal AllocationPercentage, in either case for the Due Period in which such Business Day occursand (ii) Series Allocable Principal Collections for such Business Day and (b)on any Transfer Date, the amount, if any, of Available CertificateholderInterest Collections treated as Investor Principal Collections pursuant toSections 4.04(a)(iii) and (iv).

 

“*Investor Servicing Fee*” shall have the meaning specified inSection 3.01.

 

*“LIBOR”* shall have the meaning specified in the Certificate PurchaseAgreement.

 

*“Liquidity Reserve Account”* shall have the meaning specified in Section4.02(c)(i).

 

“*Maximum Funded Amount*” shall have the meaning specified inthe Certificate Purchase Agreement.

 

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*“Maximum Subordinated Amount”* shall mean, with respect to any TransferDate related to a Due Period, the product of (a) the Invested Amount as ofthe preceding Distribution Date and (b) the Subordinated Percentage; *provided*, *however*,that with respect to a Transfer Date related to a Due Period occurring duringan Early Amortization Period, the Maximum Subordinated Amount shall not declineuntil the Invested Amount equals the Maximum Subordinated Amount, andthereafter the Maximum Subordinated Amount shall equal the Invested Amount.

 

“*Minimum Series 2000-VFC Seller’s Interest”* shall mean, withrespect to any Business Day, the sum of (a) the Available Subordinated Amountas of the end of the preceding Transfer Date, (b) the Incremental SubordinatedAmount with respect to the Distribution Date related to such preceding TransferDate, if any, and (c) the Required Excess Seller Interest as of the end of thepreceding Distribution Date.

 

“*Monthly Interest*” shall have the meaning specified in theCertificate Purchase Agreement.

 

*“Monthly Servicing Fee”* shall have the meaning specified in Section3.01.

 

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

 

*“Non-Use Fee”* shall have the meaning specified in the Certificate PurchaseAgreement.

 

*“Portfolio Yield”* shall mean, with respect to any Due Period, the product of (a) thequotient of (i) Finance Charges for such Due Period and (ii) the daily averageprincipal amount of Dealer Notes outstanding during such Due Period and (b) afraction, the numerator of which is 365 and the denominator of which is theactual number of days elapsed during such Due Period.  Portfolio Yield shall be expressed as apercentage, and shall be rounded to the nearest one-hundredth of a percentagepoint.

 

“*Principal Allocation Percentage*” shall mean, with respect toany Due Period occurring during the Amortization Period or any EarlyAmortization Period, the percentage equivalent (which percentage shall neverexceed 100%) of a fraction, the numerator of which is the Invested Amount as ofthe end of the Revolving Period and the denominator of which is equal to theproduct of (a) the sum of the aggregate amount of Dealer Notes in the MasterTrust and the aggregate principal amount of funds on deposit in the ExcessFunding Account, both as of the end of the Revolving Period and (b) the Series2000-VFC Allocation Percentage for the Due Period for which the PrincipalAllocation Percentage is being calculated.

 

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*“Principal Shortfall”* shall mean, with respect to Series 2000-VFC,the Series 2000-VFC Principal Shortfall.

 

*“Projected Dealer Note Income”*shall mean, on any Transfer Date, an amountequal to the sum of (a) the product of (i) the principal amount of Dealer Notesfinancing new vehicles outstanding on such Transfer Date, (ii) the New VehicleMonthly Interest Rate for the Due Period in which such Transfer Date occurs and(iii) the Series 2000-VFC Allocation Percentage for such Due Period and (b) theproduct of (i) the principal amount of Dealer Notes financing used vehiclesoutstanding on such Transfer Date, (ii) the Used Vehicle Monthly Interest Ratefor such Due Period and (iii) the Series 2000-VFC Allocation Percentage forsuch Due Period.

 

“*Projected Monthly Interest*” shall mean, on any TransferDate, an amount equal to the product of (a) the Certificate Rate for therelated Distribution Date, (b) the Invested Amount as of the immediatelypreceding Distribution Date, (c) the result of (i) the actual number of days insuch Accrual Period divided by (ii) 360 and (d) 1.25.

 

“*Projected Monthly Servicing Fee*” shall mean, on any TransferDate with respect to the Due Period in which such Transfer Date occurs, anamount equal to one-twelfth of the product of (a) 1%, (b) the aggregateprincipal amount of Dealer Notes as of such Transfer Date, (c) the Series 2000-VFCAllocation Percentage for the Due Period related to such Transfer Date and(d) the Floating Allocation Percentage for the Due Period related to suchTransfer Date.

 

“*Projected Spread*” shall mean, with respect to theDistribution Date next following the Distribution Date to which such TransferDate relates, the sum of (a) the positive amount, if any, by which (i) the sumof (A) Projected Monthly Interest for such Distribution Date, and (B) theProjected Monthly Servicing Fee for the Due Period in which such Transfer Dateoccurs exceeds (ii) the Projected Dealer Note Income as of such Transfer Dateand (b) 1.25% of the Invested Amount as of such Distribution Date.

 

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

 

“*Reassignment Amount*” shall mean, with respect to anyDistribution Date, after giving effect to any deposits and distributionsotherwise to be made on such Distribution Date, the sum of (a) the InvestedAmount on such Distribution Date, (b) accrued and unpaid interest thereon and(c) accrued and unpaid Non-Use Fees and Additional Amounts.

 

*“Remaining Available Seller’s Principal Calculations”* shall have the meaning specified in Section4.08(d).

 

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*“Required Excess Seller Interest”* shall mean, with respect to any BusinessDay, 3.0% of the Invested Amount as of the end of the preceding DistributionDate (and such percentage shall be the “*RequiredExcess Seller Interest Percentage*”).

 

“*Required Subordinated Amount*” shall mean, with respect toany Transfer Date related to a Due Period, an amount equal to 87.1% of theMaximum Subordinated Amount as of such Transfer Date.

 

“*Revolving Due Period*” shall have the meaning specified inSection 4.12.

 

“*Revolving Period*” shall mean, unless an Early AmortizationEvent shall have occurred prior thereto, the period beginning on the ClosingDate and ending on the earlier of (a) the close of business on theBusiness Day immediately preceding the Amortization Period Commencement Dateand (b) the close of business on the Business Day immediately precedingthe day on which an Early Amortization Event occurs.

 

“*Seller’s Percentage*” shall mean, with respect to any DuePeriod, 100% minus (a) the Floating Allocation Percentage for such Due Period,when used with respect to Finance Charge Collections and Dealer Note Losses atall times or Principal Collections during the Revolving Period, and (b) thePrincipal Allocation Percentage for such Due Period, when used with respect toPrincipal Collections during the Amortization Period or any Early AmortizationPeriod.

 

“*Seller’s Principal Collections*” shall mean, with respect toany Business Day, an amount equal to the sum of (a) Available Seller’sPrincipal Collections for such Business Day and (b) Excess Seller’s PrincipalCollections for such Business Day.

 

“*Series 2000-VFC*” shall mean the Series of InvestorCertificates, the terms of which are specified in this Series Supplement.

 

“*Series 2000-VFC Accounts*” shall mean, collectively, theSeries Principal Account, the Distribution Account maintained for the Series2000-VFC Certificateholders, the Liquidity Reserve Account, the IncrementalFunding Reserve Account and the Spread Account.

 

“*Series 2000-VFC Allocation Percentage*” shall mean the SeriesAllocation Percentage with respect to Series 2000-VFC.

 

“*Series 2000-VFC Certificateholders*” shall mean the holdersof Series 2000-VFC Certificates.

 

“*Series 2000-VFC Certificateholders’ Interest*” shall meanthat portion of the Certificateholders’ Interest evidenced by the Series 2000-VFCCertificates.

 

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“*Series 2000-VFC Certificates*” shall mean any one of thecertificates executed by the Seller and authenticated by the Master TrustTrustee, substantially in the form of Exhibit A.

 

*“Series 2000-VFC Principal Shortfall”* shall equal, with respect to any BusinessDay during any Early Amortization Period, the excess, if any, of the InvestedAmount (reduced by (i) amounts on deposit in the Series Principal Account and(ii) the aggregate amount of Series Principal Account Losses for the Due Periodin which such Business Day occurs) as of the immediately preceding DistributionDate over Investor Principal Collections for such Business Day.

 

“*Series 2000-VFC Shared Principal Collections*” shall have themeaning specified in Section 4.09(b).

 

*“Series 2000-VFC Shared Seller Principal Collections”* shall have the meaning specified in Section4.08(d)(iv).

 

“*Series Allocable Dealer Note Losses*” shall mean, withrespect to any Due Period, the product of (a) the Series 2000-VFC AllocationPercentage for such Due Period and (b) Dealer Note Losses for such Due Period.

 

“*Series Allocable Finance Charge Collections*” shall mean,with respect to any Due Period, the product of (a) the Series 2000-VFCAllocation Percentage for such Due Period and (b) the amount of Finance ChargeCollections for such Due Period.

 

“*Series Allocable Principal Collections*” shall mean, withrespect to any Business Day, the sum of (a) the product of (i) theSeries 2000-VFC Allocation Percentage for the related Due Period and(ii) the amount of Principal Collections deposited in the CollectionsAccount on such Business Day and (b) if the Amortization Period CommencementDate occurs on such Business Day, the product of (i) the Series 2000-VFCAllocation Percentage for such Due Period and (ii) the amount of funds ondeposit in the Excess Funding Account on such Amortization Period CommencementDate.

 

“*Series Invested Amount*” shall mean, with respect to Series2000-VFC, the Invested Amount.

 

“*Series Principal Account*” shall have the meaning specifiedin Section 4.02(a)(i).

 

*“Series Principal Account Losses”* shall mean losses of principal on investmentof funds in the Series Principal Account.

 

*“Series Termination Date”* shall mean the Distribution Date 36 monthsafter the Expected Payment Date.

 

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“*Spread Account*” shall have the meaning specified in Section4.02(b)(i).

 

“*Spread Account Deposit Amount*” shall mean, with respect toany Transfer Date, the amount, if any, by which the Projected Spread exceedsthe amount of funds on deposit in the Spread Account.

 

“*Subject Month*” shall have the meaning specified in Section4.12.

 

“*Subordinated Percentage*” shall mean 15.5%.

 

*“Turnover”* shall have the meaning specified in Section 6.01(k).

 

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

 

(b)                                 As used in this Series Supplement and in theAgreement with respect to Series 2000-VFC, “highest investment category” shallmean (i) in the case of Standard & Poor’s, A-1+, AAA, AAAm, or AAAm-G, asapplicable, and (ii) in the case of Moody’s, P-1 or Aaa, as applicable.

 

(c)                                  All capitalized terms used herein and nototherwise defined herein have the same meanings ascribed to them in theAgreement or, if not defined therein, in the Certificate Purchase Agreement.

 

(d)                                 The words “hereof,” “herein” and “hereunder”and words of similar import when used in this Series Supplement shall refer tothis Series Supplement as a whole and not to any particular provision of thisSeries Supplement; references to any Article, Section or Exhibit are referencesto Articles, Sections and Exhibits in or to this Series Supplement unlessotherwise specified; and the term “including” means “including withoutlimitation.”

 

(e)                                  As used in this Series Supplement, referencesto the Available Subordinated Amount “as of the end” of a Transfer Date shallmean the Available Subordinated Amount as of such Transfer Date, after givingeffect to all increases and reductions thereof pursuant to Article IV hereof.

 

(f)                                    As used in this Series Supplement, accountingterms which are not defined, and accounting terms partly defined, herein shallhave the respective meanings given to them under generally accepted accountingprinciples as in effect on the date hereof. To the extent that the definitions of accounting terms in this SeriesSupplement are inconsistent with the

 

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meaningsof such terms under generally accepted accounting principles, the definitionscontained in this Series Supplement will control.

 

(g)                                 With respect to any Distribution Date orTransfer Date, the “related Due Period” and the “related Distribution Period”will mean the Due Period and Distribution Period, respectively, immediatelypreceding such Distribution Date or Transfer Date, and the relationshipsbetween Due Periods and Distribution Periods will be correlative to theforegoing relationships.  With respect toany LIBOR Determination Date, the “related Distribution Period” will mean theDistribution Period beginning on the Distribution Date immediately followingsuch LIBOR Determination Date.

 

(h)                                 Each defined term used in this SeriesSupplement has a comparable meaning when used in its plural or singularform.  Each gender-specific term used inthis Series Supplement has a comparable meaning whether used in a masculine,feminine or gender-neutral form.

 

ARTICLE III

SERVICINGFEE

 

SECTION 3.01  ServicingCompensation.  The monthly servicingfee (the “Monthly Servicing Fee”) shall be payable to the Servicer, in arrears,on each Distribution Date in respect of a Due Period (or portion thereof)occurring prior to the earlier of the first Distribution Date following theSeries Termination Date and the first Distribution Date on which the InvestedAmount is zero, in an amount equal to one-twelfth of the result of (a) 1% *multiplied**by* (b) the aggregate principal amount of Dealer Notesoutstanding as of the last day of such Due Period and *multiplied**by* (c) the Series 2000-VFC Allocation Percentage withrespect to such Due Period.  The share ofthe Monthly Servicing Fee allocable to the Series 2000-VFC Certificateholderswith respect to any Transfer Date (the “Investor Servicing Fee”) shall be equalto the product of (a) the Monthly Servicing Fee and (b) the FloatingAllocation Percentage with respect to such Due Period.  The remainder of the Monthly Servicing Feeshall be paid by the Seller and in no event shall the Master Trust, the MasterTrust Trustee or the Series 2000-VFC Certificateholders be liable for the shareof the Monthly Servicing Fee to be paid by the Seller; and the remainder of theServicing Fee shall be paid by the Seller and the Investor Certificateholdersof other Series and the Series 2000-VFC Certificateholders shall in no event beliable for the share of the Servicing Fee to be paid by the Seller or theInvestor Certificateholders of other Series. The Investor Servicing Fee shall be payable to the Servicer solely tothe extent amounts are available for distribution in accordance with the termsof this Series Supplement.

 

The Servicer will bepermitted, in its sole discretion, to waive the Monthly Servicing Fee for anyDistribution Date by notice to the Master Trust Trustee on or before therelated Determination Date; *provided*,*however*, that the Servicerbelieves that sufficient Series Allocable Finance Charge Collections will be availableon any future Distribution Date to pay the Investor Servicing Fee relating tothe waived Monthly Servicing Fee.  If theServicer so waives

 

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theMonthly Servicing Fee for any Distribution Date, the Monthly Servicing Fee andthe Investor Servicing Fee for such Distribution Date shall be deemed to bezero for all purposes of this Series Supplement and the Agreement; *provided*, *however*,that such Investor Servicing Fee shall be paid on a future date solely to theextent amounts are available therefor pursuant to Section 4.04(a)(vi); and *provided**further*that, to the extent any such waived Investor Servicing Fee is so paid, therelated portion of the Monthly Servicing Fee to be paid by the Seller shall bepaid by the Seller to the Servicer.

 

ARTICLE IV

RIGHTSOF SERIES 2000-VFC CERTIFICATEHOLDERS

AND ALLOCATION AND APPLICATION OF COLLECTIONS

 

SECTION 4.01   Rightsof the Series 2000-VFC Certificateholders. The Series 2000-VFC Certificates shall represent fractional undividedinterests in the Master Trust, consisting of the right to receive, to theextent necessary to make the required payments with respect to the Series 2000-VFCCertificates at the times and in the amounts specified in this Series Supplement,Collections allocated to Series 2000-VFC pursuant to Article IV of theAgreement and this Article IV, funds on deposit in the Collections Account andthe Excess Funding Account allocable to Series 2000-VFC Certificateholderspursuant to Article IV of the Agreement and this Article IV, and funds ondeposit in the Series 2000-VFC Accounts (collectively, the “Series 2000-VFCCertificateholders’ Interest”), it being understood that the Series 2000-VFCCertificates shall not represent any interest in any Series Account orEnhancement for the benefit of any other Series or Class.  The Servicer shall apply, or instruct theMaster Trust Trustee to apply, all funds on deposit in the Collections Accountand Excess Funding Account allocable to the Series 2000-VFC Certificates, andall funds on deposit in the Series Principal Account, the Spread Account, theIncremental Funding Reserve Account and the Distribution Account maintained forthe Series 2000-VFC Certificateholders, as described in this Article IV.

 

SECTION 4.02  Establishmentof Series Principal Account, Spread Account, Liquidity Reserve Account andIncremental Funding Reserve Account.

 

(a)                                  Series Principal Account.

 

(i)                                     On or prior to the commencement of an EarlyAmortization Period or the Amortization Period, the Master Trust Trustee, forthe benefit of the Series 2000-VFC Certificateholders, shall establish andmaintain in the name of the Master Trust an Eligible Deposit Account bearing adesignation clearly indicating that the funds deposited therein are held forthe benefit of the Series 2000-VFC Certificateholders (the “Series PrincipalAccount”).  The Master Trust Trusteeshall possess all right, title and interest in all funds on deposit from timeto time in the Series Principal Account and in all proceeds thereof.  Pursuant to authority granted to it pursuantto Section 3.01(b) of the Agreement, the Servicer shall have the revocablepower to instruct the Master Trust

 

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Trustee to withdraw fundsfrom the Series Principal Account for the purpose of carrying out the duties ofthe Servicer under this Series Supplement and the Agreement.  The Servicer at all times shall maintainaccurate records reflecting each transaction in the Series Principal Account.

 

(ii)                                  Funds on deposit in the Series PrincipalAccount overnight or for a longer period shall at all times be invested inEligible Investments at the direction of the Servicer or its agent, subject tothe restrictions set forth in the Agreement and subject to the requirement thateach such Eligible Investment shall have a stated maturity on or prior to thefollowing Transfer Date (or such longer maturity as shall be allowed upon thewritten consent of the Administrative Agent). Net interest and earnings (less investment expenses) on funds on depositin the Series Principal Account, if any, shall be allocated and distributed asprovided in Section 4.04.

 

(b)                                 Spread Account.

 

(i)                                     The Master Trust Trustee, for the benefit ofthe Series 2000-VFC Certificateholders, shall cause to be established andmaintained in the name of the Master Trust, an Eligible Deposit Account bearinga designation clearly indicating that the funds deposited therein are held forthe benefit of the Series 2000-VFC Certificateholders (the “Spread Account”).  The Master Trust Trustee shall possess allright, title and interest in all funds on deposit from time to time in theSpread Account and in all proceeds thereof. Pursuant to authority granted to it pursuant to Section 3.01(b) of the Agreement,the Servicer shall have the revocable power to instruct the Master TrustTrustee to withdraw funds from the Spread Account for the purpose of carryingout the duties of the Servicer under this Series Supplement and the Agreement.  The Servicer at all times shall maintainaccurate records reflecting each transaction in the Spread Account.  As of the Closing Date, the Servicer shallcause to be deposited in the Spread Account an amount equal to the Initial SpreadAccount Required Amount.

 

(ii)                                  Funds on deposit in the Spread Accountovernight or for a longer period shall at all times be invested in EligibleInvestments at the direction of the Servicer or its agent, subject to therestrictions set forth in the Agreement and subject to the requirement thateach such Eligible Investment shall have a stated maturity on or prior to thefollowing Transfer Date.  Net interestand earnings (less investment expenses) on funds on deposit in the SpreadAccount, if any, shall be allocated and distributed as provided in Section4.04.

 

(iii)                               On any Transfer Date related to a Due Periodon which the amount of funds on deposit in the Spread Account is greater thanthe Projected Spread on such Transfer Date, the Servicer shall withdraw theamount of such excess from the Spread Account and allocate and pay such excessto the Seller.

 

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(iv)                              Uponthe commencement of and during an Early Amortization Period, the Master TrustTrustee will deposit all funds in the Spread Account into the Liquidity ReserveAccount, and no additional funds shall be deposited into the Spread Account.

 

(c)                                  LiquidityReserve Account.

 

(i)                                     TheMaster Trust Trustee, for the benefit of the Seller, shall establish on orprior to the commencement of an Early Amortization Period and maintain or causeto be established and maintained in the name of the Master Trust Trustee, anEligible Deposit Account bearing a designation clearly indicating that thefunds deposited therein are held for the benefit of the Seller (the “LiquidityReserve Account”).  The Seller shallpossess all right, title and interest in all funds on deposit from time to timein the Liquidity Reserve Account and in all proceeds thereof; *provided*, *however*,that no funds on deposit in the Liquidity Reserve Account shall be paid to theSeller if such payment would reduce the funds in such account below an amountequal to the Available Subordinated Amount. Pursuant to authority granted to it pursuant to Section 3.01(b) of theAgreement, the Servicer shall have the revocable power to instruct the MasterTrust Trustee to withdraw funds from the Liquidity Reserve Account for thepurpose of fulfilling the obligations of the Seller under this SeriesSupplement and the Agreement.  TheServicer at all times shall maintain accurate records reflecting transactionsin the Liquidity Reserve Account.

 

(ii)                                  Fundson deposit in the Liquidity Reserve Account overnight or for a longer periodshall at all times be invested in Eligible Investments at the direction of theSeller or its agent, subject to the restrictions set forth in theAgreement.  Any Eligible Investment witha stated maturity shall mature on or prior to the following Transfer Date.  All net interest and earnings (lessinvestment expenses) on funds on deposit in the Liquidity Reserve Account, ifany, shall be paid to the Seller.  On anyTransfer Date on which the amount on deposit in the Liquidity Reserve Accountexceeds the Available Subordinated Amount as of the end of such Transfer Date,the Servicer shall withdraw the amount of such excess from the LiquidityReserve Account and allocate and pay such excess to the Seller.

 

(d)                                 IncrementalFunding Reserve Account.

 

(i)                                     TheMaster Trust Trustee, for the benefit of the Series 2000-VFCCertificateholders, shall establish on or prior to the commencement of an EarlyAmortization Period and maintain or cause to be established and maintained inthe name of the Master Trust Trustee, an Eligible Deposit Account bearing adesignation clearly indicating that the funds deposited therein are held forthe benefit of the Series 2000-VFC Certificateholders, (the “Incremental FundingReserve Account”).  The Master TrustTrustee shall possess all right, title and interest in all funds on depositfrom time to time

 

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in the Incremental Funding Reserve Account and in all proceeds thereof.  Pursuant to authority granted to it pursuantto Section 3.01(b) of the Agreement, the Servicer shall have the revocablepower to instruct the Master Trust Trustee to withdraw funds from theIncremental Funding Reserve Account for the purpose of fulfilling theobligations of the Servicer under this Series Supplement and theAgreement.  The Servicer at all timesshall maintain accurate records reflecting transactions in the IncrementalFunding Reserve Account.

 

(ii)                                  Fundson deposit in the Incremental Funding Reserve Account overnight or for a longerperiod shall at all times be invested in Eligible Investments at the directionof the Servicer or its agent, subject to the restrictions set forth in theAgreement.  Any Eligible Investment witha stated maturity shall mature on or prior to the following Transfer Date.  All net interest and earnings (lessinvestment expenses) on funds on deposit in the Incremental Funding ReserveAccount, if any, shall be paid to the Seller.

 

(e)                                  ReplacementSeries 2000-VFC Accounts.  If, at anytime, any of the Series 2000-VFC Accounts ceases to be an Eligible DepositAccount, the Master Trust Trustee (or the Servicer on its behalf) shall uponthe earlier of (a) 30 calendar days, or (b) the next Determination Date,establish a new Series 2000-VFC Account meeting the conditions specified inparagraphs (a), (b), (c) or (d) above, as applicable, as an Eligible DepositAccount and shall transfer any cash and/or any investments to such new Series2000-VFC Account.  Neither the Seller,the Servicer nor any person or entity claiming by, through or under the Seller,the Servicer or any such person or entity shall have any right, title orinterest in, or any right to withdraw any amount from, any Series 2000-VFCAccount, except as expressly provided herein.

 

SECTION 4.03  [Reserved].

 

SECTION 4.04    Application of AvailableCertificateholder Interest Collections

 

(a)                                  Applicationof Available Certificateholder Interest Collections.  On each Transfer Date related to a DuePeriod, the Master Trust Trustee, acting in accordance with instructions fromthe Servicer, shall apply Available Certificateholder Interest Collections forsuch Due Period in the following amounts and in the following order ofpriority:

 

(i)                                     InvestorServicing Fee.  An amount equal tothe Investor Servicing Fee for such Due Period (unless such amount has beennetted against deposits to the Collections Account or waived) shall beallocated and paid to the Servicer.

 

(ii)                                  MonthlyInterest.  An amount equal to MonthlyInterest for the Distribution Date shall be deposited in the DistributionAccount.

 

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(iiA)                        Non-UseFees.  An amount equal to the Non-UseFees for the related Distribution Date shall be deposited in the DistributionAccount.

 

(iiB)                        AdditionalAmounts.  An amount equal to theAdditional Amounts

for the related Distribution Date, but not in excess of 0.40% of theInvested Amount as of the Distribution Date immediately preceding the relatedDue Period, shall be deposited into the Distribution Account.

 

(iii)                               InvestorDealer Note Losses.  An amount equalto the Investor Dealer Note Losses, if any, for such Due Period shall bereimbursed by being treated as Investor Principal Collections for such TransferDate.

 

(iv)                              Reimbursementof Investor Charge-Offs.  An amountequal to the aggregate amount of unreimbursed Investor Charge-Offs, if any, forany prior Due Period shall be reimbursed by being treated as Investor PrincipalCollections for such Transfer Date.

 

(v)                                 SpreadAccount Deposit Amount.  An amountequal to the Spread Account Deposit Amount, if any, for such Transfer Dateshall be deposited into the Spread Account.

 

(vi)                              DeferredInvestor Servicing Fee.  An amountequal to the aggregate outstanding amounts of the Investor Servicing Fee whichhave been previously waived pursuant to Section 3.01 (unless such amounts havebeen waived again) shall be allocated and paid to the Servicer.

 

(vii)                           Reinstatementof Available Subordinated Amount.  Anamount equal to the excess, if any, of the Maximum Subordinated Amount as ofthe end of the preceding Transfer Date over the Available Subordinated Amountas of the end of the preceding Transfer Date shall be (A) during theRevolving Period or the Amortization, allocated and paid to the Seller or(B) during an Early Amortization Period, deposited in the LiquidityReserve Account, and in either case (A) or (B) the Available SubordinatedAmount shall be reinstated by the amount of such payment or deposit.

 

(viiA)                 AdditionalAmounts.  An amount equal to anyAdditional Amounts for the related Distribution Date not paid pursuant toSection 4.04(iiB) shall be deposited into the Distribution Account.

 

(viiB)                   IncrementalFunding Reserve Deposit Amount.  Anamount equal to the Incremental Funding Reserve Deposit Amount, if any, shallbe deposited into the Incremental Funding Reserve Account.

 

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(viii)                        ExcessInterest Collections.  Any remaining AvailableCertificateholder Interest Collections shall be treated as Excess InterestCollections, and applied pursuant to Section 4.03(f) of the Agreement.

 

If AvailableCertificateholder Interest Collections are not sufficient to satisfy theapplication described in clauses (i) through (viiA) above on any Transfer Date,then funds on deposit in the Incremental Funding Reserve Account will beapplied in the manner described in clause (ii) above.  After such application, any remaining fundsin the Incremental Funding Reserve Account shall be paid to the Seller.  If Available Certificateholder InterestCollections, plus amounts allocated from the Incremental Funding ReserveAccount as described above, are not sufficient to satisfy each of theapplications described in clauses (i) through (viiA) above on any TransferDate, then Excess Interest Collections from other Series allocable to Series2000-VFC will be applied as Available Certificateholder Interest Collections inthe priority and the manner described in clauses (i) through (viiA) above.  If Excess Interest Collections are less thanthe shortfalls for all Series that provide for allocations of Excess InterestCollections, such Excess Interest Collections shall be allocable to shortfallsfor Series 2000-VFC and any other Series that so provides *pro rata* based on the relative amounts ofeach Series’ shortfall.

 

SECTION 4.05  Application of Available Seller’s FinanceCharge Collections, Spread Account and Liquidity Reserve Account to DeficiencyAmount.

 

(a)                                  Oneach Transfer Date, the Servicer shall determine the amount (the “DeficiencyAmount”), if any, by which the amount of the entire allocations required onsuch Transfer Date by Sections 4.04(a)(i) through (iv) exceeds the amount ofAvailable Certificateholder Interest Collections for such Due Period and ExcessInterest Collections allocated to Series 2000-VFC on such Transfer Date, ifany, for the related Due Period.

 

(b)                                 Ifthe Deficiency Amount for any Transfer Date is greater than zero, the MasterTrust Trustee, acting in accordance with instructions from the Servicer, shallapply available funds from the following sources in the following order ofpriority in the same manner as Available Certificateholder InterestCollections, each of which applications shall reduce such Deficiency Amount(all such available funds being the “Available Draw Funds” for such TransferDate):

 

(i)                                     AvailableSeller’s Finance Charge Collections;

 

(ii)                                  fundson deposit in the Spread Account;

 

(iii)                               forany Transfer Date occurring during any Early Amortization Period, funds on depositin the Liquidity Reserve Account;

 

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*provided*, *however*,that the amount applied pursuant to this Section 4.05(b) shall not exceed theDraw Amount.  The Available SubordinatedAmount shall be reduced by the aggregate amount of Available Draw Funds appliedpursuant to this Section 4.05(b).

 

(c)                                  Ifall of the amounts applied pursuant to Section 4.05(a) and (b) are insufficientto make the entire application described in Section 4.04(a)(iii), the AvailableSubordinated Amount shall be reduced (but not below zero) by the amount of suchdeficiency and any remaining Investor Dealer Note Losses shall be deemed to bereimbursed to the extent of such reduction.

 

SECTION 4.06  Investor Charge-Offs.  If, for any Transfer Date on which theAvailable Subordinated Amount equals or is reduced to zero (after giving effectto the allocations, distributions, withdrawals and deposits to be made on suchTransfer Date) and the Deficiency Amount for such Transfer Date (as reduced bythe applications required by Section 4.05 of this Series Supplement) is greaterthan zero, the Invested Amount shall be reduced by the lesser of (i) suchremaining Deficiency Amount for such Transfer Date and (ii) the amount ofInvestor Dealer Note Losses for the related Due Period remaining unreimbursedafter all applications of funds or reductions of the Available SubordinatedAmount pursuant to Section 4.04 and 4.05 (such lesser amount being an “InvestorCharge-Off”).

 

SECTION 4.07  Application of Seller’s Finance ChargeCollections.

 

(a)                                  Applicationof Available Seller’s Finance Charge Collections.  On each Transfer Date related to a DuePeriod, the Master Trust Trustee, acting in accordance with instructions fromthe Servicer, shall withdraw and apply from the Collections Account to theextent of Available Seller’s Finance Charge Collections for such Due Period,the following amounts in the following order of priority:

 

(i)                                     Oneach Transfer Date related to a Due Period for which a Deficiency Amountexists, the amount required by Section 4.05(b)(i) shall be applied as specifiedin Section 4.05(b).

 

(ii)                                  Oneach Transfer Date related to a Due Period occurring during an EarlyAmortization Period, the amount, if any, by which the Available SubordinatedAmount as of the end of such Transfer Date exceeds the amount of funds ondeposit in the Liquidity Reserve Account shall be deposited in the LiquidityReserve Account.

 

(iii)                             Oneach Transfer Date on which the full Spread Account Deposit Amount was not depositedin the Spread Account pursuant to Section 4.04(a)(v), an amount equal to theshortfall in such Spread Account Deposit Amount shall be deposited in theSpread Account.

 

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(iv)                            Anyremaining Available Seller’s Finance Charge Collections for the related DuePeriod shall be allocated and paid to the Seller.

 

(b)                                 Applicationof Series Allocable Finance Charge Collections to the Seller.  On each Transfer Date related to a DuePeriod, the Master Trust Trustee, acting in accordance with instructions fromthe Servicer, shall withdraw from the Collections Account and allocate and payto the Seller an amount equal to the product of (i) the result of the ExcessSeller’s Percentage for such Due Period minus the Required Excess SellerInterest Percentage and (ii) Series Allocable Finance Charge Collections forsuch Due Period.

 

SECTION 4.08  Application of Series Allocable PrincipalCollections.  On each Business Day,the Master Trust Trustee, acting in accordance with instructions from theServicer, shall withdraw Series Allocable Principal Collections for suchBusiness Day from the Collections Account and apply such funds in the followingamounts:

 

(a)                                  InvestorPrincipal Collections During Revolving Period.  During the Revolving Period, an amount equalto Investor Principal Collections for such Business Day shall be treated asShared Principal Collections, and applied, pursuant to the written direction ofthe Servicer, pursuant to Section 4.03(e) of the Agreement.

 

(b)                                 InvestorPrincipal Collections during Amortization Period or Early Amortization Period.  During the Amortization Period or any EarlyAmortization Period,  Investor PrincipalCollections for such Business Day shall be allocated to the Series 2000-VFCCertificateholders and deposited into the Series Principal Account to theextent the Invested Amount as of the preceding Distribution Date exceeds theamount of funds on deposit in the Series Principal Account on such BusinessDay.  Any Investor Principal Collectionsremaining after the applications described in the preceding sentence shall betreated as Shared Principal Collections, and applied, pursuant to the writtendirection of the Servicer, pursuant to Section 4.03(e) of the Agreement.

 

(c)                                  Seller’sPrincipal Collections During the Revolving Period.  During the Revolving Period, all Seller’sPrincipal Collections for such Business Day shall be deemed to be Series 2000-VFCShared Seller Principal Collections and shall be allocated as provided inSection 4.08(d)(iii).

 

(d)                                 Seller’sPrincipal Collections During Amortization Period or Early Amortization Period;Shared Seller Principal Collections.

 

(i)                                     Duringthe Amortization Period, Available Seller’s Principal Collections for suchBusiness Day shall be deemed to be “Remaining Available Seller’s PrincipalCollections,” which shall be included in Series 2000-VFC Shared SellerPrincipal Collections and allocated as provided in clause (iii) below.  During the Amortization Period, Excess Seller’s

 

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Principal Collections shall beincluded in Series 2000-VFC Shared Seller Principal Collections and allocatedas provided in clause (iii) below.

 

(ii)                                  Duringany Early Amortization Period Available Seller’s Principal Collections for suchBusiness Day shall be deposited in the Liquidity Reserve Account to the extentthe Available Subordinated Amount as of the end of the immediately precedingTransfer Date exceeds the amount of funds on deposit in the Liquidity Reserve Account(including amounts deposited pursuant to Section 4.07(a)(ii)).  The amount required to be deposited pursuantto the preceding sentence shall be reduced by the amount of Available Seller’sFinance Charge Collections deposited in the Liquidity Reserve Account on suchBusiness Day.  Any remaining AvailableSeller’s Principal Collections for such Business Day shall be deemed to be “RemainingAvailable Seller’s Principal Collections.” During any Early Amortization Period, all Excess Seller’s Principal Collections,all Remaining Available Seller’s Principal Collections and all shared sellerprincipal collections of any other Series that provides for shared sellerprincipal collections not allocated in respect of principal shortfalls shall beallocated and paid to the Seller or deposited in the Excess Funding Account tothe extent necessary to maintain the Master Trust Seller’s Interest at anamount equal to (or, in the Seller’s discretion, greater than) the MinimumMaster Trust Seller’s Interest.

 

(iii)                               Duringthe Revolving Period or the Amortization Period, Series 2000-VFC Shared SellerPrincipal Collections, if any, and shared seller principal collections for anyother Series that provides for shared seller principal collections shall bedetermined on each business day and allocated in the following priority:  (i) to any other Series to the extent suchSeries provides for the use of shared seller principal collections in respectof principal shortfalls, (ii) to the Excess Funding Account to the extent necessaryto maintain the Master Trust Seller’s Interest at an amount equal to (or, inthe discretion of the Seller, greater than) the Minimum Master Trust Seller’sInterest, (iii) at the election of the Seller, retained and allocated to theSeries 2000-VFC Certificateholders and deposited in the Series PrincipalAccount on the related Transfer Date to make any prepayments as described inSection 1.03 and (iv) to the Seller.  Ifshared seller principal collections for all Series are less than the shortfallsfor which shared seller principal collections may be used, then such sharedseller principal collections will be allocated to all such shortfalls *pro rata* based on the relative amounts ofeach such shortfall.

 

(iv)                              “Series2000-VFC Shared Seller Principal Collections” means on each business day (i)during a Revolving Period, all Available Seller’s Principal Collections and allExcess Seller’s Principal Collections and (ii) during an Amortization Period,all Remaining Available Seller’s Principal Collections and all Excess Seller’sPrincipal Collections.  There shall be noSeries 2000-VFC Shared Seller Principal Collections during any EarlyAmortization Period.

 

(e)                                  Ifon any Distribution Date during an Early Amortization Period after theapplication of all funds to be allocated or distributed on such date theexcess, if any, of (x) the Invested Amount over (y) the amount in the SeriesPrincipal Account (the “Early Amortization

 

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Period Shortfall Amount”) isless than or equal to the aggregate amount of funds contained in the LiquidityReserve Account then funds shall be withdrawn in an amount equal to the EarlyAmortization Period Shortfall Amount and shall be deposited in the SeriesPrincipal Account.

 

SECTION 4.09  Shared Principal Collections.

 

(a)                                  Thatportion of Shared Principal Collections for any Business Day equal to theamount of Series 2000-VFC Shared Principal Collections for such Business Daywill be allocated to Series 2000-VFC and will be applied in the same manner asInvestor Principal Collections pursuant to Section 4.08(b) and otherwise willbe deposited in the Excess Funding Account to the extent necessary to maintainthe Master Trust Seller’s Interest at an amount equal to (or, in the discretionof the Seller, greater than) the Minimum Master Trust Seller’s Interest orallocated to the Seller.

 

(b)                                 “Series2000-VFC Shared Principal Collections,” with respect to any Business Day, shallmean an amount equal to the Series 2000-VFC Principal Shortfall for suchBusiness Day; *provided*, *however*, that, if the aggregate amount ofShared Principal Collections for all Series for such Business Day is less thanthe aggregate amount of Principal Shortfalls for all Series for such BusinessDay, then Series 2000-VFC Shared Principal Collections for such Business Dayshall equal the product of (x) Shared Principal Collections for all Series forsuch Business Day and (y) a fraction, the numerator of which is the Series 2000-VFCPrincipal Shortfall for such Business Day and denominator of which is theaggregate amount of Principal Shortfalls for all Series for such Business Day; *provided further* that if Shared PrincipalCollections are not required to be applied to any other Series, the Seller maydirect that all or any portion of such Shared Principal Collections be retainedand allocated to the Series 2000-VFC Certificateholders and deposited in theSeries Principal Account on the related Transfer Date to make any prepaymentpermitted by Section 1.03.

 

SECTION 4.10  Distributions to Series 2000-VFCCertificateholders.  On each TransferDate, after all allocations to the Distribution Account and the SeriesPrincipal Account for the related Transfer Date have been made, the MasterTrust Trustee, acting in accordance with instructions from the Servicer, shalltransfer to the Distribution Account the funds on deposit in the SeriesPrincipal Account and shall make, without duplication, the followingdistributions from the Distribution Account:

 

(a)                                  InterestDistributions.  On each DistributionDate (including the Expected Payment Date), Monthly Interest, Non-Use Fees andAdditional Amounts will be distributed as such to the Series 2000-VFCCertificateholders to the extent of the amount on deposit in the DistributionAccount for such purpose.

 

(b)                                 AmortizationPeriod and Early Amortization Period. On each Distribution Date related to a Due Period occurring during anAmortization Period or an Early Amortization Period, in addition to the amountdescribed in (a) above, amounts on deposit in the Series

 

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Principal Account will bedistributed as principal (up to a maximum of the Invested Amount on suchDistribution Date) on the Series 2000-VFC Certificates.

 

(c)                                 Revolving Period.  On each Distribution Date relating to a DuePeriod

during theRevolving Period, in addition to the amount described in (a) above, amounts ondeposit in the Series Principal Account will be distributed as principal (up toa maximum of the Invested Amount on such Distribution Date) on the Series2000-VFC Certificates.

 

SECTION 4.11   [Reserved]

 

SECTION 4.12   Partial Month Due Period.  The allocation and distribution provisions inthis Series Supplement are based upon the assumptions that each Due Period willbe a calendar month and that each Due Period will have a unique relatedTransfer Date and Distribution Date. However, under certain circumstances (such as the occurrence of an EarlyAmortization Event, the Revolving Period could end on a date other than thelast day of a calendar month (the period from the first day of such month (the “SubjectMonth”) to and including the date of such occurrence being referred to hereinas the “Revolving Due Period”), and an Early Amortization Period could commenceon a date other than the first day of a calendar month (the period from suchother date until the last day of the Subject Month being the “Amortizing DuePeriod”).  If such a circumstance occurs,then the Servicer, the Seller and the Master Trust Trustee shall observe thefollowing rules:

 

(i)                                     theTransfer Date for both the Revolving Due Period and the Amortizing Due Periodshall be the date on which the Transfer Date would have occurred if the SubjectMonth had been an ordinary Due Period;

 

(ii)                                  theallocations and distributions of Finance Charge Collections (and all itemsderived from Finance Charge Collections, such as Available CertificateholderInterest Collections and Available Seller’s Finance Charge Collections) andDealer Note Losses occurring during the Subject Month shall be made as if theSubject Month were one Due Period, without any distinction between theRevolving Due Period and the Amortizing Due Period; and

 

(iii)                               twoseparate sets of allocations and distributions of Principal Collections (and allitems derived from Principal Collections, such as Investor PrincipalCollections and Seller’s Principal Collections) shall be made on such TransferDate, according to whether such Principal Collections were received during theRevolving Due Period (in which case allocations and distributions shall be madeas provided in Sections 4.08(a) and (c)) or the Amortizing Due Period (in whichcase allocations and distributions shall be made as provided in Sections4.08(b) and (d)).

 

SECTION 4.13  Additional Rights upon the Occurrence ofCertain Events.  Notwithstanding theprovisions ofSection 9.02(a) of the Agreement, if any insolvency event

 

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occurs with respect to theSeller, Navistar International Corporation, Navistar InternationalTransportation Corp. or Navistar Financial Corporation on the day of suchinsolvency event, the Seller will (subject to the actions of theCertificateholders) immediately cease to transfer Dealer Notes to the MasterTrust, and promptly give notice to the Master Trust Trustee of such insolvencyevent.  Under the terms of the Poolingand Servicing Agreement, if an insolvency event occurs with respect to theSeller prior to the date on which the Series 2000-VFC Certificates issued by theMaster Trust have been paid in full, then within 15 days the Master TrustTrustee will publish a notice of such insolvency event stating that the MasterTrust Trustee intends to sell, liquidate or otherwise dispose of the DealerNotes in a commercially reasonable manner and on commercially reasonable terms,unless within a specified period of time Certificate holders representing morethan 50% of the aggregate series invested amount of the certificates of eachsuch Series and each person holding a Supplemental Certificate, instruct theMaster Trust Trustee not to sell, dispose of or otherwise liquidate the DealerNotes and to continue transferring Dealer Notes as before such insolvencyevent.

 

ARTICLE V

DISTRIBUTIONS AND REPORTS

TO SERIES 2000-VFC CERTIFICATEHOLDERS

 

SECTION 5.01  Distributions.

 

(a)                                  ThePaying Agent shall distribute (in accordance with the Monthly ServicerCertificate and Settlement Statement delivered by the Servicer to the MasterTrust Trustee and the Paying Agent pursuant to Section 3.04(d) of theAgreement) to each Series 2000-VFC Certificateholder of record on the precedingRecord Date (other than as provided in Section 12.02 of the Agreementrespecting a final distribution) on each Distribution Date suchCertificateholder’s *pro rata* share(based on the aggregate fractional undivided interests represented by theSeries 2000-VFC Certificates held by such Certificateholder) of the amounts ondeposit in the Series 2000-VFC Accounts as is payable to the Series 2000-VFCCertificateholders on such Distribution Date pursuant to Sections 4.10  (a), (b) and (c).

 

(b)                                 Exceptas provided in Section 12.03 of the Agreement with respect to a finaldistribution, distributions to Series 2000-VFC Certificateholders hereundershall be made to each Series 2000-VFC Certificateholder by wire transfer ofimmediately available funds to the account specified by such Series 2000-VFCCertificateholder without presentation or surrender of any Series 2000-VFCCertificate or the making of any notation thereon.

 

SECTION 5.02  Monthly and Annual Certificateholders’Statement.

 

(a)                                  MonthlySeries 2000-VFC Certificateholders’ Statement.  At least two Business Days prior to eachDistribution Date, the Servicer will provide to the Master Trust Trustee andthe Paying Agent, and on each Distribution Date, the Paying Agent shall forwardto each Series 2000-VFC Certificateholder a Monthly Servicer Certificate andSettlement Statement

 

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substantially in the form of ExhibitB with such changes as the Servicer shall deem necessary or appropriate,prepared by the Servicer and delivered to the Master Trust Trustee settingforth, among other things, the following information:

 

(i)                                     theaggregate amount of Collections, including the aggregate amount of FinanceCharge Collections and the aggregate amount of Principal Collections for therelated Due Period;

 

(ii)                                  theSeries 2000-VFC Allocation Percentage, the Floating Allocation Percentage andthe Principal Allocation Percentage (if applicable) for the related Due Period;

 

(iii)                               thetotal amount to be distributed on the Series 2000-VFC Certificates on suchDistribution Date;

 

(iv)                              theamount, if any, of such distribution allocable to the Invested Amount;

 

(v)                                 theamount, if any, of such distribution allocable to interest on the Series 2000-VFCCertificates;

 

(vi)                              DealerNote Losses for the related Due Period;

 

(vii)                           theDraw Amount as of the related Transfer Date, if any;

 

(viii)                        theamount of the Investor Charge-Offs and the amount of reimbursement thereof asof the related Transfer Date;

 

(ix)                                theamount of the Investor Servicing Fee to be paid on such Distribution Date;

 

(x)                                   theamount of any Incremental Funding or prepayment to occur on such DistributionDate, the aggregate amount on deposit in the Incremental Funding ReserveAccount as of the related Transfer Date, if any, the amount thereof, if any,allocated to pay Monthly Interest for such Distribution Date, the amount, ifany, thereof to be distributed to the Seller, the Incremental Funding ReserveAccount Deposit Amount for such Distribution Date, if any, and the IncrementalSubordinated Amount, if any, for such Distribution Date;

 

(xi)                                theInvested Amount (after giving effect to all distributions that will occur onsuch Distribution Date);

 

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(xii)                             theaggregate amount of Dealer Notes and funds on deposit in each of the ExcessFunding Account, Series Principal Account and Spread Account as of the end ofthe last day of the related Due Period (after giving effect to payments andadjustments made pursuant to Article IV of this Series Supplement and ofthe Agreement);

 

(xiii)                          theAvailable Subordinated Amount as of the end of the related Transfer Date;

 

(xiv)                         withrespect to Eligible Investments in the Series Principal Account, the ExcessFunding Account and the Liquidity Reserve Account, as of the last day of therelated Due Period, the aggregate amount of funds invested in EligibleInvestments in each such Series Account, a brief description of each suchEligible Investment and amount invested in each such Eligible Investment, therate of interest applicable to each such Eligible Investment and the rating ofeach such Eligible Investment;

 

(xv)                            theDealers with the five largest aggregate outstanding principal amounts of DealerNotes in the Master Trust as of the end of the related Due Period;

 

(xvi)                         theaggregate outstanding principal amount of Dealer Notes issued to finance OEMVehicles as of the end of the related Due Period;

 

(xvii)                      thepercentages and all other information calculated pursuant to Section 6.01 todetermine whether an Early Amortization Event has occurred;

 

(xviii)                   theamount of Excess Interest Collections and Investor Principal Collectionstreated as Shared Principal Collections, each for the related Due Period, andthe amount of such Excess Interest Collections and Shared Principal Collectionsallocated to other Series; and

 

(xix)                           theamount of Remaining Available Seller’s Principal Collections, the amount ofExcess Seller’s Principal Collections and Remaining Available Seller’sPrincipal Collections treated as Series 2000-VFC Shared Seller PrincipalCollections, the amount of Shared Seller Principal Collections from otherSeries, and the amount of Shared Seller Principal Collections allocated toSeries 2000-VFC and to other Series, each for the related Due Period.

 

(b)                                 [Reserved]

 

(c)                                  Acopy of the statement provided pursuant to subsection (a) will be madeavailable for inspection at the Corporate Trust Office.

 

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(d)                                 AnnualCertificateholder’s Tax Statement. On or about January 31 of each calendar year, beginning with calendaryear 2001, the Master Trust Trustee shall furnish to the Servicer and PayingAgent a list of each Person who at any time during the preceding calendar yearwas a Series 2000-VFC Certificateholder and received any payment thereon andthe dates such Person held a Series 2000-VFC Certificate, and the Paying Agentshall furnish to each such Series 2000-VFC Certificateholder a statementprepared by the Paying Agent containing the information prepared by the MasterTrust Trustee which is required to be contained in the statement to Series 2000-VFCCertificateholders as set forth in Sections 5.02(a)(iii)-(a)(v) above,aggregated for such calendar year or the applicable portion thereof duringwhich such Person was a Series 2000-VFC Certificateholder, together with suchother customary information as the Master Trust Trustee or the Servicer deemsnecessary or desirable to enable the Series 2000-VFC Certificateholders toprepare their tax returns, including information (to be supplied by theServicer to the Master Trust Trustee) regarding original issue discount on theSeries 2000-VFC Certificates, if any. Such obligation of the Paying Agent shall be deemed to have beensatisfied to the extent that substantially comparable information shall beprovided by the Master Trust Trustee pursuant to any requirements of theInternal Revenue Code as from time to time in effect.

 

ARTICLE VI

EARLY AMORTIZATION EVENTS

 

SECTION 6.01  Additional Early Amortization Events.  The occurrence of any of the following eventsshall, immediately upon the occurrence thereof without notice or other actionon the part of the Master Trust Trustee or the Series 2000-VFCCertificateholders, be deemed to be an Early Amortization Event solely withrespect to Series 2000-VFC:

 

(a)                                  theInvested Amount is not reduced to zero by the Expected Payment Date;

 

(b)                                 theUnited States government or any agency or instrumentality thereof files anotice of a lien under Internal Revenue Code §6323 or any similar statutoryprovision (including, but not limited to, §302(f) or §4068 of ERISA) on theassets of NFC or NFSC which is or may in the future be prior to the lien of theMaster Trust Trustee or the assets of the Master Trust (including, withoutlimitation, proceeds of the Dealer Notes);

 

(c)                                  failureon the part of the Seller (i) to make any payment, distribution or depositrequired under the Agreement within five business days of the date required or(ii) to observe or perform in any material respect any other materialcovenants or agreements of the Seller, which continues unremedied for a periodof 60 days after written notice of such failure shall have been given to theSeller;

 

(d)                                 anyrepresentation or warranty made by the Seller pursuant to the Agreement or anyinformation contained in the schedule of Dealer Notes delivered thereunder orthis Series Supplement shall prove to have been incorrect in any materialrespect when made or when delivered, which representation, warranty orschedule, or the circumstances or condition

 

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that caused suchrepresentation, warranty or schedule to be incorrect, continues to be incorrector uncured in any material respect for a period of 60 days after written noticeof such incorrectness shall have been given to the Seller and as a result ofwhich the interests of the Series 2000-VFC Certificateholders are materiallyand adversely affected, except that an Early Amortization Event shall not bedeemed to occur if the Seller has repurchased the related Dealer Notes or allsuch Dealer Notes, if applicable, during such period in accordance with theprovisions of the Agreement;

 

(e)                                  theSeller shall become legally unable for any reason to transfer Dealer Notes tothe Master Trust in accordance with the provisions of the Agreement;

 

(f)                                    onany Transfer Date related to a Due Period, the Available Subordinated Amountfor such Transfer Date will be reduced to an amount less than the RequiredSubordinated Amount;

 

(g)                                 anyServicer Termination Event shall occur for which the Servicer has received anotice of termination;

 

(h)                                 thedelivery by the Seller to the Master Trust Trustee of a notice stating that theSeller will no longer continue to sell Dealer Notes to the Master Trustcommencing on the date specified in such notice;

 

(i)                                     theAverage Coverage Differential shall be equal to or less than negative twopercent (-2.00%) on each of three consecutive Determination Dates;

 

(j)                                     atthe end of any Due Period, the Master Trust Seller’s Interest is reduced to anamount less than the Master Trust Minimum Seller’s Interest and the Seller hasfailed to assign additional Dealer Notes to the Master Trust in the amount ofsuch deficiency within ten Business Days following the end of such Due Period;

 

(k)                                  onany Determination Date, the quotient of (i) the product of (a) the sum ofDealer Note Collections for each of the related Due Period and the two immediatelypreceding Due Periods and (b) four *divided**by* (ii) the daily averageprincipal amount of Dealer Notes outstanding during such Due Periods (“Turnover”)is less than 1.7;

 

(l)                                     onany Determination Date, the quotient of (i) the sum of Dealer Note Lossesfor each of the related Due Period and the five immediately preceding DuePeriods and (ii) the sum of Principal Collections for each of the relatedDue Period and the five immediately preceding Due Periods, is greater than orequal to one percent (1.00%);

 

(m)                               [Reserved]

 

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(n)                                 anyof the Seller, NITC, NIC or NFC shall file a petition commencing a voluntarycase under any chapter of the federal bankruptcy laws; or the Seller or NFCshall file a petition or answer or consent seeking reorganization, arrangement,adjustment or composition under any other similar applicable federal law, orshall consent to the filing of any such petition, answer or consent; or theSeller, NITC, NIC or NFC shall appoint, or consent to the appointment of acustodian, receiver, liquidator, trustee, assignee, sequestrator or othersimilar official in bankruptcy or insolvency of it or of any substantial partof its property; or the Seller, NITC, NIC or NFC shall make an assignment forthe benefit of creditors, or shall admit in writing its inability to pay itsdebts generally as they become due;

 

(o)                                 anyorder for relief against any of the Seller, NITC, NIC or NFC shall have beenentered by a court having jurisdiction in the premises under any chapter of thefederal bankruptcy laws, and such order shall have continued undischarged orunstayed for a period of 120 days; or a decree or order by a court havingjurisdiction in the premises shall have been entered approving as properly fileda petition seeking reorganization, arrangement, adjustment, or composition ofthe Seller, NITC, NIC or NFC under any other similar applicable federal law,and such decree or order shall have continued undischarged or unstayed for aperiod of 120 days; or a decree or order of a court having jurisdiction in thepremises for the appointment of a custodian, receiver, liquidator, trustee,assignee, sequestrator or other similar official in bankruptcy or insolvency ofthe Seller, NITC, NIC or NFC of any substantial part of their property, or forthe winding up or liquidation of their affairs, shall have been entered, andsuch decree or order shall have remained in force undischarged or unstayed fora period of 120 days; and

 

(p)                                 failureon the part of NITC to make a deposit in the Interest Deposit Account requiredby the terms of the Interest Deposit Agreement on or before the date occurringfive Business Days after the date such deposit is required by the InterestDeposit Agreement to be made.

 

ARTICLE VII

OTHER SERIES PROVISIONS

 

SECTION 7.01  Conveyance of Dealer Notes.  Upon the date on which each other Series iseither no longer outstanding or the fully funded date has occurred with respectthereto, the Master Trust Trustee shall sell, assign and convey to the Selleror its designee, without recourse, representations or warranty, all right,title and interest of the Master Trust in the Dealer Notes, whether thenexisting or thereafter created, all security interests in the Financed Vehicleswith respect thereto, all monies due or to become due and all amounts receivedwith respect thereto and all proceeds thereof except for amounts on deposit inthe Collections Account that are allocable to Investor Certificates and amountson deposit in any Series Account.  TheMaster Trust Trustee shall execute and deliver such instruments of transfer andassignment, in each case without recourse, as shall be reasonably requested bythe Seller to vest in the Seller or its designee all right, title and interestwhich the Master Trust had in all such property.

 

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SECTION 7.02  Tax Treatment.  The Seller has entered into the Agreement andthis Series Supplement and the Series 2000-VFC Certificates have been issuedwith the intention that the Series 2000-VFC Certificates will qualify underapplicable tax law as indebtedness secured by the Master Trust assetsattributable to the Series 2000-VFC Certificates.  The Seller and each Series 2000-VFCCertificateholder and Certificate Owner, by the acceptance of its Series 2000-VFCCertificate or Book-Entry Certificate, as applicable, agrees to treat theSeries 2000-VFC Certificates as indebtedness secured by the Master Trust assetsattributable to the Series 2000-VFC Certificates, for Federal income taxes,state and local income and franchise taxes and any other taxes imposed on ormeasured by income in whole or in part.

 

ARTICLE VIII

FINAL DISTRIBUTIONS

 

SECTION 8.01  Sale of Investors’ Interest Pursuant toSection 2.07 of the Agreement; Distributions Pursuant to Section 2.03 or 12.03of the Agreement.

 

(a)                                  Theamount to be paid by the Seller to the Collections Account with respect toSeries 2000-VFC in connection with a purchase of the Certificateholders’Interest pursuant to Section 2.07 of the Agreement shall equal the ReassignmentAmount for the Distribution Date on which such purchase occurs.

 

(b)                                 Withrespect to the Reassignment Amount, if any, deposited into the CollectionsAccount pursuant to this Section 8.01 of this Series Supplement or Section 2.07of the Agreement or any proceeds deposited into the Collections Accountpursuant to Section 12.03(c) of the Agreement, the Master Trust Trustee shall,not later than 12:00 noon, New York City time, on the Distribution Date onwhich such amounts are deposited (or, if such date is not a Distribution Date,on the immediately following Distribution Date) (in the priority set forthbelow):  (i) *first*, deposit the Invested Amount onsuch Distribution Date into the Series Principal Account, (ii) *second*, deposit the amount of accruedand unpaid interest on the unpaid balance of the Series 2000-VFC Certificatesin the Distribution Account,  (iii) *third*, deposit the amount of accruedbut unpaid Non-Use Fees and Additional Amounts in the Distribution Account, and(iv) *fourth*, pay theremainder of any such Reassignment Amounts to the Seller.

 

(c)                                  Notwithstandingany other provision to the contrary in this Series Supplement or the Agreement,the entire amount deposited in the Series Principal Account on a DistributionDate pursuant to Section 8.01(b) and all other amounts on deposit therein shallbe distributed in full to the Series 2000-VFC Certificateholders on suchDistribution Date and any distribution made pursuant to this paragraph (c)shall be deemed to be a final distribution pursuant to Section 12.03 of theAgreement with respect to Series 2000-VFC.

 

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SECTION 8.02  Distribution of Proceeds of Sale,Disposition or Liquidation of the Dealer Notes Pursuant to Section 9.02 of theAgreement.

 

(a)                                  Notlater than 12:00 noon, New York City time, on the Distribution Date followingthe date on which the Insolvency Proceeds are deposited into the CollectionsAccount pursuant to Section 9.02(b) of the Agreement, the Master Trust Trusteeshall first (in each case, after giving effect to any deposits anddistributions otherwise to be made on such Distribution Date) deduct an amountequal to the Invested Amount on such Distribution Date from the portion of theInsolvency Proceeds allocated to Series Allocable Principal Collections anddeposit such amount in the Series Principal Account; *provided* that the amount of such deposit shall not exceedthe product of (x) the portion of the Insolvency Proceeds allocated to SeriesAllocable Principal Collections and (y) 100% minus the Excess Seller’sPercentage with respect to the related Due Period.  The remainder of the portion of theInsolvency Proceeds allocated to Series Allocable Principal Collections shallbe allocated to the Master Trust Seller’s Interest and shall be distributed onsuch Distribution Date to the Seller.

 

(b)                                 Notlater than 12:00 noon, New York City time, on such Distribution Date, theMaster Trust Trustee shall first (in each case, after giving effect to anydeposits and distributions otherwise to be made on such Distribution Date)deduct an amount equal to the sum of (i) Monthly Interest for such DistributionDate and (ii) any accrued but unpaid Non-Use Fees and Additional Amounts, fromthe portion of the Insolvency Proceeds allocated to Series Allocable FinanceCharge Collections and deposit such amount in the Distribution Account; *provided* that the amount of suchdistribution shall not exceed the product of (x) the portion of the InsolvencyProceeds allocated to Series Allocable Finance Charge Collections and (y) 100%minus the Excess Seller’s Percentage with respect to the related DuePeriod.  The remainder of the portion ofthe Insolvency Proceeds allocated to Series Allocable Finance Charge Collectionsshall be allocated to the Master Trust Seller’s Interest and shall bedistributed on such Distribution Date to the Seller.

 

(c)                                  Notwithstandinganything to the contrary in this Series Supplement or the Agreement, the entireamount deposited in the Series Principal Account and the Distribution Accountpursuant to this Section 8.02 and all other amounts on deposit therein shall bedistributed in full to the Series 2000-VFC Certificateholders on theDistribution Date on which funds are deposited pursuant to this Section 8.02(or, if not so deposited on a Distribution Date, on the immediately followingDistribution Date) and any distribution made pursuant to this Section 8.02shall be deemed to be a final distribution pursuant to Section 12.03 of theAgreement with respect to Series 2000-VFC.

 

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ARTICLE IX

MISCELLANEOUS PROVISIONS

 

SECTION 9.01  Ratification of Agreement.  As supplemented by this Series Supplement,the Agreement is in all respects ratified and confirmed and the Agreement as sosupplemented by this Series Supplement shall be read, taken and construed asone and the same instrument.

 

SECTION 9.02  Counterparts.  This Series Supplement may be executed in twoor more counterparts (and by different parties on separate counterparts) eachof which shall be an original, but all of which together shall constitute oneand the same instrument.

 

SECTION 9.03  GOVERNING LAW.  THIS SERIES SUPPLEMENT SHALL BE CONSTRUED,AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BEDETERMINED, IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS,WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, EXCEPT THAT THEOBLIGATIONS, RIGHTS AND REMEDIES OF THE MASTER TRUST TRUSTEE SHALL BE DETERMINEDIN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARDTO CONFLICT OF LAW PROVISIONS.

 

 

**[END OF PAGE]**

** **

** **

**[SIGNATURE PAGE FOLLOWS]**

 

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IN WITNESSWHEREOF, the Seller, the Servicer and the Master Trust Trustee have caused thisSeries Supplement to be duly executed by their respective officers as of theday and year first above written.

 

 
|   | NAVISTAR  FINANCIAL SECURITIES CORPORATION   |
|--------|----------------------------------------------|
|   | as Seller                                    |
|   |                                         |
|   |                                         |
|   | By:                                          | /s/ John A.  Bongiorno |   |
|   | Name: John A. Bongiorno                      |
|   | Title:   President & CEO       |
|   |                                         |
|   |                                         |
|   | NAVISTAR  FINANCIAL CORPORATION              |
|   | as Servicer                                  |
|   |                                         |
|   |                                         |
|   | By:                                          | /s/ John A. Bongiorno |   |
|   | Name: John A. Bongiorno                      |
|   | Title:   President & CEO       |
|   |                                         |
|   |                                         |
|   | THE BANK OF  NEW YORK                        |
|   | as Master Trust Trustee                      |
|   |                                         |
|   |                                         |
|   | By:                                          |  /s/ Edwin Soriano |   |
|   | Name: Edwin Soriano                          |
|   | Title:    Assistant Treasurer |

 

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