Document:

<PAGE>
                                                                     EXHIBIT 4.2

                                    INDENTURE

                   NISSAN AUTO RECEIVABLES _____-_ OWNER TRUST

                                    as Issuer

                                       and

                              [__________________],
               as Indenture Trustee [and Securities Intermediary]

                        Dated as of [__________________]

                                                                     (Indenture)
<PAGE>
                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                            PAGE

<S>         <C>                                                             <C>
ARTICLE I       DEFINITIONS AND INCORPORATION BY REFERENCE.....................2

     1.01   Definitions........................................................2
     1.02   Usage of Terms....................................................11
     1.03   Incorporation by Reference of Trust Indenture Act.................11

ARTICLE II      NOTES.........................................................11

     2.01   Form..............................................................11
     2.02   Execution, Authentication and Delivery............................12
     2.03   Temporary Notes...................................................14
     2.04   Registration; Registration of Transfer and Exchange...............14
     2.05   Mutilated, Destroyed, Lost or Stolen Notes........................15
     2.06   Persons Deemed Owners.............................................16
     2.07   Payments of Principal and Interest................................16
     2.08   Cancellation......................................................17
     2.09   Release of Collateral.............................................17
     2.10   Book-Entry Notes..................................................17
     2.11   Notices to Clearing Agency........................................18
     2.12   Definitive Notes..................................................18
     2.13   Tax Treatment.....................................................19

ARTICLE III     COVENANTS, REPRESENTATIONS AND WARRANTIES.....................19

     3.01   Payment of Principal and Interest.................................19
     3.02   Maintenance of Office or Agency...................................19
     3.03   Money for Payments To Be Held in Trust............................20
     3.04   Existence.........................................................21
     3.05   Protection of Trust Estate........................................21
     3.06   Opinions as to Trust Estate.......................................22
     3.07   Performance of Obligations; Servicing of Receivables..............22
     3.08   Negative Covenants................................................24
     3.09   Annual Statement as to Compliance.................................25
     3.10   Issuer May Consolidate, etc., Only on Certain Terms...............26
     3.11   Successor or Transferee...........................................27
     3.12   No Other Business.................................................28
     3.13   No Borrowing......................................................28
     3.14   Servicer's Notice Obligations.....................................28
     3.15   Guarantees, Loans, Advances and Other Liabilities.................28
     3.16   Capital Expenditures..............................................28
     3.17   Removal of Administrator..........................................28
     3.18   Restricted Payments...............................................29
     3.19   Notice of Events of Default.......................................29
     3.20   Further Instruments and Actions...................................29
     3.21   Representations and Warranties....................................29
     3.22   [Calculation Agent................................................30
</TABLE>

                                       -i-                           (Indenture)
<PAGE>
                               TABLE OF CONTENTS
                                  (CONTINUED)

<TABLE>
<CAPTION>
                                                                            PAGE

<S>         <C>                                                             <C>
ARTICLE IV      SATISFACTION AND DISCHARGE....................................31

     4.01   Satisfaction and Discharge of Indenture...........................31
     4.02   Application of Trust Money........................................32
     4.03   Repayment of Moneys Held by Paying Agent..........................32

ARTICLE V       REMEDIES......................................................32

     5.01   Events of Default.................................................32
     5.02   Acceleration of Maturity; Rescission and Annulment................34
     5.03   Collection of Indebtedness and Suits for Enforcement by Indenture
            Trustee...........................................................35
     5.04   Remedies; Priorities..............................................37
     5.05   Optional Preservation of the Receivables..........................39
     5.06   Limitation of Suits...............................................39
     5.07   Unconditional Rights of Noteholders To Receive Principal and
            Interest..........................................................40
     5.08   Restoration of Rights and Remedies................................40
     5.09   Rights and Remedies Cumulative....................................40
     5.10   Delay or Omission Not a Waiver....................................40
     5.11   Control by Noteholders............................................41
     5.12   Waiver of Past Defaults...........................................41
     5.13   Undertaking for Costs.............................................42
     5.14   Waiver of Stay or Extension Laws..................................42
     5.15   Action on Notes...................................................42
     5.16   Performance and Enforcement of Certain Obligations................42

ARTICLE VI      THE INDENTURE TRUSTEE.........................................43

     6.01   Duties of Indenture Trustee.......................................43
     6.02   Rights of Indenture Trustee.......................................45
     6.03   Individual Rights of Indenture Trustee............................46
     6.04   Indenture Trustee's Disclaimer....................................46
     6.05   Notice of Defaults................................................47
     6.06   Reports by Indenture Trustee to Holders...........................47
     6.07   Compensation and Indemnity........................................47
     6.08   Replacement of Indenture Trustee..................................48
     6.09   Successor Indenture Trustee by Merger.............................49
     6.10   Appointment of Co-Indenture Trustee or Separate Indenture
            Trustee...........................................................49
     6.11   Eligibility; Disqualification.....................................50
     6.12   Preferential Collection of Claims Against Issuer..................50
     6.13   Acknowledgement by Indenture Trustee of its Obligations Under
            the Sale and Servicing Agreement..................................51
     6.14   [Interest Rate Swap Agreement Provisions..........................51
</TABLE>

                                      -ii-
<PAGE>
                               TABLE OF CONTENTS
                                  (CONTINUED)

<TABLE>
<CAPTION>
                                                                            PAGE

<S>         <C>                                                             <C>
ARTICLE VII     NOTEHOLDERS' LISTS AND REPORTS....................................53

     7.01   Note Registrar To Furnish Names and Addresses of Noteholders..........53
     7.02   Preservation of Information; Communications to Noteholders............53
     7.03   Reports by Issuer.....................................................53
     7.04   Reports by Indenture Trustee..........................................54
     7.05   [Indenture Trustee Website............................................54

ARTICLE VIII    ACCOUNTS, DISBURSEMENTS AND RELEASES..............................55

     8.01   Collection of Money...................................................55
     8.02   Accounts..............................................................55
     8.03   General Provisions Regarding Accounts.................................56
     8.04   Release of Trust Estate...............................................58
     8.05   Release of Receivables Upon Purchase by the Seller or the Servicer....58
     8.06   Opinion of Counsel....................................................59

ARTICLE IX      SUPPLEMENTAL INDENTURES...........................................59

     9.01   Supplemental Indentures Without Consent of Noteholders................59
     9.02   Supplemental Indentures with Consent of Noteholders...................60
     9.03   Execution of Supplemental Indentures..................................62
     9.04   Effect of Supplemental Indenture......................................62
     9.05   Conformity with Trust Indenture Act...................................62
     9.06   Reference in Notes to Supplemental Indentures.........................62

ARTICLE X       RELEASE...........................................................63

     10.01  Optional Purchase of All Receivables..................................63

ARTICLE XI      MISCELLANEOUS.....................................................63

     11.01  Compliance Certificates and Opinions, etc.............................63
     11.02  Form of Documents Delivered to Indenture Trustee......................65
     11.03  Acts of Noteholders...................................................65
     11.04  Notices, to Indenture Trustee, Issuer and Rating Agencies.............66
     11.05  Notices to Noteholders; Waiver........................................67
     11.06  Alternate Payment and Notice Provisions...............................67
     11.07  Conflict with Trust Indenture Act.....................................67
     11.08  Effect of Headings and Table of Contents..............................67
     11.09  Successors and Assigns................................................68
     11.10  Severability..........................................................68
     11.11  Benefits of Indenture.................................................68
     11.12  Governing Law.........................................................68
     11.13  Counterparts..........................................................68
     11.14  Recording of Indenture................................................68
</TABLE>

                                     -iii-
<PAGE>
                               TABLE OF CONTENTS
                                  (CONTINUED)

<TABLE>
<CAPTION>
                                                                            PAGE

<S>         <C>                                                             <C>
     11.15  Trust Obligation..................................................69
     11.16  No Petition.......................................................69
     11.17  Inspection........................................................69
EXHIBIT A-1 - Form of Class A-1 Note, Class A-2 Note, Class A-3 Note and Class B
              Note
EXHIBIT A-2 - Form of VPTN
</TABLE>

                                      -iv-
<PAGE>
                              CROSS-REFERENCE TABLE
                         (not a part of this Indenture)

<TABLE>
<CAPTION>
  TIA                                                                 Indenture
Section                                                                 Section
--------                                                             ----------

<S>                                                               <C>
(Section)310(a) (1)....................................................... 6.11
      (a) (2)............................................................. 6.11
      (a) (3)........................................................6.10(b)(i)
      (a) (4)............................................................. N.A.
      (a) (5)............................................................. 6.11
      (b) ................................................................ 5.04
                                                                           6.08
                                                                           6.11
                                                                          11.04
      (c) ................................................................ N.A.
(Section)311(a) .......................................................... 6.12
      (b) ................................................................ 6.12
      (c) ................................................................ N.A.
(Section)312(a) .......................................................... 7.01
      (b) ................................................................ 7.01
                                                                        7.01(b)
      (c) ............................................................. 7.02(c)
(Section)313(a) .......................................................... 7.04
      (b) (1)............................................................. N.A.
      (b) (2)............................................................. 7.04
      (c) ................................................................ 7.04
                                                                          11.04
      (d) ................................................................ 7.04
(Section)314(a) .....................................................3.09, 7.03
                                                                           7.04
                                                                          11.04
      (b) ................................................................ 3.06
                                                                           7.04
                                                                          11.14
      (c) (1) ............................................................ 6.02
                                                                        8.05(b)
                                                                           6.02
                                                                          11.01
      (c) (2)............................................................. 3.06
                                                                           3.10
                                                                           6.02
                                                                        8.05(b)
                                                                           8.06
                                                                          11.01
      (c) (3)............................................................ 11.01
      (d) ............................................................ 11.01(c)
      (e) ............................................................... 11.01
      (f) ................................................................ N.A.
(Section)315(a) .......................................................... 6.01
      (b) ................................................................ 6.05
      (c) ................................................................ N.A.
      (d) ............................................................. 6.01(c)
      (e) ................................................................ 5.13
</TABLE>

                                      -v-
<PAGE>

<TABLE>
<CAPTION>
   TIA                                                                 Indenture
Section                                                                 Section
--------                                                               ---------

<S>                                                               <C>
(Section)316(a) (1) (A)................................................ 6.01(c)
                                                                           5.11
      (a) (1) (B)......................................................... 5.12
      (a) (2)............................................................. N.A.
      (b) ................................................................ 5.07
                                                                        5.04(b)
      (c) ................... ............................................ 2.06
(Section)317(a) (1) ........ ............................................. 5.04
      (a) (2) ......................................................... 5.03(c)
                                                                        5.03(d)
                                                                           5.04
      (b) ................................................................ 3.03
(Section)318(a) ......................................................... 11.07
</TABLE>

---------
N.A. means not applicable

                                      -vi-

<PAGE>

                  INDENTURE (this "Indenture"), dated as of
[__________________], between NISSAN AUTO RECEIVABLES [____-_] OWNER TRUST, a
Delaware statutory trust (the "Issuer"), and [__________________], a
[____________________], as trustee and not in its individual capacity (the
"Indenture Trustee").

                  Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of (i) the Holders of the Issuer's
[__]% Asset Backed Notes, Class A-1 (the "Class A-1 Notes"), [__]% Asset Backed
Notes, Class A-2 (the "Class A-2 Notes"), [__]% Asset Backed Notes, Class A-3
(the "Class A-3 Notes" and, together with the Class A-1 and the Class A-2 Notes,
the "Class A Notes"), and [__]% Asset Backed Notes, Class B (the "Class B Notes"
and, together with the Class A Notes, the "Notes") and (ii) for the purposes of
the Granting Clause below, the Certificateholders:

                                 GRANTING CLAUSE

                  The Issuer hereby Grants to the Indenture Trustee at the
Closing Date, as Indenture Trustee for the benefit of the Holders of the Notes
and Certificates [and the Swap Counterparty], the following:

                           (i) all right, title and interest of the Issuer in
         and to the Receivables (including all related Receivable Files) and all
         monies due thereon or paid thereunder or in respect thereof (including
         proceeds of the repurchase of Receivables by the Seller pursuant to
         Section 3.02 of the Sale and Servicing Agreement or the purchase of
         Receivables by the Servicer pursuant to Section 4.06 or 9.01 of the
         Sale and Servicing Agreement) after the Cutoff Date;

                           (ii) the Collection Account and amounts on deposit in
         the Collection Account [and the Yield Supplement Account];

                           (iii) the right of the Issuer in the security
         interests in the Financed Vehicles granted by the Obligors pursuant to
         the Receivables and any related property;

                           (iv) the right of the Issuer in any proceeds from
         claims on any physical damage, credit life, credit disability or other
         insurance policies covering the Financed Vehicles or the Obligors;

                           (v) the right of the Issuer (through the Seller and
         NMAC) to receive payments in respect of any Dealer Recourse with
         respect to the Receivables;

                           (vi) the rights of the Issuer under the Sale and
         Servicing Agreement, and, through the Seller, under the Purchase
         Agreement and the Assignment;

                           [(vii) the rights of the Issuer under the Yield
         Supplement Agreement;]

                           (viii) the right of the Issuer to realize upon any
         property (including the right to receive future Net Liquidation
         Proceeds) that shall have secured a Receivable;

                                                                     (Indenture)
<PAGE>

                           (ix) the right of the Issuer in rebates of premiums
         and other amounts relating to insurance policies and other items
         financed under the Receivables in effect as of the Cutoff Date;

                           (x) all other assets comprising the Owner Trust
         Estate;

                           (xi) [the rights of the Issuer under the Interest
         Rate Swap Agreement and any interest rate cap agreement]; and

                           (xii) all proceeds of the foregoing.

                  The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes, equally and ratably without prejudice, priority or distinction, and to
secure compliance with the provisions of this Indenture, and subject to the
subordinate claims thereon of the Holders of the Certificates, all as provided
in this Indenture [and payment of amounts payable to the Swap Counterparty under
the Interest Rate Swap Agreement].

                  The Indenture Trustee, as Indenture Trustee on behalf of the
Holders of the Notes and for the benefit of the Certificateholders [and the Swap
Counterparty], acknowledges such Grant, accepts the trusts under this Indenture
in accordance with the provisions of this Indenture and agrees to perform its
duties required in this Indenture to the best of its ability to the end that the
interests of the Holders of the Notes may be adequately and effectively
protected and the rights of the Certificateholders [and the Swap Counterparty]
secured.

                                    ARTICLE I
                   Definitions and Incorporation by Reference

                  1.01 Definitions. Except as otherwise specified herein or if
the context may otherwise require, capitalized terms used but not otherwise
defined herein have the meanings ascribed thereto in the Trust Agreement, the
Sale and Servicing Agreement and the Securities Account Control Agreement, as
the case may be, for all purposes of this Indenture. Except as otherwise
provided in this Indenture, whenever used herein the following words and
phrases, unless the context otherwise requires, shall have the following
meanings:

                  "Action" has the meaning specified in Section 11.03(a).

                  "Administration Agreement" means the Administration Agreement,
dated as of [___________], among the Administrator, the Issuer and the Indenture
Trustee.

                  "Administrator" means NMAC or any successor Administrator
under the Administration Agreement.

                  "Applicant" has the meaning specified in Section 7.01.

                  "Authorized Officer" means with respect to the Issuer, any
officer of the Owner Trustee who is authorized to act for the Owner Trustee in
matters relating to the Issuer identified as such on any list of Authorized
Officers delivered by the Owner Trustee to the Indenture

                                        2                            (Indenture)

<PAGE>

                  Trustee.

                  "Book-Entry Notes" means a beneficial interest in the Class
A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class B Notes,
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.10.

                  "Business Day" means any day except a Saturday, a Sunday or a
day on which banks in New York, New York, Los Angeles, California or
[________,________] are authorized or obligated by law, regulation, executive
order or governmental decree to be closed.

                  ["Calculation Agent" means the calculation agent appointed to
calculate interest rates and interest amounts on the VPTNs and to perform other
duties pursuant to Section 3.21 and shall initially be [________________].]

                  "Certificates" means the Class C Certificates and the Class D
Certificates.

                  "Class" means any one of the classes of the Notes.

                  "Class A-1 Notes" means the [____]% Asset Backed Notes, Class
A-1, substantially in the form attached hereto as Exhibit A-1.

                  "Class A-1 Rate" means [____]% per annum (computed on the
basis of [actual number of days in the related Interest Period and a 360-day
year] [a 360-day year consisting of twelve 30-day months]).

                  "Class A-2 Rate" means [____]% per annum (computed on the
basis of a 360-day year consisting of twelve 30-day months).

                  "Class A-2 Notes" means the [____]% Asset Backed Notes, Class
A-2, substantially in the form attached hereto as Exhibit A-1.

                  "Class A-3 Rate" means [____]% per annum (computed on the
basis of a 360-day year consisting of twelve 30-day months).

                  "Class A-3 Notes" means the [____]% Asset Backed Notes, Class
A-3, substantially in the form attached hereto as Exhibit A-1.

                  "Class B Rate" means [____]% per annum (computed on the basis
of a 360-day year consisting of twelve 30-day months).

                  "Class B Notes" means the [____]% Asset Backed Notes, Class B,
substantially in the form attached hereto as Exhibit A-1.

                  "Class C Certificates" means the [____]% Certificates of the
Issuer, Class C, issued under the Trust Agreement.

                  "Class D Certificates" means the [____]% Certificates of the
Issuer, Class D, issued under the Trust Agreement.

                                        3                            (Indenture)

<PAGE>

                  "Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act.

                  "Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.

                  "Closing Date" means [__________, _____].

                  "Code" means the Internal Revenue Code of 1986, as amended,
and the Treasury Regulations promulgated thereunder.

                  "Collateral" means the property of the Issuer subject to the
Granting Clause hereof, the Reserve Account, all amounts held from time to time
in the Reserve Account and all investments therein.

                  "Corporate Trust Office" means the principal office of the
Indenture Trustee at which at any particular time its corporate trust business
shall be administered, which office at the date of execution of this Agreement
is located at [_______________]; Attention: [_______________], or at such other
address as the Indenture Trustee may designate from time to time by notice to
the Noteholders, the Issuer and the Administrator, or the principal corporate
trust office of any successor Indenture Trustee at the address designated by
such successor Indenture Trustee by notice to the Noteholders, the Issuer and
the Administrator.

                  "Default" means any occurrence that is, or with notice or the
lapse of time or both would become, an Event of Default.

                  "Definitive Notes" has the meaning specified in Section 2.10.

                  ["Designated LIBOR Page" means the display on Bridge Telerate,
Inc. or any successor service or any page as may replace the designated page on
that service or any successor service that displays the London interbank rates
on major banks for U.S. dollars.]

                  "Event of Default" has the meaning specified in Section 5.01.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

                  "Executive Officer" means, with respect to any corporation,
the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, Executive Vice President, any Vice President, the Secretary or the
Treasurer of such corporation; and with respect to any partnership, any general
partner thereof.

                  ["Extended Sequential Amortization Commencement Date" means
the Targeted Scheduled Distribution Date on which two subclasses of Class A
Notes which have reached or passed their Targeted Scheduled Distribution Dates
have not been paid in full after giving effect to all payments allocable to
principal on such Targeted Scheduled Distribution Date.]

                  ["Extended Sequential Amortization Period" means the period
commencing on an

                                        4                            (Indenture)

<PAGE>

Extended Sequential Amortization Commencement Date and ending on the
Distribution Date on which the Class A-3 Notes and the VPTNs are paid in full.]

                  "Grant" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create, and grant a lien
upon and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to this Indenture. A Grant of the Collateral or of any
other agreement or instrument shall include all rights, powers and options (but
none of the obligations) of the granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments in respect of the Collateral and all other
moneys payable thereunder, to give and receive notices and other communications,
to make waivers or other agreements, to exercise all rights and options, to
bring Proceedings in the name of the granting party or otherwise, and generally
to do and receive anything that the granting party is or may be entitled to do
or receive thereunder or with respect thereto.

                  "Holder" or "Noteholder" means the Person in whose name a Note
is registered on the Note Register.

                  "Indenture Trustee" means [_______________], a
[____________________________], as Indenture Trustee under this Indenture, or
any successor Indenture Trustee under this Indenture.

                  "Independent" means, when used with respect to any specified
Person, that the Person is in fact independent of the Seller, the Servicer, the
Administrator, the Issuer or any other obligor on the Notes or any Affiliate of
any of the foregoing Persons because, among other things, such Person (a) is not
an employee, officer or director or otherwise controlled thereby or under common
control therewith, (b) does not have any direct financial interest or any
material indirect financial interest therein (whether as holder of securities
thereof or party to contract therewith or otherwise), and (c) is not and has not
within the preceding twelve months been a promoter, underwriter, trustee,
partner, director or person performing similar functions therefor or otherwise
had legal, contractual or fiduciary or other duties to act on behalf of or for
the benefit thereof.

                  "Independent Certificate" means a certificate or opinion to be
delivered to the Indenture Trustee, made by an Independent appraiser or other
expert appointed by an Issuer Order and approved by the Indenture Trustee in the
exercise of reasonable care, and such opinion or certificate shall state that
the signer has read the definition of "Independent" in this Indenture and that
the signer is Independent within the meaning thereof.

                  ["Interest Determination Date" means, with respect to any
Interest Period with respect to the [_________] Notes, the day that is two
London Business Days prior to the related Interest Reset Date.]

                  "Interest Period" means, with respect to any Distribution Date
and the Class A-1 Notes, the period from (and including) the preceding
Distribution Date to (but excluding) such Distribution Date, except that the
initial Interest Period will be from (and including) the Closing Date to (but
excluding) [___________], and, with respect to any Distribution Date and the
Class

                                        5                            (Indenture)

<PAGE>

A-2 Notes, the Class A-3 Notes and the Class B Notes, the period from (and
including) the 15th day of the preceding calendar month to (but excluding) the
15th day of the month in which such Distribution Date occurs, except that the
initial Interest Period will be from (and including) the Closing Date to (but
excluding) [__________].

                  "Interest Rate" means the Class A-1 Rate, the Class A-2 Rate,
the Class A-3 Rate or the Class B Rate, as indicated by the context.

                  ["Interest Rate Swap Agreement" shall mean the interest rate
swap agreement dated _________________, including all schedules and
confirmations thereto, between the Issuer and the Swap Counterparty, as the same
may be amended, supplemented, renewed, extended or replaced from time to time.]

                  ["Interest Reset Date" means, with respect to the VPTNs, the
first day of the applicable Interest Period.]

                  "Issuer" means Nissan Auto Receivables [____-_] Owner Trust
unless and until a successor replaces it and, thereafter, means the successor
and, for purposes of any provision contained herein and required by the TIA,
each other obligor on the Notes.

                  "Issuer Order" and "Issuer Request" mean a written order or
request signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Indenture Trustee.

                  ["LIBOR" means, for any Interest Period, the rate for deposits
in U.S. dollars for a one-month period that appears on the Designated LIBOR
Page, on the related Interest Determination Date; provided that, the following
procedures will be followed if LIBOR cannot be determined as described above:

                  (a) With respect to an Interest Determination Date on which no
         rate appears on the Designated LIBOR Page, LIBOR for the applicable
         Interest Determination Date will be the rate calculated by the
         Calculation Agent as the arithmetic mean of at least two quotations
         obtained by the Calculation Agent after requesting the principal London
         offices of each of four major reference banks in the London interbank
         market, which may include the Calculation Agent and its affiliates, as
         selected by the Calculation Agent, to provide the Calculation Agent
         with its offered quotation for deposits in U.S. dollars for a one-month
         period, commencing on the second London Business Day immediately
         following the applicable Interest Determination Date, to prime banks in
         the London interbank market at approximately 11:00 a.m., London time,
         on such Interest Determination Date and in a principal amount that is
         representative for a single transaction in U.S. dollars in that market
         at that time. If at least two such quotations are provided, LIBOR
         determined on the applicable Interest Determination Date will be the
         arithmetic mean of the quotations.

                  (b) If fewer than two quotations referred to in clause (a)
         above are provided, LIBOR determined on the applicable Interest
         Determination Date will be the rate calculated by the Calculation Agent
         as the arithmetic mean of the rates quoted at approximately 11:00 a.m.
         in New York on the applicable Interest Determination Date by three
         major banks, which may include the Calculation Agent and its
         affiliates, in New

                                        6                            (Indenture)

<PAGE>

         York, selected by the Calculation Agent for loans in U.S. dollars to
         leading European banks, having a maturity of one-month and in a
         principal amount that is representative for a single transaction in
         U.S. dollars in that market at that time.

                  (c) If the banks so selected by the Calculation Agent are not
         quoting as mentioned in clause (b) above, LIBOR for the applicable
         Interest Determination Date will be LIBOR in effect on the applicable
         Interest Determination Date.]

                  ["London Business Day" means any day on which dealings with
U.S. dollars are transacted in the London interbank market.]

                  "NMAC" means Nissan Motor Acceptance Corporation, in its
individual capacity and not as Servicer.

                  "Note" means a Class A-1 Note, a Class A-2 Note, a Class A-3
Note or a Class B Note.

                  "Note Depository Agreement" means the agreement entitled
"Letter of Representations" dated on or before the Closing Date among the
Clearing Agency, the Issuer and the Indenture Trustee with respect to certain
matters relating to the duties thereof with respect to the Book-Entry Notes.

                  "Note Owner" means, with respect to a Book-Entry Note, any
Person who is the beneficial owner of such Book-Entry Note, as reflected on the
books of the Clearing Agency or on the books of a Person maintaining an account
with such Clearing Agency (directly as a Clearing Agency Participant or as an
indirect participant, in each case in accordance with the rules of such Clearing
Agency).

                  "Note Register" means the Register of Noteholders' information
maintained by the Note Registrar pursuant to Section 2.04.

                  "Note Registrar" means the Indenture Trustee unless and until
a successor Note Registrar shall have been appointed pursuant to Section 2.04.

                  "Officer's Certificate" means a certificate signed by any
Authorized Officer of the Issuer, under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01, and
delivered to the Indenture Trustee.

                  "Opinion of Counsel" means one or more written opinions of
counsel who may, except as otherwise expressly provided in this Indenture, be an
employee of or counsel to the Issuer, the Seller or the Servicer and which
counsel shall be reasonably satisfactory to the Owner Trustee, the Indenture
Trustee or the Rating Agencies, as the case may be.

                  "Outstanding" means, as of the date of determination, all
Notes theretofore authenticated and delivered under this Indenture except:

                  (a) Notes theretofore canceled by the Note Registrar or
         delivered to the Note Registrar for cancellation;

                                        7                            (Indenture)

<PAGE>

                  (b) Notes or portions thereof the payment for which money in
         the necessary amount has been theretofore deposited with the Indenture
         Trustee or any Paying Agent in trust for the Holders of such Notes; and

                  (c) Notes in exchange for or in lieu of which other Notes have
         been authenticated and delivered pursuant to this Indenture unless
         proof satisfactory to the Indenture Trustee is presented that any such
         Notes are held by a protected purchaser;

provided, that in determining whether the Holders of the requisite percentage of
the Outstanding Amount of the Notes, or any Class of Notes, have given any
request, demand, authorization, direction, notice, consent, or waiver hereunder
or under any Basic Document, Notes owned by the Issuer, any other obligor upon
the Notes, the Seller or any Affiliate of any of the foregoing Persons shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Indenture Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent, or waiver, only
Notes that the Indenture Trustee knows to be so owned shall be so disregarded.
Notes so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Indenture
Trustee the pledgee's right so to act with respect to such Notes and that the
pledgee is not the Issuer, any other obligor upon the Notes, the Seller or any
Affiliate of any of the foregoing Persons.

                  "Outstanding Amount" means the aggregate principal amount of
all Notes, or, if indicated by the context, all Notes of any Class, Outstanding
at the date of determination.

                  "Owner Trustee" means [_______________], not in its individual
capacity but solely as Owner Trustee under the Trust Agreement, or any successor
Owner Trustee under the Trust Agreement.

                  "Paying Agent" means the Indenture Trustee or any other Person
that meets the eligibility standards for the Indenture Trustee specified in
Section 6.11 that has been authorized by the Issuer to make payments to and
distributions from the Collection Account, including payment of principal of or
interest on the Notes on behalf of the Issuer.

                  "Predecessor Note" means, with respect to any particular Note,
every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purpose of this definition, any
Note authenticated and delivered under Section 2.05 in lieu of a mutilated,
lost, destroyed or stolen Note shall be deemed to evidence the same debt as the
mutilated, lost, destroyed or stolen Note.

                  "Proceeding" means any suit in equity, action at law or other
judicial or administrative proceeding.

                  "Registered Holder" means the Person in whose name a Note is
registered on the Note Register on the applicable Record Date.

                  "Responsible Officer" means, with respect to the Indenture
Trustee, any officer within the Corporate Trust Office of the Indenture Trustee,
including any Vice President, Assistant Vice President, Assistant Treasurer,
Assistant Secretary or any other officer of the

                                        8                            (Indenture)

<PAGE>

Indenture Trustee customarily performing functions similar to those performed by
any of the above designated officers and also, with respect to a particular
matter, any other officer to whom such matter is referred because of such
officer's knowledge of and familiarity with the particular subject.

                  "Sale and Servicing Agreement" means the Sale and Servicing
Agreement, dated as of [_______________], among the Issuer, Nissan Auto
Receivables Corporation II, as Seller, and Nissan Motor Acceptance Corporation,
as Servicer, and as to which the Indenture Trustee is a third party beneficiary
of certain provisions.

                  "Securities Act" means the Securities Act of 1933, as amended.

                  "Securities Account Control Agreement" shall have the meaning
assigned to such term in the Sale and Servicing Agreement.

                  "Seller" shall mean Nissan Auto Receivables Corporation II, in
its capacity as seller under the Sale and Servicing Agreement, and its successor
in interest.

                  "Servicer" shall mean Nissan Motor Acceptance Corporation, in
its capacity as servicer under the Sale and Servicing Agreement, and any
Successor Servicer thereunder.

                  ["Spread" means with respect to any VPTN, the percentage over
LIBOR as determined at the time of issuance as set forth in such VPTN, which
percentage shall not exceed [____]%.]

                  "Successor Servicer" has the meaning specified in Section
3.07.

                  ["Swap Counterparty" shall mean __________, as swap
counterparty under the Interest Rate Swap Agreement, or any successor or
replacement swap counterparty from time to time under the Interest Rate Swap
Agreement. Each Swap Counterparty (or the institution guaranteeing such Swap
Counterparty's obligations) must have ratings at least equal to "[____]" by
Standard & Poor's, a division of The McGraw-Hill Companies, Inc. and "[____]" by
Moody's Investor Service, Inc. at the time of entry into the Interest Rate Swap
Agreement.]

                  ["Swap Payment" means on any Distribution Date the net amount,
if any, then payable by the Issuer to the Swap Counterparty, excluding any Swap
Termination Payments.]

                  ["Swap Receipt" means on any Distribution Date the net amount,
if any, then payable by a Swap Counterparty to the Issuer, excluding any Swap
Termination Payments.]

                  ["Swap Termination Payment" means any termination payment
payable by the Issuer to the Swap Counterparty or by the Swap Counterparty to
the Issuer under the Interest Rate Swap Agreement.]

                  ["Targeted Scheduled Distribution Date" means as set forth
below for each subclass of the Class A Note:

                                        9                            (Indenture)

<PAGE>

                                                 Targeted Scheduled
                                                 Distribution Date

                      Subclass

         Class A-1 Notes                          ______________, ________

         Class A-2 Notes                          ______________, ________

         Class A-3 Notes                          ______________, ________]

                  "Trust Estate" means all money, instruments, rights and other
property that are subject or intended to be subject to the lien and security
interest of this Indenture for the benefit of the Noteholders (including,
without limitation, all property and interests Granted to the Indenture Trustee
pursuant to the Granting Clause), including all proceeds thereof.

                  "Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939 as in force on the date hereof, unless otherwise specifically provided.

                  "UCC" means, unless the context otherwise requires, the
Uniform Commercial Code, as in effect in the relevant jurisdiction at the
relevant time.

                  ["VTPN" means the Floating Rate Asset Backed Variable Pay Term
Notes issued from time to time by the Trust pursuant to this Indenture,
substantially in the form attached hereto as Exhibit A-2.]

                  ["VPTN Issuance Amount" means, for any Targeted Scheduled
Distribution Date, the amount the Issuer is able to issue pursuant to Section
2.02 of this Indenture, not to exceed an amount equal to (i) the aggregate
outstanding principal balance of the related subclass of the Class A Notes and
the aggregate outstanding balance of all the Class A Notes which were not paid
in full on their Targeted Schedule Distribution Dates over (ii) sum of the
amount on deposit in the Accumulation Account and the amount on deposit in the
Collection Account, if any, which is allocable to the subclass or subclasses of
the Class A Notes in (i) above.]

                  ["VPTN Rate" means, with respect to each VPTN, or any
Distribution Date, the rate equal to one-month LIBOR on the related LIBOR
Determination Date plus a fixed percentage spread for such VPTN determined at
the time of issuance based on market conditions; provided that such interest
rate shall not exceed one-month LIBOR plus [____%]. Interest with respect to any
VPTN shall be computed on the basis of actual days elapsed and a 360 day year
for all purposes of the Basic Documents.]

                                       10                            (Indenture)

<PAGE>

                  1.02 Usage of Terms. With respect to all terms in this
Indenture, the singular includes the plural and the plural the singular; words
importing any gender include the other genders; references to "writing" include
printing, typing, lithography and other means of reproducing words in a visible
form; references to agreements and other contractual instruments include all
subsequent amendments, amendments and restatements and supplements thereto or
changes therein entered into in accordance with their respective terms and not
prohibited by this Indenture; references to Persons include their permitted
successors and assigns; references to laws include their amendments and
supplements, the rules and regulations thereunder and any successors thereto;
and the term "including" means "including without limitation."

                  1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:

                  "Commission" means the Securities and Exchange Commission.

                  "indenture securities" means the Notes.

                  "indenture security holder" means a Noteholder.

                  "indenture to be qualified" means this Indenture.

                  "indenture trustee" or "institutional trustee" means the
Indenture Trustee.

                  "obligor" on the indenture securities means the Issuer and any
other obligor on the indenture securities.

                  All other TIA terms used in this Indenture that are defined in
the TIA, defined in the TIA by reference to another statute or defined by
Commission rule have the meanings so assigned to them.

                                   ARTICLE II
                                      Notes

                  2.01 Form. The Class A-1 Notes, the Class A-2 Notes, the Class
A-3 Notes[, the VPTN] and the Class B Notes, in each case together with the
Indenture Trustee's certificate of authentication, shall be in substantially the
form set forth in Exhibit A, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may, consistently herewith,
be determined by the officers executing such Notes, as evidenced by their
execution thereof. Any portion of the text of any Note may be set forth on the
reverse thereof, with an appropriate reference thereto on the face of the Note.

                  The Definitive Notes shall be typewritten, printed,
lithographed or engraved or produced by any combination of these methods (with
or without steel engraved borders), all as determined by the officers executing
such Notes, as evidenced by their execution of such Notes.

                                       11                            (Indenture)

<PAGE>

                  Each Note shall be dated the date of its authentication. The
terms of the Notes set forth in Exhibit A are part of the terms of this
Indenture.

                  2.02 Execution, Authentication and Delivery. The Notes shall
be executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile. Notes bearing the manual or facsimile signature of individuals who
were at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes. The Indenture Trustee shall upon Issuer
Order authenticate and deliver the Class A-1 Notes for original issue in an
aggregate principal amount of $[_______________], the Class A-2 Notes for
original issue in an aggregate principal amount of $[_______________], the Class
A-3 Notes for original issue in an aggregate principal amount of
$[_______________], [the VPTN for original issue in an aggregate principal
amount of $[______________],] and the Class B Notes for original issue in an
aggregate principal amount of $[_______________]. The aggregate principal amount
of the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class B
Notes outstanding at any time may not exceed such respective amounts except as
provided in Section 2.05. The Notes shall be issuable as registered Notes in
denominations of $1,000 and any integral multiple thereof. Each Note shall be
dated the date of its authentication.

                  [On the Targeted Scheduled Distribution Date for each subclass
of the Class A Notes, a VPTN may be issued in an amount equal to the VPTN
Issuance Amount. The Issuer shall execute the VPTN, and upon receipt of the
Issuer Order, the Indenture Trustee shall cause such VPTN to be authenticated
and delivered. Each such order shall set forth:

                           (i) the issuance date and Spread of the VPTN;

                           (ii) the aggregate principal amount of the VPTN to be
         authenticated and delivered on such issuance date,

                           (iii) the VPTN Rate for such VPTN; and

                           (iv) any other terms or provisions of such VPTN which
         shall not be inconsistent with the provisions of this Indenture.

                  The Indenture Trustee shall not, however, cause to be
authenticated and deliver any VPTN on a Targeted Scheduled Distribution Date
unless the Issuer has:

                           (i) delivered to the Indenture Trustee an Officer's
         Certificate certifying that the following conditions have been
         satisfied:

                                    (A) both before and after giving effect to
                           the issuance of the VPTN and to the application of
                           such proceeds and any amounts on deposit in the
                           Accumulation Account and in the Collection Account,
                           the aggregate principal balance of the receivables
                           must be equal to or greater than the aggregate
                           outstanding balance of the Class A Notes, the VPTNs,
                           the Class B Notes and the Class C Certificates;

                                       12                            (Indenture)

<PAGE>

                                    (B) an Extended Sequential Amortization
                           Period must not have occurred;

                                    (C) the VPTN must be rated "AAA" and "Aaa"
                           by S&P and Moody's, respectively;

                                    (D) the Interest Rate Swap Agreement must be
                           in full force and effect with a notional amount equal
                           to the sum of the principal balances of such VPTN and
                           any other outstanding VPTNs;

                                    (E) no Servicer Default shall have occurred
                           and be continuing;

                                    (F) no Event of Default shall have occurred
                           and be continuing;

                                    (G) the purchase price of the VPTN must be
                           equal to par; and

                                    (H) the interest rate on the VPTN must not
                           exceed one-month LIBOR plus [____]%.

                           (ii) delivered to the Indenture Trustee an Opinion of
         Counsel, which shall also be addressed to the purchaser of such VPTN
         and the Rating Agencies and shall be dated the related Targeted
         Scheduled Distribution Date, substantially to the effect that:

                                    (A) the Issuer has been duly formed and is
                           validly existing as a statutory trust under the
                           Delaware Statutory Trust Act (the "Statutory Trust
                           Act"), and has the power and authority under the
                           Trust Agreement and the Statutory Trust Act to
                           execute, deliver and perform its obligations under
                           the Trust Agreement, the Indenture, the Sale and
                           Servicing Agreement, the Administration Agreement,
                           the Interest Rate Swap Agreement, the Certificates
                           and the Notes;

                                    (B) the Issuer has full power and authority
                           to issue and sell the VPTN to be sold to the
                           purchaser on such Targeted Scheduled Distribution
                           Date, pursuant to a VPTN purchase agreement, and the
                           Issuer has duly authorized such sale to the purchaser
                           by all necessary action;

                                    (C) registration of the VPTN under the
                           Securities Act is not required in connection with the
                           purchase and sale of the VPTN pursuant to the VPTN
                           purchase agreement; and

                                    (D) the issuance and sale of the VPTN has
                           been duly authorized by the Trust, and the VPTN, when
                           duly executed by the Trust and authenticated by the
                           Indenture Trustee in accordance with the Indenture
                           and delivered to and paid for by the purchaser
                           thereof in accordance with the Indenture, will be
                           validly issued and outstanding and entitled to the
                           benefits of the Indenture.]

         No Note shall be entitled to any benefit under this Indenture or be
valid or

                                       13                            (Indenture)

<PAGE>

obligatory for any purpose, unless there appears on such Note a certificate of
authentication substantially in the form included in Exhibit A, executed by the
Indenture Trustee by the manual or facsimile signature of one of its authorized
signatories, and such certificate upon any Note shall be conclusive evidence,
and the only evidence, that such Note has been duly authenticated and delivered
hereunder.

                  2.03 Temporary Notes. Pending the preparation of Definitive
Notes, the Issuer may execute, and upon receipt of an Issuer Order the Indenture
Trustee shall authenticate and deliver, temporary Notes that are printed,
lithographed, typewritten, mimeographed or otherwise produced, of the tenor of
the Definitive Notes in lieu of which they are issued and with such variations
not inconsistent with the terms of this Indenture as the officers executing such
Notes may determine, as evidenced by their execution of such Notes. If temporary
Notes are issued, the Issuer will cause Definitive Notes to be prepared without
unreasonable delay. After the preparation of Definitive Notes, the temporary
Notes shall be exchangeable for Definitive Notes upon surrender of the temporary
Notes at the office or agency of the Issuer to be maintained as provided in
Section 3.02, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Notes of any Class, the Issuer shall execute, and the
Indenture Trustee shall authenticate and deliver in exchange therefor, a like
principal amount of Definitive Notes of such Class of authorized denominations.
Until so exchanged, the temporary Notes shall in all respects be entitled to the
same benefits under this Indenture as Definitive Notes.

                  2.04 Registration; Registration of Transfer and Exchange.

                  (a) The Note Registrar shall maintain a Note Register in
         which, subject to such reasonable regulations as it may prescribe, the
         Note Registrar shall provide for the registration of Notes and
         transfers and exchanges of Notes as provided in this Indenture. The
         Indenture Trustee is hereby initially appointed Note Registrar for the
         purpose of registering Notes and transfers and exchanges of Notes as
         provided in this Indenture. In the event that, subsequent to the
         Closing Date, the Indenture Trustee notifies the Issuer that it is
         unable to act as Note Registrar, the Issuer shall appoint another bank
         or trust company, having an office or agency located in the Borough of
         Manhattan, The City of New York, agreeing to act in accordance with the
         provisions of this Indenture applicable to it, and otherwise acceptable
         to the Indenture Trustee, to act as successor Note Registrar under this
         Indenture.

                  If a Person other than the Indenture Trustee is appointed by
the Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture Trustee
shall have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof, and the Indenture Trustee shall have the right to rely
upon a certificate executed on behalf of the Note Registrar by an Executive
Officer thereof as to the names and addresses of the Holders of the Notes and
the principal amounts and number of such Notes.

                  (b) Upon the proper surrender for registration of transfer of
         any Note at the office or agency of the Issuer to be maintained as
         provided in Section 3.02, the Issuer shall execute, and the Indenture
         Trustee shall authenticate in the name of the designated

                                       14                            (Indenture)

<PAGE>

         transferee or transferees, one or more new Notes of the same Class in
         authorized denominations of a like aggregate principal amount.

                  (c) At the option of the Holder, Notes may be exchanged for
         other Notes of the same Class in any authorized denominations, of a
         like aggregate principal amount, upon surrender of the Notes to be
         exchanged at such office or agency. Whenever any Notes are so
         surrendered for exchange, the Issuer shall execute, and the Indenture
         Trustee shall authenticate and the Noteholder shall obtain from the
         Indenture Trustee, the Notes which the Noteholder making the exchange
         is entitled to receive. Every Note presented or surrendered for
         registration of transfer or exchange shall be accompanied by a written
         instrument of transfer in form satisfactory to the Indenture Trustee
         and the Note Registrar duly executed by the Holder thereof or his
         attorney duly authorized in writing.

                  (d) No service charge shall be made for any registration of
         transfer or exchange of Notes, but the Indenture Trustee may require
         payment of a sum sufficient to cover any tax or governmental charge
         that may be imposed in connection with any transfer or exchange of
         Notes.

                  (e) All Notes surrendered for registration of transfer or
         exchange shall be canceled and subsequently destroyed by the Indenture
         Trustee.

                  2.05 Mutilated, Destroyed, Lost or Stolen Notes. If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Indenture Trustee such security or
indemnity as may be required by it to hold the Issuer and the Indenture Trustee
harmless, then, in the absence of notice to the Issuer, the Note Registrar or
the Indenture Trustee that such Note has been acquired by a protected purchaser,
the Issuer shall execute, and upon its request the Indenture Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Note, a replacement Note of the same Class. In
connection with the issuance of any new Note under this Section 2.05, the Issuer
may require payment by the Holder of such Note of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto.

                  If, after the delivery of such replacement Note or payment of
a destroyed, lost or stolen Note, a protected purchaser of the original Note in
lieu of which such replacement Note was issued presents for payment such
original Note, the Issuer and the Indenture Trustee shall be entitled to recover
such replacement Note (or such payment) from the Person to whom it was delivered
or any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a
protected purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Issuer or the Indenture Trustee in connection therewith.

                  Every replacement Note issued pursuant to this Section 2.05 in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally

                                       15                            (Indenture)

<PAGE>

and proportionately with any and all other Notes of the same Class duly issued
hereunder.

                  The provisions of this Section 2.05 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.

                  2.06 Persons Deemed Owners. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee may treat the Person in whose name
any Note is registered (as of the day of determination) as the owner of such
Note for the purpose of receiving payments of principal of and interest, if any,
on such Note and for all other purposes whatsoever, and none of the Issuer, the
Indenture Trustee or any agent of the Issuer or the Indenture Trustee shall be
affected by notice to the contrary.

                  2.07 Payments of Principal and Interest.

                  (a) The Class A-1 Notes, the Class A-2 Notes, the Class A-3
         Notes and the Class B Notes shall accrue interest during each Interest
         Period at the Class A-1 Rate, the Class A-2 Rate, the Class A-3 Rate
         and the Class B Rate, respectively, and such interest shall be payable
         on each related Distribution Date as specified in the applicable Note
         by applying amounts available pursuant to Section 5.06 of the Sale and
         Servicing Agreement and to Section 3.01 of this Indenture. Any
         installment of interest or principal payable on any Note that is
         punctually paid or duly provided for by the Issuer on the applicable
         Distribution Date shall be paid to the Person in whose name such Note
         (or one or more Predecessor Notes) is registered on the Record Date by
         wire transfer in immediately available funds to the account designated
         by such nominee, except for the final installment of principal payable
         with respect to such Note on a Distribution Date or on the applicable
         Final Scheduled Distribution Date, which shall be payable as provided
         below.

                  (b) The principal of each Note shall be payable in
         installments on each Distribution Date by applying amounts available
         pursuant to Section 5.06 of the Sale and Servicing Agreement.
         Notwithstanding the foregoing, the entire unpaid principal amount of
         the Notes shall be due and payable, if not previously paid, from and
         after the date on which the Indenture Trustee or the Holders of the
         Controlling Class of Notes representing not less than a majority of the
         Outstanding Amount of such Class (excluding for such purpose the
         outstanding principal amount of any Notes held of record or
         beneficially owned by NARC II, NMAC or any of their Affiliates unless
         at such time all of the Notes of such Class are held of record or
         beneficially owned by NARC II, NMAC or any of their Affiliates) have
         declared the Notes to be immediately due and payable in the manner
         provided in Section 5.02 in connection with an Event of Default. All
         principal payments on each Class of Notes shall be made pro rata to the
         Noteholders of such Class entitled thereto. The Indenture Trustee shall
         notify the Person in whose name a Note is registered at the close of
         business on the Record Date preceding the Distribution Date on which
         the final installment of principal of and interest on such Note will be
         paid. Such notice shall be mailed or transmitted by facsimile not less
         than 15 nor more than 30 days prior to such final Distribution Date,
         shall specify that such final installment will be payable only upon

                                       16                            (Indenture)

<PAGE>

         presentation and surrender of such Note and shall specify the place
         where such Note may be presented and surrendered for payment of such
         installment.

                  2.08 Cancellation. All Notes surrendered for payment,
registration of transfer or exchange shall, if surrendered to any Person other
than the Indenture Trustee, be delivered to the Indenture Trustee and shall be
promptly canceled by the Indenture Trustee. The Issuer may at any time deliver
to the Indenture Trustee for cancellation any Notes previously authenticated and
delivered hereunder which the Issuer may have acquired in any manner whatsoever,
and all Notes so delivered shall be promptly canceled by the Indenture Trustee.
No Notes shall be authenticated in lieu of or in exchange for any Notes canceled
as provided in this Section, except as expressly permitted by this Indenture.
All canceled Notes may be held or disposed of by the Indenture Trustee in
accordance with its standard retention or disposal policy as in effect at the
time unless the Issuer shall direct by an Issuer Order that they be destroyed or
returned to it; provided, that such Issuer Order is timely and the Notes have
not been previously disposed of by the Indenture Trustee.

                  2.09 Release of Collateral. Subject to Sections 8.05 and 11.01
and the terms of the Basic Documents, the Indenture Trustee shall release
property from the lien of this Indenture only upon receipt of an Issuer Request
accompanied by an Officer's Certificate, an Opinion of Counsel and Independent
Certificates in accordance with TIA Sections 314(c) and 314(d)(l) or an Opinion
of Counsel in lieu of such Independent Certificates to the effect that the TIA
does not require any such Independent Certificates.

                  2.10 Book-Entry Notes. The Notes, upon original issuance, will
be issued in the form of typewritten Notes representing the Book-Entry Notes, to
be delivered to The Depository Trust Company, the initial Clearing Agency, or a
custodian therefor, by, or on behalf of, the Issuer. The Book-Entry Notes shall
be registered initially on the Note Register in the name of Cede & Co., the
nominee of the initial Clearing Agency, and no Note Owner thereof will receive a
Definitive Note representing such Note Owner's interest in such Note, except as
provided in Section 2.12. Unless and until definitive, fully registered Notes
(the "Definitive Notes") have been issued to such Note Owners pursuant to
Section 2.12:

                  (a) the provisions of this Section shall be in full force and
         effect;

                  (b) the Note Registrar and the Indenture Trustee shall be
         entitled to deal with the Clearing Agency for all purposes of this
         Indenture (including the payment of principal of and interest on the
         Notes and the giving of instructions or directions hereunder) as the
         authorized representative of the Note Owners;

                  (c) to the extent that the provisions of this Section conflict
         with any other provisions of this Indenture, the provisions of this
         Section shall control;

                  (d) the rights of Note Owners shall be exercised only through
         the Clearing Agency and shall be limited to those established by law
         and agreements between such Note Owners and the Clearing Agency and/or
         the Clearing Agency Participants pursuant to the Note Depository
         Agreement. Unless and until Definitive Notes are issued pursuant to
         Section 2.12, the initial Clearing Agency will make book-entry
         transfers among the

                                       17                             Indenture)

<PAGE>

         Clearing Agency Participants and receive and transmit payments of
         principal of and interest on the Notes to such Clearing Agency
         Participants; and

                  (e) whenever this Indenture requires or permits actions to be
         taken based upon instructions or directions of Holders of Notes
         evidencing a specified percentage of the Outstanding Amount of the
         Notes or of the Notes of any Class, the Clearing Agency shall be deemed
         to represent such percentage only to the extent that it has received
         instructions to such effect from Note Owners and/or Clearing Agency
         Participants owning or representing, respectively, such required
         percentage of the beneficial interest in the Notes and has delivered
         such instructions to the Indenture Trustee.

                  2.11 Notices to Clearing Agency. Whenever a notice or other
communication to the Noteholders is required under this Indenture, unless and
until Definitive Notes shall have been issued to such Note Owners pursuant to
Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to be given to Holders of the Notes to the
Clearing Agency and shall be deemed to have been given as of the date of
delivery to the Clearing Agency.

                  2.12 Definitive Notes. If (i) the Seller, the Owner Trustee or
the Administrator advises the Indenture Trustee in writing that the Clearing
Agency is no longer willing or able to properly discharge its responsibilities
with respect to the Book-Entry Notes and the Seller, the Owner Trustee and the
Administrator are unable to locate a qualified successor (and if the
Administrator has made such determination, the Administrator has given written
notice thereof to the Indenture Trustee), [(ii) the Seller, the Indenture
Trustee or the Administrator at its option advises each other such party in
writing that it elects to terminate the book-entry system through the Clearing
Agency] or [(iii)] after the occurrence of an Event of Default or a Servicer
Default, Note Owners representing beneficial interests aggregating a majority of
the Outstanding Amount of the Notes of all Classes advise the Indenture Trustee
and the Clearing Agency in writing that the continuation of a book-entry system
through the Clearing Agency or a successor thereto is no longer in the best
interests of the Note Owners acting together as a single Class, then the
Clearing Agency shall notify all Note Owners and the Indenture Trustee of the
occurrence of such event and of the availability of Definitive Notes to Note
Owners requesting the same. Upon surrender to the Indenture Trustee of the
typewritten Notes representing the Book-Entry Notes by the Clearing Agency,
accompanied by registration instructions, the Issuer shall execute and the
Indenture Trustee shall authenticate the Definitive Notes in accordance with the
instructions of the Clearing Agency. None of the Issuer, the Note Registrar or
the Indenture Trustee shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be protected in relying on,
such instructions. Upon the issuance of Definitive Notes, the Indenture Trustee
shall recognize the Holders of the Definitive Notes as Noteholders. The
Indenture Trustee, Issuer and Administrator shall not be liable for any
inability to locate a qualified successor Clearing Agency. From and after the
date of issuance of Definitive Notes, all notices to be given to Noteholders
will be mailed thereto at their addresses of record in the Note Register as of
the relevant Record Date. Such notices will be deemed to have been given as of
the date of mailing.

                                       18                            (Indenture)

<PAGE>

         2.13 Tax Treatment. The Issuer has entered into this Indenture, and the
Notes will be issued, with the intention that, for federal, state and local
income, single business and franchise tax purposes, the Notes will qualify as
indebtedness of the Issuer secured by the Trust Estate or, for periods during
which there is a single beneficial owner of the Certificates, indebtedness of
the Certificateholder issued by the Trust Estate. The Issuer, by entering into
this Indenture, and each Noteholder, by its acceptance of a Note (and each Note
Owner by its acceptance of an interest in the applicable Book-Entry Note), agree
to treat the Notes for federal, state and local income, single business and
franchise tax purposes as indebtedness of the Issuer.

                                   ARTICLE III

                    Covenants, Representations and Warranties

         3.01 Payment of Principal and Interest. In accordance with the terms of
this Indenture, the Issuer will duly and punctually (i) pay the principal of and
interest, if any, on the Notes in accordance with the terms of the Notes and
this Indenture and (ii) cause the Servicer to direct the Indenture Trustee to
release from the Collection Account all other amounts distributable or payable
from the Owner Trust Estate under the Trust Agreement, the Sale and Servicing
Agreement and the Administration Agreement. Without limiting the foregoing and
in order to fulfill such obligations, pursuant to Sections 8.02 and 8.03 hereof,
the Issuer will cause the Servicer to direct the Indenture Trustee to apply all
amounts on deposit in the Collection Account [, and] the Reserve Account [and
the Yield Supplement Account] on a Distribution Date deposited therein pursuant
to the Sale and Servicing Agreement (i) (a) for the benefit of the Class A-1
Notes, to the Class A-1 Noteholders, (b) for the benefit of the Class A-2 Notes,
to the Class A-2 Noteholders, (c) for the benefit of the Class A-3 Notes, to the
Class A-3 Noteholders, and (d) for the benefit of the Class B Notes, to the
Class B Noteholders, and (ii) for the benefit of the Certificateholders, to or
as directed by the Owner Trustee or the Administrator, as set forth in Section
5.06, 5.07 and 5.08 of the Sale and Servicing Agreement. Amounts properly
withheld under the Code by any Person from a payment to any Noteholder or
Certificateholder of interest and/or principal shall be considered as having
been paid by the Issuer to such Noteholder or Certificateholder for all purposes
of this Indenture.

         3.02 Maintenance of Office or Agency. The Issuer will maintain in the
Borough of Manhattan, The City of New York, an office or agency where Notes may
be surrendered for registration of transfer or exchange, and where notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may be
served. The Issuer hereby initially appoints [the Indenture Trustee] to serve as
its agent for the foregoing purposes. The Issuer will give prompt written notice
to the Indenture Trustee of the location, and of any change in the location, of
any such office or agency. If at any time the Issuer shall fail to maintain any
such office or agency or shall fail to furnish the Indenture Trustee with the
address thereof, such surrenders, notices and demands may be made or served at
the Corporate Trust Office, and the Issuer hereby appoints the Indenture Trustee
as its agent to receive all such surrenders, notices and demands.

                                       19                            (Indenture)

<PAGE>

         3.03 Money for Payments To Be Held in Trust. As provided in Sections
8.02 and 8.03, all payments of amounts due and payable with respect to any Notes
that are to be made from amounts withdrawn from the Collection Account, [the
Accumulation Account,] [or] the Reserve Account [or the Yield Supplement
Account] pursuant to Sections 8.02 and 8.03 shall be made on behalf of the
Issuer by the Indenture Trustee or by the Paying Agent, and no amounts so
withdrawn from such accounts for payments of Notes shall be paid over to the
Issuer, the Owner Trustee or the Administrator except as provided in this
Section.

         On or before each Distribution Date, the Issuer shall deposit in the
Collection Account or, in accordance with the Sale and Servicing Agreement,
cause to be deposited (including the provision of instructions to the Indenture
Trustee to make any required withdrawals from the Reserve Account [or the Yield
Supplement Account] and to deposit such amounts in the Collection Account), an
aggregate sum sufficient to pay the amounts then becoming due under the Notes[,
the Interest Rate Swap Agreement] and the Certificates, such sum to be held in
trust for the benefit of the Persons entitled thereto, and (unless the Paying
Agent is the Indenture Trustee) shall promptly notify the Indenture Trustee of
its action or failure so to act.

         The Indenture Trustee, as Paying Agent, hereby agrees with the Issuer
that it will, and the Issuer will cause each Paying Agent other than the
Indenture Trustee, as a condition to its acceptance of its appointment as Paying
Agent, to execute and deliver to the Indenture Trustee an instrument in which
such Paying Agent shall agree with the Indenture Trustee, subject to the
provisions of this Section, that such Paying Agent will:

         (a) hold all sums held by it for the payment of amounts due with
     respect to the Notes or Certificates or for release to the Issuer for
     payment on the Certificates in trust for the benefit of the Persons
     entitled thereto until such sums shall be paid to such Persons or otherwise
     disposed of as herein provided and pay or release such sums to such Persons
     as herein provided;

         (b) give the Indenture Trustee notice of any default by the Issuer
     (or any other obligor upon the Notes) of which it has actual knowledge
     in the making of any payment required to be made with respect to the Notes
     or the release of any amounts to the Issuer to be paid to the
     Certificateholders;

         (c) at any time during the continuance of any such default, upon the
     written request of the Indenture Trustee, forthwith pay to the Indenture
     Trustee all sums so held in trust by such Paying Agent;

         (d) immediately resign as a Paying Agent and forthwith pay to the
     Indenture Trustee all sums held by it in trust for the payment of Notes (or
     for release to the Issuer) if at any time it ceases to meet the standards
     required to be met by a Paying Agent at the time of its appointment; and

         (e) comply with all requirements of the Code with respect to the
     withholding from any payments made by it on any Notes or Certificates (or
     assisting the Issuer to withhold from payment to the Certificateholders) of
     any applicable withholding taxes

                                       20                            (Indenture)
<PAGE>

     imposed thereon and with respect to any applicable reporting requirements
     in connection therewith.

         The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to pay to the Indenture Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Indenture Trustee upon
the same trusts as those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Indenture Trustee, such Paying
Agent shall be released from all further liability with respect to such money.

         Subject to applicable laws with respect to escheat of funds, any money
held by the Indenture Trustee or any Paying Agent in trust for the payment of
any amount due with respect to any Note and remaining unclaimed after such
amount has become due and payable and after the Indenture Trustee has taken the
steps described in this paragraph shall be discharged from such trust and be
paid to Children's Hospital Los Angeles upon presentation thereto of an Issuer
Request; and the Holder of such Note shall thereafter, as an unsecured general
creditor, look only to the Issuer for payment thereof, and all liability of the
Indenture Trustee or such Paying Agent with respect to such trust money shall
thereupon cease. In the event that any Noteholder shall not surrender its Notes
for retirement within six months after the date specified in the written notice
of final payment described in Section 2.07, the Indenture Trustee will give a
second written notice to the registered Noteholders that have not surrendered
their Notes for final payment and retirement. If within one year after such
second notice any Notes have not been surrendered, the Indenture Trustee shall,
at the expense and direction of the Issuer, cause to be published once, in a
newspaper published in the English language, customarily published on each
Business Day and of general circulation in The City of New York, notice that
such money remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be paid to Children's Hospital Los
Angeles. The Indenture Trustee shall also adopt and employ, at the expense and
direction of the Issuer, any other reasonable means of notification of such
repayment specified by the Issuer or the Administrator.

         3.04 Existence. The Issuer will keep in full effect its existence,
rights and franchises as a statutory trust under the laws of the State of
Delaware (unless it becomes, or any successor Issuer hereunder is or becomes,
organized under the laws of any other State or of the United States of America,
in which case the Issuer will keep in full effect its existence, rights and
franchises under the laws of such other jurisdiction) and will obtain and
preserve its qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Trust Estate or the Owner Trust Estate.

         3.05 Protection of Trust Estate. The Issuer will from time to time
execute and deliver all such supplements and amendments hereto and all such
financing statements, continuation statements, instruments of further assurance
and other instruments, and will take such other action necessary or advisable
to:

         (a) maintain or preserve the lien and security interest (and the
     priority thereof) of this Indenture or carry out more effectively the
     purposes hereof;

                                       21                            (Indenture)
<PAGE>

         (b) perfect, publish notice of or protect the validity of any Grant
     made or to be made by this Indenture;

         (c) enforce any of the Collateral; or

         (d) preserve and defend title to the Trust Estate and the rights of
     the Indenture Trustee[, the Swap Counterparty] and the Noteholders in such
     Trust Estate against the claims of all persons and parties.

         The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to execute any financing statement, continuation statement or
other instrument required to be executed pursuant to this Section 3.05.

         3.06 Opinions as to Trust Estate.

         (a) On the Closing Date, the Issuer shall furnish or cause to be
     furnished to the Indenture Trustee an Opinion of Counsel either stating
     that, in the opinion of such counsel, such action has been taken with
     respect to the execution, recording and filing of this Indenture, any
     indentures supplemental hereto, any requisite financing statements and
     continuation statements and any other requisite documents necessary to
     perfect and make effective the lien and security interest of this Indenture
     or stating that, in the opinion of such counsel, no such action is
     necessary to make such lien and security interest effective.

         (b) As and when specified in Section 10.02(h) of the Sale and
     Servicing Agreement, the Issuer shall furnish or cause to be furnished to
     the Indenture Trustee an Opinion of Counsel either stating that, in the
     opinion of such counsel, such action has been taken with respect to the
     execution, recording, filing or re-recording and refiling of this
     Indenture, any indentures supplemental hereto, any financing statements and
     continuation statements and any other requisite documents necessary to
     maintain the lien and security interest created by this Indenture or
     stating that in the opinion of such counsel no such action is necessary to
     maintain such lien and security interest. Such Opinion of Counsel shall
     also describe the execution, recording, filing or re-recording and refiling
     of this Indenture, any indentures supplemental hereto, any financing
     statements and continuation statements and any other documents that will,
     in the opinion of such counsel, be required to maintain the lien and
     security interest of this Indenture until the date in the following
     calendar year on which such Opinion of Counsel must again be delivered.

         3.07 Performance of Obligations; Servicing of Receivables.

         (a) The Issuer will not take any action and will use its best efforts
     not to permit any action to be taken by others that would release any
     Person from any of such Person's material covenants or obligations under
     any instrument or agreement included in the Trust Estate or that would
     result in the amendment, hypothecation, subordination, termination or
     discharge of, or impair the validity or effectiveness of, any such
     instrument or agreement, except as expressly provided in the Basic
     Documents.

                                       22                            (Indenture)
<PAGE>

         (b) The Issuer may contract with other Persons to assist it in
     performing its duties under this Indenture, and any performance of such
     duties by a Person identified to the Indenture Trustee in an Officer's
     Certificate of the Issuer shall be deemed to be action taken by the Issuer.
     Initially, the Issuer has contracted with the Servicer and the
     Administrator to assist the Issuer in performing its duties under this
     Indenture.

         (c) The Issuer will punctually perform and observe all of its
     obligations and agreements contained in the Basic Documents and in the
     instruments and agreements included in the Trust Estate, including but not
     limited to filing or causing to be filed all UCC financing statements and
     continuation statements required to be filed by the terms of the Trust
     Agreement, this Indenture and the Sale and Servicing Agreement in
     accordance with and within the time periods provided for herein and
     therein.

         (d) If an Authorized Officer of the Issuer shall have knowledge of
     the occurrence of a Servicer Default under the Sale and Servicing
     Agreement, the Issuer shall promptly notify the Indenture Trustee and the
     Rating Agencies thereof, and shall specify in such notice the action, if
     any, the Issuer is taking with respect of such default. If a Servicer
     Default shall arise from the failure of the Servicer to perform any of its
     duties or obligations under the Sale and Servicing Agreement with respect
     to the Receivables, the Issuer shall take all reasonable steps available to
     it to remedy such failure.

         (e) As promptly as possible after the giving of notice of termination
     to the Servicer of the Servicer's rights and powers pursuant to Section
     8.01 of the Sale and Servicing Agreement, the Indenture Trustee shall
     appoint a successor servicer (the "Successor Servicer"), and such Successor
     Servicer shall accept its appointment by a written assumption in a form
     acceptable to the Indenture Trustee. In the event that a Successor Servicer
     has not been appointed and accepted its appointment as set forth in Section
     8.02 of the Sale and Servicing Agreement, the Indenture Trustee without
     further action shall automatically be appointed the Successor Servicer and
     shall thereafter be entitled to the Total Servicing Fee. Notwithstanding
     the above, the Indenture Trustee shall, if it shall be legally unable so to
     act, appoint or petition a court of competent jurisdiction to appoint, and
     the predecessor Servicer, if no successor Servicer has been appointed at
     the time the predecessor Servicer has ceased to act, may petition a court
     of competent jurisdiction to appoint, any established institution having a
     net worth of not less than $100,000,000 and whose regular business shall
     include the servicing of automobile and/or light-duty truck receivables, as
     the successor to the Servicer under the Sale and Servicing Agreement. Upon
     such appointment, the Indenture Trustee will be released from the duties
     and obligations of acting as Successor Servicer, such release effective
     upon the effective date of the servicing agreement entered into between the
     Successor Servicer and the Issuer.

         In connection with any such appointment, the Indenture Trustee may make
such arrangements for the compensation of such successor as it and such
Successor Servicer shall agree, subject to the limitations set forth below and
in the Sale and Servicing Agreement, and in accordance with Section 8.02 of the
Sale and Servicing Agreement, the Issuer shall enter into an agreement with such
Successor Servicer for the servicing of the Receivables (such agreement to be in
form and substance satisfactory to the Indenture Trustee). If the Indenture
Trustee shall

                                       23                            (Indenture)
<PAGE>

succeed to the Servicer's duties as servicer of the Receivables as provided
herein, it shall do so in its individual capacity and not in its capacity as
Indenture Trustee and, accordingly, the provisions of Article VI hereof shall be
inapplicable to the Indenture Trustee in its duties as Successor Servicer and
the servicing of the Receivables. In case the Indenture Trustee shall become the
Successor Servicer, the Indenture Trustee shall be entitled to appoint as a
subservicer any one of its Affiliates, provided that the Indenture Trustee, in
its capacity as Successor Servicer, shall remain fully liable for the actions
and omissions of such Affiliate.

         (f) Upon any termination of the Servicer's rights and powers pursuant
     to the Sale and Servicing Agreement, the Issuer shall promptly notify the
     Indenture Trustee. As soon as a Successor Servicer is appointed, the Issuer
     shall notify the Indenture Trustee of such appointment, specifying in such
     notice the name and address of such Successor Servicer.

         (g) Without derogating from the absolute nature of the assignment
     granted to the Indenture Trustee under this Indenture or the rights of the
     Indenture Trustee hereunder, the Issuer agrees (i) that it will not,
     without the prior written consent of the Indenture Trustee and the Holders
     of the Controlling Class of Notes representing a majority in Outstanding
     Amount of such Class (excluding for such purposes the outstanding principal
     amount of any Notes held of record or beneficially owned by NMAC, NARC II
     or any of their Affiliates, unless at such time, all of the Notes of such
     Class are held of record or beneficially owned by NARC II, NMAC or any of
     their Affiliates), amend, modify, waive, supplement, terminate or
     surrender, or agree to any amendment, modification, waiver, supplement,
     termination or surrender of, the terms of any Collateral (except to the
     extent otherwise provided in the Sale and Servicing Agreement) or the Basic
     Documents, or waive timely performance or observance by the Servicer or the
     Seller under the Sale and Servicing Agreement; and (ii) that any such
     amendment shall not (A) increase or reduce in any manner the amount of, or
     accelerate or delay the timing of, collections of payments on the
     Receivables or distributions that are required to be made for the benefit
     of the Noteholders or change the Interest Rate or the Specified Reserve
     Account Balance (except as otherwise provided in the Basic Documents), in
     each case without the consent of each of the "adversely affected"
     Noteholders, or (B) reduce the aforesaid percentage of the Notes that is
     required to consent to any such amendment, without the consent of the
     Holders of all the outstanding Notes. If any such amendment, modification,
     supplement or waiver shall be so consented to by the Indenture Trustee or
     such Holders, the Issuer agrees, promptly following a request by the
     Indenture Trustee to agree to such amendment and to execute and deliver, in
     its own name and at its own expense, such agreements, instruments, consents
     and other documents as the Indenture Trustee may deem necessary or
     appropriate in the circumstances to implement such amendment and to cause
     the relevant Basic Documents, as amended, to be enforceable against the
     Issuer. For the purposes of clause (ii) above, an amendment will be deemed
     not to "adversely affect" a Noteholder of any Class only if each Rating
     Agency confirms that such amendment will not result in a reduction or
     withdrawal of its rating on such Class of Notes.

         3.08 Negative Covenants. So long as any Notes are Outstanding, the
Issuer shall not:

                                       24                            (Indenture)
<PAGE>

         (a) except as expressly permitted by Basic Documents, sell, transfer,
     exchange or otherwise dispose of any of the properties or assets of the
     Issuer, including those included in the Trust Estate, unless directed to do
     so by the Indenture Trustee;

         (b) claim any credit on, or make any deduction from the principal or
     interest payable in respect of, the Notes (other than amounts properly
     withheld from such payments under the Code) or assert any claim against any
     present or former Noteholder by reason of the payment of the taxes levied
     or assessed upon any part of the Trust Estate;

         (c) except as may be expressly permitted hereby, (A) permit the
     validity or effectiveness of this Indenture to be impaired, or permit the
     lien of this Indenture to be amended, hypothecated, subordinated,
     terminated or discharged, or permit any Person to be released from any
     covenants or obligations with respect to the Notes under this Indenture,
     (B) permit any lien, charge, excise, claim, security interest, mortgage or
     other encumbrance (other than the lien of this Indenture) to be created on
     or extend to or otherwise arise upon or burden the Trust Estate or any part
     thereof or any interest therein or the proceeds thereof (other than tax
     liens, mechanics' liens and other liens that arise by operation of law, in
     each case on any of the Financed Vehicles and arising solely as a result of
     an action or omission of the related Obligor), (C) permit the lien of this
     Indenture not to constitute a valid first priority (other than with respect
     to any such tax, mechanics' or other lien) security interest in the Trust
     Estate, or (D) dissolve or liquidate in whole or in part; or

         (d) assume or incur any indebtedness other than the Notes or as
     expressly contemplated by this Indenture (in connection with the obligation
     to reimburse Advances from the Trust Estate, or to pay expenses from the
     Trust Estate) or by the Basic Documents as in effect on the date hereof.

         3.09 Annual Statement as to Compliance. The Issuer will cause the
Servicer to deliver to the Indenture Trustee concurrently with its delivery
thereof to the Issuer the annual statement of compliance described in Section
4.09 of the Sale and Servicing Agreement. In addition, on the same date annually
upon which such annual statement of compliance is to be delivered by the
Servicer, the Issuer shall deliver to the Indenture Trustee an Officer's
Certificate stating, as to the Authorized Officer signing such Officer's
Certificate, that:

         (a) a review of the activities of the Issuer during such year and of
     its performance under this Indenture has been made under such Authorized
     Officer's supervision; and

         (b) to the best of such Authorized Officer's knowledge, based on such
     review, the Issuer has complied with all conditions and covenants under
     this Indenture throughout such year, or, if there has been a default in its
     compliance with any such condition or covenant, specifying each such
     default known to such Authorized Officer and the nature and status thereof.

                                       25                            (Indenture)
<PAGE>

         3.10 Issuer May Consolidate, etc., Only on Certain Terms.

         (a) The Issuer shall not consolidate or merge with or into any other
     Person, unless:

               (1) the Person (if other than the Issuer) formed by or surviving
         such consolidation or merger shall be a Person organized and existing
         under the laws of the United States of America or any State or the
         District of Columbia and shall expressly assume, by an indenture
         supplemental hereto, executed and delivered to the Indenture Trustee,
         in form satisfactory to the Indenture Trustee, the duty to make due and
         punctual payment of the principal of and interest on all Notes and the
         performance or observance of every agreement and covenant of this
         Indenture on the part of the Issuer to be performed or observed, all as
         provided herein;

               (2) immediately after giving effect to such transaction, no
         Default or Event of Default shall have occurred and be continuing;

               (3) no Rating Agency shall have notified the Indenture Trustee
         and the Owner Trustee that such transaction might or would result in
         the removal or reduction of the rating then assigned thereby to any
         Class of Notes;

               (4) the Issuer shall have received an Opinion of Counsel (and
         shall have delivered copies thereof to the Indenture Trustee) to the
         effect that such transaction will not have any material adverse tax
         consequence to the Issuer, [the Swap Counterparty,] any Noteholder or
         any Certificateholder;

               (5) any action that is necessary to maintain each lien and
         security interest created by the Trust Agreement, the Sale and
         Servicing Agreement or this Indenture shall have been taken; and

               (6) the Issuer shall have delivered to the Indenture Trustee an
         Officer's Certificate and an Opinion of Counsel each stating that such
         consolidation or merger and any related supplemental indenture complies
         with this Article III and that all conditions precedent provided in
         this Indenture relating to such transaction have been complied with
         (including any filing required by the Exchange Act).

         (b) The Issuer shall not convey or transfer any of its properties or
     assets, including those included in the Trust Estate, to any Person,
     unless:

               (1) the Person that acquires by conveyance or transfer such
         properties and assets of the Issuer shall (A) be a United States
         citizen or a Person organized and existing under the laws of the United
         States of America or any state or the District of Columbia, (B)
         expressly assume, by an indenture supplemental hereto, executed and
         delivered to the Indenture Trustee, in form satisfactory to the
         Indenture Trustee, the duty to make due and punctual payment of the
         principal of and interest on all Notes [and all obligations under the
         Interest Rate Swap Agreement] and the performance or observance of
         every agreement and covenant of this Indenture on the part of the
         Issuer to be performed or observed, all as

                                       26                            (Indenture)
<PAGE>

         provided herein, (C) expressly agrees by means of such supplemental
         indenture that all right, title and interest so conveyed or
         transferred shall be subject and subordinate to the rights of Holders
         of the Notes [and the Swap Counterparty], (D) unless otherwise
         provided in such supplemental indenture, expressly agrees to
         indemnify, defend and hold harmless the Issuer, the Owner Trustee and
         the Indenture Trustee against and from any loss, liability or expense
         arising under or related to this Indenture and the Notes, and (E)
         expressly agrees by means of such supplemental indenture that such
         Person (or if a group of Persons, then one specified Person) shall
         make all filings that counsel satisfactory to such purchaser or
         transferee and the Indenture Trustee determines must be made with (1)
         the Commission (and any other appropriate Person) required by the
         Exchange Act or the appropriate authorities in any state in which the
         Notes have been sold pursuant to any qualification or exemption under
         the securities or "blue sky" laws of such state, in connection with
         the Notes or (2) the Internal Revenue Service or the relevant state or
         local taxing authorities of any jurisdiction;

               (2) immediately after giving effect to such transaction, no
         Default or Event of Default shall have occurred and be continuing;

               (3) no Rating Agency shall have notified the Indenture Trustee
         and the Owner Trustee that such transaction might or would result in
         the removal or reduction of the rating then assigned thereby to any
         Class of Notes;

               (4) the Issuer shall have received an Opinion of Counsel (and
         shall have delivered copies thereof to the Indenture Trustee) to the
         effect that such transaction will not have any material adverse tax
         consequence to the Issuer, [the Swap Counterparty,] any Noteholder or
         any Certificateholder;

               (5) any action that is necessary to maintain each lien and
         security interest created by the Trust Agreement, the Sale and
         Servicing Agreement or this Indenture shall have been taken; and

               (6) the Issuer shall have delivered to the Indenture Trustee an
         Officer's Certificate and an Opinion of Counsel each stating that such
         conveyance or transfer and such supplemental indenture comply with this
         Article III and that all conditions precedent herein provided for
         relating to such transaction have been complied with (including any
         filing required by the Exchange Act).

         3.11 Successor or Transferee.

         (a) Upon any consolidation or merger of the Issuer in accordance with
     Section 3.10(a), the Person formed by or surviving such consolidation or
     merger (if other than the Issuer) shall succeed to, and be substituted for,
     and may exercise every right and power of, the Issuer under this Indenture
     with the same effect as if such Person had been named as the Issuer herein.

         (b) Upon a conveyance or transfer of all the assets and properties of
     the Issuer pursuant to Section 3.10(b), Nissan Auto Receivables [____-_]
     Owner Trust will be

                                       27                            (Indenture)
<PAGE>

     released from every covenant and agreement of this Indenture to be observed
     or performed on the part of the Issuer with respect to the Notes and the
     Certificates immediately upon the delivery of written notice to the
     Indenture Trustee stating that Nissan Auto Receivables [____-_] Owner Trust
     is to be so released.

         3.12 No Other Business. Unless and until the Issuer shall have been
released from its duties and obligations hereunder, the Issuer shall not engage
in any business other than financing, purchasing, owning, selling and managing
the Receivables in the manner contemplated by the Basic Documents and activities
incidental thereto

         3.13 No Borrowing. Unless and until the Issuer shall have been
released from its duties and obligations hereunder, the Issuer shall not issue,
incur, assume, guarantee or otherwise become liable, directly or indirectly, for
any indebtedness except for the Notes or other obligations permitted hereunder
(including the obligation to reimburse Advances or certain expenses of the
Servicer) or under another Basic Document (including indemnification expenses of
the Issuer and certain fees and expenses of the Administrator).

         3.14 Servicer's Notice Obligations. The Issuer shall cause the
Servicer to comply with all of its duties and obligations with respect to the
preparation of reports, the delivery of Officer's Certificates and Opinions of
Counsel and the giving of instructions and notices under the Sale and Servicing
Agreement (including, but not limited to, under Sections 4.08, 4.09, 4.11, 4.13,
5.09 and Article IX thereof).

         3.15 Guarantees, Loans, Advances and Other Liabilities. Unless and
until the Issuer shall have been released from its duties and obligations
hereunder, except as contemplated by the Sale and Servicing Agreement, this
Indenture, or the other Basic Documents, the Issuer shall not make any loan or
advance or credit to, or guarantee (directly or indirectly or by an instrument
having the effect of assuring another's payment or performance on any obligation
or capability of so doing or otherwise), endorse or otherwise become
contingently liable, directly or indirectly, in connection with the obligations,
stocks or dividends of, or own, purchase, repurchase or acquire (or agree
contingently to do so) any stock, obligations, assets or securities of, or any
other interest in, or make any capital contribution to, any other Person.

         3.16 Capital Expenditures. Unless and until the Issuer shall have been
released from its duties and obligations hereunder, the Issuer shall not make
any expenditure (by long-term or operating lease or otherwise) for capital
assets (either realty or personalty).

         3.17 Removal of Administrator. So long as any Notes are Outstanding,
the Issuer shall not remove the Administrator without cause unless so instructed
by the Owner Trustee or the Indenture Trustee and unless each Rating Agency
shall have received 10 days' written notice thereof and shall not have notified
the Indenture Trustee, the Administrator or the Owner Trustee that such removal
might or would result in the removal or reduction of the rating, if any, then
assigned thereby to any Class of Notes or the Certificates.

                                       28                            (Indenture)
<PAGE>

         3.18 Restricted Payments. The Issuer shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Servicer, the Owner Trustee or any Certificateholder or
otherwise with respect to any ownership or equity interest or security in or of
the Issuer, (ii) redeem, purchase, retire or otherwise acquire for value any
such ownership or equity interest or security or (iii) set aside or otherwise
segregate any amounts for any such purpose; provided, however, that the Issuer
may make, or cause to be made, (x) distributions to the Servicer, the Owner
Trustee, [the Swap Counterparty,] the Noteholders and the Certificateholders as
contemplated by, and to the extent funds are available for such purpose under,
the Sale and Servicing Agreement or the Trust Agreement, and (y) payments to the
Owner Trustee or the Indenture Trustee pursuant to the Administration Agreement.
The Issuer will not, directly or indirectly, make payments to or distributions
from the Collection Account except in accordance with the Basic Documents.

         3.19 Notice of Events of Default. The Issuer shall give the Indenture
Trustee and each Rating Agency prompt written notice of each Event of Default
hereunder, each default on the part of the Servicer or the Seller of its
obligations under the Sale and Servicing Agreement (including any Servicer
Defaults) and each default on the part of NMAC of its obligations under the
Purchase Agreement.

         The Indenture Trustee shall notify each Noteholder of record in writing
of any Event of Default promptly upon a Responsible Officer obtaining actual
knowledge thereof. Such notices will be provided in accordance with Section
2.11.

         3.20 Further Instruments and Actions. Upon request of the Indenture
Trustee, the Issuer will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.

         3.21 Representations and Warranties. The Issuer makes the following
representations and warranties. Such representations and warranties speak as of
the execution and delivery of this Indenture and as of the Closing Date, but
shall survive the Closing Date. Notwithstanding anything to the contrary, the
Indenture Trustee shall not waive any breach of representations or warranties in
this Section 3.21 without the written consent of the Holders of the Controlling
Class of Notes representing a majority of the Outstanding Amount of such Class
(excluding for such purposes the outstanding principal amount of any Notes held
of record or beneficially owned by NMAC, NARC II or any of their Affiliates,
unless at such time all of the Notes are held of record or beneficially owned by
NMAC, NARC II or any of their Affiliates).

         (a) This Indenture creates a valid and continuing security interest
     (as defined in the applicable UCC) in the Collateral in favor of the
     Indenture Trustee, which security interest is prior to all other Liens, and
     is enforceable as such as against creditors of any purchasers from the
     Issuer.

         (b) The Issuer has taken all steps necessary to perfect its security
     interest against the Obligor in the property securing the Receivables.

                                       29                            (Indenture)
<PAGE>

         (c) The Collateral constitutes "tangible chattel paper" [or
     "electronic chattel paper"] within the meaning of the applicable UCC.

         (d) The Issuer owns and has good and marketable title to the
     Collateral free and clear of any Lien, claim or encumbrance of any Person.

         (e) The Issuer has caused or will have caused, within ten days, the
     filing of all appropriate financing statements in the proper filing office
     in the appropriate jurisdictions under applicable law in order to perfect
     the security interest in the Collateral granted to the Indenture Trustee
     hereunder.

         (f) Other than the security interest granted to the Indenture Trustee
     pursuant to this Indenture, the Issuer has not pledged, assigned, sold,
     granted a security interest in, or otherwise conveyed any of the
     Collateral. The Issuer has not authorized the filing of and is not aware of
     any financing statements against the Issuer that includes a description of
     collateral covering the Collateral other than any financing statement
     relating to the security interest granted to the Indenture Trustee
     hereunder or a financing statement as to which the security interest
     covering the Receivables has been released. The Issuer is not aware of any
     judgment or tax lien filings against the Issuer.

         (g) The Servicer, as an agent of the Issuer, has in its possession
     all original copies of the Receivable File that constitute or evidence the
     Collateral. The Receivable Files that constitute or evidence the Collateral
     do not have any marks or notations indicating that they have been pledged,
     assigned or otherwise conveyed by the Issuer to any Person other than the
     Indenture Trustee. All financing statements filed or to be filed against
     the Issuer in favor of the Indenture Trustee in connection herewith
     describing the Collateral contain a statement to the following effect: "A
     purchase of or security interest in any collateral described in this
     financing statement, except as permitted in the Indenture, will violate the
     rights of the Indenture Trustee."

         3.22 [Calculation Agent. (i) The Issuer agrees that for so long as
any of the VPTNs are Outstanding, there shall at all times be an agent appointed
to calculate LIBOR in respect of each Interest Period (the "Calculation Agent").
The Issuer has initially appointed [____________________________] as Calculation
Agent for purposes of determining LIBOR for each Interest Period. The
Calculation Agent may be removed by the Issuer at any time. If the Calculation
Agent is unable or unwilling to act as such or is removed by the Issuer, the
Issuer shall promptly appoint as a replacement Calculation Agent a lending bank
which is engaged in transactions in Eurodollar deposits in the international
Eurodollar market and which does not control or is not controlled by or under
common control with the Issuer or its Affiliates. The Calculation Agent may not
resign its duties without a successor having been duly appointed.

               (ii) The Calculation Agent shall be required to agree that, as
     soon as possible after [___] (London time) on each LIBOR Determination
     Date, but in no event later than [___] (London Time) on the Business Day
     immediately following each LIBOR Determination Date, the Calculation Agent
     shall calculate the interest rate for each VPTN for the related Interest
     Period and the amount of interest payable (rounded to the nearest cent,
     with half a cent being rounded upwards) on the related Distribution Date,
     and shall

                                       30                            (Indenture)
<PAGE>

     communicate such rates and amounts to the Administrator, the Indenture
     Trustee and the Servicer. The Calculation Agent shall also specify to the
     Administrator and the Indenture Trustee the quotations upon which the
     interest rates have been calculated and in any event the Calculation Agent
     shall notify the Indenture Trustee and the Servicer before [___] (London
     time) on each LIBOR Determination Date that either: (A) it has determined
     or is in the process of determining the interest rates for the VPTNs and
     the amount of interest due on such Notes, or (ii) it has not determined and
     is not in the process of determining the interest rates for the VPTNs and
     the amount of interest due on such Notes, together with its reasons
     therefore. The determination of the interest rates and interest amounts by
     the Calculation Agent shall (in the absence of manifest error) be final and
     binding upon all parties.]

                                   ARTICLE IV
                           Satisfaction and Discharge

         4.01 Satisfaction and Discharge of Indenture. This Indenture shall
cease to be of further effect with respect to the Notes except as to (i) rights
of registration of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments
of principal thereof and interest thereon, (iv) Sections 3.03, 3.04, 3.05, 3.08,
3.10, 3.12 and 3.13, (v) the rights, obligations and immunities of the Indenture
Trustee hereunder (including the rights of the Indenture Trustee under Section
6.07 and the obligations of the Indenture Trustee under Sections 3.03 and 4.02),
and (vi) the rights of the Noteholders and the Certificateholders as
beneficiaries hereof with respect to the property so deposited with the
Indenture Trustee payable to all or any of them, and the Indenture Trustee, on
demand of and at the expense of the Issuer, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture with respect to the
Notes, when:

         (a) either (1) all Notes theretofore authenticated and delivered
     (other than Notes that have been destroyed, lost or stolen and that have
     been replaced or paid as provided in Section 2.05 and Notes for whose
     payment money has theretofore been deposited in trust or segregated and
     held in trust by the Issuer and thereafter repaid to the Issuer or
     discharged from such trust, as provided in Section 3.03) have been
     delivered to the Indenture Trustee for cancellation or (2) all Notes not
     theretofore delivered to the Indenture Trustee for cancellation have become
     due and payable or will become due and payable within one year (either
     because the Final Scheduled Distribution Date for the Class B Notes is
     within one year or because the Indenture Trustee has received notice of the
     exercise of the option granted pursuant to Section 9.01 of the Sale and
     Servicing Agreement) and the Issuer has irrevocably deposited or caused to
     be irrevocably deposited with the Indenture Trustee cash or direct
     obligations of or obligations guaranteed by the United States of America
     (which will mature prior to the date such amounts are payable), in trust
     for such purpose, in an amount sufficient to pay and discharge the entire
     indebtedness on such Notes not theretofore delivered to the Indenture
     Trustee for cancellation when due;

                                       31                            (Indenture)
<PAGE>

         (b) the Issuer has paid or caused to be paid all other sums payable
     hereunder [and under the Interest Rate Swap Agreement] by the Issuer; and

         (c) the Issuer has delivered to the Indenture Trustee an Officer's
     Certificate, (if required by the TIA or the Indenture Trustee) an Opinion
     of Counsel and (if required by the TIA or the Indenture Trustee) an
     Independent Certificate from a firm of certified public accountants, each
     meeting the applicable requirements of Section 11.01 and, subject to
     Section 11.02, each stating that all conditions precedent herein provided
     for relating to the satisfaction and discharge of this Indenture have been
     complied with.

         4.02 Application of Trust Money. All moneys deposited with the
Indenture Trustee pursuant to Section 4.01 hereof shall be held in trust and (a)
applied by it in accordance with the provisions of the Notes and this Indenture
to the payment, either directly or through any Paying Agent, as the Indenture
Trustee may determine, to the Holders of the particular Notes for the payment of
which such moneys have been deposited with the Indenture Trustee, of all sums
due and to become due thereon for principal and interest or (b) released to the
Owner Trustee for distribution to the Certificateholders or application pursuant
to the Trust Agreement or the Sale and Servicing Agreement [and for payment to
the Swap Counterparty of all sums, if any, due or to become due to the Swap
Counterparty under and in accordance with this Indenture]; but such moneys need
not be segregated from other funds except to the extent required herein or in
the Sale and Servicing Agreement or required by law.

         4.03 Repayment of Moneys Held by Paying Agent. In connection with the
satisfaction and discharge of this Indenture with respect to the Notes, all
moneys then held by any Paying Agent other than the Indenture Trustee under the
provisions of this Indenture with respect to such Notes shall, upon demand of
the Issuer, be paid to the Indenture Trustee to be held and applied according to
Section 3.03 or 4.02 and thereupon such Paying Agent shall be released from all
further liability with respect to such moneys.

                                    ARTICLE V
                                    Remedies

         5.01 Events of Default. "Event of Default," wherever used herein,
means any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):

         (a) default in the payment of any interest on any Class A Note when
     the same becomes due and payable, and such default shall continue for a
     period of five days (so long as any Class A Notes are Outstanding, each
     Holder of any Class B Note or the Note Owner of any such Note by such
     Holder's acceptance of such Note or beneficial interest therein, as the
     case may be, shall be deemed to have consented to the delay in payment of
     interest on such Class of Notes and to have waived its right to institute
     suit for enforcement of any such payment);

                                       32                            (Indenture)
<PAGE>

         (b) after the Class A Notes have been paid in full, default in the
     payment of any interest on any Class B Note when the same becomes due and
     payable, and such default shall continue for a period of five days (so long
     as the Class B Notes are Outstanding);

         (c) default in the payment of the principal of or any installment of
     the principal of any Note when the same becomes due and payable;

         (d) default in the observance or performance of any covenant or
     agreement of the Issuer made in this Indenture (other than a covenant or
     agreement, a default in the observance or performance of which is elsewhere
     in this Section specifically dealt with) which shall continue or not be
     cured for a period of 90 days after there shall have been given, by
     registered or certified mail, to the Issuer by the Indenture Trustee or to
     the Issuer and the Indenture Trustee by the Holders of at least 25% of the
     Outstanding Amount of the Notes, acting together as a single class, a
     written notice specifying such default or incorrect representation or
     warranty and requiring it to be remedied and stating that such notice is a
     notice of Default hereunder;

         (e) any representation or warranty of the Issuer made in this
     Indenture or in any certificate or other writing delivered pursuant hereto
     or in connection herewith shall prove to have been incorrect in any
     material respect as of the time when the same shall have been made, and
     such default shall continue or not be cured, or the circumstance or
     condition in respect of which such misrepresentation or warranty was
     incorrect shall not have been eliminated or otherwise cured, for a period
     of 30 days after there shall have been given, by registered or certified
     mail, to the Issuer by the Indenture Trustee or to the Issuer and the
     Indenture Trustee by the Holders of at least 25% of the Outstanding Amount
     of the Notes, acting together as a single Class, a written notice
     specifying such default or incorrect representation or warranty and
     requiring it to be remedied and stating that such notice is a notice of
     Default hereunder;

         (f) the filing of a petition seeking entry of a decree or order for
     relief by a court having jurisdiction in the premises in respect of the
     Issuer or any substantial part of the Trust Estate in an involuntary case
     under any applicable federal or state bankruptcy, insolvency or other
     similar law now or hereafter in effect, or appointing a receiver,
     liquidator, assignee, custodian, trustee, sequestrator or similar official
     of the Issuer or for any substantial part of the Trust Estate, or ordering
     the winding-up or liquidation of the Issuer's affairs, and such petition
     shall remain unstayed and in effect for a period of 90 consecutive days; or

         (g) the commencement by the Issuer of a voluntary case under any
     applicable federal or state bankruptcy, insolvency or other similar law now
     or hereafter in effect, or the consent by the Issuer to the entry of an
     order for relief in an involuntary case under any such law, or the consent
     by the Issuer to the appointment or taking possession by a receiver,
     liquidator, assignee, custodian, trustee, sequestrator or similar official
     of the Issuer or for any substantial part of the Trust Estate, or the
     making by the Issuer of any general assignment for the benefit of
     creditors, or the failure by the Issuer generally to

                                       33                            (Indenture)
<PAGE>

     pay its debts as such debts become due, or the taking of any action by the
     Issuer in furtherance of any of the foregoing.

         The Issuer shall deliver to the Indenture Trustee, within five Business
Days after the occurrence thereof, written notice in the form of an Officer's
Certificate of any Default that with the giving of notice or the lapse of time
would become an Event of Default under clauses (d) or (g), stating the status of
such Default and any action the Issuer is taking or proposes to take with
respect thereto.

         5.02 Acceleration of Maturity; Rescission and Annulment. If an Event
of Default should occur and be continuing, then and in every such case the
Indenture Trustee or the Holders of the Controlling Class of Notes representing
not less than a majority of the Outstanding Amount of such Class (excluding for
such purposes the outstanding principal amount of any Notes held of record or
beneficially owned by NMAC, NARC II or any of their Affiliates, unless at such
time all of the Notes of such Class are held of record or beneficially owned by
NARC II, NMAC or any of their Affiliates) may declare all the Notes to be
immediately due and payable, by a notice in writing to the Issuer (and to the
Indenture Trustee if given by Noteholders), and upon any such declaration the
unpaid principal amount of such Notes, together with accrued and unpaid interest
thereon through the date of acceleration, shall become immediately due and
payable. [In the event of such declaration or automatic acceleration, the
Indenture Trustee shall give prompt written notice to the Swap Counterparty.]

         At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided, the
Holders of the Controlling Class of Notes representing a majority of the
Outstanding Amount of such Class (excluding for such purposes the outstanding
principal amount of any Notes held of record or beneficially owned by NMAC, NARC
II or any of their Affiliates, unless at such time all of the Notes of such
Class are held of record or beneficially owned by NARC II, NMAC or any of their
Affiliates), by written notice to the Issuer and the Indenture Trustee, may
rescind and annul such declaration and its consequences if:

         (a) the Issuer has paid or deposited with the Securities Intermediary
     in the name of the Indenture Trustee a sum sufficient to pay:

               (1) all payments of principal of and interest on the respective
         Classes of Notes and all other amounts that would then be due hereunder
         or upon such Notes [and pursuant to the Interest Rate Swap Agreement]
         if the Event of Default giving rise to such acceleration had not
         occurred; and

               (2) all sums paid or advanced by the Indenture Trustee hereunder
         and the reasonable compensation, expenses, disbursements and advances
         of the Indenture Trustee and its agents and counsel; and

         (b) all Events of Default, other than the nonpayment of the principal
     of the Notes that has become due solely by such acceleration, have been
     cured or waived as provided in Section 5.12.

                                       34                            (Indenture)
<PAGE>

         No such rescission shall affect any subsequent default or impair any
right consequent thereto.

         5.03 Collection of Indebtedness and Suits for Enforcement by Indenture
Trustee.

         (a) The Issuer covenants that if (i) default is made (A) in the
     payment of any interest on any Class A Note, so long as any amounts remain
     unpaid with respect to the Class A Notes, or (B) in the payment of any
     interest on any Class B Note, after the Class A Notes have been paid in
     full, when the same becomes due and payable, and such default continues for
     a period of five days, or (ii) default is made in the payment of the
     principal of or any installment of the principal of any Note when the same
     becomes due and payable, the Issuer will, upon demand of the Indenture
     Trustee, pay to the Indenture Trustee, for the benefit of the Holders of
     the Notes, the whole amount then due and payable on such Class of Notes for
     principal and interest, with interest upon the overdue principal and, to
     the extent payment at such rate of interest shall be legally enforceable,
     upon overdue installments of interest at the rate borne by the Notes and in
     addition thereto such further amount as shall be sufficient to cover the
     costs and expenses of collection, including the reasonable compensation,
     expenses, disbursements and advances of the Indenture Trustee and its
     agents and counsel.

         (b) In case the Issuer shall fail forthwith to pay such amounts upon
     such demand, the Indenture Trustee, in its own name and as trustee of an
     express trust, may institute a Proceeding for the collection of the sums so
     due and unpaid, and may prosecute such Proceeding to judgment or final
     decree, and may enforce the same against the Issuer or other obligor upon
     such Notes and collect in the manner provided by law out of the property of
     the Issuer or other obligor upon such Notes, wherever situated, the moneys
     adjudged or decreed to be payable.

         (c) If an Event of Default occurs and is continuing, the Indenture
     Trustee may, as more particularly provided in Section 5.04, in its
     discretion, proceed to protect and enforce its rights and the rights of the
     Noteholders[, the Swap Counterparty] and, incidentally thereto, the
     Certificateholders, by such appropriate Proceedings as the Indenture
     Trustee shall deem most effective to protect and enforce any such rights,
     whether for the specific enforcement of any covenant or agreement in this
     Indenture or in aid of the exercise of any power granted herein, or to
     enforce any other proper remedy or legal or equitable right vested in the
     Indenture Trustee by this Indenture or by law.

         (d) In case there shall be pending, relative to the Issuer or any
     other obligor upon the Notes or any Person having or claiming an ownership
     interest in the Trust Estate, Proceedings under Title 11 of the United
     States Code or any other applicable federal or state bankruptcy, insolvency
     or other similar law, or in case a receiver, assignee or trustee in
     bankruptcy or reorganization, liquidator, sequestrator or similar official
     shall have been appointed for or taken possession of the Issuer or its
     property or such other obligor or Person, or in case of any other
     comparable judicial Proceedings relative to the Issuer or other obligor
     upon the Notes, or to the creditors or property of the Issuer or such other
     obligor, then, irrespective of whether the principal of any Notes shall

                                       35                            (Indenture)
<PAGE>

     then be due and payable as therein expressed or by declaration or otherwise
     and irrespective of whether the Indenture Trustee shall have made any
     demand pursuant to the provisions of this Section, the Indenture Trustee
     shall be entitled and empowered, by intervention in such Proceedings or
     otherwise:

               (1) to file and prove a claim or claims for the whole amount of
         principal and interest owing and unpaid in respect of the Notes and the
         Certificates, and to file such other papers or documents as may be
         necessary or advisable in order to have the claims of the Indenture
         Trustee (including any claim for reasonable compensation to the
         Indenture Trustee and each predecessor Indenture Trustee, and their
         respective agents, attorneys and counsel, and for reimbursement of all
         expenses and liabilities incurred, and all advances made, by the
         Indenture Trustee and each predecessor Indenture Trustee, except as a
         result of negligence or bad faith)[, the Swap Counterparty] and of the
         Noteholders or the Certificateholders allowed in such Proceedings;

               (2) unless prohibited by applicable law and regulations, to vote
         on behalf of the Holders of Notes [and the Swap Counterparty] in any
         election of a trustee, a standby trustee or Person performing similar
         functions in any such Proceedings;

               (3) to collect and receive any moneys or other property payable
         or deliverable on any such claims and to distribute all amounts
         received with respect to the claims of the Noteholders[, the Swap
         Counterparty] [or the Certificateholders] and of the Indenture Trustee
         on their behalf; and

               (4) to file such proofs of claim and other papers or documents
         as may be necessary or advisable in order to have the claims of the
         Indenture Trustee[, the Swap Counterparty] or the Holders of Notes
         allowed in any judicial proceedings relative to the Issuer, its
         creditors and its property.

         Any trustee, receiver, liquidator, custodian or other similar official
in any such Proceeding is hereby authorized by each of such Noteholders [and by
the Swap Counterparty] to make payments to the Indenture Trustee and, in the
event that the Indenture Trustee shall consent to the making of payments
directly to such Noteholders [or to the Swap Counterparty], to pay to the
Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee except as a result of negligence or bad faith.

         (a) Nothing herein contained shall be deemed to authorize the
     Indenture Trustee to authorize or consent to or vote for or accept or adopt
     on behalf of any Noteholder [or the Swap Counterparty] any plan of
     reorganization, arrangement, adjustment or composition affecting the Notes
     or the rights of any Holder thereof [or the Swap Counterparty] or to
     authorize the Indenture Trustee to vote in respect of the claim

                                       36                            (Indenture)
<PAGE>

     of any Noteholder [or the Swap Counterparty] in any such proceeding except,
     as aforesaid, to vote for the election of a trustee in bankruptcy or
     similar Person.

         (b) All rights of action and of asserting claims under this
     Indenture, or under any of the Notes, may be enforced by the Indenture
     Trustee without the possession of any of the Notes or the production
     thereof in any trial or other Proceedings relative thereto, and any such
     action or Proceedings instituted by the Indenture Trustee shall be brought
     in its own name as trustee of an express trust, and any recovery of
     judgment, subject to the payment of the expenses, disbursements and
     compensation of the Indenture Trustee, each predecessor Indenture Trustee
     and their respective agents and attorneys, shall be for the ratable benefit
     of the Holders of the Notes[, the Swap Counterparty] and, incidentally
     thereto, for the benefit of the Certificateholders.

         (c) In any Proceedings brought by the Indenture Trustee (and also any
     Proceedings involving the interpretation of any provision of this Indenture
     to which the Indenture Trustee shall be a party), the Indenture Trustee
     shall be held to represent all the Noteholders [and the Swap Counterparty],
     and it shall not be necessary to make any Noteholder [or the Swap
     Counterparty] a party to any such Proceedings.

         5.04 Remedies; Priorities.

         (a) If an Event of Default shall have occurred and be continuing and
     result in the acceleration of the Notes, the Indenture Trustee shall make
     payments on the Notes and to the Owner Trustee as set forth in Section
     5.06(d) of the Sale and Servicing Agreement, rather than pursuant to
     Section 5.06(c) thereof.

         (b) If the Indenture Trustee, in compliance with Section 5.04(a), is
     deemed to have a conflict of interest under the TIA and is required to
     resign as Indenture Trustee hereunder, the Issuer shall, pursuant to
     Section 6.08, cause the Servicer to appoint a successor Indenture Trustee:

               (1) so long as any amounts remain unpaid with respect to the
         Class A Notes, only the Indenture Trustee for the Class A Noteholders
         shall be entitled to exercise any remedies under this Indenture; and

               (2) after the Class A Notes have been paid in full, only the
         Indenture Trustee for the Class B Noteholders shall be entitled to
         exercise any remedies under this Indenture.

         (c) In accordance with Section 5.04(b), if an Event of Default shall
     have occurred and be continuing, the Indenture Trustee may do one or more
     of the following (subject to Section 5.05):

               (1) institute Proceedings in its own name and as trustee of an
         express trust for the collection of all amounts then payable on the
         Notes or under this Indenture with respect thereto, whether by
         declaration or otherwise, enforce any judgment obtained, and collect
         from the Issuer and any other obligor upon such Notes moneys adjudged
         due;

                                       37                            (Indenture)
<PAGE>

               (2) institute Proceedings from time to time for the complete or
         partial foreclosure of this Indenture with respect to the Trust Estate;

               (3) exercise any remedies of a secured party under the UCC and
         take any other appropriate action to protect and enforce the rights and
         remedies of the Indenture Trustee and the Noteholders; and

               (4) sell the Trust Estate or any portion thereof or rights or
         interest therein, at one or more public or private sales called and
         conducted in any manner permitted by law; provided, however, that the
         Indenture Trustee may not sell or otherwise liquidate the Trust Estate
         following an Event of Default, other than an Event of Default described
         in Section 5.01(a) or (b), unless (A) the Holders of 100% of the
         Outstanding Amount of the Controlling Class of Notes consent thereto
         (but excluding for purposes of such vote all Notes held or beneficially
         owned by NMAC, NARC II or any of their Affiliates, unless at such time
         all of the Notes of such Class are held or beneficially owned by NMAC,
         NARC II and their Affiliates), or (B) the proceeds of such sale or
         liquidation distributable to the Noteholders are sufficient to
         discharge in full all amounts then due and unpaid upon such Notes for
         principal and interest, or (C) the Indenture Trustee determines that
         the Trust Estate may not continue to provide sufficient funds on an
         ongoing basis to make all payments of principal of and interest on the
         Notes as they would have become due if the Notes had not been declared
         due and payable, and the Indenture Trustee obtains the consent of
         Holders of a 66 2/3% of the Outstanding Amount of the Controlling Class
         of Notes (but excluding for purposes of such vote all Notes held or
         beneficially owned by NMAC, NARC II or any of their Affiliates, unless
         at such time all of the Notes of such Class are held or beneficially
         owned by NMAC, NARC II and their Affiliates). In determining such
         sufficiency or insufficiency with respect to clause (B) and (C), the
         Indenture Trustee may, but need not, obtain and rely upon an opinion of
         an Independent investment banking or accounting firm of national
         reputation as to the feasibility of such proposed action and as to the
         sufficiency of the Trust Estate for such purpose.

         (d) The Indenture Trustee may fix a record date and payment date for
     any payment to Noteholders pursuant to this Section. At least 15 days
     before such record date, the Issuer shall mail to each Noteholder and the
     Indenture Trustee a notice that states the related record date, payment
     date and amount to be paid.

                                       38                            (Indenture)
<PAGE>

         5.05 Optional Preservation of the Receivables. If the Notes have been
declared to be due and payable under Section 5.02 following an Event of Default
and such declaration and its consequences have not been rescinded and annulled,
the Indenture Trustee may, unless otherwise directed by the Holders of the
Controlling Class of Notes representing at least a majority of the Outstanding
Amount such Notes (excluding from such action and calculation any Notes held by
NMAC, NARC II or any of their Affiliates unless at such time all of the Notes of
such Class are held of record or beneficially owned by NARC II, NMAC or any of
their Affiliates), but need not, elect to maintain possession of the Trust
Estate and direct the Issuer, Servicer and Administrator not to take steps to
liquidate the Receivables. It is the desire of the parties hereto and the
Noteholders that there be at all times sufficient funds for the payment of
principal of and interest on the Notes, and the Indenture Trustee shall take
such desire into account when determining whether or not to maintain possession
of the Trust Estate. In determining whether to maintain possession of the Trust
Estate, the Indenture Trustee may, but need not, obtain and rely upon an opinion
of an Independent investment banking or accounting firm of national reputation
as to the feasibility of such proposed action and as to the sufficiency of the
Trust Estate for such purpose.

         5.06 Limitation of Suits. No Holder of any Note shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture or for the appointment of a receiver or trustee, or for any other
remedy hereunder unless such Holder has previously given written notice to the
Indenture Trustee of a continuing Event of Default, and:

         (a) the Event of Default arises from the Servicer's failure to remit
     payments when due; or

         (b) the Holders of the Controlling Class of Notes representing not less
     than 25% of the Outstanding Amount of such Class (excluding for such
     purpose the outstanding principal amount of any Notes held of record or
     beneficially owned by NARC II, NMAC or any of their Affiliates, unless at
     such time all of the Notes of such Class are held of record or beneficially
     owned by NARC II, NMAC or any of their Affiliates) have made written
     request to the Indenture Trustee to institute such Proceeding in respect of
     such Event of Default in its own name as Indenture Trustee hereunder and
     have offered to the Indenture Trustee reasonable indemnity against the
     costs, expenses and liabilities to be incurred in complying with such
     request, the Indenture Trustee for 60 days after its receipt of such
     notice, request and offer of indemnity has failed to institute such
     Proceedings, and no direction inconsistent with that written request has
     been given to the Indenture Trustee during the 60-day period by the holders
     of a majority in principal amount of those outstanding Notes (or relevant
     class or classes of Notes).

         It is understood and intended that no one or more Holders of Notes
shall have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Notes or to obtain or to seek to obtain priority or preference
over any other Holders or to enforce any right under this Indenture, except in
the manner herein provided.

                                       39                            (Indenture)
<PAGE>

         In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of Notes,
each representing less than a majority of the Outstanding Amount of the Notes,
the Indenture Trustee in its sole discretion may determine what action, if any,
shall be taken, notwithstanding any other provisions of this Indenture.

         5.07 Unconditional Rights of Noteholders To Receive Principal and
Interest. Notwithstanding any other provisions in this Indenture, the Holder of
any Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of and interest, if any, on such Note on or after the
respective due dates thereof expressed in such Note and in this Indenture (in
each case with reference to the calculations to be made pursuant to the Sale and
Servicing Agreement) and to institute suit for the enforcement of any such
payment, and such right shall not be impaired without the consent of such
Holder, provided that each Holder or Note Owner of a Class B Note will be deemed
to have consented to any delay in the payment thereto of any interest due
thereon that is in accordance with the payment of amounts pursuant to Section
5.06 of the Sale and Servicing Agreement for so long as any Class A Note is
Outstanding.

         5.08 Restoration of Rights and Remedies. If the Indenture Trustee or
any Noteholder has instituted any Proceeding to enforce any right or remedy
under this Indenture and such Proceeding has been discontinued or abandoned for
any reason or has been determined adversely to the Indenture Trustee or to such
Noteholder, then and in every such case the Issuer, the Indenture Trustee and
the Noteholders shall, subject to any determination in such Proceeding, be
restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Indenture Trustee and the Noteholders
shall continue as though no such Proceeding had been instituted.

         5.09 Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Indenture Trustee or to the Noteholders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

         5.10 Delay or Omission Not a Waiver. No delay or omission of the
Indenture Trustee or any Holder of any Note to exercise any right or remedy
accruing upon any Default or Event of Default shall impair any such right or
remedy or constitute a waiver of any such Default or Event of Default or an
acquiescence therein. Every right and remedy given by this Article V or by law
to the Indenture Trustee or to the Noteholders may be exercised from time to
time, and as often as may be deemed expedient, by the Indenture Trustee or by
the Noteholders, as the case may be.

                                       40                            (Indenture)
<PAGE>

         5.11 Control by Noteholders. The Holders of the Controlling Class of
Notes representing a majority of the Outstanding Amount of such Class (excluding
for such purpose the outstanding principal amount of any Notes held of record or
beneficially owned by NARC II, NMAC or any of their Affiliates, unless at such
time all of the Notes of such Class are held of record or beneficially owned by
NARC II, NMAC or any of their Affiliates), shall have the right to direct the
time, method and place of conducting any Proceeding for any remedy available to
the Indenture Trustee with respect to the Notes or exercising any trust or power
conferred on the Indenture Trustee; provided that:

         (a) such direction shall not be in conflict with any rule of law or
     with this Indenture; and

         (b) any direction to the Indenture Trustee to sell or liquidate the
     Trust Estate shall be by Holders of Notes representing not less than the
     applicable percentage of the Outstanding Amount of the relevant class set
     forth in Section 5.04(c)(iv); and

         (c) the Indenture Trustee may take any other action deemed proper by
     the Indenture Trustee that is not inconsistent with such direction.

         Notwithstanding the rights of Noteholders set forth in this Section,
subject to Section 6.01, the Indenture Trustee need not take any action that it
determines might involve it in liability or might materially adversely affect
the rights of any Noteholders not consenting to such action.

         5.12 Waiver of Past Defaults. Prior to the declaration of the
acceleration of the maturity of the Notes as provided in Section 5.02 or the
liquidation or sale of the Trust Estate pursuant to Section 5.04, the Holders of
the Controlling Class of Notes representing a majority of the Outstanding Amount
of such Class (excluding for such purposes the outstanding principal amount of
any Notes held of record or beneficially owned by NMAC, NARC II or any of their
Affiliates, unless at such time all of the Notes are held of record or
beneficially owned by NARC II, NMAC or any of their Affiliates) may waive any
past Default or Event of Default and its consequences except a Default or Event
of Default in (a) the deposit of collections or other required amounts, (b) any
required payment from amounts held in Accounts in respect of amounts due on the
Notes, (c) payment of principal or interest on the Notes, or (d) an Event of
Default in respect of a covenant or provision hereof that cannot be modified or
amended without the consent of the Holder of each Note. In the case of any such
waiver, the Issuer, the Indenture Trustee and the Holders of the Notes shall be
restored to their former positions and rights hereunder, respectively.

         Upon any such waiver, such Default shall cease to exist and be deemed
to have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or Event of Default or impair any right consequent thereto.

                                       41                            (Indenture)
<PAGE>

         5.13 Undertaking for Costs. All parties to this Indenture agree, and
each Holder of any Note or Note Owner by such Holder's acceptance of such Note
or beneficial interest therein, as the case may be, shall be deemed to have
agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to (a) any suit instituted by the
Indenture Trustee, (b) any suit instituted by any Noteholder of the Controlling
Class of Notes, or a group of Noteholders of such Class, in each case holding in
the aggregate more than 10% of the Outstanding Amount of such Class, (c) any
suit instituted by any Noteholder for the enforcement of the payment of
principal of or interest on any Note on or after the respective due dates
expressed in such Note and in this Indenture.

         5.14 Waiver of Stay or Extension Laws. The Issuer covenants (to the
extent that it may lawfully do so) that it will not at any time insist upon, or
plead or in any manner whatsoever, claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Indenture; and
the Issuer (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Indenture
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.

         5.15 Action on Notes. The Indenture Trustee's right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture. Neither the lien of this Indenture nor any rights or remedies
of the Indenture Trustee or the Noteholders shall be impaired by the recovery of
any judgment by the Indenture Trustee against the Issuer or by the levy of any
execution under such judgment upon any portion of the Trust Estate or upon any
of the assets of the Issuer. Any money or property collected by the Indenture
Trustee shall be applied in accordance with Section 5.04(a).

         5.16 Performance and Enforcement of Certain Obligations.

         (a) Promptly following a request from the Indenture Trustee to do so
     and at the Administrator's expense, the Issuer shall take all such lawful
     action as the Indenture Trustee may request to compel or secure the
     performance and observance by the Seller and the Servicer, as applicable,
     of each of their obligations to the Issuer or to each other under or in
     connection with the Sale and Servicing Agreement [and the Interest Rate
     Swap Agreement] or by the Seller of its remedies under or in connection
     with the Purchase Agreement, and to exercise any and all rights, remedies,
     powers and privileges lawfully available to the Issuer under or in
     connection with each such Agreement to the extent and in the manner
     directed by the Indenture Trustee, including the transmission of notices of
     default on the part of the Seller or the Servicer thereunder and the
     institution of legal or administrative actions or proceedings to compel or
     secure performance by the

                                       42                            (Indenture)
<PAGE>

     Seller or the Servicer of each of their respective obligations under the
     Sale and Servicing Agreement or the Purchase Agreement. [In addition,
     promptly following a request from the Indenture Trustee to do so, and at
     the Administrator's expense, the Issuer shall take all such lawful action
     as the Indenture Trustee may request to compel or secure the performance
     and observance by the Swap Counterparty in accordance with the Interest
     Rate Swap Agreement and to exercise any and all rights, remedies, powers
     and privileges lawfully available to the Issuer under or in connection with
     the Interest Rate Swap Agreement to the extent and in the manner directed
     by the Indenture Trustee, including the transmission of notices of default
     thereunder and the institution of legal or administrative actions or
     proceedings to compel or secure performance by the Swap Counterparty of its
     obligations under the Interest Rate Swap Agreement.]

         (b) If an Event of Default has occurred and is continuing, the
     Indenture Trustee may, and at the direction (which direction shall be in
     writing or by telephone, confirmed in writing promptly thereafter) of the
     Holders of the Controlling Class of Notes representing a majority of the
     Outstanding Amount of such Class (excluding for such purposes the
     outstanding principal amount of any Notes held of record or beneficially
     owned by NMAC, NARC II or any of their Affiliates unless of such time all
     of the Notes of such Class are held of record or beneficially owned by NARC
     II, NMAC or any of their Affiliates), shall, exercise all rights, remedies,
     powers, privileges and claims of the Issuer against the Seller or the
     Servicer under or in connection with the Sale and Servicing Agreement or
     the Purchase Agreement, or against the Administrator under the
     Administration Agreement, including the right or power to take any action
     to compel or secure performance or observance by the Seller, the Servicer
     or the Administrator, of each of their obligations to the Issuer thereunder
     and to give any consent, request, notice, direction, approval, extension,
     or waiver thereunder and any right of the Issuer to take such action shall
     be suspended. [In addition, if an Event of Default has occurred and is
     continuing, the Indenture Trustee may, and at the direction (which
     direction shall be in writing or by telephone, confirmed in writing
     promptly thereafter) of the Holders of the Notes evidencing not less than
     66-2/3% of the principal amount of the Controlling Class of Notes shall,
     exercise all rights, remedies, powers, privileges and claims of the Issuer
     against the Swap Counterparty including the right or power to take any
     action to compel or secure performance or observance by the Swap
     Counterparty of its obligations to the Issuer under the Interest Rate Swap
     Agreement and to give any consent, request, notice, direction, approval,
     extension, or waiver under the Interest Rate Swap Agreement and any right
     of the Issuer to take such action shall be suspended.]

                                   ARTICLE VI
                              The Indenture Trustee

         6.01 Duties of Indenture Trustee. The Indenture Trustee, both prior to
and after the occurrence of a Servicer Default under the Sale and Servicing
Agreement, undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture.

         (a) The Indenture Trustee, upon receipt of all resolutions,
     certificates, statements, opinions, reports, documents, orders or other
     instruments furnished to the Indenture Trustee that shall be specifically
     required to be furnished pursuant to any

                                       43                            (Indenture)
<PAGE>

         provision of this Indenture, shall examine them to determine whether
         they conform on their face to the requirements of this Indenture.

                  (b) No provision of this Indenture shall be construed to
         relieve the Indenture Trustee from liability for its own negligent
         action, its own negligent failure to act, its own bad faith or its own
         willful misfeasance; provided, however, that:

                           (1) the duties and obligations of the Indenture
                  Trustee shall be determined solely by the express provisions
                  of this Indenture, the Indenture Trustee shall not be liable
                  except for the performance of such duties and obligations as
                  are specifically set forth in this Indenture, no implied
                  covenants or obligations shall be read into this Indenture
                  against the Indenture Trustee, the permissive right of the
                  Indenture Trustee to do things enumerated in this Indenture
                  shall not be construed as a duty and, in the absence of bad
                  faith on the part of the Indenture Trustee, the Indenture
                  Trustee may conclusively rely, as to the truth of the
                  statements and the correctness of the opinions expressed
                  therein, upon any certificates or opinions furnished to the
                  Indenture Trustee and conforming on their face to the
                  requirements of this Indenture;

                           (2) the Indenture Trustee shall not be personally
                  liable for an error of judgment made in good faith by a
                  Responsible Officer, unless it shall be proved that the
                  Indenture Trustee was negligent in performing its duties in
                  accordance with the terms of this Indenture; and

                           (3) the Indenture Trustee shall not be personally
                  liable with respect to any action taken, suffered or omitted
                  to be taken in good faith in accordance with the direction of
                  (i) the Holders of at least a majority of the Outstanding
                  Amount of the Controlling Class of Notes (excluding for such
                  purposes the outstanding principal amount of any Notes held of
                  record or beneficially owned by NARC II, NMAC or any of their
                  Affiliates, unless at such time all of the Notes of such Class
                  are held of record or beneficially owned by NARC II, NMAC or
                  any of their Affiliates), relating to the time, method and
                  place of conducting any proceeding for any remedy available to
                  the Indenture Trustee, or exercising any trust or power
                  conferred upon the Indenture Trustee under this Indenture.

                  (c) The Indenture Trustee shall not be required to expend or
         risk its own funds or otherwise incur financial liability in the
         performance of any of its duties under this Indenture, or in the
         exercise of any of its rights or powers, if there shall be reasonable
         grounds for believing that the repayment of such funds or adequate
         indemnity against such risk or liability is not reasonably assured to
         it.

                  (d) All information obtained by the Indenture Trustee
         regarding the Obligors and the Receivables contained in the Trust,
         whether upon the exercise of its rights under this Indenture or
         otherwise, shall be maintained by the Indenture Trustee in confidence
         and shall not be disclosed to any other Person, unless such disclosure
         is required by any applicable law or regulation or pursuant to
         subpoena.

                                       44                            (Indenture)

<PAGE>

                  (e) If (i) pursuant to Section 3.02 of the Sale and Servicing
         Agreement, a Responsible Officer of the Indenture Trustee discovers
         that a representation or warranty with respect to a Receivable was
         incorrect as of the time specified with respect to such representation
         and warranty and such incorrectness materially and adversely affects
         such Receivable, or (ii) pursuant to Section 4.06 of the Sale and
         Servicing Agreement, a Responsible Officer of the Indenture Trustee
         discovers that a covenant of the Servicer has been breached with
         respect to a Receivable that would materially and adversely affect such
         Receivable, the Indenture Trustee shall give prompt written notice to
         the Servicer and the Owner Trustee of such incorrectness.

                  6.02 Rights of Indenture Trustee.

                  (a) Except as otherwise provided in Section 6.01:

                           (1) the Indenture Trustee may rely and shall be
                  protected in acting or refraining from acting upon any
                  resolution, Officer's Certificate, certificate of an
                  authorized signatory, certificate of auditors or any other
                  certificate, statement, instrument, opinion, report, notice,
                  request, consent, order, appraisal, bond or other paper or
                  document believed by it to be genuine and to have been signed
                  or presented by the proper party or parties;

                           (2) the Indenture Trustee may consult with counsel
                  and any Opinion of Counsel shall be full and complete
                  authorization and protection in respect of any action taken or
                  suffered or omitted by it under this Indenture in good faith
                  and in accordance with such Opinion of Counsel;

                           (3) the Indenture Trustee shall be under no
                  obligation to exercise any of the rights or powers vested in
                  it by this Indenture or the Sale and Servicing Agreement, or
                  to institute, conduct or defend any litigation under this
                  Indenture, or in relation to this Indenture or the Sale and
                  Servicing Agreement, at the request, order or direction of any
                  of the Noteholders pursuant to the provisions of this
                  Indenture or the Sale and Servicing Agreement, unless such
                  Noteholders shall have offered to the Indenture Trustee
                  reasonable security or indemnity against the costs, expenses
                  and liabilities that may be incurred therein or thereby;

                           (4) the Indenture Trustee shall not be personally
                  liable for any action taken, suffered or omitted by it in good
                  faith and reasonably believed by it to be authorized or within
                  the discretion or rights or powers conferred upon it by this
                  Indenture;

                           (5) the Indenture Trustee shall not be bound to
                  recalculate, reverify, or make any investigation into the
                  facts of matters stated in any resolution, certificate,
                  statement, instrument, opinion, report, notice, request,
                  consent, order, approval, bond or other paper or document,
                  unless requested in writing to do so by Holders of Notes
                  evidencing not less than 25% of the aggregate Outstanding
                  Amount of the (1) Class A Notes, so long as any Class A Notes
                  remain Outstanding (acting together as a single class) or (2)
                  Class B Notes, after the

                                       45                            (Indenture)

<PAGE>

                  Class A Notes have been paid in full, or (3) Class C Notes,
                  after the Class B Notes have been paid in full; provided,
                  however, that if the payment within a reasonable time to the
                  Indenture Trustee of the costs, expenses or liabilities likely
                  to be incurred by it in the making of such investigation is,
                  in the opinion of the Indenture Trustee, not reasonably
                  assured to the Indenture Trustee by the security afforded to
                  it by the terms of this Indenture, the Indenture Trustee may
                  require reasonable indemnity against such cost, expense or
                  liability as a condition to so proceeding; the reasonable
                  expense of every such examination shall be paid by the
                  Administrator or, if paid by the Indenture Trustee, shall be
                  reimbursed by the Administrator upon demand; and nothing in
                  this clause shall derogate from the obligation of the Servicer
                  to observe any applicable law prohibiting disclosure of
                  information regarding the Obligors; and

                           (6) the Indenture Trustee may execute any of the
                  trusts or powers under this Indenture or perform any duties
                  under this Indenture either directly or by or through agents
                  or attorneys or a custodian.

                  (b) No Noteholder will have any right to institute any
         proceeding with respect to this Indenture except upon satisfying the
         conditions set forth in Section 5.06.

                  6.03 Individual Rights of Indenture Trustee. The Indenture
Trustee in its individual or any other capacity may become the Holder,
beneficial owner or pledgee of Notes and may otherwise deal with the Issuer or
its Affiliates with the same rights it would have if it were not Indenture
Trustee. Any Paying Agent, Note Registrar, co-registrar or co-paying agent may
do the same with like rights. However, in so doing the Indenture Trustee must
comply with Sections 6.11 and 6.12.

                  6.04 Indenture Trustee's Disclaimer. The Indenture Trustee
makes no representations as to the validity or sufficiency of this Indenture or
of the Notes (other than the execution by the Indenture Trustee on behalf of the
Trust of, and the certificate of authentication on, the Notes), or of the
Certificates. The Indenture Trustee shall have no obligation to perform any of
the duties of the Servicer or the Administrator unless explicitly set forth in
this Indenture. The Indenture Trustee shall at no time have any responsibility
or liability for or with respect to the legality, validity and enforceability of
the Notes or any Receivable, any ownership interest in any Financed Vehicle, or
the maintenance of any such ownership interest, or for or with respect to the
efficacy of the Trust or its ability to generate the payments to be distributed
to Noteholders under this Indenture, including without limitation the validity
of the assignment of the Receivables to the Trust or of any intervening
assignment; the existence, condition, location and ownership of any Receivable
or Financed Vehicle; the existence and enforceability of any physical damage or
credit life or credit disability insurance; the existence and contents of any
retail installment sales contract or any computer or other record thereof; the
completeness of any retail installment sales contract; the performance or
enforcement of any retail installment sales contract; the compliance by the
Issuer with any covenant or the breach by the Issuer, Seller or Servicer of any
warranty or representation made under this Indenture or in any Basic Document or
other related document and the accuracy of any such warranty or representation
prior to the Indenture Trustee's receipt of notice or other discovery of any
noncompliance therewith or any breach thereof; the acts or omissions of the
Issuer, Seller or the Servicer; or any action by the

                                       46                            (Indenture)
<PAGE>

Indenture Trustee taken at the instruction of the Servicer, provided, however,
that the foregoing shall not relieve the Indenture Trustee of its obligation to
perform its duties under this Indenture. Except with respect to a claim based on
the failure of the Indenture Trustee to perform its duties under this Indenture
or based on the Indenture Trustee's willful misconduct, bad faith or negligence,
no recourse shall be had for any claim based on any provision of this Indenture,
the Notes or Certificates or assignment thereof against the institution serving
as the Indenture Trustee in its individual capacity. The Indenture Trustee shall
not have any personal obligation, liability or duty whatsoever to any Noteholder
or any other Person with respect to any such claim, and any such claim shall be
asserted solely against the Trust or any indemnitor who shall furnish indemnity
as provided in this Indenture. The Indenture Trustee shall not be accountable
for the use or application by the Issuer of any of the Notes or of the proceeds
of such Notes, or for the use or application of any funds paid to the Servicer
in respect of the Notes.

                  6.05 Notice of Defaults. If a Responsible Officer of the
Indenture Trustee knows that a Default has occurred and is continuing, the
Indenture Trustee shall mail to each Noteholder notice of such Default within 10
days of the occurrence thereof. Except in the case of a Default in payment of
principal of or interest on any Note, the Indenture Trustee may withhold such
notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Noteholders.

                  6.06 Reports by Indenture Trustee to Holders. The Indenture
Trustee shall deliver or cause to be delivered annually to each Noteholder of
record such information as may be required to enable such holder to prepare its
federal and state income tax returns. The Indenture Trustee shall also deliver
or cause to be delivered annually to each Noteholder of record a report relating
to its eligibility and qualification to continue as Indenture Trustee under this
Indenture, any amounts advanced by it under this Indenture, the amount, interest
rate and maturity date of certain indebtedness owed by the Trust to such
Indenture Trustee, in its individual capacity, the property and funds physically
held by such Indenture Trustee in its capacity as such, and any action taken by
it that materially affects the Notes and that has not been previously reported.

                  6.07 Compensation and Indemnity. The Issuer shall cause the
Servicer to pay to the Indenture Trustee from time to time reasonable
compensation for its services. The Indenture Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Issuer
shall cause the Servicer to reimburse the Indenture Trustee for all reasonable
out-of-pocket expenses incurred or made by it, including costs of collection
[and the costs of implementing any Swap Agreement as contemplated by Section
9.02], in addition to the compensation for its services. Such expenses shall
include the reasonable compensation and expenses, disbursements and advances of
the Indenture Trustee's agents, counsel, accountants and experts. The
Administrator shall indemnify or shall cause the Servicer to indemnify the
Indenture Trustee against any and all loss, liability or expense (including
reasonable attorneys' fees) incurred by it in connection with the administration
of this Indenture and the performance of its duties hereunder. The Indenture
Trustee shall notify the Administrator and the Servicer promptly of any claim
for which it may seek indemnity. Failure by the Indenture Trustee to so notify
the Administrator and the Servicer shall not relieve the Administrator or the
Servicer of its obligations hereunder. The Administrator shall defend or shall
cause the Servicer to defend any such claim, and the Indenture Trustee may have
separate counsel and the Administrator shall pay

                                       47                            (Indenture)
<PAGE>

or shall cause the Servicer to pay the fees and expenses of such counsel.
Neither the Administrator nor the Servicer need reimburse any expense or
indemnify against any loss, liability or expense incurred by the Indenture
Trustee through the Indenture Trustee's own willful misconduct, negligence or
bad faith.

                  The Administrator's payment obligations to the Indenture
Trustee pursuant to this Section shall survive the discharge of this Indenture.
When the Indenture Trustee incurs expenses after the occurrence of a Default
specified in Section 5.01(e) or (f) with respect to the Issuer, the expenses are
intended to constitute expenses of administration under Title 11 of the United
States Code or any other applicable federal or state bankruptcy, insolvency or
similar law.

                  6.08 Replacement of Indenture Trustee. The Indenture Trustee
may resign at any time by providing written notice of its resignation to the
Issuer. The Administrator may remove the Indenture Trustee if:

                  (a) the Indenture Trustee fails to comply with Section 6.11;

                  (b) the Indenture Trustee is adjudged a bankrupt or insolvent;

                  (c) a receiver or other public officer takes charge of the
         Indenture Trustee or its property; or

                  (d) the Indenture Trustee otherwise becomes legally or
         practically incapable of fulfilling its duties hereunder.

                  If the Indenture Trustee resigns or is removed or if a vacancy
exists in the office of Indenture Trustee for any reason (the Indenture Trustee
in such event being referred to herein as the retiring Indenture Trustee), the
Servicer shall promptly appoint a successor Indenture Trustee. No resignation or
removal of the Indenture Trustee and no appointment of a successor Indenture
Trustee shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this Section 6.08.

                  A successor Indenture Trustee shall deliver a written
acceptance of its appointment to the retiring Indenture Trustee, to the Servicer
and to the Administrator. Thereupon the resignation or removal of the retiring
Indenture Trustee shall become effective, and the successor Indenture Trustee
shall have all the rights, powers and duties of the Indenture Trustee under this
Indenture. The successor Indenture Trustee shall mail a notice of its succession
to Noteholders. The retiring Indenture Trustee shall promptly transfer all
property held by it as Indenture Trustee to the successor Indenture Trustee.

                  If a successor Indenture Trustee does not take office within
30 days after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Administrator or the Holders of a majority in Outstanding
Amount of the Notes may petition any court of competent jurisdiction for the
appointment of a successor Indenture Trustee.

                  If the Indenture Trustee fails to comply with Section 6.11,
any Noteholder may at any time thereafter petition any court of competent
jurisdiction for the removal of the Indenture Trustee and the appointment of a
successor Indenture Trustee.

                                       48                            (Indenture)

<PAGE>

                  Notwithstanding the replacement of the Indenture Trustee
pursuant to this Section, the Issuer's and the Administrator's obligations under
Section 6.07 shall continue for the benefit of the retiring Indenture Trustee.

                  6.09 Successor Indenture Trustee by Merger. If the Indenture
Trustee consolidates with, merges or converts into, or transfers all or
substantially all its corporate trust business or assets to, another Person, the
resulting, surviving or transferee corporation without any further act shall be
the successor Indenture Trustee if such surviving Person or transferee
corporation or banking shall be otherwise qualified and eligible under Section
6.11. The Indenture Trustee shall provide the Issuer, the Servicer and the
Rating Agencies reasonable prior written notice of any such transaction.

                  In case at the time such successor or successors by merger,
conversion or consolidation to the Indenture Trustee shall succeed to the trusts
created by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.

                  6.10 Appointment of Co-Indenture Trustee or Separate Indenture
Trustee.

                  (a) Notwithstanding any other provisions of this Indenture, at
         any time, for the purpose of meeting any legal requirement of any
         jurisdiction in which any part of the Trust Estate may at the time be
         located [or for the purpose of implementing any Swap Agreement as
         contemplated by Section 9.02], the Indenture Trustee shall have the
         power and may execute and deliver all instruments to appoint one or
         more Persons to act as a co-trustee or co-trustees, or separate trustee
         or separate trustees, of all or any part of the Trust, and to vest in
         such Person or Persons, in such capacity and for the benefit of the
         Noteholders, such title to the Trust Estate, or any part hereof, and,
         subject to the other provisions of this Section, such powers, duties,
         obligations, rights and trusts as the Indenture Trustee may consider
         necessary or desirable. No co-trustee or separate trustee hereunder
         shall be required to meet the terms of eligibility as a trustee under
         Section 6.11 and no notice to Noteholders of the appointment of any
         co-trustee or separate trustee shall be required under Section 6.08
         hereof.

                  (b) Every separate trustee and co-trustee shall, to the extent
         permitted by law, be appointed and act subject to the following
         provisions and conditions:

                           (1) all rights, powers, duties and obligations
                  conferred or imposed upon such separate trustee or co-trustee
                  shall be conferred or imposed upon and exercised or performed
                  by the Indenture Trustee and such separate trustee or
                  co-trustee jointly (it being understood that such separate
                  trustee or co-trustee is not authorized to act separately
                  without the Indenture Trustee joining in and/or directing such
                  act), except to the extent that under any law of any
                  jurisdiction in

                                       49                            (Indenture)

<PAGE>

                  which any particular act or acts are to be performed the
                  Indenture Trustee shall be incompetent or unqualified to
                  perform such act or acts, in which event such rights, powers,
                  duties and obligations (including the holding of title to the
                  Trust Estate or any portion thereof in any such jurisdiction)
                  shall be exercised and performed singly by such separate
                  trustee or co-trustee, but solely at the direction of the
                  Indenture Trustee;

                           (2) no trustee hereunder shall be personally liable
                  by reason of any act or omission of any other trustee
                  hereunder; and

                           (3) the Indenture Trustee may at any time accept the
                  resignation of or remove any separate trustee or co-trustee.

                  (c) Any notice, request or other writing given to the
         Indenture Trustee shall be deemed to have been given to each of the
         then separate trustees and co-trustees as effectively as if given to
         each of them. Every instrument appointing any separate trustee or
         co-trustee shall refer to this Indenture and the conditions of this
         Article VI. Each separate trustee and co-trustee, upon its acceptance
         of the trusts thereupon conferred, shall be vested with the estates or
         property specified in its instrument of appointment, either jointly
         with the Indenture Trustee or separately, as may be provided therein,
         subject to all the provisions of this Indenture, including every
         provision of this Indenture relating to the conduct of, affecting the
         liability of, or affording protection to, the Indenture Trustee. Every
         such instrument shall be filed with the Indenture Trustee.

                  (d) Any separate trustee or co-trustee may at any time
         constitute the Indenture Trustee, its agent or attorney-in-fact with
         full power and authority, to the extent not prohibited by law, to do
         any lawful act under or in respect of this Indenture on its behalf and
         in its name. If any separate trustee or co-trustee shall die, become
         incapable of acting, resign or be removed, all of its estates,
         properties, rights, remedies and trusts shall vest in and be exercised
         by the Indenture Trustee, to the extent permitted by law, without the
         appointment of a new or successor trustee.

                  6.11 Eligibility; Disqualification. The Indenture Trustee
shall at all times satisfy the requirements of TIA Section 310(a). The Indenture
Trustee shall have a combined capital and surplus of at least $50,000,000 as set
forth in its most recent published annual report of condition and it or its
parent shall have a long-term debt rating of "Baa3" or better by Moody's or
shall otherwise be acceptable to Moody's. The Indenture Trustee shall comply
with TIA Section 310(b), including the optional provision permitted by the
second sentence of TIA Section 310(b)(9); provided, however, that there shall be
excluded from the operation of TIA Section 310(b)(1) any indenture or indentures
under which other securities of the Issuer are outstanding if the requirements
for such exclusion set forth in TIA Section 310(b)(1) are met.

                  6.12 Preferential Collection of Claims Against Issuer. The
Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). An Indenture Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated.

                                       50                            (Indenture)

<PAGE>

                  6.13 Acknowledgement by Indenture Trustee of its Obligations
Under the Sale and Servicing Agreement. The Indenture Trustee hereby agrees and
consents to the provisions of the Sale and Servicing Agreement applicable to it
(including, without limitation, Sections 5.06, 5.07, 5.09 thereof) and agrees to
be bound by such provisions.

                  6.14 [Interest Rate Swap Agreement Provisions. (i) The Issuer
has entered into an Interest Rate Swap Agreement, in a form satisfactory to the
Rating Agencies, to hedge the floating rate interest expense on the VPTNs. The
Issuer may, from time to time, enter into one or more replacement Interest Rate
Swap Agreements in the event that any Interest Rate Swap Agreement is terminated
prior to its scheduled expiration pursuant to an Event of Default or a
Termination Event (each such term as defined in the Interest Rate Swap
Agreement). Swap Payments (other than any Swap Termination Payments) will rank
senior to interest payments on the Class A Notes and VPTNs, and Swap Termination
Payments will rank pari passu with interest payments on the Class A Notes and
the VPTNs, all as set forth in the Sale and Servicing Agreement.

                           (ii) The Indenture Trustee will be responsible for
         remitting Swap Payments and any Swap Termination Payments payable to
         the Swap Counterparty and for collecting Swap Receipts and any Swap
         Termination Payments payable to the Issuer.

                           (iii) In the event that the Swap Counterparty is
         required to collateralize any Interest Rate Swap transaction pursuant
         to the terms of the Interest Rate Swap Agreement, the Indenture
         Trustee, upon written request of the Administrator, shall establish
         individual collateral accounts and will hold any securities deposited
         therein in trust and will invest any cash amounts in accordance with
         the provisions of the Interest Rate Swap Agreement.

                           (iv) The notional amounts under the Interest Rate
         Swap Agreement will be increased by the principal balance of any VPTNs
         issued after the Closing Date and reduced from time to time by amounts
         paid as principal on the VPTNs pursuant to the information provided
         each month in the Servicer Certificate. The Administrator shall
         calculate and provide written notification to the Swap Counterparty and
         to the Indenture Trustee of the notional amount of the Interest Rate
         Swap as of each Distribution Date on or before the twelfth day of the
         month of the related Distribution Date. The Administrator shall also
         obtain the calculation of LIBOR from the Calculation Agent under this
         Agreement and shall calculate the amount of all Swap Payments, Swap
         Receipts and Swap Termination Payments payable on each Distribution
         Date, and shall provide written notification of such amounts to the
         Swap Counterparty and to the Indenture Trustee prior to such
         Distribution Date. At least five days before the effective date of any
         proposed amendment or supplement to an Interest Rate Swap Agreement,
         the Administrator shall provide the Rating Agencies with a copy of such
         amendment or supplement. Unless the amendment or supplement clarifies
         any term or provision, corrects any inconsistency, cures any ambiguity,
         or corrects any typographical error in the Interest Rate Swap
         Agreement, an amendment or supplement to the Interest Rate Swap
         Agreement will be effective only after satisfaction of any Rating
         Agency condition.

                                       51                            (Indenture)

<PAGE>

                           (v) Promptly following the early termination of an
         Interest Rate Swap Agreement due to an Event of Default or Termination
         Event (as each such term is defined in the Interest Rate Swap
         Agreement), the Issuer will use reasonable efforts to cause the Issuer
         to enter into a replacement Interest Rate Swap Agreement.

                           (vi) The Interest Rate Swap Agreement shall provide
         that if the rating of the Swap Counterparty is downgraded below a
         rating of "[____]" by Standard & Poor's, a division of The McGraw-Hill
         Companies, Inc. and "[____]" by Moody's Investor Service, Inc. or is
         suspended or withdrawn by any such Rating Agency, within 30 days of
         such downgrade, suspension or withdrawal, the Swap Counterparty must
         either (1) post collateral acceptable to the Issuer in amounts
         sufficient to secure its obligations under the Interest Rate Swap
         Agreement, (2) assign its rights and obligations under the Interest
         Rate Swap Agreement to a replacement counterparty acceptable to the
         Issuer or (3) establish other arrangements necessary, if any, in each
         case so that the Rating Agencies confirm the ratings of the Class A
         Notes and the VPTN that were in effect immediately prior to such
         downgrade, suspension or withdrawal. If the Swap Counterparty is
         required to collateralize any Interest Rate Swap transaction, the
         Administrator shall send written instructions to the Indenture Trustee
         to establish individual collateral accounts and to hold any securities
         deposited therein in trust and invest any cash amounts therein in
         accordance with the provisions of the Interest Rate Swap Agreement.

                           (vii) The Administrator shall notify the Swap
         Counterparty of any proposed amendment or supplement to any of the
         Basic Documents. If such proposed amendment or supplement would
         adversely affect any of the Swap Counterparty's rights or obligations
         under the Interest Rate Swap Agreement or modify the obligations of, or
         impair the ability of the Issuer to fully perform any of its
         obligations under the Interest Rate Swap Agreement, the Administrator
         shall obtain the consent of the Swap Counterparty prior to the adoption
         of such amendment of supplement, provided, the Swap Counterparty's
         consent to any such amendment or supplement shall not be unreasonably
         withheld, and provided further, the Swap Counterparty's consent will be
         deemed to have been given if the Swap Counterparty does not object in
         writing within ten Business Days of receipt of a written request for
         such consent.]

                                       52                            (Indenture)

<PAGE>

                                   ARTICLE VII
                         Noteholders' Lists and Reports

                  7.01 Note Registrar To Furnish Names and Addresses of
Noteholders. The Note Registrar shall furnish or cause to be furnished to the
Indenture Trustee, the Owner Trustee, the Servicer or the Administrator, within
15 days after receipt by the Note Registrar of a written request therefrom, a
list of the names and addresses of the Noteholders of any Class as of the most
recent Record Date. If three or more Noteholders of any Class, or one or more
Holders of such Class evidencing not less than 25% of the Outstanding Amount of
such Class (hereinafter referred to as "Applicants"), apply in writing to the
Indenture Trustee, and such application states that the Applicants desire to
communicate with other Noteholders with respect to their rights under this
Indenture or under the Notes and such application is accompanied by a copy of
the communication that such Applicants propose to transmit, then the Indenture
Trustee shall, within five Business Days after the receipt of such application,
afford such Applicants access, during normal business hours, to the current list
of Noteholders. Such Indenture Trustee may elect not to afford the requesting
Noteholders access to the list of Noteholders if it agrees to mail the desired
communication by proxy, on behalf of and at the expense of the requesting
Noteholders, to all Noteholders of such series. Every Noteholder, by receiving
and holding a Note, agrees with the Indenture Trustee and the Issuer that none
of the Indenture Trustee, the Owner Trustee, the Issuer, the Servicer or the
Administrator shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Noteholders under this
Indenture, regardless of the source from which such information was derived.

                  If the Indenture Trustee shall cease to be the Note Registrar,
then thereafter the Administrator will furnish or cause to be furnished to the
Indenture Trustee not more than five days after the most recent Record Date or
at such other times as the Indenture Trustee reasonably may request in writing,
a list, in such form as the Indenture Trustee reasonably may require, of the
names and addresses of the Holders of Notes as of such Record Date.

                  7.02 Preservation of Information; Communications to
Noteholders.

                  (a) The Indenture Trustee shall preserve, in as current a form
         as is reasonably practicable, the names and addresses of the Holders of
         Notes contained in the most recent list furnished to the Indenture
         Trustee as provided in Section 7.01 and the names and addresses of
         Holders of Notes received by the Indenture Trustee in its capacity as
         Note Registrar. The Indenture Trustee may destroy any list furnished to
         it as provided in such Section 7.01 upon receipt of a new list so
         furnished.

                  (b) Noteholders may communicate pursuant to TIA Section 312(b)
         with other Noteholders with respect to their rights under this
         Indenture or under the Notes.

                  (c) The Issuer, the Indenture Trustee and the Note Registrar
         shall have the protection of TIA Section 3.12(c).

                  7.03 Reports by Issuer.

                  (a) The Issuer shall:

                                       53                            (Indenture)

<PAGE>

                           (1) file with the Indenture Trustee, within 15 days
                  after the Issuer is required to file the same with the
                  Commission, copies of the annual reports and of the
                  information, documents and other reports (or copies of such
                  portions of any of the foregoing as the Commission may from
                  time to time by rules and regulations prescribe) that the
                  Issuer may be required to file with the Commission pursuant to
                  Section 13 or 15(d) of the Exchange Act;

                           (2) file with the Indenture Trustee and the
                  Commission in accordance with the rules and regulations
                  prescribed from time to time by the Commission such additional
                  information, documents and reports with respect to compliance
                  by the Issuer with the conditions and covenants of this
                  Indenture as may be required from time to time by such rules
                  and regulations; and

                           (3) supply to the Indenture Trustee (and the
                  Indenture Trustee shall transmit by mail to all Noteholders
                  described in TIA Section 313(c)) such summaries of any
                  information, documents and reports required to be filed by the
                  Issuer pursuant to clauses (i) and (ii) of this Section
                  7.03(a) and by rules and regulations prescribed from time to
                  time by the Commission.

                  (b) Unless the Issuer otherwise determines, the fiscal year of
         the Issuer shall end on [March 31] of each year, unless the fiscal year
         of the Servicer ends on some other date, in which case, the fiscal year
         of the Issuer shall be the same as the fiscal year of the Servicer.

                  7.04 Reports by Indenture Trustee. If required by TIA Section
313(a), within 60 days after the end of each Fiscal Year of the Issuer,
beginning with [_______________], the Indenture Trustee shall mail to each
Noteholder as required by TIA Section 313(c) a brief report dated as of such
date that complies with TIA Section 313(a). The Indenture Trustee also shall
comply with TIA Section 313(b).

                  A copy of each report at the time of its mailing to
Noteholders shall be filed by the Indenture Trustee with the Commission and each
stock exchange, if any, on which the Notes are listed. The Issuer shall notify
the Indenture Trustee if and when the Notes are listed on any stock exchange.

                                       54                            (Indenture)

<PAGE>

                  7.05 [Indenture Trustee Website. The Indenture Trustee may
make available to the Noteholders, via the Indenture Trustee's website, all
reports or notices required to be provided by the Indenture Trustee under the
terms of this Indenture and, with the consent or at the direction of the
Servicer, such other information regarding the Notes as the Indenture Trustee
may have in its possession, but only with the use of a password provided by the
Indenture Trustee [or its agent to such Person upon receipt by the Indenture
Trustee from such Person of a certification in the form of Exhibit B hereto;
provided, however, that the Indenture Trustee or its agent shall provide such
password to each party to this Indenture without requiring such certification].
Any information that is disseminated in accordance with the provisions of this
Section 7.05 shall not be required to be disseminated in any other form or
manner. Except for documents prepared by the Indenture Trustee and subject to
its obligations under this Indenture, the Indenture Trustee will make no
representation or warranties as to the accuracy or completeness of such
documents and will assume no responsibility therefor.

                  The Indenture Trustee's internet website shall be initially
located at [_________________] or at such other address as shall be specified by
the Indenture Trustee from time to time in writing to the parties hereto. In
connection with providing access to the Trustee's internet website, the
Indenture Trustee may require registration and the acceptance of a disclaimer.]

                                  ARTICLE VIII
                      Accounts, Disbursements and Releases

                  8.01 Collection of Money. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable to
or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such money received by it as provided in this Indenture.
Except as otherwise expressly provided in this Indenture, if any default occurs
in the making of any payment or performance under any agreement or instrument
that is part of the Trust Estate, the Indenture Trustee may take such action as
may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate Proceedings. Any such action shall be
without prejudice to any right to claim a Default or Event of Default under this
Indenture and any right to proceed thereafter as provided in Article V.

                  8.02 Accounts.

                  (a) On or prior to the Closing Date, [(i)] the Issuer shall
         cause the Servicer to establish and maintain, in the name of the
         Indenture Trustee, for the benefit of the Noteholders and, to the
         extent set forth herein, the Certificateholders, the Collection Account
         as provided in Section 5.01 of the Sale and Servicing Agreement [and
         (ii) the Issuer will establish and maintain with the Securities
         Intermediary and pledge to the Indenture Trustee for the benefit of the
         Noteholders the Yield Supplement Account in the name of the Indenture
         Trustee pursuant to the Yield Supplement Agreement as provided in
         Section 5.08 of the Sale and Servicing Agreement and the Securities
         Account Control Agreement].

                                       55                            (Indenture)

<PAGE>

                  (b) On or prior to the Closing Date, the Issuer will cause the
         Seller to, pursuant to the Securities Account Control Agreement,
         establish and maintain with the Securities Intermediary in the name of
         the Indenture Trustee, for the benefit of the Noteholders, the Reserve
         Account as provided in Section 5.07, of the Sale and Servicing
         Agreement.

                  (c) The Indenture Trustee shall transfer all amounts remaining
         on deposit in the Collection Account on the Distribution Date on which
         the Notes of all Classes have been paid in full (or substantially all
         of the Trust Estate is otherwise released from the lien of this
         Indenture) to the Trust Collection Account and shall take all necessary
         or appropriate actions to transfer all of its right, title and interest
         in the Collection Account, all funds or investments held therein and
         all proceeds thereof, whether or not on behalf of the Securityholders,
         to the Owner Trustee for the benefit of the Certificateholders, subject
         to the limitations set forth herein with respect to amounts held for
         payment to Noteholders that do not promptly deliver a Note for payment
         on such Distribution Date.

                  (d) [The Indenture Trustee shall transfer all amounts
         remaining on deposit in the Yield Supplement Account on the
         Distribution Date on which the Notes of all Classes have been paid in
         full (or substantially all of the Trust Estate is otherwise released
         from the lien of this Indenture) to the Owner Trustee for the benefit
         of the Certificateholders and shall take all necessary or appropriate
         actions to transfer all of its right, title and interest in the Yield
         Supplement Account, all funds or investments held therein and all
         proceeds thereof, whether or not on behalf of the Securityholders, to
         the Owner Trustee for the benefit of the Certificateholders, which
         amounts the Owner Trustee shall deposit into the Trust Collection
         Account, subject to the limitations set forth herein with respect to
         amounts held for payment to Noteholders that do not promptly deliver a
         Note for payment on such Distribution Date.]

                  8.03 General Provisions Regarding Accounts.

                  (a) So long as no Default or Event of Default shall have
         occurred and be continuing, all or a portion of the funds in the
         Collection Account shall be invested in Eligible Investments and
         reinvested by the Indenture Trustee at the written direction of the
         Servicer, subject to the provisions of Section 5.01 of the Sale and
         Servicing Agreement. All income or other gain from investments of
         moneys deposited in the Collection Account shall be deposited by the
         Indenture Trustee in the Collection Account and paid to the Servicer as
         servicing compensation on any Business Day on or after which such
         amount is deposited in the Collection Account, and any loss resulting
         from such investments shall be charged to such account. The Servicer
         will not direct the Indenture Trustee, and the Issuer shall cause the
         Servicer not, to make any investment of any funds or to sell any
         investment held in the Collection Account unless the security interest
         Granted and perfected in such account will continue to be perfected in
         such investment or the proceeds of such sale, in either case without
         any further action by any Person, and, in connection with any direction
         to the Indenture Trustee to make any such investment or sale, if
         requested by the Indenture Trustee, the Servicer shall deliver to the
         Indenture Trustee an Opinion of Counsel, acceptable to the Indenture
         Trustee, to such effect.

                                       56                            (Indenture)

<PAGE>

                  (b) So long as no Default or Event of Default shall have
         occurred and be continuing, all or a portion of the funds in the
         Reserve Account [and the Yield Supplement Account] shall be invested in
         Eligible Investments and reinvested by the Indenture Trustee at the
         written direction of the Servicer, subject to the provisions of Section
         5.07 and Section 5.08, respectively, of the Sale and Servicing
         Agreement and the provisions of the Securities Account Control
         Agreement. All income or other gain from investments of moneys
         deposited in the Reserve Account shall be paid by the Indenture Trustee
         to the Seller on any Business Day on or after which such amount is
         deposited in the Reserve Account. [All income or other gain from
         investments of moneys deposited in the Yield Supplement Account shall
         be deposited into the Collection Account on each Distribution Date.]
         Subject to the right of the Indenture Trustee to make withdrawals
         therefrom, as directed by the Servicer, for the purposes and in the
         amounts set forth in Section 5.06 of the Sale and Servicing Agreement,
         the Reserve Account [and the Yield Supplement Account] and all funds
         held therein shall be the property of the Seller and not the property
         of the Trust, the Owner Trustee or the Indenture Trustee. The Seller
         will grant to the Indenture Trustee, for the benefit of the Noteholders
         and the Class C Certificateholders, a security interest in all funds
         (including Eligible Investments) in the Reserve Account (including the
         Reserve Account Initial Deposit) and the proceeds thereof, [and the
         Issuer will grant to the Indenture Trustee, for the benefit of the
         Noteholders, a security interest in all funds (including Eligible
         Investments) in the Yield Supplement Account and the proceeds thereof],
         and the Indenture Trustee shall have all of the rights of a secured
         party under the UCC with respect thereto; provided that all income from
         the investment of funds in the Reserve Account and the right to receive
         such income are retained by the Seller and are not transferred,
         assigned or otherwise conveyed hereunder[; and provided, further, that
         amounts on deposit in the Yield Supplement Account in excess of the
         Required Yield Supplement Amount will be deposited into the Collection
         Account for distribution in accordance with the terms of Section
         5.06(c) of the Sale and Servicing Agreement]. The Servicer will not
         direct the Indenture Trustee to make any investment of any funds or to
         sell any investment held in the Reserve Account [or the Yield
         Supplement Account] unless the security interest granted and perfected
         in such account will continue to be perfected in such investment or the
         proceeds of such sale, in either case without any further action by any
         Person, and, in connection with any direction to the Indenture Trustee
         to make any such investment or sale, if requested by the Indenture
         Trustee, the Servicer shall deliver to the Indenture Trustee an Opinion
         of Counsel, acceptable to the Indenture Trustee, to such effect.

                  (c) Subject to Section 6.01(c), the Indenture Trustee shall
         not in any way be held liable by reason of any insufficiency in the
         Collection Account, [or] the Reserve Account [or the Yield Supplement
         Account] resulting from any loss on any Eligible Investment included
         therein at the direction of the Servicer, except for losses
         attributable to the Indenture Trustee's failure to make payments on
         such Eligible Investments issued by the Indenture Trustee, in its
         commercial capacity as principal obligor and not as trustee, in
         accordance with the terms thereof.

                  (d) If (i) the Servicer shall have failed to give investment
         directions for any funds on deposit in the Collection Account, [or] the
         Reserve Account [or the Yield Supplement Account] to the Indenture
         Trustee by 5:00 p.m. Eastern Time (or such other

                                       57                            (Indenture)

<PAGE>

         time as may be agreed by the Servicer and Indenture Trustee) on any
         Business Day or (ii) a Default or Event of Default shall have occurred
         and be continuing with respect to the Notes but the Notes shall not
         have been declared due and payable pursuant to Section 5.02 or (iii) if
         such Notes shall have been declared due and payable following an Event
         of Default, amounts collected or receivable from the Trust Estate are
         being applied in accordance with Section 5.05 as if there had not been
         such a declaration, then the Indenture Trustee shall, to the fullest
         extent practicable, invest and reinvest funds in the Accounts in one or
         more Eligible Investments specified in clauses (i), (iv) or (vi) of the
         definition of Eligible Investments provided in the Sale and Servicing
         Agreement. If the Indenture Trustee invests and reinvests funds in the
         Reserve Account [or the Yield Supplement Account] pursuant to clause
         (ii) or clause (iii) above, the Indenture Trustee shall issue a
         prohibition notice to the securities intermediary as provided in the
         Securities Account Control Agreement. If the Default or Event of
         Default that caused the Indenture Trustee to assume control over the
         investment of funds in the Reserve Account [and Yield Supplement
         Account] has been waived and the acceleration, if any, of the Notes has
         been rescinded, the Indenture Trustee shall issue a rescission of
         prohibition notice to the securities intermediary as provided in the
         Securities Account Control Agreement.

                  8.04 Release of Trust Estate.

                  (a) Subject to the payment of its fees and expenses pursuant
         to Section 6.07, the Indenture Trustee may, and when required by the
         provisions of this Indenture shall, execute instruments to release
         property from the lien of this Indenture, or convey the Indenture
         Trustee's interest in the same, in a manner and under circumstances
         that are not inconsistent with the provisions of this Indenture. No
         party relying upon an instrument executed by the Indenture Trustee as
         provided in this Article VIII shall be bound to ascertain the Indenture
         Trustee's authority, inquire into the satisfaction of any conditions
         precedent or see to the application of any moneys.

                  (b) The Indenture Trustee shall, at such time as there are no
         Notes outstanding and all sums due the Indenture Trustee pursuant to
         Section 6.07 have been paid [and all amounts owing under the Interest
         Rate Swap Agreement have been paid], release any remaining portion of
         the Trust Estate that secured the Notes [and the Interest Rate Swap
         Agreement] from the lien of this Indenture and release to or to the
         order of the Issuer, or, in the case of the Reserve Account [or the
         Yield Supplement Account], to the Seller, any funds entitled thereto
         then on deposit in the Collection Account, the Reserve Account and the
         Yield Supplement Account, as the case may be. The Indenture Trustee
         shall release property from the lien of this Indenture pursuant to this
         Section 8.04(b) only upon receipt of an Issuer Request accompanied by
         [confirmation that all amounts owing under the Interest Rate Swap
         Agreement have been paid and] an Officer's Certificate and (if required
         by the TIA) Independent Certificates in accordance with TIA Sections
         314(c) and 314(d)(1) meeting the applicable requirements of Section
         11.01.

                                       58                            (Indenture)

<PAGE>

                  8.05 Release of Receivables Upon Purchase by the Seller or the
Servicer. Upon repurchase of any Receivable by the Seller pursuant to Section
3.02 of the Sale and Servicing Agreement or any purchase of any Receivable by
the Servicer pursuant to Section 4.06 or Section 9.01 of the Sale and Servicing
Agreement, the Indenture Trustee, on behalf of the Noteholders, shall, without
further action, be deemed to release from the Lien of this Indenture such
repurchased Receivable, all monies due or to become due with respect thereto and
all proceeds thereof and the other property with respect to such Receivable, and
all security and any documents relating thereto, and the Seller or the Servicer,
as applicable, shall thereupon own each such Receivable, and all such related
security and documents, free of any further obligation to the Issuer, the
Indenture Trustee or the Noteholders with respect thereto.

                  (a) The Indenture Trustee shall execute such documents and
         instruments and take such other actions as shall be reasonably
         requested by the Seller or the Servicer, as the case may be, to effect
         the release of such Receivable pursuant hereto and the assignment of
         such Receivable by the Issuer pursuant to Section 9.02 of the Sale and
         Servicing Agreement.

                  8.06 Opinion of Counsel. The Indenture Trustee shall receive
at least seven days notice when requested by the Issuer to take any action
pursuant to Section 8.04(a), accompanied by copies of any instruments involved,
and the Indenture Trustee may also require (and shall require, to extent
required by the TIA), except in connection with any action contemplated by
Section 8.04(b), as a condition to such action, an Opinion of Counsel, in form
and substance satisfactory to the Indenture Trustee, stating the legal effect of
any such action, outlining the steps required to complete the same, and
concluding that all conditions precedent to the taking of such action have been
complied with and such action will not materially and adversely impair the
security for the Notes or the rights of the Noteholders [or adversely affect the
Swap Counterparty] in contravention of the provisions of this Indenture;
provided, however, that such Opinion of Counsel shall not be required to express
an opinion as to the fair value of the Trust Estate. Counsel rendering any such
opinion may rely, without independent investigation, on the accuracy and
validity of any certificate or other instrument delivered to the Indenture
Trustee in connection with any such action.

                                   ARTICLE IX
                             Supplemental Indentures

                  9.01 Supplemental Indentures Without Consent of Noteholders.

                  (a) Without the consent of the Holders of any Notes [or the
         Swap Counterparty] but with prior notice to the Rating Agencies, the
         Issuer and the Indenture Trustee, when authorized by an Issuer Order,
         at any time and from time to time, may enter into one or more
         indentures supplemental hereto (which shall conform to the provisions
         of the TIA as in force at the date of the execution thereof), in form
         satisfactory to the Indenture Trustee, for any of the following
         purposes:

                           (1) to correct or amplify the description of any
                  property at any time subject to the lien of this Indenture, or
                  to better assure, convey and confirm unto

                                       59                            (Indenture)

<PAGE>

                  the Indenture Trustee any property subject or required to be
                  subjected to the lien of this Indenture, or to subject to the
                  lien of this Indenture additional property;

                           (2) to evidence the succession, in compliance with
                  the applicable provisions hereof, of another person to the
                  Issuer, and the assumption by any such successor of the
                  covenants of the Issuer contained herein and in the Notes;

                           (3) to add to the covenants of the Issuer, for the
                  benefit of the Holders of the Notes, or to surrender any right
                  or power herein conferred upon the Issuer;

                           (4) to convey, transfer, assign, mortgage or pledge
                  any property to or with the Indenture Trustee;

                           (5) to cure any ambiguity, to correct or supplement
                  any provision herein or in any supplemental indenture that may
                  be inconsistent with any other provision herein or in any
                  supplemental indenture or to make any other provisions with
                  respect to matters or questions arising under this Indenture
                  or in any supplemental indenture to the extent such action
                  shall not adversely affect the interests of the Holders of the
                  Notes [or adversely affect the rights or obligations of the
                  Swap Counterparty under the Interest Rate Swap Agreement or
                  modify the obligations of or impair the ability of the Issuer
                  to fully perform any of its obligations under the Interest
                  Rate Swap Agreement];

                           (6) to evidence and provide for the acceptance of the
                  appointment hereunder by a successor trustee with respect to
                  the Notes and to add to or change any of the provisions of
                  this Indenture as shall be necessary to facilitate the
                  administration of the trusts hereunder by more than one
                  trustee, pursuant to the requirements of Article VI; or

                           (7) to modify, eliminate or add to the provisions of
                  this Indenture to such extent as shall be necessary to effect
                  the qualification of this Indenture under the TIA or under any
                  similar federal statute hereafter enacted and to add to this
                  Indenture such other provisions as may be expressly required
                  by the TIA.

                  The Indenture Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained.

                  (b) The Issuer and the Indenture Trustee, when authorized by
         an Issuer Order, may, also without the consent of any of the Holders of
         the Notes, enter into an indenture or indentures supplemental hereto
         for the purpose of adding any provisions to, or changing in any manner
         or eliminating any of the provisions of, this Indenture or of modifying
         in any manner the rights of the Holders of the Notes under this
         Indenture; provided, however, that such action shall not materially and
         adversely affect the interests of any Noteholder.

                                       60                            (Indenture)

<PAGE>

                  9.02 Supplemental Indentures with Consent of Noteholders. The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may,
with prior notice to the Rating Agencies and with the consent of the Holders of
the Controlling Class of Notes representing a majority of the Outstanding Amount
of such Class (excluding for such purpose the outstanding principal amount of
any Notes held of record or beneficially owned by NARC II, NMAC or any of their
Affiliates, unless at such time all of the Notes of such Class are held of
record or beneficially owned by NARC II, NMAC or any of their Affiliates), by
Action of such Holders delivered to the Issuer and the Indenture Trustee, enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to, or changing in any manner or eliminating any of the
provisions of, this Indenture or of modifying in any manner the rights of the
Holders of the Notes under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Note affected thereby:

                  (a) change the due date of any installment of principal of or
         interest on any Note, or reduce the principal amount thereof, the
         Interest Rate thereon or redemption price therefor, or change any place
         of payment where, or the coin or currency in which, any Note or the
         interest thereon is payable;

                  (b) impair the right to institute suit for the enforcement of
         the provisions of this Indenture requiring the application of funds
         available therefor, as provided in Article V, to the payment of any
         such amount due on the Notes on or after the respective due dates
         thereof;

                  (c) reduce the percentage of the Outstanding Amount of the
         Notes, the consent of the Holders of which is required for any such
         supplemental indenture, or the consent of the Holders of which is
         required for any waiver of compliance with certain provisions of this
         Indenture or certain defaults hereunder and their consequences provided
         for in this Indenture;

                  (d) modify or alter the provisions of the proviso to the
         definition of the term "Outstanding";

                  (e) reduce the percentage of the Outstanding Amount of the
         Notes required to direct the Indenture Trustee to sell or liquidate the
         Trust Estate if the proceeds of that sale would be insufficient to pay
         the principal amount of and accrued but unpaid interest on the Notes
         pursuant to Section 5.04(c)(iv);

                  (f) reduce any percentage required to amend the sections of
         the Indenture that specify the applicable percentage of Outstanding
         Amount of the Notes necessary to amend the Indenture; or

                  (g) permit the creation of any lien ranking prior to or on a
         parity with the lien of this Indenture with respect to any part of the
         Trust Estate or, except as otherwise permitted or contemplated herein,
         terminate the lien of this Indenture on any property at any time
         subject hereto or deprive the Holder of any Note of the security
         provided by the lien of this Indenture.

                                       61                            (Indenture)

<PAGE>

                  The Indenture Trustee may in its discretion determine whether
or not any Notes would be adversely affected by any supplemental indenture and
any such determination shall be conclusive upon the Holders of all Notes,
whether theretofore or thereafter authenticated and delivered hereunder. The
Indenture Trustee shall not be liable for any such determination made in good
faith.

                  It shall not be necessary for any Action of Noteholders under
this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Action shall approve the substance
thereof.

                  Promptly after the execution by the Issuer and the Indenture
Trustee of any supplemental indenture pursuant to this Section, the Indenture
Trustee shall mail to the Holders of the Notes to which such amendment or
supplemental indenture relates a notice setting forth in general terms the
substance of such supplemental indenture. Any failure of the Indenture Trustee
to mail such notice, or any defect therein, shall not, however, in any way
impair or affect the validity of any such supplemental indenture.

                  [Pursuant to the Trust Agreement and the Sale and Servicing
Agreement, the Issuer may, from time to time, at its option, enter into a
currency Swap Agreement with a Swap Counterparty to swap amounts payable to
Certificateholders from U.S. dollars to Japanese yen; provided, that (1) at the
time the Issuer enters into the Swap Agreement, the rating agencies have
confirmed the then-existing ratings of the Notes, and (2) any payments to the
Swap Counterparty (including termination payments) are payable only from amounts
that are otherwise payable to the Certificateholders. Any payments received by
the Issuer from the Swap Counterparty under such a Swap Agreement shall not be
deposited in the Collection Account and shall be paid by the Indenture Trustee
directly to or to the order of the Certificateholders on the related
Distribution Date. In connection with executing any such Swap Agreement, the
Issuer, Indenture Trustee, Owner Trustee, Seller and Servicer will enter into a
supplement to this Indenture, subject to this Section 9.02 and subject to the
approval of the Owner Trustee and the Certificateholders, that will specify the
creation of any necessary accounts and modifications of any provisions necessary
or appropriate to effectuate the intention of such Swap Agreement.]

                  9.03 Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modification thereby of the trusts created
by this Indenture, the Indenture Trustee shall be entitled to receive upon
request therefor, and subject to Sections 6.01 and 6.02, shall be fully
protected in relying upon, an Opinion of Counsel from external counsel stating
that the execution of such supplemental indenture is authorized or permitted by
this Indenture. The Indenture Trustee may, but shall not be obligated to, enter
into any such supplemental indenture that affects the Indenture Trustee's own
rights, duties, liabilities or immunities under this Indenture or otherwise.

                                       62                            (Indenture)

<PAGE>

                  9.04 Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and shall be deemed to be modified and amended in accordance therewith
with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer and the Holders of the Notes
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.

                  9.05 Conformity with Trust Indenture Act. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article IX shall conform to the requirements of the Trust Indenture Act as then
in effect so long as this Indenture shall then be qualified under the Trust
Indenture Act.

                  9.06 Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.

                                    ARTICLE X
                                     Release

                  10.01 Optional Purchase of All Receivables. If the Servicer or
any successor to the Servicer shall notify the Owner Trustee and the Indenture
Trustee of its intention to exercise the option granted to it in Section 9.01 of
the Sale and Servicing Agreement to repurchase the outstanding Receivables
primarily comprising the Owner Trust Estate, then the Owner Trustee and the
Indenture Trustee shall give written notice thereof to each Securityholder and
the Rating Agencies as soon as practicable after their receipt of notice from
the Servicer. Upon deposit by the Servicer or any successor to the Servicer of
the amount necessary to effect such purchase of the corpus of the Owner Trust
Estate, the Indenture Trustee shall make the final distributions to the
Noteholders and Certificateholders as set forth in Section 5.06 of the Sale and
Servicing Agreement and shall promptly transfer all of its right, title and
interest in and to any amounts or investments remaining on deposit in the
Collection Account to the Owner Trustee, and in the Reserve Account [and the
Yield Supplement Account] to the Seller (in any event excluding any portion
thereof necessary to make distributions to Noteholders described in Section
3.03), and release from the lien of this Indenture all of the remaining
Collateral. The Indenture Trustee shall execute, deliver and file all
agreements, certificates, instruments or other documents necessary or reasonably
requested by the Issuer in order to effect such release and the transfer to the
Issuer of the Collateral.

                                       63                            (Indenture)

<PAGE>

                                   ARTICLE XI
                                 Miscellaneous

                  11.01 Compliance Certificates and Opinions, etc.

                  (a) Upon any application or request by the Issuer to the
         Indenture Trustee to take any action under any provision of this
         Indenture, the Issuer shall, upon written request therefor from the
         Indenture Trustee, furnish to the Indenture Trustee (i) an Officer's
         Certificate stating that all conditions precedent, if any, provided for
         in this Indenture relating to the proposed action have been complied
         with, (ii) an Opinion of Counsel stating that in the opinion of such
         counsel all such conditions precedent, if any, have been complied with,
         and (iii) (if required by the TIA) an Independent Certificate from a
         firm of certified public accountants meeting the applicable
         requirements of this Section, except that, in the case of any such
         application or request as to which the furnishing of such documents is
         specifically required by any provision of this Indenture, no such
         written request from the Indenture Trustee need be furnished (and only
         such expressly required documents need be delivered in connection
         therewith).

                  (b) Every certificate or opinion with respect to compliance
         with a condition or covenant provided for in this Indenture shall
         include:

                           (1) a statement that each signatory of such
                  certificate or opinion has read or has caused to be read such
                  covenant or condition and the definitions herein relating
                  thereto;

                           (2) a brief statement as to the nature and scope of
                  the examination or investigation upon which the statements or
                  opinions contained in such certificate or opinion are based;

                           (3) a statement that, in the opinion of each such
                  signatory, such signatory has made such examination or
                  investigation as is necessary to enable such signatory to
                  express an informed opinion as to whether or not such covenant
                  or condition has been complied with; and

                           (4) a statement as to whether, in the opinion of each
                  such signatory, such condition or covenant has been complied
                  with.

                  (c) Prior to the deposit of any Collateral or other property
         or securities with the Indenture Trustee that is to be made the basis
         for the release of any property or securities subject to the lien of
         this Indenture, the Issuer shall, in addition to any obligation imposed
         in Section 11.01(a) or elsewhere in this Indenture, furnish to the
         Indenture Trustee (if so requested by the Indenture Trustee or required
         by the TIA) an Officer's Certificate certifying or stating the opinion
         of each person signing such certificate as to the fair value (within 90
         days of such deposit) to the Issuer of the Collateral or other property
         or securities to be so deposited.

                  Whenever the Issuer would be required to furnish to the
Indenture Trustee an Officer's Certificate certifying or stating the opinion of
any signatory thereof as to the matters

                                       64                            (Indenture)

<PAGE>

described in this clause (c) above if such an Officer's Certificate had been
requested by the Indenture Trustee or required by the TIA, regardless of whether
such an Officer's Certificate was so requested or required, the Issuer shall
deliver to the Indenture Trustee an Independent Certificate as to the same
matters, if the fair value to the Issuer of the securities to be so deposited
and of all other such securities made the basis of any such withdrawal or
release since the commencement of the then-current calendar year of the Issuer,
as set forth in the certificates delivered pursuant to clause (c) above, is 10%
or more of the Outstanding Amount of the Notes, but such a certificate need not
be furnished with respect to any securities so deposited, if the fair value
thereof to the Issuer as set forth in the related Officer's Certificate is less
than $25,000 or less than one percent of the Outstanding Amount of the Notes.

                  Whenever any property or securities are to be released from
the lien of this Indenture, the Issuer shall also furnish to the Indenture
Trustee an Officer's Certificate certifying or stating the opinion of each
person signing such certificate as to the fair value (within 90 days of such
release) of the property or securities proposed to be released and stating that
in the opinion of such person the proposed release will not impair the security
under this Indenture in contravention of the provisions hereof.

                  Notwithstanding Section 2.09 or any other provision of this
Section, the Issuer may, without compliance with the requirements of the other
provisions of this Section, (A) collect, liquidate, sell or otherwise dispose of
Receivables and Financed Vehicles as and to the extent permitted or required by
the Basic Documents and (B) make cash payments out of the Accounts as and to the
extent permitted or required by the Basic Documents so long as the Issuer shall
deliver to the Indenture Trustee every six months, commencing [____________], an
Officer's Certificate of the Issuer stating that all such dispositions of
Collateral that occurred during the preceding six calendar months were in the
ordinary course of the Issuer's business and that the proceeds thereof were
applied in accordance with the Basic Documents.

                  11.02 Form of Documents Delivered to Indenture Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.

                  Any certificate or opinion of an Authorized Officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which such officer's
certificate or opinion is based are erroneous. Any such certificate of an
Authorized Officer or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Servicer, the Seller, the Issuer or the
Administrator, stating that the information with respect to such factual matters
is in the possession of the Servicer, the Seller, the Issuer or the
Administrator, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.

                                       65                            (Indenture)

<PAGE>

                  Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.

                  Whenever in this Indenture, in connection with any application
or certificate or report to the Indenture Trustee, it is provided that the
Issuer shall deliver any document as a condition of the granting of such
application, or as evidence of the Issuer's compliance with any term hereof, it
is intended that the truth and accuracy, at the time of the granting of such
application or at the effective date of such certificate or report (as the case
may be), of the facts and opinions stated in such document shall in such case be
conditions precedent to the right of the Issuer to have such application granted
or to the sufficiency of such certificate or report. The foregoing shall not,
however, be construed to affect the Indenture Trustee's right to rely upon the
truth and accuracy of any statement or opinion contained in any such document as
provided in Article VI.

                  11.03 Acts of Noteholders.

                  (a) Any request, demand, authorization, direction, notice,
         consent, waiver or other action provided by this Indenture to be given
         or taken by Noteholders may be embodied in and evidenced by one or more
         instruments of substantially similar tenor signed by such Noteholders
         in person or by agents duly appointed in writing; and except as herein
         otherwise expressly provided such action shall become effective when
         such instrument or instruments are delivered to the Indenture Trustee,
         and, where it is hereby expressly required, to the Issuer. Such
         instrument or instruments (and the action embodied therein and
         evidenced thereby) are herein sometimes referred to as the "Action" of
         the Noteholders signing such instrument or instruments. Proof of
         execution of any such instrument or of a writing appointing any such
         agent shall be sufficient for any purpose of this Indenture and
         (subject to Section 6.01) conclusive in favor of the Indenture Trustee
         and the Issuer, if made in the manner provided in this Section.

                  (b) The fact and date of the execution by any person of any
         such instrument or writing may be proved in any manner that the
         Indenture Trustee deems sufficient.

                  (c) The ownership of Notes shall be proved by the Note
         Register.

                  (d) Any request, demand, authorization, direction, notice,
         consent, waiver or other action by the Holder of any Notes shall bind
         the Holder of every Note issued upon the registration thereof or in
         exchange therefor or in lieu thereof, in respect of anything done,
         omitted or suffered to be done by the Indenture Trustee or the Issuer
         in reliance thereon, whether or not notation of such action is made
         upon such Note.

                  11.04 Notices, to Indenture Trustee, Issuer and Rating
Agencies. Any request, demand, authorization, direction, notice, consent, waiver
or Action of Noteholders or other documents provided or permitted by this
Indenture shall be in writing and if such request, demand, authorization,
direction, notice, consent, waiver or Action of Noteholders is to be made upon,
given or furnished to or filed with:

                                       66                            (Indenture)

<PAGE>

                  (a) the Indenture Trustee by any Noteholder or by the Issuer,
         it shall be sufficient for every purpose hereunder if made, given,
         furnished or filed in writing to or with the Indenture Trustee at its
         Corporate Trust Office, or

                  (b) the Issuer by the Indenture Trustee or by any Noteholder,
         it shall be sufficient for every purpose hereunder if in writing and
         mailed first-class, postage prepaid to the Issuer addressed to: Nissan
         Auto Receivables [____-_] Owner Trust, c/o [______________________],
         Attention: [____________], with a copy to Nissan Motor Acceptance
         Corporation, 990 West 190th Street, Torrance, California 90502,
         Attention: Secretary, or at any other address previously furnished in
         writing to the Indenture Trustee by the Issuer or the Administrator.
         The Issuer shall promptly transmit any notice received by it from the
         Noteholders to the Indenture Trustee.

                  Notices required to be given to the Rating Agencies by the
Issuer, the Indenture Trustee or the Owner Trustee shall be in writing,
personally delivered or mailed by certified mail, return receipt requested, to
(i) in the case of Moody's, at the following address: Moody's Investors Service,
ABS Monitoring Department, 99 Church Street, New York, New York 10007, and (ii)
in the case of Standard & Poor's, at the following address: Standard & Poor's, a
division of The McGraw-Hill Companies, Inc., 55 Water Street, New York, New York
10041-0003, Attention: Asset Backed Surveillance Department, or as to each of
the foregoing, at such other address as shall be designated by written notice to
the other parties.

                  11.05 Notices to Noteholders; Waiver. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at his address as it appears on the Note Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Noteholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Noteholder shall affect the sufficiency of such notice with
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given.

                  Where this Indenture provides for notice in any manner, such
notice may be waived in writing by any Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.

                  In case, by reason of the suspension of regular mail service
as a result of a strike, work stoppage or similar activity, it shall be
impractical to mail notice of any event to Noteholders when such notice is
required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the Indenture Trustee
shall be deemed to be a sufficient giving of such notice.

                  Where this Indenture provides for notice to the Rating
Agencies, failure to give such notice shall not affect any other rights or
obligations created hereunder, and shall not under any circumstance constitute a
Default or Event of Default.

                                       67                            (Indenture)

<PAGE>

                  11.06 Alternate Payment and Notice Provisions. Notwithstanding
any provision of this Indenture or any of the Notes to the contrary, the Issuer
may enter into any agreement with any Holder of a Note providing for a method of
payment, or notice by the Indenture Trustee or any Paying Agent to such Holder,
that is different from the methods provided for in this Indenture for such
payments or notices. The Issuer will furnish to the Indenture Trustee a copy of
each such agreement and the Indenture Trustee will cause payments to be made and
notices to be given in accordance with such agreements.

                  11.07 Conflict with Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with another provision hereof that is
required to be included in this Indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control.

                  The provisions of TIA Sections 310 through 317 that impose
duties on any person (including the provisions automatically deemed included
herein unless expressly excluded by this Indenture) are a part of and govern
this Indenture, whether or not physically contained herein.

                  11.08 Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.

                  11.09 Successors and Assigns. All covenants and agreements in
this Indenture and the Notes by the Issuer shall bind its successors and
assigns, whether so expressed or not. All agreements of the Indenture Trustee in
this Indenture shall bind its successors, co-trustees and agents.

                  11.10 Severability. If any one or more of the covenants,
agreements, provisions or terms of this Indenture shall be for any reason
whatsoever held invalid or unenforceable in any jurisdiction, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Indenture and shall
in no way affect the validity or enforceability of the other provisions of this
Indenture or of the Notes or the Certificates or the rights of the Holders
thereof.

                  11.11 Benefits of Indenture. Nothing in this Indenture or in
the Notes, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, and the Noteholders, and any other party
secured hereunder, and any other Person with an ownership interest in any part
of the Trust Estate, any benefit or any legal or equitable right, remedy or
claim under this Indenture.

                  11.12 Governing Law. This Indenture shall be governed by and
construed in accordance with the laws of the State of New York, without
reference to its conflict of law provisions (other than Section 5-1401 of the
General Obligations Law of the State of New York), and the obligations, rights
and remedies of the parties hereunder shall be determined in accordance with
such laws.

                  11.13 Counterparts. This Indenture may be executed
simultaneously in any number of counterparts, each of which shall be deemed to
be an original, and all of which shall constitute but one and the same
instrument.

                                       68                            (Indenture)
<PAGE>
         11.14 Recording of Indenture. If this Indenture is subject to recording
in any appropriate public recording offices, such recording is to be effected by
the Issuer and at its expense accompanied by an Opinion of Counsel (which may be
counsel to the Indenture Trustee or any other counsel reasonably acceptable to
the Indenture Trustee) to the effect that such recording is necessary either for
the protection of the Noteholders or any other Person secured hereunder or for
the enforcement of any right or remedy granted to the Indenture Trustee under
this Indenture.

         11.15 Trust Obligation. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or Certificates or under this Indenture or
any certificate or other writing delivered in connection herewith or therewith,
against (i) the Indenture Trustee or the Owner Trustee in its individual
capacity, (ii) the Seller, any Certificateholder or other owner of a beneficial
interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer,
director, employee or agent of the Indenture Trustee or the Owner Trustee in its
individual capacity, any Certificateholder or other owner of a beneficial
interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any
successor or assign of the Indenture Trustee or the Owner Trustee in its
individual capacity, except as any such Person may have expressly agreed (it
being understood that the Indenture Trustee and the Owner Trustee have no such
obligations in their individual capacity) and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by applicable
law, for any unpaid consideration for stock, unpaid capital contribution or
failure to pay any installment or call owing to such entity. For all purposes of
this Indenture, in the performance of any duties or obligations of the Issuer
hereunder, the Owner Trustee shall be subject to, and entitled to the benefits
of, the terms and provisions of Article VI, VII and VIII of the Trust Agreement.

         11.16 No Petition. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they will not at any time file, join in any filing of, or cooperate or
encourage others to file against the Seller or the Issuer any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any United States federal or state bankruptcy or similar law,
in connection with any obligations relating to the Notes, the Certificates or
any of the Basic Documents.

         11.17 Inspection. The Issuer agrees that, on reasonable prior notice,
it will permit any representative of the Indenture Trustee, during the Issuer's
normal business hours, to examine all the books of account, records, reports and
other papers of the Issuer, to make copies and extracts therefrom, to cause (at
the expense of the requesting party) such books to be audited by Independent
certified public accountants, and to discuss the Issuer's affairs, finances and
accounts with the Issuer's officers, employees, and Independent certified public
accountants, all at such reasonable times and as often as may be reasonably
requested. The Indenture Trustee shall and shall cause its representatives to
hold in confidence all such information except to the extent disclosure may be
required by law (and all reasonable applications for confidential treatment are
unavailing) and except to the extent that the Indenture Trustee may reasonably
determine that such disclosure is consistent with its obligations hereunder.

                                       69                            (Indenture)
<PAGE>

                  IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have
caused this Indenture to be duly executed by their respective officers,
thereunto duly authorized and duly attested, all as of the day and year first
above written.

                                    NISSAN AUTO RECEIVABLES [____-_] OWNER TRUST

                                    By:  [                                    ],
                                          ------------------------------------

                                         not in its individual capacity but
                                         solely as Owner Trustee

                                         By:
                                              --------------------------------
                                              Name:
                                              Title:

                                    [                                         ],
                                     -----------------------------------------
                                         not in its individual capacity but
                                         solely as Indenture Trustee

                                         By:
                                              --------------------------------
                                              Name:
                                              Title:

                                      S-1                            (Indenture)
<PAGE>
                                   EXHIBIT A-1

    (Form of Class A-1 Note, Class A-2 Note, Class A-3 Note and Class B Note)

         UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.

         THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH
HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME
MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.

         THIS NOTE IS NOT AN OBLIGATION OF, AND WILL NOT BE INSURED OR
GUARANTEED BY, ANY GOVERNMENTAL AGENCY OR NISSAN AUTO RECEIVABLES CORPORATION
II, NISSAN MOTOR ACCEPTANCE CORPORATION, NISSAN NORTH AMERICA, INC., NISSAN
MOTOR CO., LTD., ANY TRUSTEE OR ANY OF THEIR AFFILIATES. THE PRINCIPAL AND
INTEREST ON THIS NOTE IS PAYABLE SOLELY FROM PAYMENTS ON THE RECEIVABLES AND
AMOUNTS ON DEPOSIT IN THE RESERVE ACCOUNT [AND THE YIELD SUPPLEMENT ACCOUNT].

                                     A-1-1                           (Indenture)
<PAGE>
No._____       $__________

                   NISSAN AUTO RECEIVABLES ___-___ OWNER TRUST

                CLASS [A-1][A-2][A-3] [B] ___% ASSET BACKED NOTES

         Nissan Auto Receivables Owner Trust, a statutory trust organized and
existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to ____________________,
or registered assigns, the principal sum of _______________ DOLLARS
($__________) payable on each Distribution Date in an aggregate amount, if any,
payable from the Collection Account in respect of the principal on the Class
[A-1][A-2][A-3][B] Notes pursuant to Section 3.01 of the Indenture dated as of
__________, _____ (the "Indenture"), between the Issuer and [________], a
___________________, as Indenture Trustee (the "Indenture Trustee") and Sections
5.06(c), (d) and (e) of the Sale and Servicing Agreement dated as of [_________]
among the Issuer, NARC II, as Seller, and NMAC, as Servicer (which amounts shall
be limited to the portion of Available Amounts specified in such sections);
provided, however, that the entire unpaid principal amount of this Note shall be
due and payable on the Distribution Date occurring in [________] (the "Class
[A-1][A-2][A-3][B] Final Scheduled Distribution Date"). Capitalized terms used
but not defined herein have the meanings ascribed thereto in the Indenture and
the Sale and Servicing Agreement, as the case may be.

         The Issuer will pay interest on this Note at the rate per annum shown
above on each Distribution Date until the principal of this Note is paid or made
available for payment, on the principal amount of this Note outstanding on the
preceding Distribution Date (after giving effect to all payments of principal
made on the preceding Distribution Date), subject to certain limitations
contained in Section 3.01 of the Indenture. Interest on this Note will accrue
for each Distribution Date, [during the period from (and including) the
Distribution Date during the calendar month preceding such Distribution Date (or
in the case of the first Distribution Date, from (and including) the Closing
Date to (but excluding) such Distribution Date)] [during the period from (and
including) the 15th day of the preceding calendar month to (but excluding) the
15th day of the month in which such Distribution Date occurs]. Interest will be
computed on the basis specified in the Indenture for each Interest Period. Such
principal of and interest on this Note shall be paid in the manner specified on
the reverse hereof.

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

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

                                     A-1-2                           (Indenture)
<PAGE>

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

         IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer, as of the date set forth
below.

Date:
      --------------------

                              NISSAN AUTO RECEIVABLES _____-_
                              OWNER TRUST

                              By:
                                 -------------------------------------------
                                     not in its individual capacity but
                                     solely as Owner Trustee under the
                                     Trust Agreement,

                              By:
                                 -------------------------------------------
                                     Authorized Signatory

                                     A-1-3                           (Indenture)
<PAGE>

                     TRUSTEE'S CERTIFICATE OF AUTHENTICATION

This is one of the Notes designated above and referred to in the
within-mentioned Indenture.

Date:
      ------------------

                                                                            ,
                                   -----------------------------------------
                                          not in its individual capacity but
                                          solely as Indenture Trustee,

                                   By:
                                        ------------------------------------
                                          Authorized Signatory

                                     A-1-4                           (Indenture)
<PAGE>

         This Note is one of a duly authorized issue of Notes of the Issuer,
designated as [____]% Asset Backed Notes, Class [A-1][A-2][A-3][B] (herein
called the "Class [A-1][A-2][A-3][B] Notes"), all issued under the Indenture, to
which Indentures and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights and obligations thereunder of the
Issuer, the Indenture Trustee and the Holders of the Notes. The Class
[A-1][A-2][A-3][B] Notes are subject to all terms of the Indenture.

         The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the
Class B Notes (collectively, the "Notes") are and will be equally and ratably
secured by the collateral pledged as security therefor as provided in the
Indenture.

         Principal of the Class [A-1][A-2][A-3] [B] Notes will be payable on
each Distribution Date in an amount described in the Indenture. "Distribution
Date" means the [________] day of each month, or, if any such date is not a
Business Day, the next succeeding Business Day, commencing [________].

         Notwithstanding the foregoing, the entire unpaid principal amount of
the Notes shall be due and payable on the date on which an Event of Default
shall have occurred and be continuing and the Indenture Trustee or the Holders
of the Controlling Class of Notes representing not less than a majority of the
Outstanding Amount of such Class (excluding for such purpose the outstanding
principal amount of any Notes held of record or beneficially owned by NARC II,
NMAC or any of their Affiliates, unless at such time all of the Notes of such
Class are held of record or beneficially owned by NARC II, NMAC or any of their
Affiliates) have declared the Notes to be immediately due and payable in the
manner provided in Section 5.02 of the Indenture or following the exercise by
the Servicer of its option to purchase the Receivables pursuant to Section 9.01
of the Sale and Servicing Agreement and Section 10.01 of the Indenture. In case
of an unrescinded acceleration upon an Event of Default, all payments of
interest and principal in that order of payment, will be made (1) first to the
holders of the Class A-1 Notes, until the outstanding principal balance of the
Class A-1 Notes has been paid in full; (2) then to the holders of the Class A-2
Notes and the Class A-3 Notes on a pro rata basis (x) with respect to interest,
based on the respective aggregate amounts of interest due to these classes of
notes and (y) with respect to principal, based on the respective outstanding
principal balances of those classes of notes, until the outstanding principal
balances of those classes of notes have been paid in full; and (3) then to the
holders of Class B Notes on a pro rata basis (x) with respect to interest, based
on the respective aggregate amounts of interest due to the Class B Notes and (y)
with respect to principal, based on the respective outstanding principal
balances of the Class B Notes, until the outstanding principal balances of the
Class B Notes have been paid in full. In case of the optional purchase of the
Receivables, all interest and all principal payments on the Class
[A-1][A-2][A-3][A-4] Notes shall be made pro rata to the Class [A-1][A-2][A-3]
[B] Noteholders entitled thereto.

         Payments of interest on this Note due and payable on each Distribution
Date, together with the installment of principal, if any, to the extent not in
full payment of this Note, shall be paid to the Person in whose name of such
Note (or one or more Predecessor Notes) is registered on the Record Date by wire
transfer in immediately available funds to the account designated by such
nominee, except for the final installment of principal payable with respect to
such Note on a Distribution Date or on the applicable Final Scheduled
Distribution Date, which

                                     A-1-5                           (Indenture)
<PAGE>
shall be payable as provided below. Any reduction in the principal amount of
this Note (or any one or more Predecessor Notes) effected by any payments made
on any Distribution Date shall be binding upon all future Holders of this Note
and of any Note issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof, whether or not noted hereon. If funds are expected to
be available, as provided in the Indenture, for payment in full of the then
remaining unpaid principal amount of this Note on a Distribution Date, then the
Indenture Trustee, in the name of and on behalf of the Issuer, will notify the
Person who was the Registered Holder hereof as of the Record Date preceding such
Distribution Date by notice mailed or transmitted by facsimile prior to such
Distribution Date, and the amount then due and payable shall be payable only
upon presentation and surrender of this Note at the Indenture Trustee's
principal Corporate Trust Office or at the office of the Indenture Trustee's
agent appointed for such purposes located in The City of New York.

         The Issuer shall pay interest on overdue installments of interest at
the Class [A-1][A-2][A-3][B] Rate to the extent lawful.

         [FOR CLASS B NOTES] Default in the payment of interest on this Class
[B] Note is not an Event of Default under the Indenture so long as any Class [A]
Notes are Outstanding. By acceptance of this Class [B] Note or any beneficial
interest herein, you are deemed to have consented to the delay in payment of
interest on such Class [B] Note and waived your rights to institute suit for
enforcement of any such payment to the extent described in the Indenture.

         As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Note may be registered on the Note Register
upon surrender of this Note for registration of transfer at the office or agency
designated by the Issuer pursuant to the Indenture, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Indenture Trustee as set forth in Section 2.04 of the Indenture, and thereupon
one or more new Notes of authorized denominations and in the same aggregate
principal amount will be issued to the designated transferee or transferees. No
service charge will be charged for any registration of transfer or exchange of
this Note, but the transferor may be required to pay a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
such registration of transfer or exchange.

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

                                     A-1-6                           (Indenture)
<PAGE>
stock, unpaid capital contribution or failure to pay any installment or call
owing to such entity.

         The Holder of this Note by its acceptance hereof agrees that, except as
expressly provided in the Basic Documents, in the case of an Event of Default
under the Indenture, the Holder shall have no claim against any of the foregoing
for any deficiency, loss or claim therefrom; provided, however, that nothing
contained herein shall be taken to prevent recourse to, and enforcement against,
the assets of the Issuer for any and all liabilities, obligations and
undertakings contained in the Indenture or in this Note.

         Each Noteholder or Note Owner, by acceptance of a Note or, in the case
of a Note Owner, a beneficial interest in a Note, covenants and agrees by
accepting the benefits of the Indenture that such Noteholder or Note Owner will
not at any time file, join in the filing of, or cooperate with or encourage
others to file against the Seller or the Issuer, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings under any United States
federal or state bankruptcy or similar law in connection with any obligations
relating to the Notes, the Indenture or the Basic Documents.

         The Issuer has entered into the Indenture and this Note is issued with
the intention that, for federal, state and local income, single business and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Trust Estate. Each Noteholder, by acceptance of a Note (and each
Note Owner by acceptance of a beneficial interest in a Note), agrees to treat
the Notes for federal, state and local income, single business and franchise tax
purposes as indebtedness of the Issuer.

         Prior to the due presentment for registration of transfer of this Note,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Note (as of the day of
determination or as of such other date as may be specified in the Indenture) is
registered as the owner hereof for all purposes, whether or not this Note be
overdue, and none of the Issuer, the Indenture Trustee or any such agent shall
be affected by notice to the contrary.

         The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer and the Indenture Trustee, when authorized by an Issuer
Order, with prior notice to the Rating Agencies and with the consent of the
Holders of the Controlling Class of Notes representing a majority of the
Outstanding Amount of such Class (excluding for such purpose the outstanding
principal amount of any Notes held of record or beneficially owned by NARC II,
NMAC or any of their Affiliates, unless at such time all of the Notes are held
of record or beneficially owned by NARC II, NMAC or any of their Affiliates).
Section 5.12 of the Indenture also contains provisions permitting the Holders of
the Controlling Class of Notes representing a majority of the Outstanding Amount
of such Class (excluding for such purpose the outstanding principal amount of
any Notes held of record or beneficially owned by NARC II, NMAC or any of their
Affiliates, unless at such time all of the Notes of such Class are held of
record or beneficially owned by NARC II, NMAC or any of their Affiliates), on
behalf of the Holders of all the Notes, to waive compliance by the Issuer with
certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Note (or any one or more

                                     A-1-7                           (Indenture)
<PAGE>
Predecessor Notes) shall be conclusive and binding upon such Holder and upon all
future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation
of such consent or waiver is made upon this Note. The Indenture also permits the
Indenture Trustee to amend or waive certain terms and conditions set forth in
the Indenture without the consent of Holders of the Notes issued thereunder.

         The term "Issuer" as used in this Note includes any successor to the
Issuer under the Indenture.

         The Issuer is permitted by the Indenture, under certain circumstances,
to merge or consolidate, subject to the rights of the Indenture Trustee and the
Holders of Notes under the Indenture.

         The Notes are issuable only in registered form in denominations as
provided in the Indenture, subject to certain limitations therein set forth.

         This Note and the Indenture shall be construed in accordance with the
laws of the State of New York, without reference to its conflict of law
provisions (other than Section 5-1401 of the General Obligations Law of the
State of New York), and the obligations, rights and remedies of the parties
hereunder and thereunder shall be determined in accordance with such laws.

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

                                     A-1-8                           (Indenture)
<PAGE>
                                   ASSIGNMENT

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

         FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto:

--------------------------------------------------------------------------------
                         (name and address of assignee)

the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints , attorney, to transfer said Note on the books kept for
registration thereof, with full power of substitution in the premises.

Dated:                          */
      --------------------------

Signature Guaranteed:
                                */
--------------------------------

         */ NOTICE: The signature to this assignment must correspond with the
name of the registered owner as it appears on the face of the within Note in
every particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.

                                     A-1-9                           (Indenture)
<PAGE>
                                   EXHIBIT A-2

                        [FORM OF VARIABLE PAY TERM NOTE]

         THIS VARIABLE PAY TERM NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER
ANY STATE SECURITIES OR BLUE SKY LAW OF ANY STATE OF THE UNITED STATES. THE
HOLDER HEREOF BY PURCHASING THIS VARIABLE PAY TERM NOTE, AGREES THAT THIS
VARIABLE PAY TERM NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE
LAWS, AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A")
TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER, WITHIN THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT
THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (2) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER
THE SECURITIES ACT (IF AVAILABLE), SUBJECT TO THE RECEIPT BY THE INDENTURE
TRUSTEE AND THE VARIABLE PAY TERM NOTE REGISTRAR OF SUCH EVIDENCE ACCEPTABLE TO
THE INDENTURE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, (3) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING THEREOF IN RULE
501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT PURSUANT TO
ANY OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE RECEIPT BY THE INDENTURE TRUSTEE AND THE NOTE REGISTRAR OF SUCH
OTHER EVIDENCE ACCEPTABLE TO THE INDENTURE TRUSTEE THAT SUCH REOFFER, RESALE,
PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE
LAWS, OR (4) TO THE SELLER OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH
ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND SECURITIES AND BLUE SKY
LAWS OF THE STATES OF THE UNITED STATES.

         THE PRINCIPAL OF THIS VARIABLE PAY TERM NOTE IS PAYABLE IN INSTALLMENTS
AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS
VARIABLE PAY TERM NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE
HEREOF.

                                     A-2-1                           (Indenture)
<PAGE>

                                                                        [$[    ]

No. ______                                                      CUSIP NO. [    ]

                FLOATING RATE ASSET BACKED VARIABLE PAY TERM NOTE

         NISSAN AUTO RECEIVABLES ___-___ OWNER TRUST, a business trust organized
and existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to [_________], or
registered assigns, the principal sum of [___________] MILLION DOLLARS payable
on each Distribution Date in an amount equal to the result obtained by
multiplying (i) a fraction, the numerator of which is [_________] (the original
face amount of this Note) and the denominator of which is [_________] (the
aggregate principal amount of the VPTN on the original issuance date of this
VPTN) by (ii) the aggregate amount, if any, payable to the VPTNs issued on the
original issuance date of this VPTN in respect of principal pursuant to the
Indenture dated as of [___________] (as from time to time amended, supplemented
or otherwise modified and in effect, the "Indenture"), between the Issuer and
_________________, as Indenture Trustee (in such capacity the "Indenture
Trustee"); provided, however, the entire unpaid principal amount of this Note
shall be due and payable on the ___________, ____ Distribution Date (the "VPTN
Final Scheduled Distribution Date") and upon the optional repurchase of the
Receivables, if any, pursuant to Section 10.01 of the Indenture. Capitalized
terms used but not defined herein are defined in Article I of the Indenture,
which also contains rules as to construction that shall be applicable herein.

         The Issuer shall pay interest on this VPTN on each Distribution Date at
a rate equal to one-month LIBOR on the related LIBOR Determination Date (as
defined in the Indenture) plus [___]%. Interest on this VPTN will accrue, in the
case of the first Distribution Date following the issuance of the VPTN, the
period from and including the issuance date to and excluding such Distribution
Date and for any other Distribution Date, the period from and including the most
recent Distribution Date to but excluding such Distribution Date. Interest will
be computed on the basis of actual days elapsed and a 360-day year. Such
principal of and interest on this VPTN shall be paid in the manner specified on
the reverse hereof. "Distribution Date" means the fifteenth day of each month,
or, if any such date is not a Business Day, the next succeeding Business Day,
commencing __________, ____.

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

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

         Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, the VPTN
shall not be entitled to any

                                     A-2-2                           (Indenture)
<PAGE>
benefit under the Indenture referred to on the reverse hereof, or be valid or
obligatory for any purpose.]

               [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]

                                     A-2-3                           (Indenture)
<PAGE>
         IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer, as of the date set forth
below.

Date:             ,
       -----------  ----
                                     NISSAN AUTO RECEIVABLES ___-___
                                     OWNER TRUST

                                     By:
                                         --------------------------------------

                                           not in its individual capacity but
                                           solely as Owner Trustee under
                                           the Trust Agreement

                                     By:
                                         --------------------------------------

                                            Authorized Signatory

                     TRUSTEE'S CERTIFICATE OF AUTHENTICATION

         This is one of the VPTNs designated above and referred to in the
within-mentioned Indenture.

Date:             ,
       -----------  ----
                                       [                                       ]
                                        ---------------------------------------
                                             not in its individual capacity but
                                             solely as Indenture Trustee

                                       By:
                                          -------------------------------------

                                          Authorized Signatory

                                     A-2-4                           (Indenture)
<PAGE>
                                [REVERSE OF NOTE

         This VPTN is one of a duly authorized issue of VPTNs of the Issuer,
designated as its Floating Rate Asset Backed Variable Pay Term Notes (the
"VPTNs") which, together with the Issuer's Class A-1 ___% Asset Backed Notes
(the "Class A-1 Notes"), Class A-2 ___% Asset Backed Notes (the "Class A-2
Notes"), Class A-3 ___% Asset Backed Notes (the "Class A-3 Notes," and together
with the Class A-1 Notes and the Class A-2 Notes, the "Class A Notes") and Class
B ___% Asset Backed Notes (the "Class B Notes" and, together with the VPTNs and
the Class A Notes, the "Notes"), are issued under the Indenture, to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights and obligations thereunder of the Issuer, the
Indenture Trustee and the Noteholders. The VPTNs are subject to all the terms of
the Indenture.

         The VPTNs are and will be equally and ratably secured by the collateral
pledged as security therefor as provided in the Indenture.

         As described on the face thereof, the entire unpaid principal amount of
this VPTN shall be due and payable on the VPTN Final Scheduled Distribution
Date. Notwithstanding the foregoing, the entire unpaid principal amount of the
VPTNs shall be due and payable on the date on which an Event of Default shall
have occurred and be continuing and the Indenture Trustee or the Holders of the
Controlling Class of Notes representing not less than a majority of the
Outstanding Amount of such Class (excluding for such purposes the outstanding
principal amount of any Notes held of record or beneficially owned by NMAC, NARC
II or any of their Affiliates, unless at such time all of the Notes of such
Class are held of record or beneficially owned by NARC II, NMAC or any of their
Affiliates) have declared the Notes to be immediately due and payable in the
manner provided in Section 5.02 of the Indenture. All principal payments on the
VPTNs shall be made sequentially, such that no payments of principal on a VPTN
shall be payable until all earlier issued VPTNs have been paid in full.

         Payments of interest on this VPTN on each Distribution Date, together
with the installment of principal, if any, to the extent not in full payment of
this VPTN, shall be made to the Person whose name appears as the Registered
Noteholder of the VPTN on the Note Register as of the close of business on each
Record Date either by wire transfer in immediately available funds, to the
account of such Noteholder at a bank or other entity having appropriate
facilities therefor, if such Noteholder shall have provided to the Note
Registrar appropriate written instructions at least five (5) Business Days prior
to such Distribution Date and such Noteholder's Notes in the aggregate evidence
a denomination of not less than $1,000,000, or, if not, by check mailed
first-class postage prepaid to such Person's address as it appears on the Note
Register on such Record Date. Such payments will be made without requiring that
the VPTN be submitted for notation of payment. Any reduction in the principal
amount of this VPTN effected by any payments made on any Distribution Date shall
be binding upon all future Noteholders of this VPTN and of any VPTN issued upon
the registration of transfer hereof or in exchange thereof or in lieu hereof,
whether or note noted herein. If funds are expected to be available, as provided
in the Indenture, for payment in full of the then remaining unpaid principal
amount of this VPTN on a Distribution Date, then the Indenture Trustee, in the
name of and on behalf of the Issuer, will notify the Person who was the
Registered Noteholder hereof as of the Record Date preceding such Distribution
Date by notice mailed or transmitted by facsimile prior to such

                                     A-2-5                           (Indenture)
<PAGE>
Distribution Date, and the amount then due and payable shall be payable only
upon presentation and surrender of this VPTN at the Indenture Trustee's
principal Corporate Trust Office or at the office of the Indenture Trustee's
agent appointed for such purposes located _______________________.

         The Issuer shall pay interest on overdue installments of interest at
the VPTN Rate to the extent lawful.

         As provided in the Indenture, the Notes may be redeemed, in whole but
not in part, in the manner and to the extent described in the Indenture and the
Sale and Servicing Agreement.

         As provided in the Indenture, and subject to the restrictions on
transfer set forth in the legend on the face of this VPTN and in the Indenture,
the transfer of this VPTN may be registered on the Note Register upon surrender
of this VPTN for registration of transfer at the office or agency designated by
the Issuer pursuant to the Indenture, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Indenture Trustee
duly executed by, the Noteholder hereof or such Noteholder's attorney duly
authorized in writing, with such signature guaranteed by an "eligible guarantor
institution" meeting the requirements of the Note Registrar, and thereupon one
or more new VPTNs of the same Class in authorized denominations and in the same
aggregate principal amount will be issued to the designated transferee or
transferees. No service charge will be charged for any registration of transfer
or exchange of this VPTN, but the transferor may be required to pay a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any such registration of transfer or exchange.

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

         Each Noteholder, by acceptance of a VPTN covenants and agrees by
accepting the benefits of the Indenture that such Noteholder will not at any
time institute against the Seller or the Issuer, or join in any institution
against the Seller or the Issuer of, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings under any United States
federal or State bankruptcy or similar law in connection with any obligations
relating to the Notes, the Indenture or the other Basic Documents.

                                     A-2-6                           (Indenture)
<PAGE>
         The Issuer has entered into the Indenture and this VPTN is issued with
the intention that, for federal, State and local income, and franchise tax
purposes, the VPTNs will qualify as indebtedness of the Issuer secured by the
Indenture Trust Estate. Each Noteholder, by its acceptance of a VPTN, will be
deemed to agree to treat the VPTNs for federal, State or local income, single
business and franchise tax purposes as indebtedness of the Issuer.

         Prior to the due presentment for registration of transfer of this VPTN,
the Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this VPTN (as of the day of
determination or as of such other date as may be specified in the Indenture) is
registered as the owner hereof for all purposes, whether or not this VPTN be
overdue, and none of the Issuer, the Indenture Trustee or any such agent shall
be affected by notice to the contrary.

         The Indenture permits (with certain exceptions requiring the consent of
all Noteholders adversely affected) the amendment thereof by the Issuer and the
Indenture Trustee without the consent of the Noteholders provided certain
conditions are satisfied. The Indenture also contains provisions permitting the
Noteholders of VPTNs evidencing specified percentages of the principal amount of
the Notes Outstanding or of the Controlling Class of Notes, on behalf of all
Noteholders, to waive compliance by the Issuer with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Noteholder of this VPTN shall be conclusive
and binding upon such Noteholder and upon all future Noteholders of this VPTN
and of any VPTN issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof whether or not notation of such consent or waiver is
made upon this VPTN.

         The term "Issuer", as used in this VPTN, includes any successor to the
Issuer under the Indenture.

         The Issuer is permitted by the Indenture, under certain circumstances,
to merge or consolidate, subject to the rights of the Indenture Trustee and the
Noteholders under the Indenture.

         The VPTNs are issuable only in registered form in denominations of
$100,000 and integral multiples of $1,000 thereof as provided in the Indenture,
subject to certain limitations therein set forth.

         This VPTN and the Indenture shall be governed by, and construed in
accordance with the laws of the State of New York, without reference to its
conflicts of law provisions.

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

         Anything herein to the contrary notwithstanding, except as expressly
provided in the Basic Documents, none of ______________, in its individual
capacity, _______________, in its individual capacity, any owner of a beneficial
interest in the Issuer, or any of their respective partners, beneficiaries,
agents, officers, directors, employees or successors or assigns shall be

                                     A-2-7                           (Indenture)
<PAGE>
personally liable for, nor shall recourse be had to any of them for, the payment
of principal or of interest on this VPTN or performance of, or omission to
perform, any of the covenants, obligations or indemnifications contained in the
Indenture. The Noteholder of this VPTN, by its acceptance hereof, agrees that,
except as expressly provided in the Basic Documents, in the case of an Event of
Default under the Indenture, the Noteholder shall have no claim against any of
the foregoing for any deficiency, loss or claim therefrom; provided, however,
that nothing contained herein shall be taken to prevent recourse to, and
enforcement against, the assets of the Issuer for any and all liabilities,
obligations and undertakings contained in the Indenture or in this VPTN.]

                                     A-2-8                           (Indenture)
<PAGE>
                                   ASSIGNMENT

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

    FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto:

                         (name and address of assignee)

the within VPTN and all rights thereunder, and hereby irrevocably constitutes
and appoints _______________, attorney, to transfer said VPTN on the books kept
for registration thereof, with full power of substitution in the premises.

Dated:                                                                */
        ---------------                    ---------------------------

                                           Signature Guaranteed

                                                                      */

*/       NOTICE: The signature to this assignment must correspond with the name
         of the registered owner as it appears on the face of the within VPTN in
         every particular, without alteration, enlargement or any change
         whatever. Such signature must be guaranteed by an "eligible guarantor
         institution" meeting the requirements of the Note Registrar.

                                     A-2-9                           (Indenture)<PAGE>
                                                                     EXHIBIT 4.3

                          SALE AND SERVICING AGREEMENT

                                      among

                  NISSAN AUTO RECEIVABLES ______-_ OWNER TRUST
                                   as Issuer,

                     NISSAN AUTO RECEIVABLES CORPORATION II,
                                   as Seller,

                                       and

                      NISSAN MOTOR ACCEPTANCE CORPORATION,
                                   as Servicer

                              Dated as of [_______]

<PAGE>

                                TABLE OF CONTENTS

<Table>
<S>                                                                                                 <C>
                                                             ARTICLE I

                                                            DEFINITIONS

SECTION 1.01      Definitions.......................................................................    1
SECTION 1.02      Usage of Terms...................................................................    21

                                                             ARTICLE II

                                                     CONVEYANCE OF RECEIVABLES

SECTION 2.01      Conveyance of Receivables........................................................    22
SECTION 2.02      Custody of Receivable Files......................................................    23

                                                            ARTICLE III

                                                          THE RECEIVABLES

SECTION 3.01      Representations and Warranties of the Seller with Respect to the Receivables ....    24
SECTION 3.02      Repurchase upon Breach ..........................................................    28
SECTION 3.03      Duties of Servicer as Custodian .................................................    29
SECTION 3.04      Instructions; Authority To Act ..................................................    29
SECTION 3.05      Custodian's Indemnification .....................................................    29
SECTION 3.06      Effective Period and Termination ................................................    30

                                                             ARTICLE IV

                                            ADMINISTRATION AND SERVICING OF RECEIVABLES

SECTION 4.01      Duties of Servicer ..............................................................    30
SECTION 4.02      Collection of Receivable Payments ...............................................    32
SECTION 4.03      Realization upon Receivables ....................................................    32
SECTION 4.04      Maintenance of Security Interests in Financed Vehicles ..........................    32
SECTION 4.05      Covenants of Servicer ...........................................................    32
SECTION 4.06      Purchase of Receivables upon Breach .............................................    33
SECTION 4.07      Servicing Fee and Expenses ......................................................    33
SECTION 4.08      Servicer's Certificate ..........................................................    34
SECTION 4.09      Annual Statement as to Compliance; Notice of Default ............................    34
SECTION 4.10      Annual Independent Certified Public Accountants' Report .........................    35
SECTION 4.11      Access to Certain Documentation and Information Regarding Receivables ...........    35
SECTION 4.12      Appointment of Subservicer ......................................................    36
SECTION 4.13      Amendments to Schedule of Receivables ...........................................    36
SECTION 4.14      Acknowledgement by Servicer of its Obligations under the Indenture ..............    36
</Table>

                                       i
<PAGE>

<Table>
<S>                                                                                                 <C>
                                                             ARTICLE V

                                             DISTRIBUTIONS; ACCOUNTS; STATEMENTS TO THE

                                               CERTIFICATEHOLDERS AND THE NOTEHOLDERS

SECTION 5.01      Establishment of Accounts .......................................................    36
SECTION 5.02      Collections .....................................................................    39
SECTION 5.03      Application of Collections ......................................................    40
SECTION 5.04      Advances ........................................................................    40
SECTION 5.05      Additional Deposits .............................................................    41
SECTION 5.06      Payments and Distributions ......................................................    42
SECTION 5.07      Reserve Account .................................................................    48
SECTION 5.08      [Yield Supplement Account .......................................................    50
SECTION 5.09      Statements to Certificateholders and Noteholders ................................    52
SECTION 5.10      Net Deposits ....................................................................    53
SECTION 5.11      [Swap Agreement .................................................................    54

                                                             ARTICLE VI

                                                             THE SELLER

SECTION 6.01      Representations of Seller .......................................................    54
SECTION 6.02      Additional Covenants of the Seller ..............................................    55
SECTION 6.03      Liability of Seller; Indemnities ................................................    58
SECTION 6.04      Merger or Consolidation of, or Assumption of the Obligations of, Seller .........    59
SECTION 6.05      Limitation on Liability of Seller and Others ....................................    59
SECTION 6.06      Seller May Own Certificates or Notes ............................................    60

                                                            ARTICLE VII

                                                            THE SERVICER

SECTION 7.01      Representations of Servicer .....................................................    60
SECTION 7.02      Indemnities of Servicer .........................................................    61
SECTION 7.03      Merger or Consolidation of, or Assumption of the Obligations of, Servicer .......    63
SECTION 7.04      Limitation on Liability of Servicer and Others ..................................    63
SECTION 7.05      NMAC Not To Resign as Servicer ..................................................    64

                                                            ARTICLE VIII

                                                              DEFAULT

SECTION 8.01      Servicer Default ................................................................    64
SECTION 8.02      Appointment of Successor ........................................................    66
SECTION 8.03      Repayment of Advances ...........................................................    67
SECTION 8.04      Notification ....................................................................    67
SECTION 8.05      Waiver of Past Defaults .........................................................    67
</Table>

                                       ii         (Sale and Servicing Agreement)
<PAGE>

<Table>
<S>                                                                                                 <C>
                                                             ARTICLE IX

                                                TERMINATION; RELEASE OF RECEIVABLES

SECTION 9.01      Optional Purchase of All Receivables ............................................    67
SECTION 9.02      Release of Receivables ..........................................................    68
SECTION 9.03      Termination .....................................................................    69

                                                             ARTICLE X

                                                           MISCELLANEOUS

SECTION 10.01      Amendment ......................................................................    69
SECTION 10.02      Protection of Title to Trust ...................................................    71
SECTION 10.03      Notices ........................................................................    73
SECTION 10.04      Assignment by the Seller or the Servicer .......................................    73
SECTION 10.05      Limitations on Rights of Others ................................................    73
SECTION 10.06      Severability ...................................................................    74
SECTION 10.07      Separate Counterparts ..........................................................    74
SECTION 10.08      Headings .......................................................................    74
SECTION 10.09      Governing Law ..................................................................    74
SECTION 10.10      Assignment by Issuer ...........................................................    74
SECTION 10.11      Nonpetition Covenants ..........................................................    74
SECTION 10.12      Limitation of Liability of Owner Trustee and Indenture Trustee .................    75
SECTION 10.13      Waivers ........................................................................    75

SCHEDULE A         Schedule of Receivables
SCHEDULE B         Location of the Receivable Files
EXHIBIT A          Form of Yield Supplement Agreement
</Table>

                                      iii         (Sale and Servicing Agreement)
<PAGE>

         SALE AND SERVICING AGREEMENT, dated as of [_______], among NISSAN AUTO
RECEIVABLES _____-_ OWNER TRUST, a Delaware statutory trust (the "Issuer"),
NISSAN AUTO RECEIVABLES CORPORATION II, a Delaware corporation (the "Seller"),
and NISSAN MOTOR ACCEPTANCE CORPORATION, a California corporation, in its
individual capacity (in such capacity, "NMAC") and as Servicer (in such
capacity, the "Servicer"). Capitalized terms used herein without definition
shall have the respective meanings assigned to such terms in Article I.

         WHEREAS, the Issuer desires to purchase a portfolio of receivables
arising in connection with retail installment sales contracts secured by new,
near-new or used automobiles and light-duty trucks generated by NMAC in the
ordinary course of business and sold to the Seller;

         WHEREAS, the Seller is willing to sell such receivables to the Issuer;
and

         WHEREAS, the Servicer is willing to service such receivables.

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

                                    ARTICLE I

                                   Definitions

         SECTION 1.01 Definitions. Except as otherwise provided in this
Agreement, whenever used herein, the following words and phrases, unless the
context otherwise requires, shall have the following respective meanings:

         "Accounts" means the Collection Account, the Yield Supplement Account
and the Reserve Account.

         ["Accumulation Account" is an account created pursuant to Section
5.01(e).]

         "Administration Agreement" means the Administration Agreement, dated as
of [_______], among the Administrator, the Issuer, the Indenture Trustee and the
Owner Trustee.

         "Administrative Purchase Payment" for any Administrative Receivable as
of the last day of any Collection Period, means the sum of the Principal Balance
thereof as of the beginning of such Collection Period plus interest accrued
thereon through the due date for the Obligor's payment in such Collection Period
at the related APR, after giving effect to the receipt of monies collected (from
whatever source other than the Advances) on such Administrative Receivable, if
any, during such Collection Period.

         "Administrative Receivable" means a Receivable purchased as of the
close of business on the last day of a Collection Period by the Servicer
pursuant to Section 4.06 or Section 9.01.

         "Administrator" means NMAC, or any successor Administrator under the
Administration Agreement.

                                       1          (Sale and Servicing Agreement)

<PAGE>

         "Advance" means the amount, as of the last day of a Collection Period,
that the Servicer is required to advance on the respective Receivable pursuant
to Section 5.04.

         "Affiliate" means, with respect to any specified Person, any other
Person controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control," when used with respect
to any specified Person, means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the term "controlling" and
"controlled" have meanings correlative to the foregoing.

         "Aggregate Certificateholders' Interest Distributable Amount" means,
with respect to any Distribution Date, the sum of the Certificateholders'
Interest Distributable Amount for all Classes of Certificates for such
Distribution Date.

         "Aggregate Noteholders' Interest Distributable Amount" means, with
respect to any Distribution Date, the sum of the Noteholders' Interest
Distributable Amount for all Classes of Notes with respect to such Distribution
Date.

         "Agreement" means this Sale and Servicing Agreement among Nissan Auto
Receivables [___-___] Owner Trust, as Issuer, NARC II, as Seller, and NMAC, as
Servicer.

         "AICPA" shall have the meaning assigned to such term in Section 4.10.

         "Allocable Principal" means, for any Distribution Date, an amount equal
to the excess, if any, of (i) the sum of the Outstanding Amount of the Notes and
the Certificate Balance as of the close of business on the immediately preceding
Distribution Date over (ii) the Pool Balance as of the end of the related
Collection Period [minus the Yield Supplement Purchase Price Adjustment Amount].

         "Amount Financed" with respect to any Receivable, means the amount
advanced under the Receivable toward the purchase price of the related Financed
Vehicle and any related costs, including but not limited to accessories,
insurance premiums, service and warranty contracts and other items customarily
financed as part of retail automobile and light-duty truck installment sale
contracts.

         "Annual Percentage Rate" or "APR" of a Receivable means the annual rate
of finance charges stated in such Receivable.

         "Annual USAP Report" shall have the meaning specified in Section 4.10.

         "Assignment" shall have the meaning assigned to such term in the
Purchase Agreement.

         "Available Amounts" means, with respect to any Distribution Date, the
sum of Available Interest and Available Principal for such Distribution Date.

         "Available Interest" means, for any Distribution Date, the sum of the
following amounts received during the related Collection Period: (i) that
portion of all collections on Receivables allocable to interest, (ii) without
duplication of amounts described in clause (i), Net Liquidation

                                       2         (Sale and Servicing Agreement)
<PAGE>

Proceeds to the extent allocable to interest due on a Liquidated Receivable in
accordance with the Servicer's customary servicing procedures, [and] (iii) all
Advances made by the Servicer pursuant to Section 5.04, (iv) without duplication
of any amounts described above in clauses (i) and (ii), the Administrative
Purchase Payment of each Receivable that became an Administrative Receivable
during the related Collection Period to the extent attributable to interest
thereon, (v) without duplication of any amounts described above in clauses (i)
and (ii), the Warranty Purchase Payment of each Receivable that became a
Warranty Receivable during the related Collection Period to the extent
attributable to interest thereon[, and (vi) the Yield Supplement Deposit plus
the sum of (x) reinvestment income on the Yield Supplement Account and (y) the
amount, if any, deposited into the Collection Account pursuant to the second or
third sentence of Section 5.08(b)]; provided, however, that in calculating
Available Interest, amounts to be paid to the Servicer as reimbursement for
Advances pursuant to Sections 5.06(c)(i), 5.06(c)(ii), 5.06(d)(i), 5.06(d)(ii),
5.06(e)(i) and 5.06(e)(ii) on such Distribution Date shall be excluded.

         "Available Principal" means, for any Distribution Date, the sum of the
following amounts received during the related Collection Period: (i) that
portion of all collections on Receivables attributable to principal, (ii)
without duplication of amounts described in clause (i), Net Liquidation Proceeds
attributable to principal due on a Liquidated Receivable in accordance with the
Servicer's customary servicing procedures, (iii) without duplication of any
amounts described above in clauses (i) and (ii), the Administrative Purchase
Payment of each Receivable that became an Administrative Receivable during the
related Collection Period to the extent attributable to principal, and (iv)
without duplication of any amounts described above in clauses (i) and (ii), the
Warranty Purchase Payment of each Receivable that became a Warranty Receivable
during the related Collection Period to the extent attributable to principal.

         "Bankruptcy Code" means the United States Bankruptcy Code, 11 U.S.C.
Section 101 et seq.

         "Base Servicing Fee" means the fee payable to the Servicer on each
Distribution Date for services rendered during the related Collection Period,
which shall be equal to one-twelfth of the Servicing Rate multiplied by the Pool
Balance as of the close of business on the last day of the immediately preceding
Collection Period or, with respect to the first Distribution Date, the Original
Pool Balance.

         "Basic Documents" means the Purchase Agreement, the Trust Agreement,
the Certificate of Trust, this Agreement, the Indenture, the Administration
Agreement, the Securities Account Control Agreement, [the Yield Supplement
Agreement,] the Note Depository Agreement, the Certificate Depository Agreement
and the other documents and certificates delivered in connection herewith and
therewith.

         "Business Day" means any day other than a Saturday, a Sunday or a day
on which banking institutions in New York, New York, Los Angeles, California,
Wilmington, Delaware or Minneapolis, Minnesota are authorized or obligated by
law, regulation, executive order or governmental decree to remain closed.

         "Certificate Balance" means, as of any Distribution Date and for each
Class of Certificates, the Original Certificate Balance of such Class, reduced
by all amounts distributed to the Certificateholders of such Class allocable to
principal pursuant to Section 5.06(c), (d) and/or

                                       3         (Sale and Servicing Agreement)

<PAGE>

(e) hereof (but in no event less than zero). When the term "Certificate Balance"
is not used in respect of any Class of Certificates, then it shall mean the sum
of the Certificate Balance of the Class C Certificates and the Class D
Certificates. For the purposes of determining whether the vote of the requisite
percentage of Certificateholders necessary to effect any consent, waiver,
request or demand shall have been obtained, the Certificate Balance shall be
deemed to be reduced by the amount equal to the balance (without giving effect
to this provision) evidenced by any Certificate registered in the name of the
Seller, the Servicer or any Person actually known to a Trust Officer of the
Owner Trustee or the Indenture Trustee, as the case may be, to be the Seller or
the Servicer or any of their Affiliates.

         ["Certificate Depository Agreement" means the agreement entitled
"Letter of Representations" dated on or before the Closing Date among the
Clearing Agency, the Trust and the Owner Trustee with respect to certain matters
relating to the duties thereof with respect to the Book-Entry Certificates.]

         "Certificate Factor" means, with respect to any Class of Certificates
and any Distribution Date, a seven-digit decimal figure obtained by dividing the
Certificate Balance of such Class of Certificates as of the close of business on
the last day of the related Collection Period by the Original Certificate
Balance of such Class of Certificates.

         "Certificate of Trust" shall have the meaning assigned to such term in
the Trust Agreement.

         "Certificate Pool Factor" means, with respect to any Class of
Certificates and any Distribution Date, a seven-digit decimal figure obtained by
dividing the Certificate Balance of such Class of Certificates as of the close
of business on the last day of the related Collection Period by the Original
Pool Balance.

         "Certificate Register" means the register maintained by the Certificate
Registrar pursuant to the Trust Agreement recording the names of the
Certificateholders.

         "Certificateholders" shall have the meaning assigned to such term in
the Trust Agreement.

         "Certificateholders' Interest Carryover Shortfall" means, with respect
to any Distribution Date and a Class of Certificates, the excess, if any, of the
sum of the Certificateholders' Monthly Interest Distributable Amount for such
Class for the preceding Distribution Date plus any outstanding
Certificateholders' Interest Carryover Shortfall for such Class on such
preceding Distribution Date, over the amount in respect of interest that is
actually paid on the Certificates of such Class on such preceding Distribution
Date, plus, to the extent permitted by applicable law, interest on the
Certificateholders' Interest Carryover Shortfall at the related Pass-Through
Rate for such Class for the related Interest Period.

         "Certificateholders' Interest Distributable Amount" means, with respect
to any Distribution Date and a Class of Certificates, the sum of the
Certificateholders' Monthly Interest Distributable Amount for such Class plus
any outstanding Certificateholders' Interest Carryover Shortfall for such Class
as of the close of the immediately preceding Distribution Date.

                                       4         (Sale and Servicing Agreement)
<PAGE>

         "Certificateholders' Monthly Interest Distributable Amount" means, with
respect to any Distribution Date and a Class of Certificates, interest accrued
for the related Interest Period at the related Pass-Through Rate for such Class
of Certificates on the Certificate Balance of such Class on the immediately
preceding Distribution Date, after giving effect to all payments of principal to
Certificateholders of such Class on or prior to such Distribution Date (or, in
the case of the first Distribution Date, on the Original Certificate Balance of
such Class of Certificates).

         "Certificateholders' Monthly Principal Distributable Amount" means,
with respect to any Distribution Date, the Certificateholders' Percentage of the
Allocable Principal for such Distribution Date.

         "Certificateholders' Percentage" means [for each Distribution Date,
100% minus the Noteholders' Percentage for such Distribution Date][(i) for each
Distribution Date until the Distribution Date on which the principal amount of
all of the Notes has been paid in full, 0%, (ii) for the Distribution Date on
which the principal amount of all the Notes has been paid in full, 100% minus
the sum of the Noteholders' Percentage and the Class D Certificateholders' Pro
Rata Percentage for such Distribution Date, (iii) for each Distribution Date
after the aggregate principal amount of all of the Notes has been paid in full
and until the Distribution Date on which the aggregate principal amount of all
of the Class C Certificates have been paid in full, 100% minus the Class D
Certificateholders' Pro Rata Percentage, and (iv) thereafter, 100%.

         "Certificateholders' Principal Carryover Shortfall" means, with respect
to any Distribution Date and a Class of Certificates, the excess, if any, of the
Certificateholders' Monthly Principal Distributable Amount for such Class plus
any outstanding Certificateholders' Principal Carryover Shortfall for such Class
for the preceding Distribution Date over the amount in respect of principal that
is actually distributed to the Certificateholders on such current Distribution
Date. Certificateholders' Principal Carryover Shortfall is not used to determine
the amount of principal due on such Class on any Distribution Date, but is used
solely for reporting purposes.

         "Certificateholders' Principal Distributable Amount" means, with
respect to any Distribution Date and a Class of Certificates, the sum of (i) the
Certificateholders' Monthly Principal Distributable Amount for such Distribution
Date, and (ii) on the Final Scheduled Distribution Date for such Class of
Certificates, if any, or upon the termination of the Trust, the amount necessary
to reduce the outstanding principal amount of such Class of Certificates to
zero; provided, however, that the Certificateholders' Principal Distributable
Amount with respect to a Class of Certificates shall not exceed the Certificate
Balance of such Class of Certificates.

         "Certificates" shall have the meaning assigned to such term in the
Trust Agreement.

         "Class" means any one of the classes of Notes or Certificates, as the
case may be.

         "Class A-1 Interest Rate" means [__]% per annum.

         "Class A-1 Note" means any of the [__]% Asset Backed Notes, Class A-1,
issued under the Indenture.

                                       5         (Sale and Servicing Agreement)
<PAGE>

         "Class A-1 Noteholder" means the Person in whose name a Class A-1 Note
is registered in the Note Register.

         "Class A-2 Interest Rate" means [__]% per annum.

         "Class A-2 Note" means any of the [__]% Asset Backed Notes, Class A-2,
issued under the Indenture.

         "Class A-2 Noteholder" means the Person in whose name a Class A-2 Note
is registered in the Note Register.

         "Class A-3 Interest Rate" means [__]% per annum.

         "Class A-3 Note" means any of the [__]% Asset Backed Notes, Class A-3,
issued under the Indenture.

         "Class A-3 Noteholder" means the Person in whose name a Class A-3 Note
is registered in the Note Register.

         "Class B Interest Rate" means [__]% per annum.

         "Class B Note" means any of the [__]% Asset Backed Notes, Class B,
issued under the Indenture.

         "Class B Noteholder" means the Person in whose name a Class B Note is
registered in the Note Register.

         "Class C Certificateholder" means the holder of any Class C Certificate
as evidenced by the Certificate Register.

         "Class C Pass-Through Rate" means [__]% per annum.

         "Class D Certificateholder" means the holder of any Class D Certificate
as evidenced by the Certificate Register.

         ["Class D Certificateholders' Pro Rata Monthly Principal Distributable
Amount" means, with respect to any Distribution Date, the Certificateholders'
Percentage of the Allocable Principal for such Distribution Date.]

         ["Class D Certificateholders' Pro Rata Percentage" means (i) for any
Distribution Date after the Class A-1 Notes are paid in full until the Class C
Certificates are paid in full, the percentage equivalent of a fraction, the
numerator of which is the aggregate of the principal balances of the Class D
Certificates as of the Closing Date, and the denominator of which is the
aggregate of the principal balances of the Class A-2, Class A-3 and Class B
Notes and the Certificates as of the Closing Date, except that following (a) the
cessation of delinquencies or chargeoffs exceeding Specified Levels or (b) the
rescission of an acceleration of the Notes after an Event of Default, the Class
D Certificateholders' Pro Rata Percentage for subsequent Distribution Dates is
0%, and (ii) thereafter, 0%.]

                                       6         (Sale and Servicing Agreement)
<PAGE>

         "Class D Pass-Through Rate" means [__]% per annum.

         "Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act.

         "Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.

         "Closing Date" means [_______].

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

         "Collection Period" means, with respect to any Distribution Date, the
preceding calendar month. Any amount stated "as of the close of business of the
last day of a Collection Period" shall give effect to the following calculations
as determined as of the end of the day on such last day: (i) all applications of
collections, (ii) all Advances and reductions of Outstanding Advances and (iii)
all distributions.

         "Controlling Class of Certificates" means, on any date of
determination, until the Class C Certificates have been paid in full, the Class
C Certificates, and thereafter, the Class D Certificates.

         "Controlling Class of Notes" means, on any date of determination, until
the Class A Notes have been paid in full, the Class A Notes, and thereafter, the
Class B Notes.

         "Corporate Trust Office" shall have the meaning assigned to such term
in the Indenture.

         "Cutoff Date" means [_______].

         "Damages" shall have the meaning assigned to such term in Section 7.02.

         "Dealer" means the dealer who sold a Financed Vehicle and who
originated and assigned the related Receivable to NMAC under an existing
agreement between such dealer and NMAC.

         "Dealer Recourse" means, with respect to a Receivable, all recourse
rights against the Dealer which originated the Receivable, and any successor
Dealer.

         "Default" shall have the meaning assigned to such term in the
Indenture.

         "Defaulted Receivable" means (a) a Receivable (other than an
Administrative Receivable or a Warranty Receivable), which, by its terms, is
delinquent for 120 or more days, (b) with respect to Receivables that are
delinquent for less than 120 days, the Servicer has (i) determined, in
accordance with its customary servicing procedures, that eventual payment in
full is unlikely or (ii) repossessed the Financed Vehicle, or (c) a Receivable
with respect to which the Servicer has received notification that the related
Obligor is subject to proceedings under Chapter 13 of the Bankruptcy Code.

                                       7         (Sale and Servicing Agreement)
<PAGE>

         "Definitive Certificates" and "Definitive Notes" shall have the
meanings ascribed thereto in the Trust Agreement and the Indenture,
respectively.

         "Determination Date" means the tenth calendar day of each calendar
month, or if such tenth day is not a Business Day, the next succeeding Business
Day.

         "Distribution Date" means, for each Collection Period, the 15th
calendar day of the following calendar month, or if the 15th day is not a
Business Day, the next succeeding Business Day, commencing [_______].

         "DTC" means The Depository Trust Company.

         "Eligible Deposit Account" means an account maintained (i) with the
Indenture Trustee or the Owner Trustee so long as the Indenture Trustee's or the
Owner Trustee's short-term unsecured debt obligations have a rating of "P-1" by
Moody's and a rating of "A-1+" by Standard & Poor's, and for any account in
which deposits in excess of 30 days are to be made, so long as the Indenture
Trustee's or the Owner Trustee's long-term unsecured debt obligations have a
rating of at least "AA-" by Standard & Poor's (such short-term and long-term (if
applicable) ratings being, the "Required Deposit Rating"), or (ii) in a
segregated trust account in the trust department of the Indenture Trustee or the
Owner Trustee, as the case may be. Notwithstanding anything to the contrary, as
of the Closing Date, the Indenture Trustee shall be deemed to have met the
requirements in clause (i).

         "Eligible Investments" means, at any time, any one or more of the
following obligations and securities:

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

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

                  (iii) commercial paper having, at the time of the investment
         or contractual commitment to invest therein, a rating from each of the
         Rating Agencies in the highest investment category granted thereby;

                  (iv) investments in money market funds having a rating from
         each of the Rating Agencies in the highest investment category granted
         thereby (including funds for which the Owner Trustee, the Indenture
         Trustee or any of their respective Affiliates is investment manager or
         advisor);

                                       8         (Sale and Servicing Agreement)
<PAGE>

                  (v) bankers' acceptances issued by any depository institution
         or trust company referred to in clause (ii) above;

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

                  (vii) repurchase obligations with respect to any security or
         whole loan, entered into with (a) a depository institution or trust
         company (acting as principal) described in clause (ii) above (except
         that the rating referred to in the proviso in such clause (ii) shall be
         "A-1" or higher in the case of Standard & Poor's) (such depository
         institution or trust company being referred to in this definition as a
         "financial institution"), (b) a broker/dealer (acting as principal)
         registered as a broker or dealer under Section 15 of the Exchange Act
         (a "broker/dealer"), the unsecured short-term debt obligations of which
         are rated "P-1" by Moody's and at least "A-1" by Standard & Poor's at
         the time of entering into such repurchase obligation (a "rated
         broker/dealer"), (c) an unrated broker/dealer (an "unrated
         broker/dealer"), acting as principal that is a wholly-owned subsidiary
         of a non-bank holding company the unsecured short-term debt obligations
         of which are rated "P-1" by Moody's and at least "A-1" by Standard &
         Poor's at the time of entering into such repurchase obligation (a
         "Rated Holding Company"), or (d) an unrated wholly-owned subsidiary of
         a direct or indirect parent Rated Holding Company, which guarantees
         such subsidiary's obligations under such repurchase agreement (a
         "Guaranteed Counterparty"); provided that the following conditions are
         satisfied:

                           (A) the aggregate amount of funds invested in
                  repurchase obligations of a financial institution, a rated
                  broker/dealer, an unrated broker/dealer or a Guaranteed
                  Counterparty in respect of which the unsecured short-term
                  ratings of Standard & Poor's are "A-1" (in the case of an
                  unrated broker/dealer or Guaranteed Counterparty, such rating
                  being that of the related Rated Holding Company) shall not
                  exceed 20% of the outstanding Pool Balance (there being no
                  limit on the amount of funds that may be invested in
                  repurchase obligations in respect of which such Standard &
                  Poor's rating is "A-1+" (in the case of an unrated
                  broker/dealer or Guaranteed Counterparty, such rating being
                  that of the related Rated Holding Company));

                           (B) in the case of the Reserve Account and the Yield
                  Supplement Account, the rating from Standard & Poor's in
                  respect of the unsecured short term debt obligations of the
                  financial institution, rated broker/dealer, unrated
                  broker/dealer or Guaranteed Counterparty (in the case of an
                  unrated broker/dealer or Guaranteed Counterparty, such rating
                  being that of the related Rated Holding Company) shall be
                  "A-1+";

                           (C) the repurchase obligation must mature within 30
                  days of the date on which the Indenture Trustee or the Owner
                  Trustee, as applicable, enters into such repurchase
                  obligation;

                                       9         (Sale and Servicing Agreement)
<PAGE>

                           (D) the repurchase obligation shall not be
                  subordinated to any other obligation of the related financial
                  institution, rated broker/dealer, unrated broker/dealer or
                  Guaranteed Counterparty;

                           (E) the collateral subject to the repurchase
                  obligation is held, in the appropriate form, by a custodial
                  bank on behalf of the Indenture Trustee or the Owner Trustee,
                  as applicable;

                           (F) the repurchase obligation shall require that the
                  collateral subject thereto shall be marked to market daily;

                           (G) in the case of a repurchase obligation of a
                  Guaranteed Counterparty, the following conditions shall also
                  be satisfied:

                                    (1) the Indenture Trustee or the Owner
                           Trustee, as applicable, shall have received an
                           Opinion of Counsel to the effect that the guarantee
                           of the related Rated Holding Company is a legal,
                           valid and binding agreement of the Rated Holding
                           Company, enforceable in accordance with its terms,
                           subject to the effect of bankruptcy, insolvency,
                           reorganization and moratorium or other similar laws
                           affecting creditors' rights generally and to general
                           equitable principles;

                                    (2) the Indenture Trustee or the Owner
                           Trustee, as applicable, shall have received (x) an
                           incumbency certificate for the signer of such
                           guarantee, certified by an officer of such Rated
                           Holding Company, and (y) a resolution, certified by
                           an officer of the Rated Holding Company, of the board
                           of directors (or applicable committee thereof) of the
                           Rated Holding Company authorizing the execution,
                           delivery and performance of such guarantee by the
                           Rated Holding Company;

                                    (3) the only conditions to the obligation of
                           such Rated Holding Company to pay on behalf of the
                           Guaranteed Counterparty shall be that the Guaranteed
                           Counterparty shall not have paid under such
                           repurchase obligation when required (it being
                           understood that no notice to, demand on or other
                           action in respect of the Guaranteed Counterparty is
                           necessary) and that the Indenture Trustee or the
                           Owner Trustee, as applicable, shall make a demand on
                           the Rated Holding Company to make the payment due
                           under such guarantee;

                                    (4) the guarantee of the Rated Holding
                           Company shall be irrevocable with respect to such
                           repurchase obligation and shall not be subordinated
                           to any other obligation of the Rated Holding Company;
                           and

                                    (5) each of the Rating Agencies has
                           confirmed in writing to the Indenture Trustee or the
                           Owner Trustee, as applicable, that it has reviewed
                           the form of the guarantee of the Rated Holding
                           Company and has determined that the issuance of such
                           guarantee will not result in the

                                       10         (Sale and Servicing Agreement)
<PAGE>

                           downgrade or withdrawal of the ratings assigned to
                           the Notes or the Class C Certificates; and

                          (H) the repurchase obligation shall require that the
                  repurchase obligation be overcollateralized and shall provide
                  that, upon any failure to maintain such overcollateralization,
                  the repurchase obligation shall become due and payable, and
                  unless the repurchase obligation is satisfied immediately, the
                  collateral subject to the repurchase agreement shall be
                  liquidated and the proceeds applied to satisfy the unsatisfied
                  portion of the repurchase obligation; and

                  (viii) any other investment with respect to which the Servicer
         has received written notification from the Rating Agencies that the
         acquisition of such investment as an Eligible Investment will not
         result in a withdrawal or downgrading of the ratings on the Notes or
         the Class C Certificates;

provided that, unless otherwise expressly stated herein, each of the foregoing
investments shall be denominated in U.S. dollars, shall not be purchased at a
premium, shall mature no later than the Business Day prior to the Distribution
Date immediately following the date of purchase, and shall be required to be
held to such maturity; and provided, further, that notwithstanding clauses (i)
through (viii) above, "Eligible Investments" shall not include any security
having an "r" subscript attached to its Standard & Poor's rating.

         For purposes of this definition, any reference to the highest available
credit rating of an obligation shall mean the highest available credit rating
for such obligation (excluding any "+" signs associated with such rating), or
such lower credit rating (as approved in writing by each Rating Agency) as will
not result in the qualification, downgrading or withdrawal of the rating then
assigned by such Rating Agency to any of the Notes.

         "Event of Default" shall have the meaning assigned to such term in the
Indenture.

         "Exchange Act" means the Securities Exchange Act of 1934.

         "Final Scheduled Distribution Date" means, with respect to the Class
A-1 Notes, the Distribution Date in [_______]; with respect to the Class A-2
Notes, the Distribution Date in [_______]; with respect to the Class A-3 Notes,
the Distribution Date in [_______]; with respect to the Class B Notes, the
Distribution Date in [_______]; with respect to the Class C Certificates, the
Distribution Date in [_______]; and with respect to the Class D Certificates,
the Distribution Date in [_______].

         "Financed Vehicle" means a new, near-new or used automobile or
light-duty truck, together with all accessions thereto, securing an Obligor's
indebtedness under the related Receivable.

         "Holder" or "Securityholder" means the registered holder of any
Certificate or Note as evidenced by the Certificate Register (as defined in the
Trust Agreement) or Note Register (as defined in the Indenture) except that,
solely for the purposes of giving certain consents, waivers, requests or demands
pursuant to the Trust Agreement or the Indenture, the interest evidenced by any
Certificate or Note registered in the name of NARC II or NMAC, or any Person
actually

                                       11        (Sale and Servicing Agreement)
<PAGE>

known to a Trust Officer to be an Affiliate of NARC II or NMAC, shall not be
taken into account in determining whether the requisite percentage necessary to
effect any such consent, waiver, request or demand shall have been obtained
unless NARC II or NMAC are the only holders.

         "Indenture" means the Indenture dated as of [_______], between the
Issuer and the Indenture Trustee.

         "Indenture Trustee" means the Person acting as Indenture Trustee under
the Indenture, its successors in interest and any successor trustee under the
Indenture.

         ["Initial Yield Supplement Amount" means $[_____________] [in cash]
[and other assets]].

         "Insolvency Event" means, with respect to a specified Person, (a) the
filing of a petition seeking entry of a decree or order for relief by a court
having jurisdiction in the premises in respect of such Person or all or
substantially all of its property in an involuntary case under any applicable
federal or state bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for all or substantially all
of its property, or ordering the winding-up or liquidation of such Person's
affairs, and such petition shall remain unstayed and in effect for a period of
90 consecutive days; or (b) the commencement by such Person of a voluntary case
under any applicable federal or state bankruptcy, insolvency or other similar
law now or hereafter in effect, or the consent by such Person to the entry of an
order for relief in an involuntary case under any such law, or the consent by
such Person to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official for
such Person or for all or substantially all of its property, or the making by
such Person of any general assignment for the benefit of creditors.

         "Interest Period" means, with respect to any Distribution Date and the
Class A-1 Notes, the period from (and including) the preceding Distribution Date
to (but excluding) such Distribution Date, except that the initial Interest
Period will be from (and including) the Closing Date to (but excluding)
[___________], and, with respect to any Distribution Date and the Class A-2
Notes, the Class A-3 Notes, the Class B Notes and the Certificates, the period
from (and including) the 15th day of the preceding calendar month to (but
excluding) the 15th day of the month in which such Distribution Date occurs,
except that the initial Interest Period will be from (and including) the Closing
Date to (but excluding) [__________].

         "Interest Rate" means the Class A-1 Interest Rate, the Class A-2
Interest Rate, the Class A-3 Interest Rate or the Class B Interest Rate.

         "Issuer" means Nissan Auto Receivables ____-_ Owner Trust, a Delaware
statutory trust.

         "Lien" means any security interest, lien, charge, pledge, equity or
encumbrance of any kind, other than, in the case of a Financed Vehicle, tax
liens, mechanics' liens and any liens that attach to such Financed Vehicle by
operation of law.

                                       12        (Sale and Servicing Agreement)
<PAGE>

         "Liquidated Receivable" means a Defaulted Receivable as to which the
related Financed Vehicle has been liquidated by the Servicer.

         "Monthly Remittance Conditions" shall have the meaning assigned to such
term in Section 5.02.

         "Moody's" means Moody's Investors Service, Inc.

         "NARC II" means Nissan Auto Receivables Corporation II, a Delaware
corporation.

         "Net Liquidation Proceeds" means the monies collected from whatever
source on a Liquidated Receivable, net of the sum of any amounts expended by the
Servicer for the account of the Obligor, plus any amounts required by law to be
remitted to the Obligor.

         "Nissan" means Nissan Motor Co., Ltd.

         "NMAC" means Nissan Motor Acceptance Corporation, a California
corporation.

         "Nonrecoverable Advance" means any Outstanding Advance with respect to
(i) any Defaulted Receivable or (ii) any Receivable as to which the Servicer
determines that any recovery from payments made on or with respect to such
Receivable is unlikely.

         "Note" means any one of the notes issued under the Indenture.

         "Note Depository Agreement" shall have the meaning assigned to such
term in the Indenture.

         "Note Factor" means, with respect to any Class of Notes and any
Distribution Date, a seven-digit decimal figure obtained by dividing the
Outstanding Amount of such Class of Notes, as of the close of business on the
last day of the related Collection Period, by the initial Outstanding Amount of
that Class of Notes.

         "Noteholder" shall have the meaning assigned to such term in the
Indenture.

         "Noteholders' Distributable Amount" means, with respect to any
Distribution Date, the Aggregate Noteholders' Interest Distributable Amount with
respect to such Distribution Date plus the Noteholders' Principal Distributable
Amount with respect to such Distribution Date for the most senior Class of
Notes.

         "Noteholders' Interest Carryover Shortfall" means, with respect to any
Distribution Date and a Class of Notes, the excess, if any, of the sum of the
Noteholders' Monthly Interest Distributable Amount for such Class for the
preceding Distribution Date plus any outstanding Noteholders' Interest Carryover
Shortfall for such Class on such preceding Distribution Date, over the amount in
respect of interest that is actually paid on the Notes of such Class on such
preceding Distribution Date, plus, to the extent permitted by applicable law,
interest on the Noteholders' Interest Carryover Shortfall at the related
Interest Rate for the related Interest Period (calculated on the same basis as
interest on that Class of Notes for the same period).

                                       13        (Sale and Servicing Agreement)
<PAGE>

         "Noteholders' Interest Distributable Amount" means, with respect to any
Distribution Date and a Class of Notes, the sum of the Noteholders' Monthly
Interest Distributable Amount for such Class plus any outstanding Noteholders'
Interest Carryover Shortfall for such Class as of the close of the immediately
preceding Distribution Date.

         "Noteholders' Monthly Interest Distributable Amount" means, with
respect to any Distribution Date and a Class of Notes, interest accrued for the
related Interest Period (calculated on the basis of, in the case of Class A-1
Notes, the actual number of days in such Interest Period and a year assumed to
consist of 360 days, and in the case of all other Classes of Notes, such
Interest Period being assumed to consist of 30 days and a year assumed to
consist of 360 days) at the related Interest Rate for such Class of Notes on the
Outstanding Amount of the Notes of such Class on the immediately preceding
Distribution Date, after giving effect to all payments of principal to
Noteholders of such Class on or prior to such Distribution Date (or, in the case
of the first Distribution Date, on the original principal amount of such Class
of Notes).

         "Noteholders' Monthly Principal Distributable Amount" means, with
respect to any Distribution Date, the Noteholders' Percentage of the Allocable
Principal for such Distribution Date.

         "Noteholders' Percentage" means (i) for each Distribution Date until
the Distribution Date on which the aggregate principal amount of all of the
Notes has been paid in full, 100% [minus the Class D Certificateholders' Pro
Rata Percentage]; (ii) for the Distribution Date on which the Notes have been
paid in full, the percentage of Allocable Principal required to pay all of the
Notes in full; and (iii) thereafter, 0%.

         "Noteholders' Principal Carryover Shortfall" means, with respect to any
Distribution Date and a Class of Notes, the excess, if any, of the Noteholders'
Monthly Principal Distributable Amount for such Class for the preceding
Distribution Date over the amount in respect of principal that is actually paid
as principal on such Class on such current Distribution Date. Noteholders'
Principal Carryover Shortfall is not used to determine the amount of principal
due on such Class on any Distribution Date, but is used solely for reporting
purposes.

         "Noteholders' Principal Distributable Amount" means, with respect to
any Distribution Date and a Class of Notes, the sum of (i) the Noteholders'
Monthly Principal Distributable Amount for such Distribution Date, and (ii) on
the Final Scheduled Distribution Date for such Class of Notes, the amount
necessary to reduce the outstanding principal amount of such Class of Notes to
zero; provided, however, that the Noteholders' Principal Distributable Amount
with respect to a Class of Notes shall not exceed the Outstanding Amount of such
Class of Notes.

         "Note Owner" shall have the meaning assigned to such term in the
Indenture.

         "Note Pool Factor" means, with respect to any Class of Notes and any
Distribution Date, a seven-digit decimal figure obtained by dividing the
Outstanding Amount of such Class of Notes as of the close of business on the
last day of the related Collection Period by the Original Pool Balance.

         "Note Register" means the register maintained by the Indenture Trustee
pursuant to the Indenture recording the name of each Noteholder.

                                       14        (Sale and Servicing Agreement)
<PAGE>

         "Notes" means the Class A-1 Notes, the Class A-2 Notes, the Class A-3
Notes and the Class B Notes.

         "Obligor" on a Receivable means the purchaser or co-purchasers of the
Financed Vehicle or any other Person who owes payments under the Receivable (but
excluding any Dealer in respect of Dealer Recourse).

         "Officer's Certificate" means a certificate signed by the chairman of
the board, the president, any executive vice president, any vice president, the
treasurer, any assistant treasurer or the controller of the Seller or the
Servicer, as the case may be.

         "Opinion of Counsel" means one or more written opinions of counsel who
may, except as otherwise provided herein, be an employee of or counsel to the
Issuer, the Seller or the Servicer, which counsel shall be reasonably acceptable
to the Indenture Trustee, the Owner Trustee or the Rating Agencies, as the case
may be.

         "Optional Purchase" shall have the meaning assigned to such term in
Section 9.01(a).

         "Optional Purchase Percentage" means [5.00%].

         "Optional Purchase Price" means an amount equal to the aggregate
Administrative Purchase Payments for the Receivables (including Receivables that
became Defaulted Receivables in the Collection Period preceding the Distribution
Date on which a purchase pursuant to Section 9.01 is effected), plus the
appraised value of any other property held by the Trust, such value to be
determined by an appraiser mutually agreed upon by the Servicer and the
Indenture Trustee (less liquidation expenses); provided, however, that the
Optional Purchase Price shall be equal to or greater than the sum of (i) the
Outstanding Amount of all Classes of Notes, (ii) the Noteholders' Interest
Distributable Amount for all Classes of Notes for such Distribution Date, (iii)
the Certificate Balance of the Class C Certificates, and (iv) the
Certificateholders' Interest Distributable Amount of the Class C Certificates
for such Distribution Date.

         "Original Certificate Balance" means $[_________] for the Class C
Certificates and $[_________] for the Class D Certificates.

         "Original Pool Balance" means the aggregate Principal Balance of the
Receivables on the Cutoff Date.

         "Original Principal Amount" means $[_________] for the Class A-1 Notes,
[_________] for the Class A-2 Notes, $[_________] for the Class A-3 Notes and
$[_________] for the Class B Notes.

         "Outstanding" shall have the meaning assigned to that term in the
Indenture.

         "Outstanding Advances" means, with respect to a Receivable and the last
day of a Collection Period, the sum of all Advances made as of or prior to such
date, minus all payments or collections as of or prior to such date that are
specified in Sections 5.04(b) and 5.04(d) as applied to reimburse all unpaid
Advances with respect to such Receivable.

                                       15        (Sale and Servicing Agreement)
<PAGE>

         "Outstanding Amount" means the aggregate principal amount of all Notes,
or, if indicated by the context, all Notes of any Class, Outstanding at the date
of determination.

         "Owner Trust Estate" means all right, title and interest of the Trust
in and to the Receivables (other than the Warranty Receivables for which the
Seller has paid the Warranty Purchase Payment in accordance with Section 3.02
and Administrative Receivables for which the Servicer has paid the
Administrative Purchase Payment in accordance with Section 4.06), and all monies
paid thereon, and all monies accrued thereon, after the Cutoff Date; security
interests in the Financed Vehicles and any accessions thereto; the Collection
Account and all funds deposited in the Collection Account; [the Yield Supplement
Account and all funds deposited in the Yield Supplement Account;] all property
(including the right to receive Net Liquidation Proceeds) that shall have
secured a Receivable and that shall have been acquired by or on behalf of the
Owner Trustee; proceeds from claims on any physical damage, credit life or
disability insurance policies covering the Financed Vehicles or the Obligors;
all right to receive payments in respect of any Dealer Recourse with respect to
the Receivables; all right, title and interest of the Seller in and to the
Purchase Agreement and the Assignment; all right, title and interest of the
Owner Trustee and the Trust pursuant to this Agreement [, the Yield Supplement
Agreement] and the Administration Agreement; certain rebates of premiums and
other amounts relating to certain insurance policies and other items financed
under the Receivables in effect as of the Cutoff Date; and the proceeds of any
and all of the foregoing.

         "Owner Trustee" means the Person acting as Owner Trustee under the
Trust Agreement, its successors in interest and any successor owner trustee
under the Trust Agreement.

         "Pass-Through Rate" means the Class C Pass-Through Rate or the Class D
Pass-Through Rate.

         "Paying Agent" shall have the meaning assigned to such term in the
Indenture.

         "Person" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.

         "Pool Balance" as of the close of business on the last day of a
Collection Period means the aggregate Principal Balance of the Receivables
(reduced by the principal balance of any Administrative Receivables, Warranty
Receivables and Defaulted Receivables) as of the close of business on such day;
provided, however, that where the Pool Balance is relevant in determining
whether the requisite percentage of Certificateholders or Noteholders (or
relevant Class or Classes of Certificates or Notes, as the case may be)
necessary to effect any consent, waiver, request or demand shall have been
obtained, the Pool Balance shall be deemed to be reduced by the amount equal to
the portion of the Pool Balance (before giving effect to this provision)
represented by the interests evidenced by any applicable Certificate or Note
registered in the name of the Seller, the Servicer or any Person actually known
to a Trust Officer of the Owner Trustee or the Indenture Trustee, as the case
may be, to be an Affiliate of the Seller or the Servicer, unless all of the
Certificates or Notes, as the case may be, are held or beneficially owned by
NMAC, NARC II or any of their Affiliates.

                                       16        (Sale and Servicing Agreement)
<PAGE>

         "Pool Factor" for a particular Class of Notes or Certificates on any
Distribution Date means a seven-digit decimal figure indicating the principal
amount of such Class of Notes or the Certificate Balance of such Class of
Certificates, as the case may be, as of the close of business on the last day of
the related Collection Period as a fraction of the Original Pool Balance.

         "Prepayment" means, with respect to any Receivable, any prepayment,
whether in part or in full, in respect of such Receivable.

         "Principal Balance" of a Receivable, as of any date of determination,
means the Amount Financed minus the sum of (i) all payments on such Receivable
allocable to principal, (ii) any refunded portion of extended warranty
protection plan or service contract costs, or of physical damage, credit life or
disability insurance premiums included in the Amount Financed, (iii) any payment
of the Administrative Purchase Payment or the Warranty Purchase Payment with
respect to the Receivable allocable to principal and (iv) any Net Liquidation
Proceeds allocable to principal.

         "Purchase Agreement" means that certain agreement, dated as of
[______________], between NMAC and the Seller, relating to the purchase by the
Seller from NMAC of the Receivables.

         "Rating Agency" means, as of any date, any of the nationally recognized
statistical rating organizations that has been requested by the Seller or one of
its Affiliates to rate any Class of Certificates or Notes and that is rating
such Class of Certificates or Notes, as the case may be, on such date.

         "Receivable" means any retail installment sale contract that appears on
Schedule A to this Agreement (which Schedule A may be in the form of microfiche,
CD, datatape or paper) and that has not been released by the Owner Trustee from
the Trust.

         "Receivable File" means the documents specified in Section 2.02
pertaining to a particular Receivable.

         "Record Date" means, with respect to the Notes or Certificates of any
Class and each Distribution Date, the 14th day of the calendar month in which
such Distribution Date occurs, or, if Definitive Notes representing any Class of
Notes or Definitive Certificates representing any Class of Certificates have
been issued, the last day of the Collection Period preceding the related
Distribution Date. Any amount stated "as of a Record Date" or "on a Record Date"
shall give effect to (i) all applications of collections, and (ii) all
distributions to any party under this Agreement, the Indenture and the Trust
Agreement or to the related Obligor, as the case may be, in each case as
determined as of the opening of business on the related Record Date.

         "Relevant Trustee" means (i) with respect to the control over or
appropriate designation denoting ownership or control over any property
comprising a portion of the Owner Trust Estate that either is not conveyed or
pledged to the Indenture Trustee for the benefit of the Noteholders pursuant to
the Granting Clause of the Indenture or that has been released from the lien of
the Indenture, the Owner Trustee, and (ii) with respect to any property
comprising a portion of the Trust Estate (as defined in the Indenture) that has
not been released from the lien of the Indenture, the Indenture Trustee;
provided, however, that with respect to any property that is

                                       17        (Sale and Servicing Agreement)
<PAGE>

under the joint or separate control of a co-trustee or separate trustee under
the Trust Agreement or the Indenture, respectively, "Relevant Trustee" shall
refer to either or both of the Owner Trustee and such co-trustee or separate
trustee or to either or both of the Indenture Trustee and such co-trustee or
separate trustee, as the case may be.

         "Required Deposit Rating" shall have the meaning assigned to such term
in the definition of "Eligible Deposit Account."

         ["Required Rate" means, with respect to each Collection Period, the sum
of (1) the [Class B Interest Rate] [weighted average Interest Rate of the Notes
and the Class C Pass-Through Rate] and (2) the Servicing Rate.]

         ["Required Yield Supplement Amount" means, with respect to every
Distribution Date, an amount equal to the lesser of (i) the aggregate amount of
Yield Supplement Deposits that would become due for all future Distribution
Dates under the Yield Supplement Agreement, assuming (1) that payments on the
Receivables are made on their scheduled due dates, (2) that no Receivable
becomes a prepaid Receivable, and (3) a discount rate of [___]%, and (ii) the
Initial Yield Supplement Amount.]

         "Reserve Account" means the account designated as such, established and
maintained pursuant to Section 5.07.

         "Reserve Account Initial Deposit" means $[_______].

         "Schedule of Receivables" means the schedule of receivables attached as
Schedule A to this Agreement, as it may be amended from time to time.

         "Scheduled Payment" on a Receivable means the payment required to be
made by the Obligor during each Collection Period that is sufficient to amortize
the related Principal Balance under the Simple Interest Method over the term of
the Receivable and to provide interest at the related APR.

         "Securities Account Control Agreement" means the Securities Account
Control Agreement, dated as of [__________], among the Seller, [___________], as
Securities Intermediary thereunder, [__________], as Indenture Trustee, and
[___________], as Owner Trustee, pursuant to which the Reserve Account and the
Yield Supplement Account will be established and maintained.

         "Securities Intermediary" shall have the meaning assigned to such term
in the Securities Account Control Agreement.

         "Securityholders" has the meaning set forth in this Section 1.01 under
the definition of "Holder."

         "Seller" means NARC II, as the seller of the Receivables under this
Agreement, and each successor to NARC II (in the same capacity) pursuant to
Section 6.04.

                                       18        (Sale and Servicing Agreement)
<PAGE>

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

         "Servicer Default" means an event specified in Section 8.01.

         "Servicer's Certificate" means a certificate completed and executed on
behalf of the Servicer by the president, any executive vice president, any vice
president, the treasurer, any assistant treasurer, the controller or any
assistant controller of the Servicer pursuant to Section 4.08.

         "Servicing Rate" means 1.00% per annum.

         "Simple Interest Method" means the method of allocating a fixed level
payment to principal and interest pursuant to which the portion of such payment
that is allocated to interest is equal to the product of the fixed rate of
interest multiplied by the unpaid principal balance multiplied by the quotient
obtained by calculating the period of time elapsed since the preceding payment
of interest was made and dividing such period of time by 365 or 366, as
appropriate.

         "Simple Interest Receivable" means any Receivable under which the
portion of a payment allocable to interest and the portion allocable to
principal is determined in accordance with the Simple Interest Method.

         ["Specified Levels" means (as it relates to an event that has the
effect of changing priorities of certain payments and the applicable
Noteholders' Percentage and Certificateholders' Percentage) the occurrence, on
any Distribution Date, of (i) the annualized average for the preceding three
Collection Periods (or such smaller number of Collection Periods as have elapsed
since the Cut-off Date) of the percentage equivalents of the ratios of net
losses (i.e., the net balances of all Liquidated Receivables, less any Net
Liquidation Proceeds with respect to such Liquidated Receivables from that or
prior Collection Periods) to the Pool Balance as of the first day of each such
Collection Period exceeds [__]% or (ii) the average for the preceding three
Collection Periods (or such smaller number of Collection Periods as have elapsed
since the Cut-off Date) of the percentage equivalents of the ratios of the
number of Receivables that are delinquent 60 days or more to the outstanding
number of Receivables exceeds [__]%.]

         "Specified Reserve Account Balance" means initially $[________]with
respect to any Distribution Date, [and thereafter will be the lesser of
$[________] and the outstanding principal balances of the Notes and the
Certificates][, provided, however, that in the event that on any Distribution
Date (i) the annualized average for the preceding three Collection Periods (or
such smaller number of Collection Periods as have elapsed since the Cutoff Date)
of the percentage equivalents of the ratios of net losses (i.e., the net
balances of all Liquidated Receivables, less any Net Liquidation Proceeds with
respect to such Liquidated Receivables from that or prior Collection Periods) to
the Pool Balance as of the first day of each such Collection Period exceeds
[__]% or (ii) the average for the preceding three Collection Periods (or such
smaller number of Collection Periods as have elapsed since the Cutoff Date) of
the percentage equivalents of the ratios of the number of Receivables that are
delinquent 60 days or more to the outstanding number of Receivables exceeds
[__]%, then the Specified Reserve Account Balance for such Distribution Date
(and for each succeeding Distribution Date until the relevant averages have not

                                       19        (Sale and Servicing Agreement)
<PAGE>

exceeded the specified percentages in clauses (i) and (ii) above for three
successive Distribution Dates) shall be a dollar amount equal to the greater of
(i) $[__________] and (ii) [ ]% of the Outstanding Amount of the Notes and the
Certificate Balance as of the preceding Distribution Date (after giving effect
to payments of principal made on such Distribution Date)].

         "Standard & Poor's" means Standard & Poor's, a division of The
McGraw-Hill Companies, Inc.

         "Successor Servicer" means any entity appointed as a successor to the
Servicer pursuant to Section 8.02.

         "Supplemental Servicing Fee" means, with respect to any Distribution
Date, all late fees, prepayment charges and other administrative fees and
expenses or similar charges allowed by applicable law with respect to the
Receivables received by the Servicer during the related Collection Period and
any interest earned from the investment of monies in the Accounts (other than
the Yield Supplement Account) during the related Collection Period.

         ["Swap Agreement" shall mean any currency swap agreement, including all
schedules and confirmations thereto, entered into by the Issuer and the Swap
Counterparty.]

         ["Swap Counterparty" shall mean an unaffiliated third party, as swap
counterparty under the Swap Agreement.]

         "Total Servicing Fee" means the sum of the Base Servicing Fee and the
Supplemental Servicing Fee.

         "Trust" means the Issuer.

         "Trust Agreement" means the Amended and Restated Trust Agreement, dated
as of [_______], between the Seller and the Owner Trustee.

         "Trust Collection Account" shall have the meaning assigned to such term
in Section 5.01(c).

         "Trust Estate" means all money, instruments, rights and other property
that are subject or intended to be subject to the lien and security interest of
the Indenture for the benefit of the Noteholders (including, without limitation,
all property and interests granted to the Indenture Trustee pursuant to the
Granting Clause of the Indenture), including all proceeds thereof.

         "Trust Officer" means, in the case of the Indenture Trustee, any
officer within the Corporate Trust Office of the Indenture Trustee, including
any Vice President, Assistant Vice President, Secretary, Assistant Secretary or
any other officer of the Indenture Trustee customarily performing functions
similar to those performed by any of the above designated officers and also,
with respect to a particular matter, any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject and, with respect to the Owner Trustee, any officer in the
Corporate Trust Administration Department of the Owner Trustee with direct
responsibility for the administration of the Trust Agreement and the Basic
Documents on behalf of the Owner Trustee.

                                       20        (Sale and Servicing Agreement)
<PAGE>

         "UCC" means the Uniform Commercial Code as in effect in the relevant
jurisdiction.

         "USAP" shall have the meaning assigned to such term in Section 4.10.

         ["VPTN Proceeds Account" is an account created pursuant to Section
5.01(f).]

         "Warranty Purchase Payment" for any Warranty Receivable as of the last
day of any Collection Period means the sum of the Principal Balance thereof as
of the beginning of such Collection Period plus interest accrued thereon through
the due date for the Obligor's payment in such Collection Period, at the related
APR, after giving effect to the receipt of monies collected (from whatever
source other than Advances) on such Warranty Receivable, if any, during such
Collection Period.

         "Warranty Receivable" means a Receivable purchased as of the close of
business on the last day of a Collection Period by the Seller pursuant to
Section 3.02.

         ["Yield Supplement Purchase Price Adjustment Amount" means, with
respect to any Distribution Date, the amount specified below with respect to
that Distribution Date:

                                 [INSERT TABLE]

         ["Yield Supplement Account" means the segregated trust account
established and maintained for the benefit of the Noteholders and the Class C
Certificateholders pursuant to Section 5.08(a).]

         ["Yield Supplement Agreement" means that certain agreement, dated as of
[______________], among the Seller, NMAC, the Indenture Trustee and the Trust,
substantially in the form attached hereto as Exhibit A.]

         ["Yield Supplement Amount" means, with respect to any Distribution
Date, the aggregate amount on deposit in the Yield Supplement Account after
giving effect to the withdrawal therefrom of the related Yield Supplement
Deposit and without regard to any amounts on deposit therein in respect of
interest or investment earnings earned on the investment of amounts on deposit
therein in Eligible Investments for any period.]

         ["Yield Supplement Deposit" means, with respect to any Distribution
Date, the amount by which (a) the aggregate amount of interest that would have
been due during the related Collection Period on all Yield Supplemented
Receivables if such Yield Supplemented Receivables bore interest at the Required
Rate exceeds (b) the amount of interest accrued on such Yield Supplemented
Receivables at their respective APRs and due during such Collection Period.]

         ["Yield Supplemented Receivable" means any Receivable that has an APR
less than the Required Rate.]

         SECTION 1.02 Usage of Terms. With respect to all terms in this
Agreement, the singular includes the plural and the plural the singular; words
importing any gender include the other genders; references to "writing" include
printing, typing, lithography and other means of

                                       21        (Sale and Servicing Agreement)
<PAGE>

reproducing words in a visible form; references to agreements and other
contractual instruments include all subsequent amendments, amendments and
restatements and supplements thereto or changes therein entered into in
accordance with their respective terms and not prohibited by this Agreement;
references to Persons include their permitted successors and assigns; references
to laws include their amendments and supplements, the rules and regulations
thereunder and any successors thereto; and the term "including" means "including
without limitation."

                                   ARTICLE II

                            Conveyance of Receivables

         SECTION 2.01 Conveyance of Receivables.

                  (a) In consideration of the promises and the agreements,
         provisions and covenants herein contained and other good and valuable
         consideration to be delivered to the Seller hereunder, on behalf of the
         Issuer, the Seller does hereby sell, transfer, assign and otherwise
         convey to the Issuer, without recourse (but subject to the Seller's
         obligations in this Agreement):

                           (i) all right, title and interest of the Seller in
         and to the Receivables (including all related Receivable Files) listed
         in Schedule A hereto and all monies due thereon or paid thereunder or
         in respect thereof (including proceeds of the repurchase of Receivables
         by the Seller pursuant to Section 3.02 or the purchase of Receivables
         by the Servicer pursuant to Section 4.06 or 9.01) after the Cutoff
         Date;

                           (ii) the right of the Seller in the security
         interests in the Financed Vehicles granted by the Obligors pursuant to
         the Receivables and any related property;

                           (iii) the right of the Seller in any proceeds from
         claims on any physical damage, credit life, credit disability or other
         insurance policies covering the Financed Vehicles or the Obligors;

                           (iv) the right of the Seller through NMAC to receive
         payments in respect of any Dealer Recourse with respect to the
         Receivables;

                           (v) the rights of the Seller under the Purchase
         Agreement and the Assignment;

                           (vi) the right of the Seller to realize upon any
         property (including the right to receive future Net Liquidation
         Proceeds) that shall have secured a Receivable;

                           (vii) the right of the Seller in rebates of premiums
         and other amounts relating to insurance policies and other items
         financed under the Receivables in effect as of the Cutoff Date;

                           (viii) all other assets comprising the Owner Trust
         Estate; and

                           (ix) all proceeds of the foregoing.

                                       22        (Sale and Servicing Agreement)
<PAGE>

                  On the Closing Date, the Seller shall deliver to, or to the
order of, the Issuer all property conveyed pursuant to this Section 2.01(a),
except for monies received in respect of the Receivables after the Cutoff Date
and before the Closing Date which shall be deposited by NMAC (in its individual
capacity or as the Servicer) into the Collection Account no later than the first
Record Date after the Closing Date. Concurrently therewith and in exchange
therefor, the Issuer shall deliver to, or to the order of, the Seller the Notes
and the Certificates.

                  (b) It is the intention of the Seller that the transfer and
         assignment contemplated by this Agreement shall constitute a sale of
         the Receivables from the Seller to the Issuer and the beneficial
         interest in and title to the Receivables shall not be part of the
         Seller's estate in the event of the filing of a bankruptcy petition by
         or against the Seller under any bankruptcy law. The Seller agrees to
         execute and file all filings (including filings under the UCC)
         necessary in any jurisdiction to provide third parties with notice of
         the sale of the Receivables pursuant to this Agreement and to perfect
         such sale under the UCC.

                  (c) Although the parties hereto intend that the transfer and
         assignment contemplated by this Agreement be a sale, if such transfer
         and assignment is deemed to be other than a sale, the parties intend
         that all filings described in the foregoing paragraph shall give the
         Issuer a first priority perfected security interest in, to and under
         the Receivables, and other property conveyed hereunder and all proceeds
         of any of the foregoing. This Agreement shall be deemed to be the grant
         of a security interest from the Seller to the Issuer, and the Issuer
         shall have all the rights, powers and privileges of a secured party
         under the UCC.

                  (d) In connection with the foregoing conveyance, the Servicer
         shall maintain its computer system so that, from and after the time of
         sale of the Receivables to the Issuer under this Agreement, the
         Servicer's master computer records that refer to any Receivable
         indicate clearly the interest of the Issuer in such Receivables and
         that such Receivable is owned by the Issuer and controlled by the
         Issuer. Indication of the Issuer's ownership of a Receivable shall be
         deleted from or modified on the Servicer's computer systems when, and
         only when, the Receivable has been paid in full, repurchased or
         assigned pursuant to this Agreement.

                  (e) Ownership and control of the Receivables, as between the
         Issuer and the Indenture Trustee (on behalf of the Noteholders and the
         Certificateholders) shall be governed by the Indenture.

         SECTION 2.02 Custody of Receivable Files. To assure uniform quality in
servicing the Receivables and to reduce administrative costs, the Issuer, upon
the execution and delivery of this Agreement, appoints the Servicer, and the
Servicer accepts such appointment, to act as the agent of the Issuer as
custodian of the following documents or instruments that are hereby
constructively delivered to the Issuer with respect to each Receivable:

                  (a) the original of such Receivable (or a photocopy or other
         image thereof that the Servicer shall keep on file in accordance with
         its customary procedures) fully executed by the Obligor;

                                       23        (Sale and Servicing Agreement)
<PAGE>

                  (b) the original credit application fully executed by the
         related Obligor (or a photocopy or other image thereof that the
         Servicer shall keep on file in accordance with its customary
         procedures);

                  (c) the original certificate of title (or a photocopy or other
         image thereof or such documents that the Servicer shall keep on file in
         accordance with its customary procedures), evidencing the security
         interest of the Servicer in the related Financed Vehicle; and

                  (d) any and all other documents that the Servicer shall keep
         on file, in accordance with its customary procedures, relating to such
         Receivable, the related Obligor or Financed Vehicle.

         SECTION 2.03 Acceptance by Issuer. The Issuer acknowledges its
acceptance pursuant to this Agreement, of all right, title and interest in and
to the Receivables and other property conveyed by the Seller pursuant to this
Agreement and declares and shall declare from and after the date hereof that the
Issuer holds and shall hold such right, title and interest, upon the terms and
conditions set forth in this Agreement.

                                  ARTICLE III

                                 The Receivables

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

                  (a) Characteristics of Receivables. Each Receivable (i) has
         been originated in the United States of America by a Dealer for the
         retail sale of a Financed Vehicle in the ordinary course of such
         Dealer's business, has been fully and properly executed by the parties
         thereto, has been purchased by the Seller from NMAC pursuant to the
         Purchase Agreement, which in turn has purchased such Receivables from
         such Dealer under an existing dealer agreement with NMAC, and has been
         validly assigned by such Dealer to NMAC, which in turn has been validly
         assigned pursuant to the Purchase Agreement by NMAC to the Seller in
         accordance with its terms, (ii) created a valid, subsisting and
         enforceable security interest in favor of NMAC in such Financed
         Vehicle, which security interest has been validly assigned pursuant to
         the Purchase Agreement by NMAC to the Seller, which in turn has been
         validly assigned by the Seller to the Issuer in accordance with the
         terms hereof, (iii) contains customary and enforceable provisions such
         that the rights and remedies of the holder thereof are adequate for
         realization against the collateral of the benefits of the security,
         (iv) provides for level monthly payments (provided that the payment in
         the first or last month in the life of the Receivable may be minimally
         different from the level payment) that fully amortize the Amount
         Financed over an original term of no greater than [___] months, and (v)
         provides for interest at the related APR.

                                       24        (Sale and Servicing Agreement)
<PAGE>

                  (b) Schedule of Receivables. The information set forth in
         Schedule A to this Agreement was true and correct in all material
         respects as of the opening of business on the Cutoff Date; the
         Receivables were selected from NMAC's retail installment sale contracts
         (other than contracts originated in [_____________]) meeting the
         criteria of the Trust set forth in this Agreement; and no selection
         procedures believed to be adverse to the Securityholders were utilized
         in selecting the Receivables.

                  (c) Compliance with Law. Each Receivable, the origination of
         such Receivable, and the sale of the Financed Vehicle complied at the
         time it was originated or made and at the execution of this Agreement
         complies in all material respects with all requirements of applicable
         federal, state and local laws, and regulations thereunder, including
         usury laws, the Federal Truth-in-Lending Act, the Equal Credit
         Opportunity Act, the Fair Credit Reporting Act, the Fair Debt
         Collection Practices Act, the Federal Trade Commission Act, the
         Magnuson-Moss Warranty Act, the Servicemembers Civil Relief Act, the
         Federal Reserve Board's Regulations B and Z, the Gramm-Leach-Bliley Act
         and state adaptations of the National Consumer Credit Protection Act
         and of the Uniform Consumer Credit Code, state "Lemon Laws" designed to
         prevent fraud in the sale of automobiles and other consumer credit laws
         and equal credit opportunity and disclosure laws.

                  (d) Binding Obligation. Each Receivable represents the
         genuine, legal, valid and binding payment obligation in writing of the
         Obligor, enforceable by the holder thereof in accordance with its terms
         subject to the effect of bankruptcy, insolvency, reorganization,
         moratorium or other similar laws affecting creditors' rights generally
         and by general equitable principles.

                  (e) Security Interest in Financed Vehicle. (i) Immediately
         prior to the sale, assignment and transfer thereof to the Issuer, each
         Receivable was secured by a validly perfected first priority security
         interest in the Financed Vehicle in favor of NMAC as secured party or
         all necessary and appropriate actions shall have been commenced that
         would result in the valid perfection of a first priority security
         interest in the Financed Vehicle in favor of NMAC as secured party, and
         (ii) as of the Cutoff Date, according to the records of NMAC, no
         Financed Vehicle has been repossessed and the possession thereof not
         reinstated.

                  (f) Receivables in Force. No Receivable has been satisfied,
         subordinated or rescinded, nor has any Financed Vehicle been released
         from the lien granted by the related Receivable in whole or in part.

                  (g) No Waiver. No provision of a Receivable has been waived in
         a manner that is prohibited by the provisions of Section 4.01 or that
         would cause such Receivable to fail to meet all of the other
         requirements and warranties made by the Seller herein with respect
         thereto.

                  (h) No Defenses. No Receivable is subject to any right of
         rescission, setoff, counterclaim or defense, including the defense of
         usury, and the operation of any of the terms of any Receivable, or the
         exercise of any right thereunder, will not render such

                                       25        (Sale and Servicing Agreement)
<PAGE>

         Receivable unenforceable in whole or in part or subject such Receivable
         to any right of rescission, setoff, counterclaim or defense, including
         the defense of usury, and no such right of rescission, setoff,
         counterclaim or defense has been asserted with respect thereto.

                  (i) No Liens. To the Seller's knowledge, no liens have been
         filed for work, labor or materials relating to a Financed Vehicle that
         shall be liens prior to, or equal or coordinate with, the security
         interest in the Financed Vehicle granted by the Receivable.

                  (j) No Default. Except for payment defaults continuing for a
         period of not more than 29 days, as of the Cutoff Date, no default,
         breach, violation or event permitting acceleration under the terms of
         any Receivable has occurred; and no continuing condition that with
         notice or the lapse of time would constitute a default, breach,
         violation or event permitting acceleration under the terms of any
         Receivable has arisen (other than deferrals and waivers of late payment
         charges or fees permitted hereunder).

                  (k) Insurance. NMAC, in accordance with its customary
         procedures, has determined at the time of origination of each
         Receivable that the related Obligor has agreed to obtain physical
         damage insurance covering the Financed Vehicle and the Obligor is
         required under the terms of the related Receivable to maintain such
         insurance.

                  (l) Title. It is the intention of the Seller that the transfer
         and assignment herein contemplated constitute a sale of the Receivables
         from the Seller to the Trust and that the beneficial interest in and
         title to the Receivables not be part of the Seller's estate in the
         event of the filing of a bankruptcy petition by or against the Seller
         under any bankruptcy law. Immediately prior to the transfer and
         assignment herein contemplated, the Seller had good and marketable
         title to each Receivable free and clear of all Liens, and immediately
         upon the transfer thereof, the Issuer, for the benefit of the
         Noteholders and the Certificateholders, shall have good and marketable
         title to each Receivable, free and clear of all Liens and rights of
         others. Each Receivable File contains the original certificate of title
         (or a photocopy or image thereof) or evidence that an application for a
         certificate of title has been filed. To the extent the transfer and
         assignment contemplated under this Agreement is deemed to be other than
         a sale, this Agreement and all filings described under this Agreement
         create a valid and continuing security interest (as defined in the
         applicable UCC) in the Receivables in favor of the Issuer, which
         security interest is prior to all other Liens, and is enforceable as
         such as against creditors of and purchasers from the Seller.

                  (m) Lawful Assignment. No Receivable has been originated in,
         or shall be subject to the laws of, any jurisdiction under which the
         sale, transfer and assignment of such Receivable under this Agreement
         are unlawful, void or voidable.

                  (n) All Filings Made. All actions have been taken, and all
         filings (including, without limitation, UCC filings) in any
         jurisdiction have been made or have been delivered to the Relevant
         Trustee in a form suitable for filing to give the Relevant Trustee a
         first priority perfected ownership interest in the Receivables.

                                       26        (Sale and Servicing Agreement)
<PAGE>

                  (o) Chattel Paper. Each Receivable constitutes "tangible
         chattel paper" [or "electronic chattel paper"] as such term[s] [is]
         [are] defined in the UCC.

                  (p) Simple Interest Receivables. All of the Receivables are
         Simple Interest Receivables.

                  (q) One Original. There is only one original executed copy of
         each Receivable.

                  (r) No Amendments. No Receivable has been amended such that
         the amount of the Obligor's Scheduled Payments has been increased.

                  (s) APR. The APR of each Receivable equals or exceeds [__%].

                  (t) Maturity. As of the Cutoff Date, each Receivable had a
         remaining term to maturity of not less than [______] payments and not
         greater than [______] payments.

                  (u) Balance. Each Receivable had an original Principal Balance
         of not more than $[_______] and, as of the Cutoff Date, had a principal
         balance of not less than $[_______] and not more than $[_______].

                  (v) Delinquency. No Receivable was more than 29 days past due
         as of the Cutoff Date and no Receivable has been extended by more than
         two months.

                  (w) Bankruptcy. No Obligor was the subject of a bankruptcy
         proceeding (according to the records of NMAC) as of the Cutoff Date.

                  (x) Transfer. Each Receivable prohibits the sale or transfer
         of the Financed Vehicle without the consent of NMAC.

                  (y) New, Near-New and Used Vehicles. Each Financed Vehicle was
         a new, near-new or used automobile or light-duty truck at the time the
         related Obligor executed the retail installment sale contract.

                  (z) Origination. Each Receivable has an origination date on or
         after [_______].

                  (aa) Receivable Files. The Receivable Files shall be kept at
         one or more of the locations listed in Schedule B hereto. The
         Receivable Files that constitute or evidence the Receivables do not
         have any marks or notations indicating that they have been pledged,
         assigned or otherwise conveyed by the Seller to any Person other than
         the Issuer. All financing statements filed or to be filed against the
         Seller in favor of the Issuer in connection herewith describing the
         Receivables contain a statement to the following effect: "A purchase of
         or security interest in any collateral described in this financing
         statement, except as permitted in the Sale and Servicing Agreement,
         will violate the rights of the Issuer."

                                       27        (Sale and Servicing Agreement)
<PAGE>

                  (bb) Forced-Placed Insurance Premiums. No contract relating to
         any Receivable has had forced-placed insurance premiums added to the
         amount financed.

                  (cc) No Fraud or Misrepresentation. To the knowledge of the
         Seller, no Receivable was originated by a Dealer and sold by such
         Dealer to the Seller with any conduct constituting fraud or
         misrepresentation on the part of such Dealer.

                  (dd) No Further Amounts Owed on the Receivables. No further
         amounts are owed by the Seller to any Obligor under the Receivables.

                  (ee) No Pledge or Assignment of Receivables. Other than the
         security interest granted to the Issuer pursuant to this Agreement, the
         Seller has not pledged, assigned, sold, granted a security interest in,
         or otherwise conveyed any of the Receivables. The Seller has not
         authorized the filing of and is not aware of any financing statements
         against the Seller that include a description of collateral covering
         the Receivables other than any financing statement relating to the
         security interest granted to the Issuer hereunder or a financing
         statement as to which the security interest covering the Receivables
         has been released. The Seller is not aware of any judgment or tax lien
         filings against the Seller.

                  (ff) [No Government Obligors. None of the Receivables shall be
         due from the United States or any state, or from any agency, department
         subdivision or instrumentality thereof.]

         SECTION 3.02 Repurchase upon Breach. The Seller, the Servicer or the
Issuer, as the case may be, shall inform the other parties to this Agreement and
the Indenture Trustee promptly, in writing, upon the discovery of any breach of
the Seller's representations and warranties pursuant to Section 3.01 that
materially and adversely affects the interests of the Securityholders in any
Receivable. Unless the breach shall have been cured by the last day of the
second Collection Period following such discovery (or, at the Seller's election,
the last day of the first Collection Period following such discovery), the
Seller shall be obligated (whether or not such breach was known to the Seller on
the Closing Date), and the Issuer shall enforce the obligation of the Seller
under this Agreement and, if necessary, the Seller shall enforce the obligation
of NMAC under the Purchase Agreement, to repurchase any Receivable the
Securityholders' interest in which was materially and adversely affected by the
breach as of such last day. A breach of the representation in Section
3.01(a)(iv), (t) or (u) shall be deemed to affect materially and adversely the
related Receivable. In consideration of the purchase of the Receivables, the
Seller shall remit the Warranty Purchase Payment in the manner specified in
Section 5.05. For purposes of this Section 3.02, the Warranty Purchase Payment
of a Receivable that is not consistent with the Seller's warranty pursuant to
Section 3.01(a)(iv) shall include such additional amount as shall be necessary
to provide the full amount of interest as contemplated therein to the date of
repurchase. The sole remedy of the Trust, the Indenture Trustee (by operation of
the assignment of the Issuer's rights hereunder pursuant to the Indenture) or
any Securityholder with respect to a breach of the Seller's representations and
warranties pursuant to Section 3.01 shall be to require the Seller to repurchase
Receivables pursuant to this Section and to enforce the obligation of NMAC to
the Seller to repurchase such Receivables pursuant to the Purchase Agreement.

                                       28        (Sale and Servicing Agreement)
<PAGE>

         SECTION 3.03 Duties of Servicer as Custodian.

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

                  (b) Maintenance of and Access to Records. The Servicer shall
         maintain each Receivable File at one of its offices specified in
         Schedule B or at such other office as shall be specified to the Owner
         Trustee and the Indenture Trustee by written notice from the Servicer
         not later than 90 days after any change in location. The Servicer shall
         make available to the Owner Trustee and the Indenture Trustee or their
         respective duly authorized representatives, attorneys or auditors the
         Receivable Files and the related accounts, records and computer systems
         maintained by the Servicer at such times during normal business hours
         as the Owner Trustee or the Indenture Trustee shall instruct. The
         Servicer shall permit the Owner Trustee, the Indenture Trustee and
         their respective agents at any time during normal business hours upon
         reasonable prior notice to inspect, audit and make copies of and
         abstracts from the Servicer's records regarding any Receivable.

                  (c) Release of Documents. Upon the occurrence and during the
         continuation of a Servicer Default or to the extent necessary for the
         Indenture Trustee to comply with its obligations under this Agreement,
         the Servicer shall, upon instruction from the Indenture Trustee,
         release any Receivable File to the Indenture Trustee, the Indenture
         Trustee's agent or the Indenture Trustee's designee, as the case may
         be, at such place or places as the Indenture Trustee may designate, as
         soon as practicable.

         SECTION 3.04 Instructions; Authority To Act. The Servicer shall be
deemed to have received proper instructions with respect to the Receivable Files
upon its receipt of written instructions signed by a Trust Officer of the Owner
Trustee or the Indenture Trustee.

         SECTION 3.05 Custodian's Indemnification. The Servicer, as custodian,
shall indemnify the Issuer, the Owner Trustee and the Indenture Trustee for any
and all liabilities, obligations, losses, compensatory damages, payments, costs
or expenses of any kind whatsoever that may be imposed on, incurred by or
asserted against any of them as the result of any

                                       29        (Sale and Servicing Agreement)
<PAGE>

improper act or omission in any way relating to the maintenance and custody by
the Servicer as custodian of the Receivable Files; provided, however, that the
Servicer shall not be liable to the Owner Trustee for any portion of any such
amount resulting from the willful misfeasance, bad faith or negligence of the
Owner Trustee, and the Servicer shall not be liable to the Indenture Trustee for
any portion of any such amount resulting from the willful misfeasance, bad faith
or negligence of the Indenture Trustee.

         SECTION 3.06 Effective Period and Termination. The Servicer's
appointment as custodian shall become effective as of the Cutoff Date, and shall
continue in full force and effect until terminated pursuant to this Section. If
NMAC shall resign as Servicer in accordance with the provisions of this
Agreement or if all of the rights and obligations of any Servicer shall have
been terminated under Section 8.01, the appointment of NMAC as custodian may be
terminated by the Indenture Trustee or by the Holders of Notes evidencing not
less than 25% of the Outstanding Amount of the Notes (but excluding for purposes
of such calculation and action all Notes held or beneficially owned by NMAC,
NARC II or any of their Affiliates unless all of the Notes are held or
beneficially owned by NMAC, NARC II or any of their Affiliates) or, with the
consent of Holders of the Notes evidencing not less than 25% of the Outstanding
Amount of the Notes, by the Owner Trustee or by the Certificateholders
evidencing not less than 25% of the Certificate Balance (but excluding for
purposes of such calculation and action all Certificates held or beneficially
owned by NMAC, NARC II or any of their Affiliates unless all of the Certificates
are held or beneficially owned by NMAC, NARC II or any of their Affiliates), in
the same manner as the Indenture Trustee or such Holders may terminate the
rights and obligations of the Servicer under Section 8.01. The Indenture Trustee
or, with the consent of the Indenture Trustee, the Issuer may terminate the
Servicer's appointment as custodian, with cause, at any time upon written
notification to the Servicer, and without cause upon 30 days' prior written
notification to the Servicer. As soon as practicable after any termination of
such appointment, the Servicer shall deliver the Receivable Files and the
related accounts and records maintained by the Servicer to the Relevant Trustee
or the agent thereof at such place or places as the Relevant Trustee may
reasonably designate.

                                   ARTICLE IV

                   Administration and Servicing of Receivables

         SECTION 4.01 Duties of Servicer.

                  (a) The Servicer shall manage, service, administer and make
         collections on the Receivables with reasonable care, using that degree
         of skill and attention that the Servicer exercises with respect to all
         comparable receivables that it services for itself or others. Except
         with respect to Defaulted Receivables, Administrative Receivables or
         Warranty Receivables, the Servicer shall not change the amount of or
         reschedule the due date of any Scheduled Payment, change the APR of, or
         extend any Receivable except as provided herein or change any material
         term of a Receivable; provided, however, that:

                           (1) if a default, breach, violation, delinquency or
event permitting acceleration under the terms of any Receivable shall have
occurred or, in the judgment of the Servicer, is imminent, the Servicer may (A)
extend such Receivable for credit related reasons

                                       30        (Sale and Servicing Agreement)
<PAGE>

that would be acceptable to the Servicer with respect to comparable new,
near-new or used automobile or light-duty truck receivables that it services for
itself, but only if (i) the final scheduled payment date of such Receivable as
extended would not be later than the last day of the Collection Period preceding
the Final Scheduled Distribution Date for the Class C Certificates, and (ii) the
rescheduling or extension would not modify the terms of such Receivable in a
manner that would constitute a cancellation of such Receivable and the creation
of a new receivable for federal income tax purposes; or (B) reduce an Obligor's
monthly payment amount in the event of a prepayment resulting from refunds of
credit life and disability insurance premiums and service contracts and make
similar adjustments in an Obligor's payment terms to the extent required by law;

                           (2) if at the end of the scheduled term of any
Receivable, the outstanding principal amount thereof is such that the final
payment to be made by the related Obligor is larger than the regularly scheduled
payment of principal and interest made by such Obligor, the Servicer may permit
such Obligor to pay such remaining principal amount in more than one payment of
principal and interest, provided that the last such payment shall be due on or
prior to the last day of the Collection Period preceding the Final Scheduled
Distribution Date for the Class C Certificates; and

                           (3) the Servicer may in its discretion waive any late
payment charge or any other fees that may be collected in the ordinary course of
servicing a Receivable.

                  (b) The Servicer's duties shall include collection and posting
         of all payments, responding to inquiries of Obligors on the
         Receivables, investigating delinquencies, sending remittance advises to
         Obligors, reporting tax information to Obligors, accounting for
         collections, furnishing monthly and annual statements to the Owner
         Trustee and the Indenture Trustee with respect to distributions and
         making Advances pursuant to Section 5.04.

                  (c) Without limiting the generality of the foregoing, the
         Servicer is authorized and empowered to execute and deliver, on behalf
         of itself, the Trust, the Owner Trustee, the Indenture Trustee and the
         Securityholders or any of them, any and all instruments of satisfaction
         or cancellation, or partial or full release or discharge, and all other
         comparable instruments, with respect to the Receivables or to the
         Financed Vehicles securing the Receivables. If the Servicer shall
         commence a legal proceeding to enforce a Receivable, the Issuer (in the
         case of a Receivable other than an Administrative Receivable or a
         Warranty Receivable) shall thereupon be deemed to have automatically
         assigned, solely for the purpose of collection, such Receivable to the
         Servicer. If in any enforcement suit or legal proceeding it shall be
         held that the Servicer may not enforce a Receivable on the ground that
         it shall not be a real party in interest or a holder entitled to
         enforce such Receivable, the Issuer shall, at the Servicer's expense
         and direction, take steps to enforce the Receivable, including bringing
         suit in its name or the name of the Indenture Trustee or the
         Securityholders. The Issuer shall furnish the Servicer with any powers
         of attorney and other documents reasonably necessary or appropriate to
         enable the Servicer to carry out its servicing and administrative
         duties hereunder.

                                       31        (Sale and Servicing Agreement)
<PAGE>

                  (d) The Servicer, at its expense, shall obtain on behalf of
         the Trust all licenses, including those required under the Pennsylvania
         Motor Vehicle Sales Finance Act and the Maryland Financial Institutions
         Article, required by the laws of any jurisdiction to be held by the
         Trust in connection with ownership of the Receivables, and shall make
         all filings and pay all fees as may be required in connection therewith
         during the term hereof. Nothing in the foregoing or in any other
         section of this Agreement shall be construed to prevent the Servicer
         from implementing new programs, whether on an intermediate, pilot or
         permanent basis, or on a regional or nationwide basis, or from
         modifying its standards, policies and procedures as long as, in each
         case, the Servicer does or would implement such programs or modify its
         standards, policies and procedures in respect of comparable assets
         serviced for itself in the ordinary course of business.

         SECTION 4.02 Collection of Receivable Payments. The Servicer shall make
reasonable efforts to collect all payments called for under the terms and
provisions of the Receivables as and when the same shall become due and shall
follow such collection procedures as it follows with respect to all comparable
receivables that it services for itself or others.

         SECTION 4.03 Realization upon Receivables. On behalf of the Trust, the
Servicer shall use commercially reasonable efforts, consistent with its
customary servicing procedures, to repossess or otherwise convert the ownership
of the Financed Vehicle securing any Receivable as to which the Servicer shall
have determined eventual payment in full is unlikely. The Servicer shall follow
such customary and usual practices and procedures as it shall deem necessary or
advisable in its servicing of comparable receivables, which may include
reasonable efforts to realize upon any Dealer Recourse and selling the related
Financed Vehicle at public or private sale. The foregoing shall be subject to
the provision that, in any case in which the Financed Vehicle shall have
suffered damage, the Servicer shall not expend funds in connection with the
repair or the repossession of such Financed Vehicle unless it shall determine in
its discretion that such repair and/or repossession will increase the Net
Liquidation Proceeds.

         SECTION 4.04 Maintenance of Security Interests in Financed Vehicles.
The Servicer shall, in accordance with its customary servicing procedures, take
such steps as are necessary to maintain perfection of the security interest
created by each Receivable in the related Financed Vehicle. The Servicer is
hereby authorized to take such steps as are necessary to re-perfect such
security interest on behalf of the Issuer and the Indenture Trustee in the event
of the relocation of a Financed Vehicle or for any other reason. If the
assignment of a Receivable to the Trust is insufficient, without a notation on
the related Financed Vehicle's certificate of title, to grant to the Trust a
first priority perfected security interest in the related Financed Vehicle, the
Servicer hereby agrees to serve as the agent of the Trust for the purpose of
perfecting the security interest of the Trust in such Financed Vehicle and
agrees that the Servicer's listing as the secured party on the certificate of
title is in this capacity as agent of the Trust.

         SECTION 4.05 Covenants of Servicer.

                  (a) The Servicer shall not release the Financed Vehicle
         securing any Receivable from the security interest granted by such
         Receivable in whole or in part except in the event of payment in full
         by or on behalf of the Obligor thereunder or repossession.

                                       32        (Sale and Servicing Agreement)
<PAGE>

                  (b) The Servicer shall not do anything to impair the rights of
         the Securityholders in the Receivables.

                  (c) Except with respect to Defaulted Receivables,
         Administrative Receivables or Warranty Receivables, the Servicer shall
         not alter the APR of any Receivable or forgive payments on a
         Receivable. Except as provided in Section 4.01, the Servicer shall not
         modify the number of payments under a Receivable, increase the amount
         financed under a Receivable, or extend the due date for any payment on
         a Receivable.

                  (d) If the Servicer shall determine not to make an Advance
         related to delinquency or non-payment of any Receivable pursuant to
         Section 5.04 because it determines that such Advance would not be
         recoverable from subsequent collections on such Receivable, such
         Receivable shall be designated by the Servicer to be a Defaulted
         Receivable, provided that such Receivable otherwise meets the
         definition of a Defaulted Receivable.

         SECTION 4.06 Purchase of Receivables upon Breach. The Servicer or the
Issuer shall inform the other party and the Indenture Trustee promptly, in
writing, upon the discovery of any breach by the Servicer of its obligations
under the second sentence of Section 4.01 or under Section 4.02, 4.04 or 4.05
that would materially and adversely affect any Receivable. Unless the breach
shall have been cured by the last day of the second Collection Period following
such discovery (or, at the Servicer's election, the last day of the first
Collection Period following discovery), the Servicer shall (whether or not such
breach was known to the Servicer on the Closing Date) purchase any Receivable
materially and adversely affected by such breach as of such last day. In
consideration of such Receivable, the Servicer shall remit the Administrative
Purchase Payment (as reduced by any Outstanding Advances with respect to such
Receivable) in the manner specified in Section 5.05. For the purposes of this
Section 4.06, the Administrative Purchase Payment shall consist in part of a
release by the Servicer of all rights of reimbursement with respect to
Outstanding Advances with respect to the purchased Receivable. The sole remedy
of the Indenture Trustee, the Owner Trustee, the Trust or the Securityholders
against the Servicer with respect to a breach by the Servicer of its obligations
under the second sentence of Section 4.01 or under Section 4.02, 4.04 or 4.05
shall be to require the Servicer to purchase Receivables pursuant to this
Section 4.06.

         SECTION 4.07 Servicing Fee and Expenses. As compensation for the
performance of its obligations hereunder, the Servicer shall be entitled to
receive on each Distribution Date the Total Servicing Fee. Except to the extent
otherwise provided herein, the Servicer shall be required to pay all expenses
incurred by it in connection with its activities under this Agreement (including
fees and disbursements of the Indenture Trustee and independent accountants,
taxes imposed on the Servicer, expenses incurred in connection with
distributions and reports to Securityholders and all other fees and expenses not
expressly stated under this Agreement to be for the account of the
Securityholders). If each Rating Agency for a series of Notes or Certificates
confirms that it will not reduce the rating of any class of Notes or
Certificates in that series, as the case may be, the Base Servicing Fee in
respect of a Collection Period (together with any portion of the Base Servicing
Fee that remains unpaid from the prior Distribution Dates) will be paid at the
beginning of that Collection Period out of collections of interest on the
related Receivables.

                                       33        (Sale and Servicing Agreement)
<PAGE>

         SECTION 4.08 Servicer's Certificate.

                  (a) On or before the tenth day of each month (or, if such
         tenth day is not a Business Day, then on the next succeeding Business
         Day), the Servicer shall deliver to the Owner Trustee, each Paying
         Agent, [the Swap Counterparty] and the Indenture Trustee, with a copy
         to each Rating Agency, a Servicer's Certificate containing all
         information necessary to make the distributions pursuant to Sections
         5.06, 5.07 and 5.08 (including the amount of the aggregate collections
         on the Receivables; the aggregate Advances to be made by the Servicer,
         if any, the aggregate Administrative Purchase Payments for any
         Administrative Receivables to be purchased by the Servicer, and the
         aggregate Warranty Purchase Payments for any Warranty Receivables to be
         purchased by the Seller) for the Collection Period preceding the date
         of such Servicer's Certificate, all information necessary for the Owner
         Trustee to send statements to the Certificateholders and the Indenture
         Trustee to send statements to the Noteholders pursuant to the Trust
         Agreement or Indenture, as the case may be. Each of the Owner Trustee
         and the Indenture Trustee may conclusively rely on the information in
         any Servicer's Certificate and shall have no duty to confirm or verify
         the contents thereof.

                  (b) Concurrently with delivery of the Servicer's Certificate
         in each month, the Servicer shall deliver to the underwriters of the
         Class A Notes, the Class B Notes, the Class C Certificates and, if any
         Class D Certificate is held by a Person other than the Seller or any
         Affiliate of the Seller, to such Class D Certificateholder, the Note
         Factor for each Class of Notes, the Certificate Factor for each Class
         of Certificates, and the Pool Factor for each Class of Notes and for
         the Certificates, in each case as of the close of business on the
         Distribution Date occurring in such month.

         SECTION 4.09 Annual Statement as to Compliance; Notice of Default.

                  (a) The Servicer shall deliver to the Owner Trustee, the
         Indenture Trustee and each of the Rating Agencies, on or before the
         last day of the third month after the end of each fiscal year of the
         Servicer, beginning [________, ____], an Officers' Certificate with
         respect to the [prior fiscal] year (or with respect to the initial
         Officer's Certificate, the period from the date of the initial issuance
         of the Securities to [_________, _____]), stating that (i) a review of
         the activities of the Servicer during the preceding 12-month (or
         shorter) period and of its performance under this Agreement has been
         made under such officer's supervision and (ii) to the best of such
         officer's knowledge, based on such review, the Servicer has fulfilled
         all its obligations under this Agreement throughout such twelve-month
         (or shorter) period, or, if there has been a default in the fulfillment
         of any such obligation, specifying each such default known to such
         officer and the nature and status thereof. A copy of such Officer's
         Certificate may be obtained by any Certificateholder or Noteholder by a
         request in writing to the Owner Trustee or the Indenture Trustee
         addressed as set forth in Section 10.03 hereof.

                  (b) The Servicer shall deliver to the Owner Trustee, the
         Indenture Trustee and each Rating Agency, promptly after having
         obtained knowledge thereof, but in no event

                                       34        (Sale and Servicing Agreement)
<PAGE>

         later than five Business Days thereafter, written notice in an
         Officer's Certificate of any event that with the giving of notice or
         lapse of time, or both, would become a Servicer Default under Section
         8.01. The Seller shall deliver to the Owner Trustee, the Indenture
         Trustee and to each such Rating Agency, promptly after having obtained
         knowledge thereof, but in no event later than five Business Days
         thereafter, written notice in an Officer's Certificate of any event
         that with the giving of notice or lapse of time, or both, would become
         a Servicer Default under Section 8.01(a)(ii) or would result in any
         lowering of the ratings described in Section 5.02(a)(ii)(A).

         SECTION 4.10 Annual Independent Certified Public Accountants' Report.
The Servicer shall cause a firm of independent certified public accountants, who
may also render other services to the Servicer, the Seller or their Affiliates,
to deliver to the Owner Trustee, the Indenture Trustee and each of the Rating
Agencies, on or before the last day of the third month after the end of each
fiscal year of the Servicer, beginning [________, ____], with respect to the
prior fiscal year (or with respect to the initial reports, the period from the
date of the initial issuance of the Securities to [________, ____]) the
following reports: (a) a report that such firm has audited the consolidated
financial statements of the Servicer in accordance with generally accepted
auditing standards, that such firm is independent of the Servicer within the
meaning of the Code of Professional Ethics of the American Institute of
Certified Public Accountants ("AICPA"), and expressing such firm's opinion
thereon; and (b) a report indicating that such firm has examined, in accordance
with standards established by AICPA, management's assertion about the Servicer's
compliance with the minimum servicing standards identified in the Mortgage
Bankers Association of America's Uniform Single Attestation Program for Mortgage
Bankers ("USAP") as such standards relate to automobile and light-duty truck
loans serviced for others, and expressing such firm's opinion on such management
assertion (the "Annual USAP Report") or any similar internal control audit
report that is acceptable to each Rating Agency. Upon the request of any
Certificateholder or Note Owner, the Owner Trustee or the Indenture Trustee, as
the case may be, shall promptly provide such Certificateholder or Note Owner
with a copy of such Annual USAP Report. For all purposes of this Agreement, the
Owner Trustee and the Indenture Trustee may rely on the representation of any
Person that it is a Certificateholder or a Note Owner, as the case may be.

         SECTION 4.11 Access to Certain Documentation and Information Regarding
Receivables.

                  (a) The Servicer shall provide to the Owner Trustee and the
         Indenture Trustee access to the Receivable Files in such cases where
         the Securityholders shall be required by applicable statutes or
         regulations to review such documentation. In each case, such access
         shall be afforded without charge, but only upon reasonable request and
         during the normal business hours at the respective offices of the
         Servicer

                  (b) The Servicer shall provide to each Rating Agency any
         information regarding the Receivables that is reasonably requested by
         such Rating Agency.

                  (c) Nothing in this Section shall affect the obligation of the
         Servicer to observe any applicable law prohibiting disclosure of
         information regarding the Obligors

                                       35        (Sale and Servicing Agreement)
<PAGE>

         and the failure of the Servicer to provide access to information as a
         result of such obligation shall not constitute a breach of this
         Section.

         SECTION 4.12 Appointment of Subservicer. So long as NMAC acts as the
Servicer, the Servicer may at any time without notice or consent subcontract
substantially all its duties under this Agreement to any corporation more than
50% of the voting stock of which is owned, directly or indirectly, by Nissan.
The Servicer may at any time perform specific duties as servicer under this
Agreement through other subcontractors; provided, however, that no such
delegation or subcontracting shall relieve the Servicer of its responsibilities
with respect to such duties as to which the Servicer shall remain primarily
responsible with respect thereto.

         SECTION 4.13 Amendments to Schedule of Receivables. If the Servicer,
during any Collection Period, assigns to a Receivable an account number that
differs from the original account number identifying such Receivable on the
Schedule of Receivables, the Servicer shall deliver to the Owner Trustee and the
Indenture Trustee, on or before the Distribution Date relating to such
Collection Period, an amendment to the Schedule of Receivables reporting the
newly assigned account number, together with the old account number of each such
Receivable. The first such delivery of amendments to the Schedule of Receivables
shall include monthly amendments reporting account numbers appearing on the
Schedule of Receivables with the new account numbers assigned to such
Receivables during any prior Collection Period.

SECTION 4.14 Acknowledgement by Servicer of its Obligations under the Indenture.
The Servicer hereby agrees and consents to the provisions of the Indenture
applicable to it (including, without limitation, Sections 8.03(a) and 8.03(b)
thereof) and agrees to be bound by such provisions.

                                   ARTICLE V
                            Distributions; Accounts;
            Statements to the Certificateholders and the Noteholders

         SECTION 5.01 Establishment of Accounts.

                  (a) The Servicer, on behalf of the Owner Trustee and the
         Indenture Trustee, shall establish the Collection Account in the name
         of the Indenture Trustee for the benefit of the Securityholders. The
         Collection Account shall be a segregated trust account initially
         established with the Indenture Trustee and maintained with the
         Indenture Trustee as long as (i) the deposits of the Indenture Trustee
         have the Required Deposit Rating or (ii) the Collection Account is
         maintained in a segregated trust account in the trust department of the
         Indenture Trustee; provided, however, that all amounts held in the
         Collection Account shall, to the extent permitted by applicable laws,
         rules and regulations and as directed by the Servicer, be invested by
         the Indenture Trustee in Eligible Investments; otherwise, such amounts
         shall be maintained in cash; provided that if (x) the Servicer shall
         have failed to give investment directions for any funds on deposit in
         the Collection Account to the Indenture Trustee by 5:00 p.m. Eastern
         Time (or such other time as may be agreed by the Servicer and the
         Indenture Trustee) on any Business Day, or (y) a Default or Event of
         Default shall have occurred and be continuing with respect to the Notes
         but the Notes shall not have been declared due and payable pursuant to
         the

                                       36        (Sale and Servicing Agreement)
<PAGE>

         Indenture, or (z) if the Notes shall have been declared due and payable
         following an Event of Default, amounts collected or receivable from the
         Trust Estate are being applied in accordance with Section 5.05 of the
         Indenture as if there had not been such a declaration, then the
         Indenture Trustee shall, to the fullest extent practicable, invest and
         reinvest funds in the Collection Account in one or more Eligible
         Investments specified in clauses (i), (iv) or (vi) of the definition of
         Eligible Investments. All such Eligible Investments shall mature not
         later than the Business Day preceding the next Distribution Date, in
         such manner that such amounts invested shall be available to make the
         required distributions on the Distribution Date; provided, that if
         permitted by the Rating Agencies, monies on deposit therein may be
         invested in Eligible Investments that mature later than the Business
         Day preceding the next Distribution Date; provided, however, that such
         investment shall be sold not later than the Business Day preceding the
         next Distribution Date. The Servicer will not direct the Indenture
         Trustee, and the Issuer shall cause the Servicer not, to make any
         investment of any funds or to sell any investment held in the
         Collection Account unless the security interest granted and perfected
         in such account will continue to be perfected in such investment or the
         proceeds of such sale, in either case without any further action by any
         Person, and, in connection with any direction to the Indenture Trustee
         to make any such investment or sale, if requested by the Indenture
         Trustee, the Servicer shall deliver to the Indenture Trustee an Opinion
         of Counsel, acceptable to the Indenture Trustee, to such effect. Should
         the short-term unsecured debt obligations of the Indenture Trustee no
         longer have the Required Deposit Rating then, unless the Collection
         Account is maintained in segregated trust accounts in the trust
         department of the Indenture Trustee, the Servicer shall, with the
         Indenture Trustee's assistance as necessary and within ten Business
         Days of receipt of notice from the Indenture Trustee that the Indenture
         Trustee no longer has the Required Deposit Rating, cause the Collection
         Account (i) to be moved to segregated trust accounts in a bank or trust
         company, the short-term unsecured debt obligations of which shall have
         the Required Deposit Rating or (ii) to be moved to the trust department
         of the Indenture Trustee.

                  (b) Earnings on investment of funds in the Collection Account
         shall be paid to the Servicer as servicing compensation, and any losses
         and investment expenses shall be charged against the funds on deposit
         in the Collection Account.

                  (c) Subject to the foregoing, the Servicer, on behalf of the
         Owner Trustee and the Indenture Trustee, shall establish and maintain
         the Collection Account as an Eligible Deposit Account in the name of
         and under the exclusive control of the Indenture Trustee, bearing a
         designation clearly indicating that the funds deposited therein are
         held for the benefit of the Securityholders. The Indenture Trustee
         shall transfer all amounts remaining on deposit in the Collection
         Account on the Distribution Date on which the Notes of all Classes have
         been paid in full (or substantially all of the Trust Estate is
         otherwise released from the lien of the Indenture) to another Eligible
         Deposit Account established pursuant to the Trust Agreement for the
         benefit of the Certificateholders (the "Trust Collection Account"), and
         take all necessary or appropriate actions to transfer all of its right,
         title and interest in the Collection Account, all funds or investments
         held therein and all proceeds thereof, whether or not on behalf of the
         Securityholders, to the Owner Trustee for the benefit of the
         Certificateholders, subject to the limitations set forth

                                       37        (Sale and Servicing Agreement)
<PAGE>

         in the Indenture with respect to amounts held for payment to
         Noteholders that do not promptly deliver a Note for payment on such
         Distribution Date. After the transfer to the Trust Collection Account
         described in the immediately preceding sentence, references in this
         Agreement to "Collection Account" shall be deemed to be references to
         the "Trust Collection Account."

                  (d) With respect to the Collection Account and all property
         held therein, the Owner Trustee agrees, by its acceptance hereof that,
         on the terms and conditions set forth in the Indenture, for so long as
         Notes of any Class remain outstanding, the Indenture Trustee shall
         possess all right, title and interest therein (excluding interest or
         investment income thereon payable to the Servicer or the Seller, as the
         case may be), and the Accounts shall be under the sole dominion and
         control of the Indenture Trustee for the benefit of the Noteholders and
         the Certificateholders, as the case may be, as set forth in the
         Indenture. The parties hereto agree that the Issuer, the Owner Trustee
         and the Holders of the Class D Certificates have no right, title or
         interest in the Reserve Account or any amounts on deposit therein at
         any time. The parties hereto agree that the Servicer shall have the
         power, revocable by the Indenture Trustee or by the Owner Trustee with
         the consent of the Indenture Trustee, to instruct the Indenture Trustee
         to make withdrawals and payments from the Collection Account for the
         purpose of permitting the Servicer, Indenture Trustee or the Owner
         Trustee to carry out its respective duties hereunder or under the
         Indenture or the Trust Agreement, as the case may be.

         Notwithstanding the foregoing, the Servicer shall be entitled to
withhold, or to be reimbursed from amounts otherwise payable into or on deposit
in the Collection Account, as the case may be, amounts previously deposited in
the Collection Account but later determined to have resulted from mistaken
deposits or posting.

                  [(e) The Servicer shall, prior to the Closing Date, establish
         and maintain a segregated trust account in the name of the Indenture
         Trustee, which shall be designated as the "Accumulation Account." The
         Accumulation Account shall be held in trust for the benefit of the
         Noteholders. The Accumulation Account shall be under the sole dominion
         and control of the Indenture Trustee; provided that the Servicer may
         make deposits to and direct the Indenture Trustee in writing to make
         withdrawals from the Accumulation Account in accordance with the Basic
         Documents. All monies deposited from time to time in the Accumulation
         Account shall be held by the Indenture Trustee as part of the Trust
         Property and all deposits to and withdrawals from the Accumulation
         Account shall be made only upon the terms and conditions of the Basic
         Documents.]

         [All amounts held in the Accumulation Account shall, to the extent
permitted by applicable law, rules and regulations, be invested, as directed in
writing by the Servicer, by the bank or trust company then maintaining the
Accumulation Account in Eligible Investments that mature not later than the
Business Day immediately prior to the Distribution Date for the Collection
Period to which such amounts relate and such Eligible Investments shall be held
to maturity. All interest and other income on funds on deposit in the
Accumulation Account shall be withdrawn and deposited in the Collection Account
for distribution on each Distribution Date.]

                                       38        (Sale and Servicing Agreement)
<PAGE>

                  [(f) The Servicer shall, prior to the Closing Date, establish
         and maintain a segregated trust account in the name of the Indenture
         Trustee, which shall be designated as the "VPTN Proceeds Account." The
         VPTN Proceeds Account shall be held in trust for the benefit of the
         holders of the subclass of the Class A Notes to be paid on its Targeted
         Scheduled Distribution Date from the proceeds of issuance after the
         Closing Date of VPTNs deposited to such account from time to time. The
         VPTN Proceeds Account shall be under the sole dominion and control of
         the Indenture Trustee; provided that the Servicer may make deposits to
         and direct the Indenture Trustee in writing to make withdrawals from
         the VPTN Proceeds Account in accordance with the Basic Documents. All
         monies deposited from time to time in the VPTN Proceeds Account shall
         be held by the Indenture Trustee as part of the Trust Property and all
         deposits to and withdrawals from the VPTN Proceeds Account shall be
         made only upon the terms and conditions of the Basic Documents.]

         SECTION 5.02 Collections.

                  (a) Except as otherwise provided in this Agreement, the
         Servicer shall remit daily to the Collection Account all payments
         received by or on behalf of the Obligors on or in respect of the
         Receivables (excluding payments on the Warranty Receivables or the
         Administrative Receivables) and all Net Liquidation Proceeds not later
         than the first Business Day after receipt thereof. For purposes of this
         Article V, the phrase "payments received by or on behalf of the
         Obligors" shall mean payments made by Persons other than the Servicer.
         Notwithstanding the foregoing, for so long as (i) NMAC is the Servicer,
         (ii) (A) NMAC's short-term unsecured debt obligations are rated at
         least "P-1" by Moody's and NMAC's short-term unsecured debt obligations
         (or, if NMAC is the Servicer and the Servicer then has no short-term
         rating from Standard & Poor's, Nissan Capital of America, Inc.'s
         short-term unsecured debt obligations) are rated "A-1" by Standard &
         Poor's (so long as Moody's and Standard & Poor's are Rating Agencies),
         or (B) certain arrangements are made that are acceptable to the Rating
         Agencies, and (iii) no Event of Default or Servicer Default shall have
         occurred and be continuing (unless waived by the appropriate
         Securityholders), except that the requirement in clause (ii) shall not
         apply if only the Class C Certificates are outstanding and the Class C
         Certificates do not have an investment grade rating, (collectively, the
         "Monthly Remittance Conditions"); the Servicer shall not be required to
         remit such collections to the Collection Account on the foregoing daily
         basis but shall be entitled to retain such collections, without
         segregation from its other funds, until the Business Day before each
         Distribution Date at which time the Servicer shall remit all such
         collections in respect of the related Collection Period to the
         Collection Account in immediately available funds. Commencing with the
         first day of the first Collection Period that begins at least two
         Business Days after the day on which any Monthly Remittance Condition
         ceases to be satisfied and for so long as any Monthly Remittance
         Condition is not satisfied, all collections then held by the Servicer
         shall be immediately deposited into the Collection Account and all
         future collections on or in respect of the Receivables (other than
         payments on Warranty Receivables and the Administrative Receivables)
         and all Net Liquidation Proceeds shall be remitted by the Servicer to
         the Collection Account on a daily basis not later than the first
         Business Day after receipt thereof.

                                       39        (Sale and Servicing Agreement)
<PAGE>

                  (b) The Indenture Trustee or the Owner Trustee shall not be
         deemed to have knowledge of any event or circumstances under clause
         (iii) of the definition of the Monthly Remittance Condition unless the
         Indenture Trustee or the Owner Trustee has received notice of such
         event or circumstance from the Seller or the Servicer in an Officer's
         Certificate or from the Holders of Notes or Certificates evidencing not
         less than 25% in principal amount of the Outstanding Amount of the
         Notes and the aggregate balance of the Certificates, acting together as
         a single class, or a Trust Officer of the Indenture Trustee or the
         Owner Trustee with knowledge hereof or familiarity herewith has actual
         knowledge of such event or circumstances.

                  (c) The Servicer shall give the Owner Trustee, the Indenture
         Trustee and each Rating Agency written notice of the failure of any
         Monthly Remittance Condition (and any subsequent curing of a failed
         Monthly Remittance Condition) as soon as practical after the occurrence
         thereof but in no event later than 10 Business Days after obtaining
         knowledge thereof (it being understood that if the Monthly Remittance
         Condition is not satisfied as of the Closing Date, no such notice shall
         be required in connection therewith).

                  (d) Notwithstanding the foregoing, if a Monthly Remittance
         Condition is not satisfied, the Servicer may utilize an alternative
         remittance schedule (which may include the remittance schedule utilized
         by the Servicer before the Monthly Remittance Condition became
         unsatisfied), if the Servicer provides to the Owner Trustee and the
         Indenture Trustee written confirmation from each Rating Agency that
         such alternative remittance schedule will not result in the downgrading
         or withdrawal by such Rating Agency of the ratings then assigned to any
         Class of Notes or the Class C Certificates.

         SECTION 5.03 Application of Collections. As of the Business Day
immediately preceding the related Distribution Date, all collections for the
related Collection Period with respect to each Receivable shall be applied by
the Servicer as follows:

                  (a) First, to interest accrued to date on such Receivable;

                  (b) Second, to principal until the Principal Balance of such
         Receivable is brought current;

                  (c) Third, to reduce the unpaid late charges (if any) as
         provided in such Receivable; and

                  (d) Fourth, to prepay principal on such Receivable.

         SECTION 5.04 Advances.

                  (a) The Servicer shall make a payment with respect to each
         Receivable (other than an Administrative Receivable, a Warranty
         Receivable or a Liquidated Receivable) (each, an "Advance") equal to
         the excess if any, of (x) the product of the Principal Balance of such
         Receivable as of the first day of the related Collection Period and
         one-twelfth of its APR (calculated on the basis of a 360-day year
         comprised of twelve 30-day months), over (y) the interest actually
         received by the Servicer with respect to such Receivable from the
         Obligor or from payments of the Administrative Purchase Payment

                                       40        (Sale and Servicing Agreement)
<PAGE>

         or the Warranty Purchase Payment, as the case may be, during such
         Collection Period. The Servicer will not be obligated to make an
         Advance in respect of a Receivable (other than an Advance in respect of
         an interest shortfall arising from the Prepayment of a Receivable) to
         the extent that the Servicer, in its sole discretion, shall determine
         that the Advance constitutes a Nonrecoverable Advance. With respect to
         each Receivable, the Advance shall increase the Outstanding Advances.
         No Advances will be made with respect to the Principal Balance of the
         Receivables. The Servicer shall deposit all such Advances into the
         Collection Account in immediately available funds no later than 5:00
         p.m., New York City time, on the Business Day immediately preceding the
         related Distribution Date. To the extent that the amount set forth in
         clause (y) above with respect to a Receivable is greater than the
         amount set forth in clause (x) above with respect thereto, such amount
         shall be distributed to the Servicer pursuant to Section 5.06;
         provided, however, that, notwithstanding anything else herein, the
         Servicer shall not be reimbursed for any amounts representing an
         Advance, or any portion thereof, made in respect of an interest
         shortfall arising from the Prepayment of a Receivable.

                  (b) The Servicer shall be entitled to reimbursement for
         Outstanding Advances, without interest, with respect to a Receivable
         from the following sources with respect to such Receivable pursuant to
         Section 5.06(c)(i), Section 5.06(d)(i) or Section 5.06(e)(i): (i)
         subsequent payments made by or on behalf of the related Obligor, (ii)
         Net Liquidation Proceeds, and (iii) the Warranty Purchase Payments.

                  (c) To the extent that the Servicer has determined that any
         Outstanding Advance is a Nonrecoverable Advance, the Servicer may
         provide to the Owner Trustee and the Indenture Trustee an Officer's
         Certificate setting forth the amount of such Nonrecoverable Advance,
         and on the related Distribution Date, the Relevant Trustee shall remit
         to the Servicer from funds on deposit in the Collection Account an
         amount equal to the amount of such Nonrecoverable Advance pursuant to
         Section 5.06(c)(ii), Section 5.06(d)(ii) or Section 5.06(e)(ii).

                  (d) Notwithstanding anything to the contrary in this
         Agreement, for so long as NMAC is the Servicer, in lieu of causing the
         Servicer first to deposit and then the Relevant Trustee to remit to the
         Servicer the amounts described in clauses (i) through (iii) in Section
         5.04(b) reimbursable in respect on Outstanding Advances, or the amounts
         described in Section 5.04(c) applicable in respect of Nonrecoverable
         Advances, the Servicer may deduct such amounts from deposits otherwise
         to be made into the Collection Account.

                  (e) Notwithstanding the provisions of Section 5.04(a), no
         Successor Servicer, including the Indenture Trustee, shall be obligated
         to make Advances unless it has expressly agreed to do so in writing.

         SECTION 5.05 Additional Deposits.

                  (a) The following additional deposits shall be made to the
         Collection Account: (i) the Seller shall remit the aggregate Warranty
         Purchase Payments with respect to Warranty Receivables pursuant to
         Section 3.02; (ii) the Servicer shall remit

                                       41        (Sale and Servicing Agreement)
<PAGE>

         (A) the aggregate Advances pursuant to Section 5.04(a), (B) the
         aggregate Administrative Purchase Payments with respect to
         Administrative Receivables pursuant to Section 4.06, and (C) the amount
         required upon any optional purchase of the Receivables by the Servicer,
         or any Successor Servicer, pursuant to Section 9.01; and (iii) the
         Indenture Trustee shall transfer (A) the Yield Supplement Deposit from
         the Yield Supplement Account to the Collection Account pursuant to
         Section 5.08, plus reinvestment income on the Yield Supplement Account
         (in assuring the availability therein of the related Available
         Interest), plus amounts described in the second sentence of Section
         5.08(b) and (B) the amounts described in Sections 5.06 and 5.07 from
         the Reserve Account to the Collection Account pursuant to Section 5.07.

                  (b) All deposits required to be made pursuant to this Section
         5.05 by the Seller or the Servicer, as the case may be, may be made in
         the form of a single deposit and shall be made in immediately available
         funds, no later than 5:00 P.M., New York City time, on the Business Day
         immediately preceding the related Distribution Date. At the direction
         of the Servicer, the Relevant Trustee shall invest such amounts in
         Eligible Investments maturing not later than 12:00 P.M. New York City
         Time, on the related Distribution Date.

         SECTION 5.06 Payments and Distributions.

                  (a) The rights of the Certificateholders to receive
         distributions in respect of the Certificates shall be and hereby are
         subordinated to the rights of the [Class A-1] Noteholders to receive
         distributions in respect of the [Class A-1] Notes to the extent
         provided in this Section 5.06.

                  (b) On each Determination Date, the Servicer shall calculate
         the Available Interest, the Available Principal, the [Allocable
         Principal, the] Yield Supplement Deposit, the Noteholders' Principal
         Distributable Amount, the Certificateholders' Principal Distributable
         Amount, the amount to be distributed to Noteholders of each class and
         Certificateholders of each class pursuant to Section 5.06(c), (d) or
         (e) and all other distributions, deposits and withdrawals to be made on
         the related Distribution Date.

                  (c) Subject to Sections 5.06(d) and (e), on each Distribution
         Date, the Relevant Trustee shall make the following payments and
         distributions from the Collection Account (after payment of the
         Supplemental Servicing Fee to the extent not previously retained by the
         Servicer) in the following order of priority and in the amounts set
         forth in the Servicer's Certificate for such Distribution Date;
         provided, however, that such payments and distributions shall be made
         only from those funds deposited in the Collection Account for the
         related Collection Period:

                           (i) to the Servicer, from amounts on deposit in the
         Collection Account, any payments in respect of Advances required to be
         reimbursed and to the extent set forth in Section 5.04(b);

                                       42        (Sale and Servicing Agreement)
<PAGE>

                           (ii) to the Servicer, from amounts on deposit in the
         Collection Account, any payments in respect of Nonrecoverable Advances
         required to be reimbursed and to the extent set forth in Section
         5.04(c);

                           (iii) to the Servicer, from Available Amounts, the
         Base Servicing Fee (including any unpaid Base Servicing Fees from one
         or more prior Collection Periods);

                           (iv) on a pro rata basis (based on the amounts
         distributable pursuant to this clause to each such Class), to the Class
         A-1 Noteholders, the Noteholders' Interest Distributable Amount for
         such Class, to the Class A-2 Noteholders, the Noteholders' Interest
         Distributable Amount for such Class, and to the Class A-3 Noteholders,
         the Noteholders' Interest Distributable Amount for such Class; such
         amounts to be paid from Available Amounts (after giving effect to any
         reduction in Available Amounts described in clause (iii) above);

                           (v) to the Class B Noteholders, the Noteholders'
         Interest Distributable Amount for such Class; such amounts to be paid
         from Available Amounts (after giving effect to any reduction in
         Available Amounts described in clauses (iii) and (iv) above);

                           (vi) to the Class A-1 Noteholders, an amount equal to
         the Noteholders' Principal Distributable Amount for such Class, such
         amount to be paid from Available Amounts (after giving effect to any
         reduction in Available Amounts described in clauses (iii) through (v)
         above), until the principal amount of the Class A-1 Notes is reduced to
         zero;

                           (vii) [on the Distribution Date on which the Class
         A-1 Notes have been paid in full and on each Distribution Date
         thereafter, to the Class A-2 Noteholders, an amount equal to the
         Noteholders' Principal Distributable Amount, such amount to be paid
         from Available Amounts (after giving effect to any reduction in
         Available Amounts described in clauses (iii) through (vi) above), until
         the principal amount of the Class A-2 Notes is reduced to zero;]

                           (viii) [on the Distribution Date on which the Class
         A-2 Notes have been paid in full and on each Distribution Date
         thereafter, to the Class A-3 Noteholders, an amount equal to the
         Noteholders' Principal Distributable Amount, such amount to be paid
         from Available Amounts (after giving effect to any reduction in
         Available Amounts described in clauses (iii) through (vii) above),
         until the principal amount of the Class A-3 Notes is reduced to zero;]

                           (ix) [to the Class C Certificateholders, an amount
         equal to the Certificateholders' Interest Distributable Amount for such
         Class, such amount to be paid from Available Amounts (after giving
         effect to any reduction in Available Amounts described in clauses (iii)
         through (viii) above);]

                           (x) [on each Distribution Date after the Class B
         Notes have been paid in full, to the Class C Certificateholders, an
         amount equal to the Certificateholders' Principal Distributable Amount
         for such Class, such amount to be paid from Available Amounts (after
         giving effect to any reduction in Available Amounts described in
         clauses

                                       43        (Sale and Servicing Agreement)
<PAGE>

         (iii) through (ix) above), until the principal amount of the Class C
         Certificates is reduced to zero;]

                           (xi) to the Reserve Account, the amount, if any,
         necessary to cause the balance of funds therein to equal the Specified
         Reserve Account Balance with respect to such Distribution Date, such
         amounts to be paid from Available Amounts (after giving effect to any
         reduction in Available Amounts described in clauses (iii) through (x)
         above);

                           (xii) [subject to Section 5.11,] [to the Class D
         Certificateholders, an amount equal to the Certificateholders' Interest
         Distributable Amount for such Class, such amounts to be paid from
         Available Amounts (after giving effect to any reduction in Available
         Amounts described in clauses (iii) through (xi) above);]

                           (xiii) [subject to Section 5.11,] [to the Class D
         Certificateholders, an amount equal to the Class D Certificateholders'
         Pro Rata Monthly Principal Distributable Amount, such amount to be paid
         from Available Amounts (after giving affect to the reduction in
         Available Amounts described in clauses (iii) through (xii) above);]

                           (xiv) [subject to Section 5.11,] [after the Class C
         Certificates have been paid in full, to the Class D Certificateholders,
         an amount equal to the Certificateholders' Principal Distributable
         Amount for such Class, such amount to be paid from Available Amounts
         (after giving effect to the reduction in Available Amounts described in
         clauses (iii) through (xiii) above)]; and

                           (xv) any Available Amounts remaining after giving
         effect to the foregoing, to the Seller.

                  (d) Notwithstanding the provisions of Section 5.06(c), after
         the occurrence of an Event of Default that results in the acceleration
         of any Notes and unless and until such acceleration has been rescinded,
         on each Distribution Date, the Relevant Trustee shall make the
         following payments and distributions from the Collection Account (after
         payment of the Supplemental Servicing Fee to the extent not previously
         retained by the Servicer) in the following order of priority and in the
         amounts set forth in the Servicer's Certificate for such Distribution
         Date; provided, however, that such payments and distributions shall be
         made only from those funds deposited in the Collection Account for the
         related Collection Period:

                           (i) to the Servicer, from amounts on deposit in the
         Collection Account, any payments in respect of Advances required to be
         reimbursed and to the extent set forth in Section 5.04(b);

                           (ii) to the Servicer, from amounts on deposit in the
         Collection Account, any payments in respect of Nonrecoverable Advances
         required to be reimbursed and to the extent set forth in Section
         5.04(c);

                           (iii) to the Servicer, from Available Amounts, the
         Base Servicing Fee (including any unpaid Base Servicing Fees from one
         or more prior Collection Periods);

                                       44        (Sale and Servicing Agreement)
<PAGE>

                           (iv) to the Class A-1 Noteholders, the Noteholders'
         Interest Distributable Amount for such Class (after giving effect to
         any reduction in Available Amounts described in clause (iii) above);

                           (v) to the Class A-1 Noteholders, until the total
         amount paid to such Noteholders in respect of principal from the
         Closing Date is equal to the Original Principal Amount for such Class
         of Notes, such amounts to be paid from Available Amounts (after giving
         effect to any reduction in Available Amounts described in clauses (iii)
         and (iv) above);

                           (vi) on the Distribution Date on which the Class A-1
         Notes have been paid in full and on each Distribution Date thereafter,
         on a pro rata basis (based on the amounts distributable pursuant to
         this clause to each such Class), to the Class A-2 Noteholders, the
         Noteholders' Interest Distributable Amount for such Class, and to the
         Class A-3 Noteholders, the Noteholders' Interest Distributable Amount
         for such Class; such amounts to be paid from Available Amounts (after
         giving effect to any reduction in Available Amounts described in
         clauses (iii) through (v) above);

                           (vii) to the Class A-2 Noteholders and the Class A-3
         Noteholders, on a pro rata basis (based on the Outstanding Amount of
         each Class), until the total amount paid to such Noteholders in respect
         of principal from the Closing Date is equal to the Original Principal
         Amount for such Class of Notes, such amounts to be paid from Available
         Amounts (after giving effect to any reduction in Available Amounts
         described in clauses (iii) through (vi) above);

                           (viii) to the Class B Noteholders, the Noteholders'
         Interest Distributable Amount for such Class; such amounts to be paid
         from Available Amounts (after giving effect to any reduction in
         Available Amounts described in clauses (iii) through (vii) above);

                           (ix) on each Distribution Date after the Class A
         Notes have been paid in full, to the Class B Noteholders, until the
         total amount paid to the Class B Noteholders in respect of principal
         from the Closing Date is equal to the Original Principal Amount for the
         Class B Notes, such amount to be paid from Available Amounts (after
         giving effect to any reduction in Available Amounts described in
         clauses (iii) through (viii) above);

                           (x) [subject to Section 5.11,] [to the Class C
         Certificateholders, an amount equal to the Certificateholders' Interest
         Distributable Amount for such Class, such amount to be paid from
         Available Amounts (after giving effect to any reduction in Available
         Amounts described in clauses (iii) through (ix) above);]

                           (xi) [subject to Section 5.11,] [on each Distribution
         Date after the Class B Notes have been paid in full, to the Class C
         Certificateholders, until the total amount paid to the Class C
         Certificateholders in respect of principal from the Closing Date is
         equal to the Original Certificate Balance of the Class C Certificates,
         such amount

                                       45        (Sale and Servicing Agreement)
<PAGE>

         to be paid from Available Amounts (after giving effect to the reduction
         in Available Amounts described in clauses (iii) through (x) above)];

                           (xii) [subject to Section 5.11,] [to the Class D
         Certificateholders, an amount equal to the Certificateholders' Interest
         Distributable Amount for such Class, such amounts to be paid from
         Available Amounts (after giving effect to any reduction in Available
         Amounts described in clauses (iii) through (xi) above);]

                           (xiii) [subject to Section 5.11,] [after the Class C
         Certificates have been paid in full, to the Class D Certificateholders,
         an amount equal to the Certificateholders' Principal Distributable
         Amount for such Class, such amount to be paid from Available Amounts
         (after giving effect to the reduction in Available Amounts described in
         clauses (iii) through (xii) above); and]

                           (xiv) any Available Amounts remaining after giving
         effect to the foregoing, to the Seller.

                  (e) [Notwithstanding the provisions of Sections 5.06(c) and
         5.06(d), after the occurrence of an Event of Default that results in
         the acceleration of any Notes, on and after the date on which such
         acceleration has been rescinded, on each Distribution Date, the
         Relevant Trustee shall make the following payments and distributions
         from the Collection Account (after payment of the Supplemental
         Servicing Fee to the extent not previously retained by the Servicer) in
         the following order of priority and in the amounts set forth in the
         Servicer's Certificate for such Distribution Date; provided, however,
         that such payments and distributions shall be made only from those
         funds deposited in the Collection Account for the related Collection
         Period:]

                           (i) [to the Servicer, from amounts on deposit in the
         Collection Account, any payments in respect of Advances required to be
         reimbursed and to the extent set forth in Section 5.04(b);]

                           (ii) [to the Servicer, from amounts on deposit in the
         Collection Account, any payments in respect of Nonrecoverable Advances
         required to be reimbursed and to the extent set forth in Section
         5.04(c);]

                           (iii) [to the Servicer, from Available Amounts, the
         Base Servicing Fee (including any unpaid Base Servicing Fees from one
         or more prior Collection Periods);]

                           (iv) [on a pro rata basis (based on the amounts
         distributable pursuant to this clause to each such Class), to the Class
         A-1 Noteholders, the Noteholders' Interest Distributable Amount for
         such Class, to the Class A-2 Noteholders, the Noteholders' Interest
         Distributable Amount for such Class, and to the Class A-3 Noteholders,
         the Noteholders' Interest Distributable Amount for such Class, such
         amounts to be paid from Available Amounts (after giving effect to any
         reduction in Available Amounts described in clause (iii) above);]

                                       46        (Sale and Servicing Agreement)
<PAGE>

                           (v) [to the Class B Noteholders, the Noteholders'
         Interest Distributable Amount for such Class, such amounts to be paid
         from Available Amounts (after giving effect to any reduction in
         Available Amounts described in clauses (iii) and (iv) above);]

                           (vi) [to the Class A-1 Noteholders, until the total
         amount paid to such Noteholders in respect of principal from the
         Closing Date is equal to the Original Principal Amount for the Class
         A-1 Notes, such amounts to be paid from Available Amounts (after giving
         effect to any reduction in Available Amounts described in clauses (iii)
         through (v) above);]

                           (vii) [to the Class A-2 Noteholders, until the total
         amount paid to such Noteholders in respect of principal from the
         Closing Date is equal to the Original Principal Amount for the Class
         A-2 Notes, such amounts to be paid from Available Amounts (after giving
         effect to any reduction in Available Amounts described in clauses (iii)
         through (vi) above);]

                           (viii) [to the Class A-3 Noteholders, until the total
         amount paid to such Noteholders in respect of principal from the
         Closing Date is equal to the Original Principal Amount for the Class
         A-3 Notes, such amounts to be paid from Available Amounts (after giving
         effect to any reduction in Available Amounts described in clauses (iii)
         through (vii) above);]

                           (ix) [to the Class B Noteholders, until the total
         amount paid to such Noteholders in respect of principal from the
         Closing Date is equal to the Original Principal Amount for the Class B
         Notes, such amounts to be paid from Available Amounts (after giving
         effect to the reduction in Available Amounts described in clauses (iii)
         through (viii) above);]

                           (x) [subject to Section 5.11,] [on each Distribution
         Date after the Class B Notes have been paid in full, to the Class C
         Certificateholders, an amount equal to the Certificateholders' Interest
         Distributable Amount for such Class, such amounts to be paid from
         Available Amounts (after giving effect to any reduction in Available
         Amounts described in clauses (iii) through (ix) above);]

                           (xi) [subject to Section 5.11,] [to the Class C
         Certificateholders, until the total amount paid to the Class C
         Certificateholders in respect of principal from the Closing Date is
         equal to the Original Certificate Balance of the Class C Certificates,
         such amount to be paid from Available Amounts (after giving effect to
         the reduction in Available Amounts described in clauses (iii) through
         (x) above);]

                           (xii) [subject to Section 5.11,] [on each
         Distribution Date after the Class C Certificates have been paid in
         full, to the Class D Certificateholders, an amount equal to the
         Certificateholders' Interest Distributable Amount for such Class, such
         amounts to be paid from Available Amounts (after giving effect to any
         reduction in Available Amounts described in clauses (iii) through (xi)
         above);]

                           (xiii) [subject to Section 5.11,] [to the Class D
         Certificateholders, until the total amount paid to the Class D
         Certificateholders in respect of principal from the

                                       47        (Sale and Servicing Agreement)
<PAGE>

         Closing Date is equal to the Original Certificate Balance of the Class
         D Certificates, such amounts to be paid from Available Amounts (after
         giving effect to any reduction in Available Amounts described in
         clauses (iii) through (xii) above);]

                           (xiv) [any Available Amounts remaining after giving
         effect to the foregoing, to the Seller.]

                  (f) For purposes of determining whether an Event of Default
         pursuant to Section 5.01(b) of the Indenture has occurred, the amount
         of principal required to be paid to the Holders of any Class of Notes
         on any Distribution Date is the amount available to be paid thereto
         pursuant to Section 5.06(c); provided, however, that (i) the Class A-1
         Notes are required to be paid in full on or before the Final Scheduled
         Distribution Date for such Class, meaning that the Class A-1
         Noteholders are entitled to have received on or before such date
         payments in respect of principal in an aggregate amount equal to the
         Original Principal Amount for such Class, together with all interest
         accrued thereon through such date; (ii) the Class A-2 Notes are
         required to be paid in full on or before the Final Scheduled
         Distribution Date for such Class, meaning that the Class A-2
         Noteholders are entitled to have received on or before such date
         payments in respect of principal in an aggregate amount equal to the
         Original Principal Amount for such Class, together with all interest
         accrued thereon through such date; (iii) the Class A-3 Notes are
         required to be paid in full on or before the Final Scheduled
         Distribution Date for such Class, meaning that the Class A-3
         Noteholders are entitled to have received on or before such date
         payments in respect of principal in an aggregate amount equal to the
         Original Principal Amount for such Class, together with all interest
         accrued thereon through such date; and (iv) the Class B Notes are
         required to be paid in full on or before the Final Scheduled
         Distribution Date for such Class, meaning that the Class B Noteholders
         are entitled to have received on or before such date payments in
         respect of principal in an aggregate amount equal to the Original
         Principal Amount for such Class, together with all interest accrued
         thereon through such date.

                  (g) Except with respect to the final payment upon retirement
         of a Note or Certificate, the Servicer shall on each Distribution Date
         instruct the Relevant Trustee to pay or distribute to each
         Securityholder of record on the related Record Date by check mailed to
         such Securityholder at the address of such Holder appearing in the
         Certificate Register or Note Register, as the case may be (or, if DTC,
         its nominee or a Clearing Agency is the relevant Holder, by wire
         transfer of immediately available funds or pursuant to other
         arrangements), the amount to be paid or distributed to such
         Securityholder pursuant to such Holder's Note or Certificate. With
         respect to the final payment upon retirement of a Note or Certificate,
         the Servicer shall on the relevant final Distribution Date instruct the
         Relevant Trustee to pay or distribute the amounts due thereon only upon
         delivery for cancellation of the certificate representing such Note or
         Certificate in accordance with the Indenture or the Trust Agreement, as
         the case may be.

         SECTION 5.07 Reserve Account.

                  (a) In order to assure that certain amounts will be available
         to make required payments to Noteholders, the Seller will, pursuant to
         the Securities Account Control

                                       48        (Sale and Servicing Agreement)
<PAGE>

         Agreement, establish and maintain with the Securities Intermediary a
         segregated trust account (the "Reserve Account") in the name of the
         Indenture Trustee which will include the money and other property
         deposited and held therein pursuant to Section 5.06 and this Section
         5.07. On or prior to the Closing Date, the Seller shall deposit an
         amount equal to the Reserve Account Initial Deposit into the Reserve
         Account. As and to the extent set forth in Section 5.06(c), the
         Relevant Trustee will deposit Available Amounts into the Reserve
         Account on each Distribution Date as provided in the Servicer's
         Certificate, until the amount on deposit therein equals the Specified
         Reserve Account Balance. On each Distribution Date, to the extent that
         amounts in the Collection Account and/or Available Amounts, as the case
         may be, are insufficient to fully fund the payments and distributions
         described in clauses (i) through (x) of Section 5.06(c), clauses (i)
         through (xi) of Section 5.06(d), or clauses (i) through (xi) of Section
         5.06 (e) the Relevant Trustee will withdraw amounts then on deposit in
         the Reserve Account, up to the amounts of any such deficiencies, and
         deposit such amounts into the Collection Account for application
         pursuant to such clauses. On each Distribution Date, as provided in the
         Servicer's Certificate, the Relevant Trustee will release to the Seller
         any amounts remaining on deposit in the Reserve Account in excess of
         the Specified Reserve Account Balance. Upon the payment in full of the
         Notes under the Indenture, as directed in writing by the Servicer, the
         Relevant Trustee will release to the Seller any amounts remaining on
         deposit in the Reserve Account, and all rights to the Reserve Account
         and all other collateral registered or held therein shall revert to the
         Seller in accordance with the Securities Account Control Agreement.
         Upon any such distribution to the Seller, the Issuer, Owner Trustee,
         Certificateholders, Indenture Trustee and Noteholders will have no
         further rights in, or claims to, such amounts.

                  (b) All amounts held in the Reserve Account shall be invested
         by the Relevant Trustee, as directed in writing by the Servicer, in
         Eligible Investments; provided that if (x) the Servicer shall have
         failed to give investment directions for any funds on deposit in the
         Reserve Account to the Indenture Trustee by 5:00 p.m. Eastern Time (or
         such other time as may be agreed by the Servicer and the Indenture
         Trustee) on any Business Day, or (y) a Default or Event of Default
         shall have occurred and be continuing with respect to the Notes but the
         Notes shall not have been declared due and payable pursuant to the
         Indenture, or (z) the Notes shall have been declared due and payable
         following an Event of Default, but amounts collected or receivable from
         the Trust Estate are being applied pursuant to Section 5.05 of the
         Indenture as if there had not been such a declaration, then the
         Indenture Trustee shall, to the fullest extent practicable, invest and
         reinvest funds in the Reserve Account in one or more Eligible
         Investments specified in clauses (i), (iv) or (vi) of the definition of
         Eligible Investments. All such Eligible Investments shall mature not
         later than the Business Day preceding the next Distribution Date, in
         such manner that such amounts invested shall be available to make the
         required deposits on the Distribution Date; provided that if permitted
         by the Rating Agencies, monies on deposit therein may be invested in
         Eligible Investments that mature later than the Business Day preceding
         the next Distribution Date. The Servicer will not direct the Relevant
         Trustee to make any investment of any funds or to sell any investment
         held in the Reserve Account unless the security interest granted and
         perfected in such account will continue to be perfected in such
         investment or the proceeds of such sale, in either case without any
         further action by any Person, and, in connection with any direction to
         the Relevant

                                       49        (Sale and Servicing Agreement)
<PAGE>

         Trustee to make any such investment or sale, if requested by the
         Relevant Trustee, the Servicer shall deliver to the Relevant Trustee an
         Opinion of Counsel, acceptable to the Relevant Trustee, to such effect.
         Earnings, if any, on investment of funds in the Reserve Account shall
         be paid to the Seller, and losses and any investment expenses shall be
         charged against the funds on deposit therein. The Relevant Trustee
         shall incur no liability for the selection of investments or for losses
         thereon absent its own negligence or willful misfeasance. The Relevant
         Trustee shall have no liability in respect of losses incurred as a
         result of the liquidation of any investment prior to its stated
         maturity date or the failure of the Servicer to provide timely written
         investment directions.

                  (c) Subject to the right of the Relevant Trustee to make
         withdrawals therefrom, as directed by the Servicer, for the purposes
         and in the amounts set forth in Section 5.06 and 5.07(a), the Reserve
         Account and all funds held therein shall be the property of the Seller
         and not the property of the Issuer, the Owner Trustee or the Indenture
         Trustee. The Issuer, the Owner Trustee, the Seller and the Indenture
         Trustee will treat the Reserve Account, all funds therein and all net
         investment income with respect thereto as assets of the Seller for
         federal income tax and all other purposes.

                  (d) The Seller hereby grants to the Owner Trustee and the
         Indenture Trustee for the benefit of the Noteholders and the Class C
         Certificateholders a security interest in the Reserve Account and all
         funds (including Eligible Investments) in the Reserve Account
         (including the Reserve Account Initial Deposit) and the proceeds
         thereof to secure the payment of interest on and principal of the
         Notes, and the Owner Trustee and the Indenture Trustee shall have all
         of the rights of a secured party under the UCC with respect thereto;
         provided that all income from the investment of funds in the Reserve
         Account and the right to receive such income are retained by the Seller
         and are not transferred, assigned or otherwise conveyed hereunder. If
         for any reason the Reserve Account is no longer an Eligible Deposit
         Account, the Relevant Trustee shall promptly cause the Reserve Account
         to be moved to another institution or otherwise changed so that the
         Reserve Account becomes an Eligible Deposit Account.

                  (e) Neither the Owner Trustee nor the Indenture Trustee shall
         enter into any subordination or intercreditor agreement with respect to
         the Reserve Account.

         SECTION 5.08 [Yield Supplement Account.

                  (a) In order to assure that sufficient amounts to make
         required distributions of interest to Noteholders and the Class C
         Certificateholders will be available, the Owner Trustee will, pursuant
         to the Securities Account Control Agreement and the Yield Supplement
         Agreement, establish and maintain with the Securities Intermediary a
         segregated trust account (the "Yield Supplement Account") in the name
         of the Indenture Trustee which will include the money and other
         property deposited and held therein pursuant to the Yield Supplement
         Agreement and this Section 5.08.

                  (b) On or prior to the Closing Date, the Seller shall [[make a
         capital contribution to the Trust by depositing an amount equal to
         $___________] [deposit an amount equal to $_________] [in cash] into
         the Yield Supplement Account][, transfer

                                       50        (Sale and Servicing Agreement)
<PAGE>

         retail installment sales contracts with an aggregate principal balance,
         as of the Cut-Off Date, of $_________ to the Trust] [and transfer
         receivables [or other assets] in an amount, collectively, equal to
         $__________ to the Trust] ([the][collectively,] "Initial Yield
         Supplement Amount"). [On each Distribution Date, the Servicer will
         deposit payments received with respect to the retail installment sales
         contracts referred to above into the Yield Supplement Account.] [On
         each Distribution Date, the Servicer will deposit payments received
         with respect to those receivables [or other assets] referred to above
         into the Yield Supplement Account.] Each Distribution Date, to the
         extent amounts then on deposit in the Yield Supplement Account are
         sufficient therefor, the Relevant Trustee will withdraw amounts then on
         deposit in the Yield Supplement Account in an amount equal to the Yield
         Supplement Deposit with respect to such Distribution Date and deposit
         such amounts into the Collection Account for application pursuant to
         Section 5.06. On each Distribution Date, if the amount on deposit in
         the Yield Supplement Account (after giving effect to all deposits
         thereto or withdrawals therefrom on such Distribution Date) is greater
         than the Required Yield Supplement Amount, the Relevant Trustee will
         deposit such excess into the Collection Account for distribution by the
         Relevant Trustee in accordance with the terms of Section 5.06(c). Upon
         payment in full of the Notes under the Indenture, as directed in
         writing by the Servicer, the Indenture Trustee will release any amounts
         remaining on deposit in the Yield Supplement Account, and all rights to
         the Yield Supplement Account and all other collateral registered or
         held therein to the Seller.

                  (c) All amounts held in the Yield Supplement Account shall be
         invested by the Relevant Trustee, as directed in writing by the
         Servicer, in Eligible Investments; provided that if (x) the Servicer
         shall have failed to give investment directions for any funds on
         deposit in the Yield Supplement Account to the Indenture Trustee by
         5:00 p.m. Eastern Time (or such other time as may be agreed by the
         Servicer and the Indenture Trustee) on any Business Day, or (y) a
         Default or Event of Default shall have occurred and be continuing with
         respect to the Notes but the Notes shall not have been declared due and
         payable pursuant to the Indenture, or (z) the Notes shall have been
         declared due and payable following an Event of Default, but amounts
         collected or receivable from the Trust Estate are being applied
         pursuant to Section 5.05 of the Indenture as if there had not been such
         a declaration, then the Indenture Trustee shall, to the fullest extent
         practicable, invest and reinvest funds in the Yield Supplement Account
         in one or more Eligible Investments specified in clauses (i), (iv) or
         (vi) of the definition of Eligible Investments. All such Eligible
         Investments shall mature not later than the Business Day preceding the
         next Distribution Date, in such manner that such amounts invested shall
         be available to make the required deposits on the Distribution Date;
         provided, that if permitted by the Rating Agencies, monies on deposit
         therein may be invested in Eligible Investments that mature later than
         the Business Day preceding the next Distribution Date. The Servicer
         will not direct the Relevant Trustee to make any investment of any
         funds or to sell any investment held in the Yield Supplement Account
         unless the security interest granted and perfected in such account will
         continue to be perfected in such investment or the proceeds of such
         sale, in either case without any further action by any Person, and, in
         connection with any direction to the Relevant Trustee to make any such
         investment or sale, if requested by the Relevant Trustee, the Servicer
         shall deliver to the Relevant Trustee an Opinion of Counsel, acceptable
         to the Relevant Trustee, to such effect. Earnings, if any,

                                       51        (Sale and Servicing Agreement)
<PAGE>

         on investment of funds in the Yield Supplement Account shall be
         deposited in the Collection Account on each Distribution Date, and
         losses and any investment expenses shall be charged against the funds
         on deposit therein. The Relevant Trustee shall incur no liability for
         the selection of investments or for losses thereon absent its own
         negligence or willful misfeasance. The Relevant Trustee shall have no
         liability in respect of losses incurred as a result of the liquidation
         of any investment prior to its stated maturity date or the failure of
         the Servicer to provide timely written investment directions.

                  (d) [The Trust, the Owner Trustee, the Seller and the
         Indenture Trustee will treat the Yield Supplement Account, all funds
         therein and all net investment income with respect thereto as assets of
         the Trust for federal income tax and all other purposes.]

                  (e) Pursuant to the Yield Supplement Agreement and the
         Securities Account Control Agreement, the Trust will grant to the
         Indenture Trustee, for the benefit of the Noteholders and the Class C
         Certificateholders, a security interest in all funds (including
         Eligible Investments) in the Yield Supplement Account (including the
         Initial Yield Supplement Amount) and the proceeds thereof to secure the
         payment of interest on the Notes, and the Indenture Trustee shall have
         all of the rights of a secured party under the UCC with respect
         thereto. If for any reason the Yield Supplement Account is no longer an
         Eligible Deposit Account, the Relevant Trustee shall promptly cause the
         Yield Supplement Account to be moved to another institution or
         otherwise changed so that the Yield Supplement Account becomes an
         Eligible Deposit Account.

                  (f) Neither the Owner Trustee nor the Indenture Trustee shall
         enter into any subordination or intercreditor agreement with respect to
         the Yield Supplement Account.]

         SECTION 5.09 Statements to Certificateholders and Noteholders.

                  (a) On each Distribution Date, the Indenture Trustee shall
         include with each distribution to each Noteholder and the Owner Trustee
         shall include with each distribution to each Certificateholder a
         statement (which statement shall also be provided to each Rating
         Agency) based on information in the Servicer's Certificate furnished
         pursuant to Section 4.08, setting forth for the Collection Period
         relating to such Distribution Date the following information:

                           (i) the amount of the payment allocable to the
         principal amount of each Class of Notes and to the Certificate Balance
         of each Class of Certificates;

                           (ii) the amount of the payment allocable to interest
         on or with respect to each Class of Notes and Certificates;

                           (iii) the amount of the distribution allocable to the
         Yield Supplement Deposit, if any plus reinvestment income, if any, on
         the Yield Supplement Account;

                           (iv) the Pool Balance as of the close of business on
         the last day of the related Collection Period;

                                       52        (Sale and Servicing Agreement)
<PAGE>

                           (v) the amount of the Base Servicing Fee paid to the
         Servicer with respect to the related Collection Period, the amount of
         any unpaid Base Servicing Fees and the change in such amount from that
         of the prior Distribution Date;

                           (vi) the Noteholders' Interest Rate or the
         Pass-Through Rate for the Interest Period relating to the succeeding
         Distribution Date for any Class of Notes or the Certificates with
         variable or adjustable rates;

                           (vii) the Noteholders' Interest Carryover Shortfall,
         the Noteholders' Principal Carryover Shortfall, the Certificateholders'
         Interest Carryover Shortfall, the Certificateholders' Principal
         Carryover Shortfall, if any, with respect to each Class of Notes and
         the Certificates, and the change in such amounts from the preceding
         Distribution Date;

                           (viii) the Outstanding Amount, the Note Factor and
         the Note Pool Factor with respect to each Class of Notes, the aggregate
         Certificate Balance and the Certificate Balance, the Certificate Factor
         and the Certificate Pool Factor with respect to each Class of
         Certificates, in each case after giving effect to all payments in
         respect of principal on such Distribution Date;

                           (ix) the amount of Advances made in respect of the
         Receivables during the related Collection Period and the amount of
         unreimbursed Advances on such Distribution Date;

                           (x) the balance of the Reserve Account [and the Yield
         Supplement Account] on such Distribution Date, after giving effect to
         changes thereto on such Distribution Date and the amount of such
         changes;

                           (xi) the amount of defaults and net losses on the
         Receivables for the related Collection Period; [and]

                           (xii) the number of delinquencies on the Receivables
         as a percentage of the number of Receivables; [and]

                           (xiii) [the Yield Supplement Purchase Price
         Adjustment Amount.]

                  (b) Copies of such statements may be obtained by the
         Certificateholders or the Note Owners from the Owner Trustee or the
         Indenture Trustee, as the case may be, by a request in writing. The
         Owner Trustee or the Indenture Trustee, as the case may be, shall
         provide such copies promptly after such requests.

         SECTION 5.10 Net Deposits. So long as NMAC is the Servicer, the
Servicer (in whatever capacity) may make the remittances pursuant to Sections
5.02 and 5.05 above net of amounts to be distributed to the Servicer (in
whatever capacity) pursuant to Section 5.06. Accounts between the Seller and the
Servicer will be adjusted accordingly. Nonetheless, the Servicer shall account
for all of the above described remittances and distributions (except for the
Supplemental Servicing Fee to the extent that the Servicer is entitled to retain
such amounts) in the Servicer's Certificate as if the amounts were deposited
and/or transferred separately.

                                       53        (Sale and Servicing Agreement)
<PAGE>

         SECTION 5.11 [Swap Agreement. Pursuant to the Trust Agreement, the
Issuer may, from time to time, as directed by the Certificateholders by means of
notice to the Administrator, enter into a currency Swap Agreement with a Swap
Counterparty to swap amounts payable to Certificateholders from U.S. dollars to
Japanese yen; provided, that (1) at the time the Issuer enters into the Swap
Agreement, the rating agencies have confirmed the then-existing ratings of the
Notes, and (2) any payments to the Swap Counterparty (including termination
payments) are payable only from amounts that are otherwise payable to the
Certificateholders. Any payments received by the Issuer from the Swap
Counterparty under such a Swap Agreement shall not be deposited in the
Collection Account and shall be paid by the Indenture Trustee directly to or to
the order of the Certificateholders on the related Distribution Date. In
connection with executing any such Swap Agreement, the Issuer, Indenture
Trustee, Owner Trustee, Seller and Servicer will enter into an amendment to this
Sale and Servicing Agreement, subject to Section 10.01 in a form approved by the
Certificateholders, that will specify the creation of any necessary accounts and
modifications of any provisions hereof to the extent necessary or appropriate to
effectuate the intention of such Swap Agreement.]

                                   ARTICLE VI

                                   The Seller

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

                  (a) Organization and Good Standing. The Seller has been duly
         organized and is validly existing as a corporation in good standing
         under the laws of the State of Delaware, with corporate power and
         authority to own its properties and to conduct its business as such
         properties are currently owned and such business is presently
         conducted, and had at all relevant times, and has, corporate power,
         authority and legal right to acquire and own the Receivables. The
         location of the Seller's chief executive office and principal place of
         business is Torrance, California.

                  (b) Due Qualification. The Seller is duly qualified to do
         business as a foreign corporation in good standing, and has obtained
         all necessary licenses and approvals in all jurisdictions in which the
         ownership or lease of property or the conduct of its business shall
         require such qualifications and where the failure to so qualify would
         have a material adverse effect on the ability of the Seller to perform
         its obligations under this Agreement.

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

                                       54        (Sale and Servicing Agreement)
<PAGE>

                  (d) Valid Sale; Binding Obligations. This Agreement evidences
         a valid sale, transfer and assignment of the Receivables, enforceable
         against creditors of and purchasers from the Seller (other than a good
         faith purchaser for value in the ordinary course of business who takes
         actual possession of one or more Receivables); and this Agreement is a
         legal, valid and binding obligation of the Seller enforceable in
         accordance with its terms, subject to the effect of bankruptcy,
         insolvency, reorganization, moratorium or other similar laws affecting
         creditors' rights generally and by general equitable principles.

                  (e) No Violation. The consummation of the transactions
         contemplated by this Agreement and the fulfillment of the terms hereof
         do not conflict with, result in any breach of any of the terms and
         provisions of, nor constitute (with or without notice or lapse of time)
         a default under, the certificate of incorporation or by-laws of the
         Seller, or any indenture, agreement or other instrument to which the
         Seller is a party or by which it shall be bound; nor result in the
         creation or imposition of any Lien upon any of its properties pursuant
         to the terms of any such indenture, agreement or other instrument
         (other than the Basic Documents); nor violate any law or, to the best
         of the Seller's knowledge, any order, rule or regulation applicable to
         the Seller of any court or of any federal or state regulatory body,
         administrative agency or other governmental instrumentality having
         jurisdiction over the Seller or its properties; which breach, default,
         conflict, Lien or violation in any case would have a material adverse
         effect on the ability of the Seller to perform its obligations under
         this Agreement.

                  (f) No Proceedings. There are no proceedings or investigations
         pending, or, to the best of the Seller's knowledge, threatened, before
         any court, regulatory body, administrative agency or other governmental
         instrumentality having jurisdiction over the Seller or its properties:
         (i) asserting the invalidity of this Agreement, the Trust Agreement,
         the Indenture, the Securities Account Control Agreement, the Yield
         Supplement Agreement, the Certificates or the Notes; (ii) seeking to
         prevent the issuance of the Certificates or the Notes or the
         consummation of any of the transactions contemplated by this Agreement,
         the Trust Agreement, the Indenture, the Securities Account Control
         Agreement or the Yield Supplement Agreement; (iii) seeking any
         determination or ruling that would materially and adversely affect the
         performance by the Seller of its obligations under, or the validity or
         enforceability of, this Agreement, the Trust Agreement, the Indenture,
         the Securities Account Control Agreement, the Yield Supplement
         Agreement, the Certificates or the Notes; or (iv) relating to the
         Seller and that would adversely affect the federal or any state income
         tax attributes of the Issuer, the Certificates or the Notes.

         SECTION 6.02 Additional Covenants of the Seller.

                  (a) The Seller agrees with the Certificateholders, the Note
         Owners and each Rating Agency that the Seller shall not issue any
         securities or deposit assets into a trust that issues any securities,
         the issuance of which could reasonably be expected to materially and
         adversely affect the rating of any Class of Notes or the Class C
         Certificates unless it shall have first obtained the written consent of
         each Rating Agency to the effect that such issuance will not materially
         adversely affect such rating; provided

                                       55        (Sale and Servicing Agreement)
<PAGE>

         that, the issuance of another series of certificates or notes pursuant
         to agreements with terms substantially similar to the terms of the
         Basic Documents shall not be deemed to materially and adversely affect
         the ratings on the Certificates or the Notes. The Seller shall provide
         a copy of any such consent to the Owner Trustee and the Indenture
         Trustee.

                  (b) The Seller shall not do any of the following (without the
         prior written consent of each Rating Agency (other than Moody's) (which
         consent shall be to the effect that the acts set forth below shall not
         affect materially adversely the rating on any Class of Notes or the
         Class C Certificates) and, upon the Seller's receipt of such written
         consent from each Rating Agency (other than Moody's), the Owner Trustee
         and the Indenture Trustee shall, without any exercise of its own
         discretion, also provide its written consent to the Seller (promptly
         after the occurrence of any of the following, the Seller shall provide
         notice of such occurrence to Moody's, so long as Moody's is then rating
         any outstanding Notes or Certificates)):

                           (1) engage in any business or activity other than
those set forth in Article Three of the Seller's Certificate of Incorporation,
as amended;

                           (2) incur any indebtedness, or assume or guaranty any
indebtedness of any other entity, other than (A) any indebtedness incurred in
connection with the issuance of any certificates or notes (as defined in the
Seller's Certificate of Incorporation), provided that any such future
indebtedness incurred in connection with the issuance of any certificates or
notes must be rated at least with the same ratings given the outstanding
certificates or notes secured or supported by assets acquired by the Seller from
NMAC by each nationally recognized statistical rating organization that has
rated such outstanding certificates or notes or, prior to the issuing of such
future indebtedness incurred in connection with such certificates or notes, the
Seller shall have received confirmation from each nationally recognized
statistical rating organization that has rated such outstanding certificates or
notes that the ratings of such outstanding certificates or notes will not be
adversely affected by the issuance of such future indebtedness; and (B) (i) any
indebtedness to NMAC or any of its Affiliates incurred in connection with the
acquisition of receivables, which indebtedness shall be fully subordinated (and
which shall provide for payment only after payment in respect of all outstanding
rated debt) and nonrecourse against any assets of the Seller other than the
assets pledged to secure such indebtedness, (ii) such indebtedness does not
constitute a claim against the Seller in the event the assets pledged to secure
such indebtedness are insufficient to pay such indebtedness, (iii) holders of
such indebtedness agree that they have no rights in any assets of the Seller
other than the assets pledged to secure such indebtedness, and (iv) to the
extent that any holder of such indebtedness is deemed to have any interest in
any assets of the Seller other than the assets pledged to secure such
indebtedness, holders of such indebtedness agree that their interest is
subordinate to claims or rights of holders of other indebtedness issued by the
Seller, and that such agreement constitutes a subordination agreement for
purposes of Section 510(a) of the Bankruptcy Code;

                                       56        (Sale and Servicing Agreement)
<PAGE>

                           (3) dissolve or liquidate, in whole or in part,
consolidate or merge with or into any other entity or convey or transfer its
properties and assets substantially as an entirety to any entity, unless:

                           (i) the entity (if other than the Seller) formed or
                  surviving the consolidation or merger or which acquires the
                  properties and assets of the Seller is organized and existing
                  under the laws of the State of Delaware, expressly assumes the
                  due and punctual payment of all obligations of the Seller,
                  including those obligations of the Seller under this Agreement
                  and the Basic Documents, and has a Certificate of
                  Incorporation containing provisions identical to the
                  provisions of Article Three, Article Four and Article Fifteen
                  of the Seller's Certificate of Incorporation, as amended;

                           (ii) immediately after giving effect to the
                  transaction, no default or event of default has occurred and
                  is continuing under any indebtedness of the Seller or any
                  agreements relating to such indebtedness;

                           (iii) the entity (if other than the Seller) formed or
                  surviving the consolidation or merger or which acquires the
                  properties and assets of the Seller agrees that (i) it shall
                  maintain its funds or assets as identifiable and not commingle
                  its funds or assets with those of any direct or ultimate
                  parent of such entity and pay from its assets all obligations
                  and indebtedness of any kind incurred by it, (ii) it shall
                  maintain bank accounts, corporate records and books of account
                  separate from those of any direct or ultimate parent of such
                  entity and (iii) the business affairs of such entity will be
                  managed by or under the direction of its board of directors
                  and it will conduct its business from an office space separate
                  from any direct or ultimate parent of such entity; and

                           (iv) each nationally recognized statistical rating
                  organization that has rated any issue of certificates or notes
                  secured or supported by assets acquired by the Seller from
                  NMAC shall confirm in writing that the rating of such
                  certificates or notes shall not be adversely affected by such
                  consolidation or merger;

                           (4) without the affirmative vote of 100% of the
members of the board of directors of the Seller, institute proceedings to be
adjudicated bankrupt or insolvent, or consent to the institution of bankruptcy
or insolvency proceedings against it, or file a petition seeking or consent to
reorganization or relief under any applicable federal or state law relating to
bankruptcy, or consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or other similar official) of the corporation or all or
substantially all of its property, or make any assignment for the benefit of
creditors;

                           (5) cease to have an "Independent Director," as
defined in the Seller's charter;

                           (6) without the affirmative vote of at least one
"Independent Director," as defined in the Seller's charter, enter into any
transactions with the Servicer not in the ordinary course of business; or

                                       57        (Sale and Servicing Agreement)
<PAGE>

                           (7) modify any provision of the "Restricted
Articles," as defined in the Seller's Certificate of Incorporation, of the
Seller's Certificate of Incorporation, as amended, in any material respect.

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

                  (a) The Seller shall indemnify, defend and hold harmless the
         Trust, the Owner Trustee, the Indenture Trustee from and against any
         taxes that may at any time be asserted against any such Person with
         respect to, as of the date hereof, the sale of the Receivables to the
         Trust or the issuance and original sale of the Notes and the
         Certificates, including any sales, gross receipts, general corporation,
         tangible personal property, privilege or license taxes (but, in the
         case of the Trust, not including any taxes asserted with respect to
         ownership of the Receivables or federal or other income taxes arising
         out of the transactions contemplated by this Agreement and the Basic
         Documents) and costs and expenses in defending against the same.

                  (b) The Seller shall indemnify, defend and hold harmless the
         Owner Trustee and the Indenture Trustee, the Trust, the
         Certificateholders and the Noteholders from and against any loss,
         liability or expense incurred by reason of (i) the Seller's willful
         misfeasance, bad faith or negligence in the performance of its duties
         under this Agreement, or by reason of reckless disregard of its
         obligations and duties under this Agreement, and (ii) the Seller's or
         the Issuer's violation of federal or state securities laws in
         connection with the registration or the sale of the Certificates and
         the Notes. Indemnification under this Section 6.03 shall survive the
         termination of this Agreement and shall include reasonable fees and
         expenses of counsel and expenses of litigation. If the Seller shall
         have made any indemnity payment to any Person entitled thereto pursuant
         to this Section 6.03 and such Person thereafter shall collect any of
         such amounts from others, such Person shall promptly repay such amounts
         to the Seller, without interest (except to the extent the recipient
         collects interest from others).

         Promptly after receipt by a party indemnified under this Section 6.03
(for purposes of this paragraph, an "Indemnified Party") of notice of the
commencement of any action, such Indemnified Party will, if a claim is to be
made in respect thereof against the Seller under this Section 6.03, notify the
Seller of the commencement thereof. If any such action is brought against any
Indemnified Party under this Section 6.03 and it notifies the Seller of the
commencement thereof, the Seller will assume the defense thereof, with counsel
reasonably satisfactory to such Indemnified Party (who may, unless there is, as
evidenced by an Opinion of Counsel to the Indemnified Party stating that there
is, a conflict of interest, be counsel to the Seller), and the Seller will not
be liable to such Indemnified Party under this Section 6.03 for any legal or
other expenses subsequently incurred by such Indemnified Party in connection
with the defense thereof, other than reasonable costs of investigation. The
obligations set forth in this Section 6.03 shall survive the termination of this
Agreement or the resignation or removal of the Owner Trustee or the Indenture
Trustee and shall include reasonable fees and expenses of counsel and expenses
of litigation. If the Seller shall have made any indemnity payments

                                       58        (Sale and Servicing Agreement)
<PAGE>

pursuant to this Section 6.03 and the Person to or on behalf of whom such
payments are made thereafter collects any of such amounts from others, such
Person shall promptly repay such amounts to the Seller, without interest (except
to the extent received by such Person).

         SECTION 6.04 Merger or Consolidation of, or Assumption of the
Obligations of, Seller. Subject to Section 6.02, any Person (i) into which the
Seller may be merged or consolidated, (ii) resulting from any merger, conversion
or consolidation to which the Seller shall be a party, (iii) succeeding to the
business of the Seller or (iv) that is a corporation more than 50% of the voting
stock of which is owned directly or indirectly by Nissan, which Person in any of
the foregoing cases executes an agreement of assumption to perform every
obligation of the Seller under this Agreement, will be the successor to the
Seller under this Agreement without the execution or filing of any document or
any further act on the part of any of the parties to this Agreement; provided,
however, that (x) immediately after giving effect to such transaction, no
representation or warranty made pursuant to Section 6.01 shall have been
breached and no Servicer Default, and no event that, after notice or lapse of
time, or both, would become a Servicer Default, shall have occurred and be
continuing, (y) the Seller shall have delivered to the Owner Trustee and the
Indenture Trustee an Officer's Certificate stating that such consolidation,
merger or succession and such agreement or assumption comply with this Section
6.04 and that all conditions precedent, if any, provided for in this Agreement
relating to such transaction have been complied with and (z) the Seller shall
have delivered to the Owner Trustee and the Indenture Trustee an Opinion of
Counsel either (A) stating that, in the opinion of such counsel, based on
customary qualifications and assumptions, all financing statements and
continuation statements and amendments thereto have been executed and filed that
are necessary fully to perfect the interest of the Issuer and the Indenture
Trustee, respectively, in the Receivables, and reciting the details of such
filings, or (B) stating that, in the opinion of such counsel, no such action
shall be necessary to preserve and protect such interest. The Seller shall
provide notice of any merger, consolidation or succession pursuant to this
Section 6.04 to each Rating Agency. Notwithstanding anything herein to the
contrary, the execution of the foregoing agreement of assumption and compliance
with clauses (x), (y) and (z) above shall be conditions to the consummation of
the transactions referred to in clauses (i), (ii), (iii) or (iv) above.

         SECTION 6.05 Limitation on Liability of Seller and Others.

                  (a) Neither the Seller nor any of the directors, officers,
         employees or agents of the Seller shall be under any liability to the
         Trust, the Certificateholders or the Noteholders, except as provided
         under this Agreement, for any action taken or for refraining from the
         taking of any action pursuant to this Agreement or for errors in
         judgment; provided, however, that this provision shall not protect the
         Seller or any such person against any liability that would otherwise be
         imposed by reason of willful misfeasance, bad faith or negligence in
         the performance of duties or by reason of reckless disregard of
         obligations and duties under this Agreement. The Seller and any
         director, officer, employee or agent of the Seller may rely in good
         faith on the advice of counsel or on any document of any kind, prima
         facie properly executed and submitted by any Person respecting any
         matters arising under this Agreement.

                  (b) The Seller shall not be under any obligation to appear in,
         prosecute or defend any legal action that shall not be incidental to
         its obligations under this

                                       59        (Sale and Servicing Agreement)
<PAGE>

         Agreement, and that in its opinion may cause it to incur any expense or
         liability; provided, however, that the Servicer may undertake any
         reasonable action that it may deem necessary or desirable in respect of
         this Agreement and the rights and duties of the parties to this
         Agreement and the interests of the Certificateholders and the
         Noteholders under this Agreement. In such event, the legal expenses and
         costs of such action and any liability resulting therefrom shall be
         expenses, costs and liabilities of the Servicer, and the Servicer will
         not be entitled to be reimbursed therefor.

         SECTION 6.06 Seller May Own Certificates or Notes. The Seller and any
Affiliate of the Seller may in its individual or any other capacity become the
owner or pledgee of Certificates or Notes with the same rights as it would have
if it were not the Seller or an Affiliate thereof, except as otherwise provided
in the Basic Documents. Certificates or Notes so owned by or pledged to the
Seller or such controlling or commonly controlled Person shall have an equal and
proportionate benefit under the provisions of this Agreement, without
preference, priority or distinction as among all of the Certificates or the
Notes, as the case may be, except as otherwise expressly provided in the Basic
Documents.

                                  ARTICLE VII

                                  The Servicer

         SECTION 7.01 Representations of Servicer. The Servicer makes the
following representations on which the Issuer is deemed to have relied in
acquiring the Receivables. The representations speak as of the execution and
delivery of this Agreement and as of the Closing Date and shall survive the sale
of the Receivables to the Issuer and the pledge thereof to the Indenture Trustee
pursuant to the Indenture.

                  (a) Organization and Good Standing. The Servicer is duly
         organized and is validly existing as a corporation in good standing
         under the laws of the state of its incorporation, with corporate power
         and authority to own its properties and to conduct its business as such
         properties are currently owned and such business is presently
         conducted, and had at all relevant times, and has, corporate power,
         authority and legal right to acquire, own, sell and service the
         Receivables and to hold the Receivable Files as custodian on behalf of
         the Trust and the Indenture Trustee. The location of the Servicer's
         chief executive office and principal place of business is Torrance,
         California.

                  (b) Due Qualification. The Servicer is duly qualified to do
         business as a foreign corporation in good standing, and has obtained
         all necessary licenses and approvals in all jurisdictions in which the
         ownership or lease of property or the conduct of its business relating
         to the servicing of the Receivables as required by this Agreement shall
         require such qualifications and where the failure to so qualify would
         have a material adverse effect on the ability of the Servicer to
         perform its obligations under this Agreement.

                  (c) Power and Authority. The Servicer has the power and
         authority to execute and deliver this Agreement and to carry out its
         terms; and the execution, delivery and

                                       60        (Sale and Servicing Agreement)
<PAGE>

         performance of this Agreement have been duly authorized by the Servicer
         by all necessary corporate action.

                  (d) Binding Obligation. This Agreement constitutes a legal,
         valid and binding obligation of the Servicer enforceable in accordance
         with its terms, subject to the effect of bankruptcy, insolvency,
         reorganization, moratorium or other similar laws affecting creditors'
         rights generally and by general equitable principles.

                  (e) No Violation. The consummation of the transactions
         contemplated by this Agreement and the fulfillment of the terms hereof
         do not conflict with, result in any breach of any of the terms and
         provisions of, nor constitute (with or without notice or lapse of time)
         a default under, the articles of incorporation or by-laws of the
         Servicer, or any indenture, agreement or other instrument to which the
         Servicer is a party or by which it shall be bound; nor result in the
         creation or imposition of any Lien upon any of its properties pursuant
         to the terms of any such indenture, agreement or other instrument
         (other than the Basic Documents); nor violate any law or any order,
         rule or regulation applicable to the Servicer of any court or of any
         federal or state regulatory body, administrative agency or other
         governmental instrumentality having jurisdiction over the Servicer or
         its properties; which breach, default, conflict, Lien or violation in
         any case would have a material adverse effect on the ability of the
         Seller to perform its obligations under this Agreement.

                  (f) No Proceedings. There are no proceedings or investigations
         pending, or, to the best of the Servicer's knowledge, threatened,
         before any court, regulatory body, administrative agency or other
         governmental instrumentality having jurisdiction over the Servicer or
         its properties: (i) asserting the invalidity of this Agreement, the
         Trust Agreement, the Indenture, the Purchase Agreement, the
         Certificates or the Notes; (ii) seeking to prevent the issuance of the
         Certificates or the Notes or the consummation of any of the
         transactions contemplated by this Agreement, the Trust Agreement, the
         Indenture or the Purchase Agreement; (iii) seeking any determination or
         ruling that would materially and adversely affect the performance by
         the Servicer of its obligations under, or the validity or
         enforceability of, this Agreement, the Trust Agreement, the Indenture,
         the Purchase Agreement, the Certificates or the Notes; or (iv) relating
         to the Servicer and that would adversely affect the federal or any
         state income tax attributes of the Certificates or the Notes.

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

                  (a) The Servicer shall defend, indemnify and hold harmless the
         Owner Trustee, the Indenture Trustee, the Trust, the Certificateholders
         and the Noteholders from and against any and all costs, expenses,
         losses, damages, claims and liabilities (collectively, "Damages")
         arising out of or resulting from the use, ownership or operation by the
         Servicer or any of its Affiliates (other than the Trust) of a Financed
         Vehicle.

                                       61        (Sale and Servicing Agreement)
<PAGE>

                  (b) The Servicer shall indemnify, defend and hold harmless the
         Owner Trustee, the Indenture Trustee, the Trust, the Certificateholders
         and the Noteholders from and against any and all Damages to the extent
         that such Damage arose out of, or was imposed upon, the Owner Trustee,
         the Indenture Trustee, the Trust, the Certificateholders or the
         Noteholders through the negligence, willful misfeasance or bad faith of
         the Servicer in the performance of its duties under this Agreement or
         by reason of reckless disregard of its obligations and duties under
         this Agreement.

                  (c) The Servicer shall indemnify, defend and hold harmless the
         Owner Trustee and the Indenture Trustee from and against all Damages
         arising out of or incurred in connection with the acceptance or
         performance of the trusts and duties herein contained, except to the
         extent that such Damage: (i) shall be due to the willful misfeasance,
         bad faith, or negligence (except for errors in judgment) of the Owner
         Trustee or the Indenture Trustee, as the case may be; (ii) relates to
         any tax other than the taxes with respect to which the Seller shall be
         required to indemnify the Owner Trustee or the Indenture Trustee; (iii)
         shall arise from the breach by the Owner Trustee or the Indenture
         Trustee of any of their respective representations or warranties set
         forth in the Basic Documents; (iv) shall be one as to which the Seller
         is required to indemnify the Owner Trustee or the Indenture Trustee and
         as to which such Person has received payment of indemnity from the
         Seller; or (v) shall arise out of or be incurred in connection with the
         performance by the Indenture Trustee of the duties of Successor
         Servicer hereunder.

                  Promptly after receipt by a party indemnified under this
Section 7.02 (for purposes of this paragraph, an "Indemnified Party") of notice
of the commencement of any action, such Indemnified Party will, if a claim in
respect thereof is to be made against the Servicer under this Section 7.02,
notify the Servicer of the commencement thereof. If any such action is brought
against any Indemnified Party under this Section 7.02 and it notifies the
Servicer of the commencement thereof, the Servicer will assume the defense
thereof, with counsel reasonably satisfactory to such Indemnified Party (who
may, unless there is, as evidenced by an Opinion of Counsel to the Indemnified
Party stating that there is, a conflict of interest, be counsel to the
Servicer), and the Servicer will not be liable to such Indemnified Party under
this Section 7.02 for any legal or other expenses subsequently incurred by such
Indemnified Party in connection with the defense thereof, other than reasonable
costs of investigation. The obligations set forth in this Section 7.02 shall
survive the termination of this Agreement or the resignation or removal of the
Servicer, the Owner Trustee or the Indenture Trustee and shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Servicer shall have made any indemnity payments pursuant to this Section 7.02
and the Person to or on behalf of whom such payments are made thereafter
collects any of such amounts from others, such Person shall promptly repay such
amounts to the Servicer, without interest (except to the extent received by such
Person).

                  Indemnification under this Section 7.02 by NMAC (or any
successor thereto pursuant to Section 7.03) as Servicer, with respect to the
period such Person was the Servicer, shall survive the termination of such
Person as Servicer or a resignation by such Person as Servicer as well as the
termination of this Agreement and shall include reasonable fees and expenses of
counsel and expenses of litigation. If the Servicer shall have made any
indemnity

                                       62        (Sale and Servicing Agreement)
<PAGE>

payments pursuant to this Section 7.02 and the recipient thereafter collects any
of such amounts from others, the recipient shall promptly repay such amounts to
the Servicer, without interest (except to the extent the recipient collects
interest from others).

         SECTION 7.03 Merger or Consolidation of, or Assumption of the
Obligations of, Servicer. Any Person (i) into which the Servicer may be merged
or consolidated, (ii) resulting from any merger, conversion or consolidation to
which the Servicer shall be a party, (iii) succeeding to the business of the
Servicer, or (iv) so long as NMAC acts as Servicer, that is a corporation more
than 50% of the voting stock of which is owned directly or indirectly by Nissan,
which Person in any of the foregoing cases executes an agreement of assumption
to perform every obligation of the Servicer under this Agreement, will be the
successor to the Servicer under this Agreement without the execution or filing
of any paper or any further act on the part of any of the parties to this
Agreement; provided, however, that (x) immediately after giving effect to such
transaction, no Servicer Default, and no event which, after notice or lapse of
time, or both, would become a Servicer Default, shall have occurred and be
continuing, (y) the Servicer shall have delivered to the Owner Trustee and the
Indenture Trustee an Officer's Certificate stating that such consolidation,
merger or succession and such agreement of assumption comply with this Section
7.03 and that all conditions precedent provided for in this Agreement relating
to such transaction have been complied with and (z) the Servicer shall have
delivered to the Owner Trustee and the Indenture Trustee an Opinion of Counsel
either (A) stating that, in the opinion of such counsel, based on customary
qualifications and assumptions, all financing statements and continuation
statements and amendments thereto have been executed and filed that are
necessary fully to preserve and protect the interest of the Issuer and the
Indenture Trustee in the Receivables, and reciting the details of such filings,
or (B) stating that, in the opinion of such counsel, no such action shall be
necessary to perfect such interest. The Servicer shall provide notice of any
merger, consolidation or succession pursuant to this Section 7.03 to each Rating
Agency. Notwithstanding anything herein to the contrary, the execution of the
foregoing agreement of assumption and compliance with clauses (x), (y) and (z)
above shall be conditions to the consummation of the transactions referred to in
clauses (i), (ii), (iii) or (iv) above.

         SECTION 7.04 Limitation on Liability of Servicer and Others.

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

                  (b) Except as provided in this Agreement, the Servicer shall
         not be under any obligation to appear in, prosecute or defend any legal
         action that shall not be incidental to

                                       63        (Sale and Servicing Agreement)
<PAGE>

         its duties to service the Receivables in accordance with this
         Agreement, and that in its opinion may cause it to incur any expense or
         liability; provided, however, that the Servicer may undertake any
         reasonable action that it may deem necessary or desirable in respect of
         the Basic Documents and the rights and duties of the parties to the
         Basic Documents and the interests of the Certificateholders under this
         Agreement and the Noteholders under the Indenture. In such event, the
         legal expenses and costs of such action and any liability resulting
         therefrom shall be expenses, costs and liabilities of the Servicer, and
         the Servicer will not be entitled to be reimbursed therefor.

         SECTION 7.05 NMAC Not To Resign as Servicer. Subject to the provisions
of Section 7.03, NMAC shall not resign from the obligations and duties hereby
imposed on it as Servicer under this Agreement except upon determination that
the performance of its duties under this Agreement shall no longer be
permissible under applicable law. Notice of any such determination permitting
the resignation of NMAC shall be communicated to the Owner Trustee and the
Indenture Trustee at the earliest practicable time (and, if such communication
is not in writing, shall be confirmed in writing at the earliest practicable
time), and any such determination shall be evidenced by an Opinion of Counsel to
such effect delivered to the Owner Trustee and the Indenture Trustee
concurrently with or promptly after such notice. No such resignation shall
become effective until the Indenture Trustee or a Successor Servicer shall (i)
have taken the actions required by Section 8.01 of this Agreement to effect the
termination of the responsibilities and rights of the predecessor Servicer under
this Agreement, including the transfer to the Successor Servicer for
administration by it of all cash amounts that shall at the time be held by the
predecessor Servicer for deposit, or shall thereafter be received with respect
to a Receivable and the delivery of the Receivable Files, and the related
accounts and records maintained by the Servicer, (ii) have assumed the
responsibilities and obligations of NMAC as Servicer under this Agreement in
accordance with Section 8.02 of this Agreement (other than the initial
Servicer's obligation to make Advances), and (iii) become the Administrator
under the Administration Agreement in accordance with Section 8 of such
Agreement.

                                  ARTICLE VIII

                                     Default

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

                  (a) any failure by the Servicer (or the Seller, so long as
         NMAC is the Servicer) to deliver to the Relevant Trustee for deposit in
         any of the Accounts any required payment or to direct the Relevant
         Trustee to make any required distributions therefrom, which failure
         continues unremedied for a period of three Business Days after (i)
         receipt by the Servicer (or the Seller, so long as NMAC is the
         Servicer) of written notice of such failure given by the Owner Trustee
         or the Indenture Trustee, (ii) receipt by the Servicer (or the Seller,
         so long as NMAC is the Servicer), the Owner Trustee or the Indenture
         Trustee of written notice of such failure given by the Holders of Notes
         or Certificates evidencing not less than 25% of the sum of the
         Outstanding Amount or Holders of Certificates evidencing not less than
         25% of the Certificate Balance, or (iii) discovery of such failure by
         any officer of the Servicer;

                                       64        (Sale and Servicing Agreement)
<PAGE>

                  (b) any failure by the Servicer (or the Seller, as long as
         NMAC is the Servicer) to duly observe or perform in any material
         respect any other covenants or agreements of the Servicer (or the
         Seller, as long as NMAC is the Servicer) set forth in this Agreement
         (including its obligation to purchase Receivables pursuant to Section
         4.06), which failure shall materially and adversely affect the rights
         of the Certificateholders or the Noteholders and shall continue
         unremedied for a period of 90 days after giving of written notice of
         the failure to (i) the Servicer (or the Seller, as long as NMAC is the
         Servicer) by the Owner Trustee or the Indenture Trustee, or (ii) the
         Servicer (or the Seller, as long as NMAC is the Servicer) and the Owner
         Trustee or the Indenture Trustee by the Holders of Notes or
         Certificates evidencing not less than 25% of the sum of the Outstanding
         Amount or Holders of Certificates evidencing not less than 25% of the
         Certificate Balance; or

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

then, and in each and every case, so long as the Servicer Default shall not have
been remedied and the Notes have not been paid in full, either the Indenture
Trustee or the Holders of Notes evidencing a majority of the Outstanding Amount
of the Notes (but excluding for purposes of such calculation and action all
Notes held or beneficially owned by NMAC, NARC II or any of their Affiliates
unless all of the Notes are held or beneficially owned by NMAC, NARC II or any
of their Affiliates), acting together as a single Class, by notice then given in
writing to the Servicer (and to the Indenture Trustee and the Owner Trustee if
given by the Noteholders) may terminate all of the rights and obligations (other
than the obligations set forth in Section 7.02 hereof) of the Servicer under
this Agreement; or if the Notes have been paid in full, either the Owner Trustee
or Holders of Certificates evidencing a majority of the Certificate Balance (but
excluding for purposes of such calculation and action all Certificates held or
beneficially owned by NMAC, NARC II or an of their Affiliates), acting together
as a single Class, by notice then given in writing to the Servicer (and to the
Owner Trustee if given by the Holders of the Certificates) may terminate all of
the rights and obligations (other than the obligations set forth in Section 7.02
hereof) of the Servicer under this Agreement. On or after the receipt by the
Servicer of such written notice, all authority and power of the Servicer under
this Agreement, whether with respect to the Notes, the Certificates or the
Receivables or otherwise, shall, without further action, pass to and be vested
in the Relevant Trustee or such Successor Servicer as may be appointed under
Section 8.02; and, without limitation, the Indenture Trustee and the Owner
Trustee are hereby authorized and empowered to execute and deliver, for the
benefit of the predecessor Servicer, as attorney-in-fact or otherwise, any and
all documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement of the Receivables
and related documents, or otherwise. The predecessor Servicer shall cooperate
with the Successor Servicer and the Owner Trustee in effecting the termination
of the responsibilities and rights of the predecessor Servicer under this
Agreement, including, without limitation, the transfer to the Successor Servicer
for administration by it of all cash amounts that shall at the time be held by
the predecessor Servicer for deposit, or have been deposited by the predecessor
Servicer, in the Accounts or thereafter received with respect to the Receivables
that shall at that time be held by the predecessor Servicer and the delivery of
the Receivable Files and the related accounts and records maintained by the
predecessor Servicer. All reasonable costs and expenses (including attorneys'
fees) incurred in connection with transferring the Receivable Files to the

                                       65        (Sale and Servicing Agreement)
<PAGE>

Successor Servicer and amending this Agreement to reflect such succession as
Servicer pursuant to this Section 8.01 shall be paid by the predecessor Servicer
upon presentation of reasonable documentation of such costs and expenses.
Notwithstanding the foregoing, in the event the predecessor Servicer is the
Relevant Trustee, the original Servicer hereunder shall reimburse the Relevant
Trustee for all reasonable costs and expenses as described in the immediately
preceding sentence. Upon receipt of notice of the occurrence of a Servicer
Default, the Relevant Trustee shall give notice thereof to the Rating Agencies.

         SECTION 8.02 Appointment of Successor.

                  (a) Upon the Servicer's receipt of notice of termination
         pursuant to Section 8.01 or the Servicer's resignation in accordance
         with the terms of this Agreement, the predecessor Servicer shall
         continue to perform its functions as Servicer under this Agreement, in
         the case of termination, only until the date specified in such
         termination notice or, if no such date is specified in a notice of
         termination, until receipt of such notice and, in the case of
         resignation, until the earlier of (i) the date 45 days from the
         delivery to the Owner Trustee and the Indenture Trustee of written
         notice of such resignation (or written confirmation of such notice) in
         accordance with the terms of this Agreement and (ii) the date upon
         which the predecessor Servicer shall become unable to act as Servicer,
         as specified in the notice of resignation and accompanying Opinion of
         Counsel. In the event of the Servicer's resignation or termination
         hereunder, the Relevant Trustee shall appoint a Successor Servicer, and
         the Successor Servicer shall accept its appointment (including its
         appointment as Administrator under the Administration Agreement as set
         forth in Section 8.02(b)) by a written assumption in form acceptable to
         the Owner Trustee and the Indenture Trustee. If a Successor Servicer
         has not been appointed at the time when the predecessor Servicer has
         ceased to act as Servicer in accordance with this Section 8.02, the
         Indenture Trustee, or if the Notes have been paid in full, the Owner
         Trustee, without further action shall automatically be appointed the
         Successor Servicer and shall be entitled to the Total Servicing Fee.
         Notwithstanding the above, the Relevant Trustee shall, if it shall be
         legally unable so to act, appoint or petition a court of competent
         jurisdiction to appoint, and the predecessor Servicer, if no successor
         Servicer has been appointed at the time the predecessor Servicer has
         ceased to act, may petition a court of competent jurisdiction to
         appoint any established institution having a net worth of not less than
         $100,000,000 and whose regular business shall include the servicing of
         automobile and/or light-duty truck receivables, as the successor to the
         Servicer under this Agreement.

                  (b) Upon appointment, the Successor Servicer (including the
         Relevant Trustee acting as Successor Servicer) shall (i) be the
         successor in all respects to the predecessor Servicer and shall be
         subject to all the responsibilities, duties and liabilities arising
         thereafter relating thereto placed on the predecessor Servicer (except
         the initial Servicer's obligation to make Advances) and shall be
         entitled, subject to the arrangements referred to in paragraph (c)
         below, to the servicing fee and all the rights granted to the
         predecessor Servicer by the terms and provisions of this Agreement and
         (ii) become the Administrator under the Administration Agreement in
         accordance with Section 8 of such Agreement.

                                       66        (Sale and Servicing Agreement)
<PAGE>

                  (c) In connection with such appointment, the Issuer may make
         such arrangements for the compensation of such Successor Servicer out
         of payments on Receivables as it and such Successor Servicer shall
         agree; provided, however, that no such compensation shall be in excess
         of that permitted the predecessor Servicer under this Agreement. The
         Issuer, the Relvant Trustee and such Successor Servicer shall take such
         action, consistent with this Agreement, as shall be necessary to
         effectuate any such succession.

         SECTION 8.03 Repayment of Advances. If the Servicer shall resign or be
terminated, the Servicer shall continue to be entitled to receive, to the extent
of available funds, reimbursement for Outstanding Advances pursuant to Sections
5.03 and 5.04 with respect to all Advances previously made thereby.

         SECTION 8.04 Notification. Upon any termination of, or appointment of a
successor to, the Servicer pursuant to this Article VIII, the Owner Trustee
shall give prompt written notice thereof to the Certificateholders, and the
Indenture Trustee shall give prompt written notice thereof to Noteholders[, the
Swap Counterparty] and the Rating Agencies.

         SECTION 8.05 Waiver of Past Defaults. The Holders of Notes evidencing a
majority of the Outstanding Amount of the Controlling Class of Notes, or in if a
Servicer Default occurs that does not adversely affect the Indenture Trustee or
the Noteholders or occurs after the Notes have been paid in full, the Holders of
Certificates evidencing a majority of the Certificate Balance of the Controlling
Class of Certificates, in any case excluding for purposes of such calculation
and action all Securities held or beneficially owned by NMAC, NARC II or any of
their Affiliates (unless all of the Notes of such Class or the Certificates of
such Class, as the case may be, are held by NMAC, NARC II and their Affiliates),
may, on behalf of all the Noteholders and the Certificateholders, waive in
writing any default by the Servicer in the performance of its obligations
hereunder and its consequences, except a default in making any required deposits
to or payments from the Collection Account in accordance with this Agreement.
Upon any such waiver of a past default, such default shall cease to exist, and
any Servicer Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent
or other default or impair any right consequent thereto.

                                   ARTICLE IX

         Termination; Release of Receivables

         SECTION 9.01 Optional Purchase of All Receivables.

                  (a) On each Distribution Date following the last day of a
         Collection Period as of which the Pool Balance shall be less than or
         equal to the Optional Purchase Percentage multiplied by the Original
         Pool Balance, the Servicer or any successor to the Servicer shall have
         the option to purchase, or cause to be purchased, the corpus of the
         Owner Trust Estate (whether or not such assets then comprise all or a
         portion of the Trust Estate) for an amount equal to the Optional
         Purchase Price (the "Optional Purchase"). To exercise such option, the
         Servicer or any successor to the Servicer shall notify the Owner
         Trustee and the Indenture Trustee of its intention to do so in writing,
         no later than the tenth day of

                                       67        (Sale and Servicing Agreement)
<PAGE>

         the month preceding the month in which the Distribution Date as of
         which such purchase is to be effected and shall, on or before the
         Distribution Date on which such purchase is to occur, deposit pursuant
         to Section 5.05 in the Collection Account an amount equal to the
         Optional Purchase Price [(or the deposit in cash of such lesser amount
         as provided in Section 9.01(b))], and shall succeed to all interests in
         and to the Trust Estate and the Owner Trust Estate; provided, however,
         that the Servicer shall not effect any such purchase so long as the
         rating of NMAC by Moody's, or if NMAC shall then be unrated by Moody's,
         then the rating of Nissan Capital of America, Inc., is less than "Bal"
         by Moody's, unless the Owner Trustee and the Indenture Trustee shall
         have received an Opinion of Counsel to the effect that such purchase
         shall not constitute a fraudulent conveyance, subject to such
         assumptions as to factual matters as may be contained therein. Amounts
         so deposited will be paid and distributed as set forth in Section 5.06
         of this Agreement. Upon such deposit of the amount necessary to
         purchase the corpus of the Owner Trust Estate, the Servicer shall for
         all purposes of this Agreement be deemed to have released all claims
         for reimbursement of Outstanding Advances made in respect of the
         Receivables. (b) [The Servicer, at its option, may pay all or a portion
         of the Optional Purchase Price by issuing a demand note in favor of the
         Trust, the terms of which, on the whole, shall be commercially
         reasonable and substantially similar to terms that would prevail in an
         arms-length negotiation between unaffiliated parties; provided,
         however, that (i) the Servicer shall pay in cash the portion of the
         Optional Purchase Price that is equal to or greater than the sum of (x)
         the Outstanding Amount of all Classes of Notes and (y) the Noteholders'
         Interest Distributable Amount for all Classes of Notes for such
         Distribution Date, and (ii) the Servicer may issue a demand note to a
         Certificateholder pursuant to this Section 9.01 only if such
         Certificateholder consents to the receipt of such demand note.]

                  (c) Notice of any such purchase of the Owner Trust Estate
         shall be given by the Owner Trustee and the Indenture Trustee to each
         Securityholder as soon as practicable after their receipt of notice
         thereof from the Servicer.

                  (d) Following the satisfaction and discharge of the Indenture
         and the payment in full of the principal of and interest on the Notes,
         the Certificateholders will succeed to the rights of the Noteholders
         hereunder other than under Section 5.06 and the Issuer will succeed to
         the rights of the Indenture Trustee provided for in this Agreement.

         SECTION 9.02 Release of Receivables.

                  (a) Upon repurchase of any Receivable by the Seller pursuant
         to Section 3.02 or by the Servicer pursuant to Section 4.06 or Section
         9.01, the Issuer, and the Indenture Trustee on behalf of the
         Noteholders, shall, without further action, be deemed to transfer,
         assign, set-over and otherwise convey to the Seller or the Servicer, as
         the case may be, all right, title and interest of the Issuer in, to and
         under such repurchased Receivable, all monies due or to become due with
         respect thereto and all proceeds thereof and the other property
         conveyed to the Issuer hereunder pursuant to Section 2.01 with respect
         to such Receivable, and all security and any documents relating
         thereto, such assignment being

                                       68        (Sale and Servicing Agreement)
<PAGE>

         an assignment outright and not for security; and the Seller or the
         Servicer, as applicable, shall thereupon own each such Receivable, and
         all such related security and documents, free of any further obligation
         to the Issuer, the Owner Trustee, the Certificateholders, the Indenture
         Trustee or the Noteholders with respect thereto.

                  (b) The Issuer and Indenture Trustee shall execute such
         documents and instruments of transfer and assignment and take such
         other actions as shall be reasonably requested by the Seller or the
         Servicer, as the case may be, to effect the conveyance of such
         Receivable pursuant to Sections 3.02, 4.06 and 9.02.

                  (c) If in any enforcement suit or legal proceeding it is held
         that the Seller or the Servicer may not enforce a repurchased
         Receivable on the ground that it is not a real party in interest or a
         holder entitled to enforce the Receivable, the Issuer, and the
         Indenture Trustee on behalf of the Noteholders, shall, at the written
         direction and expense of the Seller or Servicer, as the case may be,
         take such reasonable steps as the Seller or the Servicer deems
         necessary to enforce the Receivable, including bringing suit in the
         name or names of the Issuer, the Certificateholders or the Noteholders.

         SECTION 9.03 Termination.

                  (a) The respective obligations of the Seller, the Servicer,
         NMAC (so long as NMAC has rights or obligations hereunder), the Owner
         Trustee, and the Indenture Trustee, as the case may be, pursuant to
         this Agreement shall terminate upon the earliest of (i) the maturity or
         other liquidation of the last Receivable and the final disposition of
         all amounts received upon liquidation of any remaining Receivables, or
         (ii) the election by the Servicer to purchase the corpus of the Trust
         as described in Section 9.01 and the payment or distribution to
         Securityholders of all amounts required to be paid to them under the
         Indenture or the Trust Agreement, as the case may be.

                  (b) Notice of any such termination under this Section 9.03
         shall be given by the Indenture Trustee or the Owner Trustee to each
         Securityholder of record as specified in the Indenture or the Trust
         Agreement, as appropriate.

                                   ARTICLE X

                                  Miscellaneous

         SECTION 10.01 Amendment.

                  (a) This Agreement may be amended by the Seller, the Servicer
         and the Issuer, with the consent of the Indenture Trustee (if the Notes
         have not been paid in full), but without the consent of any of the
         Noteholders or the Certificateholders,

                           (1) to cure any ambiguity, correct or supplement any
provision herein that may be inconsistent with any other provision herein, or
make any other provisions with respect to matters or questions arising hereunder
that are not inconsistent with the provisions herein; provided that (i) the
amendment will not materially and adversely affect the interest of any
Noteholder or Certificateholder and (ii) the Servicer shall have delivered an
Officer's

                                       69        (Sale and Servicing Agreement)
<PAGE>

Certificate to the Indenture Trustee and the Owner Trustee stating that such
amendment will not materially and adversely affect the interest of any
Noteholder or Certificateholder; and

                           (2) to change the formula for determining the
required amount for the Specified Reserve Account Balance upon (i) confirmation
from each Rating Agency that such amendment will not result in the
qualification, reduction or withdrawal of any rating it currently assigns to any
Class of Notes or Certificates, and (ii) delivery by the Servicer to the
Indenture Trustee and the Owner Trustee of an Officer's Certificate stating that
such amendment will not materially and adversely affect the interest of any
Securityholder.

         An amendment will be deemed not to materially and adversely affect the
interests of any Noteholder or Certificateholder of any Class if (x) the
amendment does not adversely affect the Trust's status as a partnership (or, for
any period during which there is not more than one beneficial owner of a
Certificate, the Trust's status as an entity that is disregarded as an entity
separate from the Certificateholder) for federal income tax purposes, (y) each
Rating Agency confirms that that amendment will not result in a reduction or
withdrawal of its rating on the Certificates or the Notes of that Class, and (z)
the Servicer has delivered the Officer's Certificate described in this Section
10.01(a).

                  (b) This Agreement may also be amended from time to time by
         the Seller, the Servicer and the Issuer, with the consent of the
         Indenture Trustee (if the Notes have not been paid in full) and the
         consent of:

                           (1) the Holders of Notes evidencing a majority of the
Outstanding Amount of the Controlling Class of Notes; or

                           (2) in the case of any amendment that does not
adversely affect the Indenture Trustee or the Noteholders, or if the Notes have
been paid in full, the Holders of the Certificates evidencing a majority of the
outstanding Certificate Balance of the Controlling Class of Certificates (but
excluding for purposes of calculation and action all Certificates held by the
Seller, the Servicer or any of their Affiliates, unless all of the Certificates
of such Class are held by the Seller, the Servicer or any of their Affiliates);

for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of those Noteholders or Certificateholders; provided, however,
that no amendment shall:

                           (1) increase or reduce in any manner the amount of,
or accelerate or delay the timing of, collections of payments on the Receivables
or distributions that are required to be made for the benefit of those
Noteholders or Certificateholders or change the Interest Rate or the
[Pass-Through Rate or the] Specified Reserve Account Balance (except as
described above under clause (2) of subsection (a) above) without the consent of
each "adversely affected" Noteholder or Certificateholder; or

                           (2) reduce the aforesaid percentage of the
Outstanding Amount of the Notes or Certificate Balance of the Certificates which
is required to consent to any amendment, without the consent of the Holders of
all the then outstanding Notes or Certificates.

                                       70        (Sale and Servicing Agreement)
<PAGE>

          An amendment referred to above will be deemed not to "adversely
affect" a Certificateholder or Noteholder of any Class only if each Rating
Agency confirms that that amendment will not result in a reduction or withdrawal
of its rating on the Certificates or Notes of that Class. In connection with any
amendment referred to in clause (x) above, the Servicer shall deliver an
Officer's Certificate to the Indenture Trustee and the Owner Trustee stating
that those Noteholders and Certificateholders whose consents were not obtained
were not adversely affected by such amendment.

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

          It shall not be necessary for the consent of the Certificateholders or
the Noteholders pursuant to this Section 10.01 to approve the particular form of
any proposed amendment or consent, but it shall be sufficient if such consent
shall approve the substance thereof.

          Prior to the execution of any amendment to this Agreement, the Owner
Trustee and the Indenture Trustee shall be entitled to receive and rely upon an
Opinion of Counsel stating that the execution of such amendment is authorized or
permitted by this Agreement and the Opinion of Counsel referred to in Section
10.02(h)(i). The Owner Trustee and the Indenture Trustee may, but shall not be
obligated to, enter into any such amendment which affects the Owner Trustee's or
the Indenture Trustee's, as applicable, own rights, duties or immunities under
this Agreement or otherwise.

         SECTION 10.02 Protection of Title to Trust.

                  (a) The Seller shall execute and file such financing
         statements and cause to be executed and filed such continuation
         statements, all in such manner and in such places as may be required by
         law fully to preserve, maintain and protect the interest of the Issuer
         and of the Indenture Trustee in the Receivables and in the proceeds
         thereof. The Seller shall deliver (or cause to be delivered) to the
         Owner Trustee and the Indenture Trustee file-stamped copies of, or
         filing receipts for, any document filed as provided above, as soon as
         available following such filing.

                  (b) The Seller and the Servicer shall notify the Owner Trustee
         and the Indenture Trustee within 30 days after any change of its name,
         identity or corporate structure in any manner that would, could or
         might make any financing statement or continuation statement filed in
         accordance with paragraph (a) above seriously misleading within the
         meaning of Section 9-507(c) of the UCC, and shall promptly file
         appropriate amendments to all previously filed financing statements or
         continuation statements.

                  (c) Each of the Seller and the Servicer shall notify the Owner
         Trustee and the Indenture Trustee of any relocation of its principal
         executive office or state of incorporation within 30 days after such
         relocation, if, as a result of such relocation, the applicable
         provisions of the UCC would require the filing of any amendment of any
         previously filed financing or continuation statement or of any new
         financing statement and shall promptly file any such amendment or new
         financing statement. The Servicer

                                       71        (Sale and Servicing Agreement)
<PAGE>

         shall at all times maintain each office from which it shall service
         Receivables, and its principal executive office, within the United
         States of America.

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

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

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

                  (g) Upon receipt of a written request from the Owner Trustee
         or the Indenture Trustee, which request shall be made no more
         frequently than annually, the Servicer shall furnish to the Owner
         Trustee or the Indenture Trustee, as the case may be, within 20
         Business Days after receipt of such request, a list of all Receivables
         (by contract number and name of Obligor) then held as part of the
         Trust, together with a reconciliation of the list of Receivables
         attached hereto as Schedule A and to each of the Servicer's
         Certificates furnished before such request indicating removal of
         Receivables from the Trust. The Servicer shall permit the Indenture
         Trustee and its agents at any time during normal business hours upon
         reasonable prior notice to inspect, audit and make copies of and
         abstracts from the Servicer's records regarding any Receivable.

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

                           (i) upon the execution and delivery of this Agreement
                  and of each amendment hereto, an Opinion of Counsel, based on
                  customary assumptions and qualifications, stating that, in the
                  opinion of such counsel, either (A) all financing statements
                  and continuation statements have been executed and filed that
                  are necessary to perfect the interest of the Trust and the
                  Indenture Trustee in the Receivables, and reciting the details
                  of such filings or referring to prior Opinions

                                       72        (Sale and Servicing Agreement)
<PAGE>

                  of Counsel in which such details are given, or (B) no such
                  action shall be necessary to preserve and protect such
                  interest; and

                           (ii) if requested by the Indenture Trustee or the
                  Owner Trustee, not more frequently than annually, an Opinion
                  of Counsel, dated as of a date during such 90-day period,
                  either (A) stating that, in the opinion of such counsel, based
                  on customary assumptions and qualifications, all financing
                  statements and continuation statements have been executed and
                  filed that are necessary to perfect the interest of the Trust
                  and the Indenture Trustee in the Receivables, and reciting the
                  details of such filings or referring to prior Opinions of
                  Counsel in which such details are given, or (B) no such action
                  shall be necessary to preserve and protect such interest.

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

         SECTION 10.03 Notices. All demands, notices, communications and
instructions upon or to the Seller, the Servicer, the Owner Trustee, the
Indenture Trustee or the Rating Agencies under this Agreement shall be in
writing, personally delivered or mailed by certified mail, return receipt
requested, and shall be deemed to have been duly given upon receipt (a) in the
case of the Seller, to Nissan Auto Receivables Corporation II, 990 West 190th
Street, Torrance, California 90502, Attention of Secretary ([(310) 719-8013)]
[(310) 719-8583], (b) in the case of the Servicer, to Nissan Motor Acceptance
Corporation, 990 West 190th Street, Torrance, California 90502, Attention of
Secretary ((310) 719-8000), (c) in the case of the Issuer or the Owner Trustee,
to [____________], (d) in the case of the Indenture Trustee, at the Corporate
Trust Office, (e) in the case of Moody's, to Moody's Investors Service, Inc.,
ABS Monitoring Department, 99 Church Street, New York, New York 10007, and (f)
in the case of Standard & Poor's, to Standard & Poor's, a division of The
McGraw-Hill Companies, Inc., 55 Water Street, New York, New York 10041-0003,
Attention: Asset Backed Surveillance Department; or, as to each of the
foregoing, at such other address as shall be designated by written notice to the
other parties.

         SECTION 10.04 Assignment by the Seller or the Servicer. Notwithstanding
anything to the contrary contained herein, except as provided in Sections 6.04
and 7.03 of this Agreement and as provided in the provisions of this Agreement
concerning the resignation or termination of the Servicer, this Agreement may
not be assigned by the Seller or the Servicer without the prior written consent
of the Indenture Trustee, the Owner Trustee, the Holders of the Certificates and
Notes evidencing not less than 66 2/3% of the Outstanding Amount of the
Certificate Balance, voting as a single class.

         SECTION 10.05 Limitations on Rights of Others. The provisions of this
Agreement are solely for the benefit of the Seller, the Servicer, the Issuer,
the Owner Trustee, the Certificateholders, the Indenture Trustee and the
Noteholders, and nothing in this Agreement, whether express or implied, shall be
construed to give to any other Person any legal or equitable right, remedy or
claim in the Owner Trust Estate or under or in respect of this Agreement or any
covenants, conditions or provisions contained herein.

                                       73        (Sale and Servicing Agreement)
<PAGE>

         SECTION 10.06 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

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

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

         SECTION 10.09 Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York, without reference to its
conflict of law provisions (other than Section 5-1401 of the General Obligations
Law of the State of New York), and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.

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

         SECTION 10.11 Nonpetition Covenants.

                  (a) Notwithstanding any prior termination of this Agreement,
         the Servicer and the Seller shall not, prior to the date which is one
         year and one day after the termination of this Agreement with respect
         to the Issuer, acquiesce, petition or otherwise invoke or cause the
         Issuer to invoke the process of any court or government authority for
         the purpose of commencing or sustaining a case against the Issuer under
         any federal or state bankruptcy, insolvency or similar law, or
         appointing a receiver, liquidator, assignee, trustee, custodian,
         sequestrator or other similar official of the Issuer or any substantial
         part of its property, or ordering the winding up or liquidation of the
         affairs of the Issuer.

                  (b) Notwithstanding any prior termination of this Agreement,
         each of the Servicer and the Owner Trustee (not in its individual
         capacity but solely as Owner Trustee), prior to the date which is one
         year and one day after the Notes are paid in full, covenants and agrees
         that it will not at any time file, join in any filing of, or cooperate
         with or encourage others to file any bankruptcy, reorganization
         arrangement, insolvency or liquidation proceeding or other proceeding
         against the Seller under any federal or state bankruptcy, insolvency or
         similar law, appointing a receiver, liquidator, assignee, trustee,
         custodian, sequestrator or other similar official of the Seller or any
         substantial part of its property, or ordering the winding up or
         liquidation of the affairs of the Seller.

                                       74        (Sale and Servicing Agreement)
<PAGE>

         SECTION 10.12 Limitation of Liability of Owner Trustee and Indenture
Trustee. Notwithstanding anything contained herein to the contrary, this
Agreement has been countersigned by [________________], not in its individual
capacity, but solely in its capacity as Owner Trustee of the Issuer, and by
[________________], not in its individual capacity, but solely in its capacity
as Indenture Trustee under the Indenture. In no event shall [______________] or
[________________] have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any of
the certificates, notices or agreements delivered by the Seller or the Servicer,
or prepared by the Seller or the Servicer for delivery by the Owner Trustee on
behalf of the Issuer, pursuant hereto, as to all of which recourse shall be had
solely to the assets of the Issuer. For all purposes of this Agreement, in the
performance of its duties or obligations hereunder or in the performance of any
duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of
Articles VI, VII and VIII of the Trust Agreement.

         SECTION 10.13 Waivers. No failure or delay on the part of the Issuer in
exercising any power, right or remedy under this Agreement or the Assignment
shall operate as a waiver hereof or thereof, nor shall any single or partial
exercise of any such power, right or remedy preclude any other or further
exercise hereof or thereof or the exercise of any such power, right or remedy
preclude any other or further exercise hereof or thereof or the exercise of any
other power, right or remedy. Notwithstanding anything to the contrary, the
Issuer shall not waive any breach of representations and warranties as set forth
in Sections 3.01(e), (l), (n), (o), (aa) or (ee) without the written consent of
at least a majority of the Outstanding Amount of the Controlling Class of Notes,
voting as a single class (excluding for such purposes the outstanding principal
amount of any Controlling Class of Notes held of record or beneficially owned by
NMAC, NARC II or any of their Affiliates, unless at such time all of the
Controlling Class of Notes are held of record or beneficially owned by NMAC,
NARC II or any of their Affiliates.)

                                       75        (Sale and Servicing Agreement)
<PAGE>

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

                                NISSAN AUTO RECEIVABLES [___-___]
                                OWNER TRUST

                                By:                                         ,
                                    ------------------------------------------
                                not in its individual capacity but solely as
                                Owner Trustee on behalf of the Trust

                                By:
                                    ------------------------------------------
                                Name:
                                      ----------------------------------------
                                Title:
                                       ---------------------------------------

                                NISSAN AUTO RECEIVABLES CORPORATION II, Seller

                                By:
                                    ------------------------------------------
                                Name:
                                      ----------------------------------------
                                Title:
                                       ---------------------------------------

                                NISSAN MOTOR ACCEPTANCE CORPORATION, Servicer

                                By:
                                    ------------------------------------------
                                Name:
                                      ----------------------------------------
                                Title:
                                       ---------------------------------------

ACKNOWLEDGED AND ACCEPTED AS OF
THE DAY AND YEAR FIRST ABOVE WRITTEN:

                                , not in its
--------------------------------
individual capacity but solely as Indenture Trustee

By:
    ------------------------------------------
Name:
      ----------------------------------------
Title:
       ---------------------------------------

                                       S-1        (Sale and Servicing Agreement)

<PAGE>

                                   SCHEDULE A

                             SCHEDULE OF RECEIVABLES

             (Delivered to the Trust on CD-ROM on the Closing Date)

                                                  (Sale and Servicing Agreement)

<PAGE>

                                   SCHEDULE B

                        LOCATION OF THE RECEIVABLES FILES

1.       Nissan Motor Acceptance Corporation,
         including its Infiniti Financial Services Division
         8900 Freeport Parkway
         Irving, Texas 75063-2438

2.       Iron Mountain, Inc.
         1235 N. Union Bower
         Irving, Texas 75061

3.       Nissan North America, Inc.
         Denver Data Center
         106 Inverness Circle
         East Englewood, Colorado 80112-5312

4.       Arcus
         15505 East Hinsdale Circle
         Englewood, Colorado 80112

5.       FDI Consulting
         1610 Arden Way, Suite 145
         Sacramento, California 95815

                                                  (Sale and Servicing Agreement)

<PAGE>

                                   [EXHIBIT A

                       FORM OF YIELD SUPPLEMENT AGREEMENT]

                                                  (Sale and Servicing Agreement)

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