Document:

Purchase Agreement

 Exhibit 10.5 
 EXECUTION COPY 
 PURCHASE AGREEMENT 
 BETWEEN 
 NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION 
 AND 
 NAVISTAR FINANCIAL CORPORATION

 DATED AS OF FEBRUARY 16, 2007 
  

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page
	ARTICLE I DEFINITIONS	  	1
	        SECTION 1.01	  	Definitions	  	1
		
	ARTICLE II PURCHASE AND SALE OF RECEIVABLES	  	2
	        SECTION 2.01	  	Purchase and Sale of Receivables	  	2
	        SECTION 2.02	  	Purchase Price	  	2
	        SECTION 2.03	  	The Closing	  	3
		
	ARTICLE III REPRESENTATIONS AND WARRANTIES	  	3
	        SECTION 3.01	  	Representations and Warranties as to Receivables	  	3
	        SECTION 3.02	  	Additional Representations and Warranties of NFC	  	7
	        SECTION 3.03	  	Representations and Warranties of NFRRC	  	9
		
	ARTICLE IV CONDITIONS	  	10
	        SECTION 4.01	  	Conditions to Obligation of NFRRC	  	10
	        SECTION 4.02	  	Conditions To Obligation of NFC	  	11
		
	ARTICLE V ADDITIONAL AGREEMENTS	  	11
	        SECTION 5.01	  	Conflicts With Further Transfer and Servicing Agreements	  	11
	        SECTION 5.02	  	Protection of Title.	  	11
	        SECTION 5.03	  	Other Liens or Interests	  	12
	        SECTION 5.04	  	Repurchase Events	  	12
	        SECTION 5.05	  	Indemnification	  	13
	        SECTION 5.06	  	Further Assignments	  	13
	        SECTION 5.07	  	Pre-Closing Collections	  	13
	        SECTION 5.08	  	Limitation on Transfer of International Purchase Obligations	  	13
	        SECTION 5.09	  	Sale Treatment	  	13
		
	ARTICLE VI MISCELLANEOUS PROVISIONS	  	14
	        SECTION 6.01	  	Amendment.	  	14
	        SECTION 6.02	  	Survival; Termination	  	14
	        SECTION 6.03	  	Notices	  	14
	        SECTION 6.04	  	Governing Law	  	14
	        SECTION 6.05	  	Waivers	  	14
	        SECTION 6.06	  	Costs and Expenses	  	14
	        SECTION 6.07	  	Confidential Information	  	14
	        SECTION 6.08	  	Headings	  	15
	        SECTION 6.09	  	Counterparts	  	15
	        SECTION 6.10	  	Severability of Provisions	  	15
	        SECTION 6.11	  	Further Assurances	  	15
	        SECTION 6.12	  	Assignment; Third-Party Beneficiaries	  	15
	        SECTION 6.13	  	Merger and Integration	  	15

  

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	        SECTION 6.14	  	No Petition Covenants	  	16
	        SECTION 6.15	  	MUTUAL WAIVER OF JURY TRIAL	  	16

 EXHIBITS 
 Exhibit A - Form of PA Assignment 
  

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 PURCHASE AGREEMENT 
 PURCHASE AGREEMENT, dated as of February 16, 2007, between NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION, a Delaware corporation (“NFRRC”), and NAVISTAR FINANCIAL CORPORATION, a Delaware
corporation (“NFC”). 
 WHEREAS, NFRRC desires to purchase on the date hereof Receivables and the Related Security with
respect thereto; 
 WHEREAS, NFC is willing to sell the Receivables and the Related Security with respect thereto to NFRRC; 
 WHEREAS, NFRRC may wish to sell or otherwise transfer the Receivables and the Related Security with respect thereto, or interests therein, to a trust,
corporation, partnership or other entity (any such transferee being the “Subsequent Transferee”); and 
 WHEREAS, the
Subsequent Transferee may issue debentures, notes, participations, certificates of beneficial interest, partnership interests or other interests or securities (collectively, any such issued interests or securities being
“Securities”) to fund its acquisition of the Receivables and the Related Security with respect thereto and, in connection with such issuance, the Subsequent Transferee may grant a security interest in, or otherwise pledge the
Receivables and Related Security to the Indenture Trustee, for the benefit of the Financial Parties. 
 NOW, THEREFORE, in consideration of
the foregoing, the other good and valuable consideration and the mutual terms and covenants herein contained, the parties hereto agree as follows: 
 ARTICLE I 
 DEFINITIONS 
 SECTION 1.01 Definitions. Capitalized terms used but not otherwise defined in this Agreement shall have the respective meanings assigned them in Part I of Appendix A to the Pooling Agreement of even date
herewith by and between Navistar Financial 2007-JPM Owner Trust and NFRRC, as it may be amended, supplemented or modified from time to time. All references herein to “the Agreement” or “this Agreement” are to this Purchase
Agreement as it may be amended, supplemented or modified from time to time, the exhibits hereto and the capitalized terms used herein which are defined in such Appendix A, and all references herein to Articles, Sections and subsections are to
Articles, Sections or subsections of this Agreement unless otherwise specified. The rules of construction set forth in Part II of such Appendix A shall be applicable to this Agreement. 

 ARTICLE II 
 PURCHASE AND SALE OF RECEIVABLES 
 SECTION 2.01 Purchase and Sale of Receivables. Subject to
the satisfaction of the conditions specified in Article IV, NFC agrees to sell, transfer, assign and otherwise convey to NFRRC, without recourse (except as provided in Section 5.04), and NFRRC agrees to purchase on the
Closing Date (the “Purchase Date”) pursuant to a written assignment substantially in the form of Exhibit A (the “PA Assignment”), all right, title and interest of NFC in, to and under the Retail Notes
identified on the Schedule of Retail Notes to the PA Assignment delivered to NFRRC on the Purchase Date (the “Designated Receivables”) and the Related Security associated with the Designated Receivables. 
 It is the intention of NFC and NFRRC that the transfer and assignment contemplated by this Section 2.01 shall constitute a sale of the Designated Receivables and
Related Security by NFC to NFRRC and the beneficial interest in and title to the assets conveyed pursuant to this Section 2.01 shall not be part of NFC’s estate in the event of the filing of a bankruptcy petition by or against NFC under
any bankruptcy law. NFC intends to treat such transfer and assignment as a sale for accounting and tax purposes. Notwithstanding the foregoing, in the event a court of competent jurisdiction determines that such transfer and assignment did not
constitute such a sale or that such sale shall for any reasons be ineffective or unenforceable or that such beneficial interest is a part of NFC’s estate (any of the foregoing, a “Recharacterization”), then (i) NFC shall
be deemed to have granted to NFRRC a first priority perfected security interest in all of NFCs right title and interest in, to and under the assets conveyed pursuant to this Section 2.01, and NFC hereby grants such security interest and
(ii) the assets conveyed pursuant to this Section 2.01 shall be deemed to include all rights, powers and options (but none of the obligations, if any) of NFC under any agreement or instrument included in the assets conveyed pursuant to
this Section 2.01, including the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of the Designated Receivables included in the assets conveyed pursuant to this
Section 2.01 and all other monies payable under the Designated Receivables conveyed pursuant to this Section 2.01, to give and receive notices and other communications, to make waivers or other agreements, to exercise all rights, powers
and options, to bring Proceedings in the name of NFC or otherwise and generally to do and receive anything that NFC is or may be entitled to do or receive under or with respect to the assets conveyed pursuant to this Section 2.01. For purposes
of such grant, this Agreement shall constitute a security agreement under the UCC. In the case of any Recharacterization, each of NFC and NFRRC represents and warrants as to itself that each remittance of collections by NFC to NFRRC hereunder or in
connection herewith will have been (i) in payment of a debt incurred by NFC in the ordinary course of business or financial affairs of NFC and NFRRC and (ii) made in the ordinary course of business or financial affairs of NFC and NFRRC.

 SECTION 2.02 Purchase Price. In consideration for the purchase of any Designated Receivables and Related Security, NFRRC shall, on
the Purchase Date, pay to NFC an amount equal to the aggregate Starting Receivables Balance for such Designated Receivables (the “Purchase Price”) and NFC shall execute and deliver to NFRRC a PA Assignment with respect to such
Designated Receivables. On the Closing Date, a portion of the Purchase Price payable on such date equal to $431,801,454.48 shall be paid to NFC in immediately available funds, and the balance of the Purchase Price ($30,018,282.93) shall be recorded
as an 

  

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intercompany obligation due from NFRRC to NFC under a revolving note issued under the Amended and Restated Intercompany Advance Agreement, dated as of
May 3, 1994, between NFC and NFRRC. 
 SECTION 2.03 The Closing. The sale and purchase of the Designated Receivables (the
“Closing”), shall take place at such a place, on a date and at a time mutually agreeable to NFC and NFRRC, and may occur simultaneously with the closing of any related transactions contemplated by the Further Transfer and Servicing
Agreements. 
 ARTICLE III 
 REPRESENTATIONS AND WARRANTIES 
 SECTION 3.01 Representations and Warranties as to Receivables. NFC makes the
following representations and warranties as to the Designated Receivables on which NFRRC relies in accepting the Designated Receivables. Such representations and warranties speak as of the Closing Date for such Designated Receivables and as of the
date of the related transfer of such Designated Receivables under the Further Transfer and Servicing Agreements, and shall survive the sale, transfer and assignment of such Designated Receivables to NFRRC and the subsequent assignment and transfer
thereof pursuant to the Further Transfer and Servicing Agreements: 
 (a) Characteristics of Receivables. Each Designated Receivable:

 (i) was originated or acquired by NFC to finance a retail purchase by a business customer or a refinancing (for reasons
other than credit reasons, unless it was amended or restructured at least 12 months prior to the Cutoff Date, it is not owed by an Obligor that is the subject of a bankruptcy or insolvency proceeding and since its amendment or restructuring it has
not been greater than 60 days past due (measured from the date of any Scheduled Payment)) of a Financed Vehicle or Financed Vehicles by a business customer; 
 (ii) has created or shall create a valid, binding and enforceable first priority, perfected security interest in favor of NFC in each
Financed Vehicle related thereto, which security interest will be validly assigned by NFC to NFRRC and will be assignable by NFRRC to a subsequent purchaser; 
 (iii) contains customary and enforceable provisions such as to render the rights and remedies of the holder thereof adequate for
realization against the collateral of the benefits of the security; 
 (iv) shall yield interest at the Annual Percentage Rate
and comes from one of the following categories, which differ in their provisions for the payment of principal and interest: Equal Payment Fully Amortizing Receivables, Equal Payment Skip Receivables, Equal Payment Balloon Receivables, Level
Principal Fully Amortizing Receivables, Level Principal Skip Receivables, Level Principal Balloon Receivables, or Other Receivables. “Equal Payment Fully Amortizing Receivables” are Receivables that provide for equal monthly payments that
fully amortize the amount financed over its original term to maturity. “Equal Payment Skip 

  

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Receivables” are Receivables that provide for equal monthly payments in eleven or fewer months of each twelve-month period that fully amortize the
amount financed over its original term to maturity. “Equal Payment Balloon Receivables” are Receivables that provide for equal monthly payments except that a larger payment becomes due on the final maturity date for such Receivables.
“Level Principal Fully Amortizing Receivables” are Receivables that provide for monthly payments consisting of level principal amounts together with accrued and unpaid interest on the unpaid Receivable Balances. “Level Principal Skip
Receivables” are Receivables that provide for monthly payments in eleven or fewer months of each twelve-month period consisting of level principal amounts together with accrued and unpaid interest on the unpaid Receivable Balances. “Level
Principal Balloon Receivables” are Receivables that provide for monthly payments consisting of level principal amounts together with accrued and unpaid interest on the unpaid Receivable Balances, except that a larger principal payment becomes
due on the final maturity date for such Receivables. “Other Receivables” are Receivables not described above, including Receivables that provide for level monthly payments in eleven or fewer months of each twelve-month period that amortize
a portion of the amount financed over its original term to maturity with a larger payment that becomes due on the final maturity date for such Receivables; 
 (v) immediately prior to the transfer and assignment thereof to NFRRC by NFC pursuant to this Agreement, NFC had good title to it, free of any Lien (except for Liens that will be released as of such transfer), and all
right, title and interest in it has been validly sold by NFC to NFRRC pursuant to this Agreement, and NFRRC has good title to it, free of any Lien (except for Liens created by the Basic Documents), and the transfer of the Retail Note to NFRRC has
been perfected under the UCC; 
 (vi) was originated or acquired in the ordinary course of business in accordance with
NFC’s underwriting standards. 
 (b) Schedule of Retail Notes. The information set forth in the Schedule of Retail Notes relating
to such Designated Receivables is true and correct in all material respects. 
 (c) Compliance With Law. All requirements of
applicable federal, state and local laws, and regulations thereunder, including the Equal Credit Opportunity Act, the Federal Reserve Board’s Regulation “B”, the Servicemembers Civil Relief Act, and any applicable bulk sales or bulk
transfer law and other equal credit opportunity and disclosure laws, in respect of any of the Designated Receivables, have been complied with in all material respects, and each such Designated Receivable and the sale of the Financed Vehicle or
Financed Vehicles evidenced thereby complied at the time it was originated or made and now complies in all material respects with all legal requirements of the jurisdiction in which it was originated or made. 
 (d) Binding Obligation. Each Designated Receivable represents the genuine, legal, valid and binding payment obligation in writing of the Obligor
thereon, enforceable against the Obligor by the holder thereof in accordance with its terms, except as enforceability 

  

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may be limited by applicable bankruptcy, insolvency, reorganization or similar laws affecting the enforcement of creditors’ rights in general and by
equity, regardless of whether such enforceability is considered in a proceeding in equity or at law. 
 (e) Security Interest in Financed
Vehicle. Immediately prior to the sale, transfer and assignment thereof pursuant hereto, each Designated Receivable was secured by a validly perfected first priority security interest in the related Financed Vehicle or, in the event any such
Receivable was secured by more than one Financed Vehicle, in each related Financed Vehicle, each in favor of NFC as secured party, or all necessary and appropriate action had been commenced that will result, within 100 days following the Cutoff
Date, in the valid perfection of a first priority security interest in each related Financed Vehicle in favor of NFC as secured party in each case (except for first priority security interests which may exist in any accessions not financed by NFC).

 (f) Receivables In Force. No Designated Receivable has been satisfied, subordinated or rescinded, and no Financed Vehicle securing
any Designated Receivable has been released from the Lien of the related Receivable in whole or in part. 
 (g) No Waiver. Since the
Cutoff Date, no provision of any Designated Receivable has been waived, altered or modified in any respect. 
 (h) No Amendments.
Since the Cutoff Date, no Designated Receivable has been amended or otherwise modified such that the total number of the Obligor’s Scheduled Payments is increased or the Starting Receivable Balance thereof is increased, and prior to the Cutoff
Date, no Designated Receivable has been amended or restructured for credit reasons, unless it was amended or restructured at least 12 months prior to the Cutoff Date, it is not owed by an Obligor that is the subject of a bankruptcy or insolvency
proceeding and since its amendment or restructuring it has not been greater than 60 days past due (measured from the date of any Scheduled Payment). 
 (i) No Defenses. No right of rescission, setoff, counterclaim or defense has been asserted or threatened with respect to any Designated Receivable. 
 (j) No Liens. There are, to NFC’s knowledge, no Liens or claims that have been filed for work, labor or materials affecting any Financed
Vehicle relating to any Designated Receivable that are or may be prior to, or equal or coordinate with, the security interest in each Financed Vehicle granted by the Designated Receivable (except for Permitted Liens). 
 (k) No Default. There has been no default, breach, violation or event permitting acceleration under the terms of any Designated Receivable, and no
event has occurred and is continuing that with notice or the lapse of time would constitute a default, breach, violation or event permitting acceleration under the terms of any Designated Receivable, and NFC has not waived any of the foregoing, in
each case except for payments on any Designated Receivables which are not more than 60 days past due (measured from the date of any Scheduled Payment) as of the Cutoff Date, or with respect to any Eligible Restructured Receivable, no such event has
occurred since the date of its amendment or restructuring. 
  

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 (l) Insurance. Each Obligor on a Designated Receivable is required to maintain a physical damage
insurance policy for each Financed Vehicle of the type that NFC requires in accordance with its customary underwriting standards for the purchase of truck, bus and trailer receivables, unless NFC has in accordance with its customary procedures
permitted an Obligor to self-insure such Financed Vehicle. 
 (m) Lawful Assignment. No Designated Receivable was originated in, or is
subject to the laws of, any jurisdiction the laws of which would make unlawful the sale, transfer and assignment of such Designated Receivable under this Agreement or any Further Transfer and Servicing Agreements. 
 (n) All Filings Made. All filings necessary under the UCC in any jurisdiction to give NFRRC a first priority perfected security or ownership
interest in the Designated Receivables and the Related Security (to the extent it constitutes Code Collateral) have been made, and the Designated Receivables constitute Code Collateral. 
 (o) One Original. There is only one original executed copy of each Designated Receivable. 
 (p) No Documents or Instruments; Etc. No Designated Receivable, or constituent part thereof, constitutes a “negotiable instrument” or
“negotiable document of title” (as such terms are used in the UCC), each Designated Receivable is an “account” or “tangible chattel paper” within the meaning of Section 9-102 of the UCC. 
 (q) Maturity of Receivables. Each Designated Receivable has an original term to maturity of not less than 7 months and not greater than 84 months
and, as of the Cutoff Date, had a remaining term to maturity of not less than 6 months and not greater than 84 months. 
 (r) Scheduled
Payments; Delinquency. As of the Cutoff Date, each Designated Receivable had a first scheduled payment that was due on or before February 28, 2007; as of the Cutoff Date, no Designated Receivable had or will have a payment that was more than 60
days past due, or with respect to any Eligible Restructured Receivable, has not had a payment more than 60 days past due since the date of its amendment or restructuring; and as of the Purchase Date, no Designated Receivable had or will have a final
scheduled payment that is due later than January 31, 2014. 
 (s) Vehicles. Each Financed Vehicle to which a Designated Receivable
relates was a new or used medium or heavy duty truck, truck chassis, bus or trailer at the time the related Obligor executed the Retail Note. 
 (t) Origin. Each Designated Receivable was originated in the United States and is payable in U.S. Dollars. 
 (u) Starting
Receivable Balance. The Starting Receivable Balance of each Designated Receivable as of the Cutoff Date shall be $1,000 or more. 
 (v)
Concentration. (i) The aggregate Starting Receivable Balance of all Receivables from a single Obligor shall not exceed 2.00% of the Aggregate Starting Receivable 

  

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Balance, (ii) the aggregate Starting Receivable Balance of all Receivables having a remaining term in excess of 72 months as of the Cutoff Date shall
not exceed 10.00% of the Aggregate Starting Receivables Balance, (iii) the weighted average remaining maturity of the Designated Receivables shall not be greater than 58 months, (iv) the aggregate Starting Receivables Balance of all
Receivables not originated by NFC or one of its Affiliates shall not exceed 3.00% of the Aggregate Starting Receivables Balance, (v) the aggregate Starting Receivables Balance for all Receivables that are Eligible Restructured Receivables shall
not exceed 5.00% of the Aggregate Starting Receivables Balance and (vi) the aggregate Starting Receivables Balance of all Receivables secured by used vehicles does not exceed 22.50% of the Aggregate Starting Receivables Balance and
(vii) the aggregate Starting Receivables Balance of all Receivables owed by Non-Fleet Obligors does not exceed 22.50% of the Aggregate Starting Receivables Balance. 
 (w) Selection Criteria. The Designated Receivables were selected on a random basis from all receivables satisfying the selection criteria described herein, and no selection procedures believed to be adverse to
NFRRC or to holders of the Securities issued under the Further Transfer and Servicing Agreements were utilized in selecting the Designated Receivables from those receivables of NFC and Truck Retail Instalment Paper Corp., its wholly owned
subsidiary, which meet the selection criteria under this Agreement. 
 (x) Minimum APR. As of the Cutoff Date, each Designated
Receivable has an Annual Percentage Rate of not less than 5.50%. 
 (y) Weighted Average APR. The Designated Receivables transferred
on the Purchase Date shall have a Weighted Average APR of not less than 8.00%. 
 (z) No Government Contracts. No Obligor under any of
the Designated Receivables is a governmental authority of the United States or any state or political subdivision thereof. 
 SECTION 3.02
Additional Representations and Warranties of NFC. NFC hereby represents and warrants to NFRRC as of the Purchase Date and as of the Closing Date under the Further Transfer and Servicing Agreements, in its capacity as the seller of the
Designated Receivables hereunder, that: 
 (a) Organization and Good Standing. NFC has been duly organized and is validly existing as
a corporation in good standing under the laws of the State of Delaware, with power and authority to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted, and had at all
relevant times, and now has, power, authority and legal right to acquire and own the Designated Receivables. 
 (b) Due Qualification.
NFC 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 requires or shall
require such qualification. 
 (c) Power and Authority. NFC has the power and authority to execute and deliver this Agreement and to
carry out its terms; NFC has full power and authority to sell and 

  

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assign the Designated Receivables and the Related Security to NFRRC, and has duly authorized such sale and assignment to NFRRC by all necessary corporate
action; and the execution, delivery and performance of this Agreement have been duly authorized by NFC by all necessary corporate action. 
 (d) Valid Sale; Binding Obligation. This Agreement, together with the PA Assignment, has been duly executed and delivered by NFC, and shall (upon satisfaction of the conditions set forth in Section 4.02(b) hereof relating
to the Designated Receivables) constitute a valid sale, transfer and assignment of the Designated Receivables and Related Security, enforceable against creditors of and purchasers from NFC. This Agreement, together with the PA Assignment constitute
a legal, valid and binding obligation of NFC enforceable against NFC in accordance with its respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws affecting the
enforcement of creditors’ rights in general and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law. 
 (e) No Violation. The consummation of the transactions contemplated by this Agreement and the PA Assignment, and the fulfillment of the terms of
this Agreement and the PA Assignment shall not conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time) a default under, the certificate of incorporation or by-laws of NFC, or
any indenture, agreement, mortgage, deed of trust or other instrument to which NFC is a party or by which it is bound, or result in the creation or imposition of any Lien upon any of its properties pursuant to the terms of any such indenture,
agreement, mortgage, deed of trust or other instrument (other than this Agreement, the PA Assignment or any Further Transfer and Servicing Agreement), or violate any law or, to NFC’s knowledge, any order, rule or regulation applicable to NFC of
any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over NFC or any of its properties. 
 (f) No Proceedings. There are no proceedings or, to NFC’s knowledge, investigations pending or, to NFC’s knowledge, threatened, before any court, regulatory body, administrative agency or other
tribunal or governmental instrumentality having jurisdiction over NFC or its properties (i) asserting the invalidity of this Agreement or the PA Assignment, (ii) seeking to prevent the consummation of any of the transactions contemplated
by this Agreement or the PA Assignment, or (iii) seeking any determination or ruling that might materially and adversely affect the performance by NFC of its obligations under, or the validity or enforceability of, this Agreement or the PA
Assignment. 
 (g) No Consent. No permit, consent, approval or authorization of, or declaration to or filing with, any governmental
authority is required in connection with the execution, delivery and performance by NFC of this Agreement or the PA Assignment or the consummation by NFC of the transactions contemplated hereby or thereby except as expressly contemplated herein or
therein. 
 (h) ERISA. No notice of a Lien arising under Title I or Title IV of ERISA has been filed against, or otherwise affects the
assets NFC. 
  

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 (i) Solvency. NFC is, and after giving effect to the transactions contemplated to occur on such
date will be, solvent. 
 (j) Investment Company Act. NFC is not, and is not controlled by, an “investment company” within
the meaning of, and is not required to register as an “investment company” under, the Investment Company Act. 
 SECTION 3.03
Representations and Warranties of NFRRC. NFRRC hereby represents and warrants to NFC as of the Purchase Date: 
 (a) Organization
and Good Standing. NFRRC has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Delaware, with power and authority to own its properties and to conduct its business as such properties are
presently owned and such business is presently conducted, and had at all relevant times, and now has, power, authority and legal right to acquire and own the Designated Receivables. 
 (b) Due Qualification. NFRRC 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 requires such qualification. 
 (c) Power and Authority. NFRRC has the power and authority to execute and deliver this Agreement and to carry out its terms and the execution, delivery and performance of this Agreement have been duly authorized by NFRRC by all
necessary corporate action. 
 (d) No Violation. The consummation by NFRRC of the transactions contemplated by this Agreement and the
fulfillment of the terms of this Agreement shall not conflict with, result in any breach of any of the terms and provisions of or constitute (with or without notice or lapse of time) a default under, the certificate of incorporation or by-laws of
NFRRC, or any indenture, agreement, mortgage, deed of trust or other instrument to which NFRRC is a party or by which it is bound, or 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 this Agreement, the PA Assignment or any Further Transfer and Servicing Agreement), or violate any law or, to NFRRC’s knowledge, any order, rule or regulation applicable to NFRRC of any court
or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over NFRRC or any of its properties. 
 (e) No Proceedings. There are no proceedings or, to NFRRC’s knowledge, investigations pending or, to NFRRC’s knowledge, threatened, before any court, regulatory body, administrative agency or other
tribunal or governmental instrumentality having jurisdiction over NFRRC or its properties (i) asserting the invalidity of this Agreement or the PA Assignment, (ii) seeking to prevent the consummation of any of the transactions contemplated
by this Agreement or (iii) seeking any determination or ruling that might materially and adversely affect the performance by NFRRC of its obligations under, or the validity or enforceability of, this Agreement or the PA Assignment. 

 

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 (f) Binding Obligation. This Agreement constitutes a legal, valid and binding obligation of NFRRC
enforceable against NFRRC in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditors’ rights in general and by general
principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law. 
 (g) No Consent.
No permit, consent, approval or authorization of, or declaration to or filing with, any governmental authority is required in connection with the execution, delivery and performance by NFRRC of this Agreement, or the consummation by NFRRC of the
transactions contemplated hereby except as expressly contemplated herein. 
 ARTICLE IV 
 CONDITIONS 
 SECTION 4.01 Conditions
to Obligation of NFRRC. The obligation of NFRRC to purchase Designated Receivables and the Related Security hereunder on the Purchase Date is subject to the satisfaction of the following conditions: 
 (a) Representations and Warranties True. The representations and warranties of NFC in Section 3.01 regarding such Designated
Receivables and the Related Security being transferred on the Purchase Date, and the representations and warranties of NFC in Section 3.02, shall be true and correct as of the Purchase Date (or if specified as applying to some other
date, as of such date), and NFC shall have performed all obligations to be performed by it hereunder on or prior to the Purchase Date. 
 (b)
No Repurchase Event. No Repurchase Event (as defined in Section 5.04 below) shall have occurred on or prior to the Purchase Date with respect to any of the Designated Receivables. 
 (c) Computer Files Marked. NFC shall, at its own expense, on or prior to the Purchase Date, (i) indicate in its computer files created in
connection with the Designated Receivables that the Designated Receivables have been sold by NFC to NFRRC pursuant to this Agreement and the PA Assignment by NFC and (ii) deliver to NFRRC the Schedule of Retail Notes certified by an officer of
NFC to be true, correct and complete. 
 (d) Documents to Be Delivered by NFC. 
 (i) The PA Assignment. On the Purchase Date, NFC shall execute and deliver to NFRRC the PA Assignment of the Designated Receivables
and the Related Security. 
 (ii) Evidence of UCC Filing. On or prior to the Purchase Date, NFC shall record and file,
at its own expense, a UCC-1 financing statement in each jurisdiction in which required by applicable law, naming NFC as seller or debtor, naming NFRRC as purchaser or secured party, naming the Designated Receivables and Related Security as
collateral, meeting the requirements of the laws of each such jurisdiction and in such manner as is necessary to perfect under the UCC the sale, 

  

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transfer, assignment and conveyance of the Designated Receivables and the Related Security (to the extent it constitutes Code Collateral) to NFRRC. NFC shall
deliver a file-stamped copy, or other evidence satisfactory to NFRRC of such filing, to NFRRC on or prior to the Purchase Date. 
 (iii) Other Documents. On the Purchase Date, NFC shall provide such other documents as NFRRC may reasonably request. 
 (e)
[Reserved]. 
 (f) Other Transactions. The related transactions contemplated by the Further Transfer and Servicing Agreements
shall be consummated on or prior to the Purchase Date (and all conditions precedent thereto shall be satisfied) to the extent that such transactions are intended to be substantially contemporaneous with the transactions hereunder. 
 SECTION 4.02 Conditions To Obligation of NFC. The obligation of NFC to sell the Designated Receivables to NFRRC hereunder on the Purchase Date is
subject to the satisfaction of the following conditions: 
 (a) Representations and Warranties True. The representations and
warranties of NFRRC hereunder shall be true and correct as of the Purchase Date, and NFRRC shall have performed all obligations to be performed by it hereunder on or prior to the Purchase Date. 
 (b) Purchase Price. On the Purchase Date, NFRRC shall pay to NFC the Purchase Price, payable on such date as provided in Section 2.02
of this Agreement. 
 ARTICLE V 
 ADDITIONAL AGREEMENTS 
 NFC agrees with NFRRC as follows: 
 SECTION 5.01 Conflicts With Further Transfer and Servicing Agreements. To the extent that any provision of Sections 5.02 through 5.04
of this Agreement conflicts with any provision of the Further Transfer and Servicing Agreements, the Further Transfer and Servicing Agreements shall govern. 
 SECTION 5.02 Protection of Title. 
 (a) Filings. NFC shall prepare and file such financing
statements and cause to be prepared and filed such continuation and other statements, all in such manner and in such places as may be required by law fully to preserve, maintain and protect the interest of NFRRC under this Agreement in the
Designated Receivables and the Related Security, and hereby authorizes NFRRC (and the Indenture Trustee) to file any such financing statements or continuation statements relating to all or any part thereof. NFC shall deliver (or cause to be
delivered) to NFRRC, the Indenture Trustee and the Agent file-stamped copies of, or filing receipts for, any document filed as provided above, as soon as available following such filing. 
  

 - 11 - 

 (b) Name Change. NFC shall not change its name, identity or corporate structure in any manner that
would, could or might make any financing statement or continuation statement filed by NFC in accordance with Section 5.02(a) seriously misleading within the meaning of Section 9-506 of the UCC, unless it shall have given NFRRC, the
Indenture Trustee and the Agent at least 60 days prior written notice thereof and shall file such financing statements or amendments as may be necessary to continue the perfection of NFRRC’s security interest in the Designated Receivables and
the Related Security. 
 (c) Jurisdiction of Formation; Maintenance of Offices. NFC shall give NFRRC, the Indenture Trustee and the
Agent at least 60 days prior written notice of any change in its jurisdiction of formation and shall file such financing statements or amendments as may be necessary to continue the perfection of NFRRC’s security interest in the Designated
Receivables and the Related Security. NFC shall at all times maintain each office from which it services Designated Receivables and its jurisdiction of formation within the United States of America. 
 SECTION 5.03 Other Liens or Interests. Except for the conveyances hereunder and as contemplated by the Further Transfer and Servicing Agreements,
NFC shall not sell, pledge, assign or transfer the Designated Receivables or the Related Security to any other Person, or grant, create, incur, assume or suffer to exist any Lien (except any Permitted Lien) on any interest therein, and NFC shall
defend the right, title and interest of NFRRC in, to and under the Designated Receivables and Related Security against all claims of third parties claiming through or under NFC. 
 SECTION 5.04 Repurchase Events. By its execution of the Further Transfer and Servicing Agreements to which it is a party, NFC shall be deemed to
acknowledge the assignment by NFRRC of such of its right, title and interest in, to and under this Agreement to the Subsequent Transferee as shall be provided in the Further Transfer and Servicing Agreements. NFC hereby covenants and agrees with
NFRRC for the benefit of NFRRC and the Interested Parties, that (A) in the event of (i) a breach of any of NFC’s representations and warranties contained in Section 3.01 hereof with respect to any Designated Receivable or
(ii) a breach by NFC of Section 5.03 hereof with respect to any Designated Receivable, which breach materially and adversely affects NFRRC’s interest (or the interest of any Financial Party) in such Designated Receivable, or
(B) if at any time NFRRC or the Subsequent Transferee is required to obtain a license pursuant to Article 11-B of the New York Banking Law and such entity has failed to obtain such license and such failure adversely affects the interest of
NFRRC (or the interest of any Financial Party) (each breach or circumstance described in preceding clause (A) or (B), a “Repurchase Event”) unless, in any such case, such breach shall have been cured in all material respects or
such license shall have been obtained, as applicable, as of the second Accounting Date following NFC’s discovery or its receipt of notice of breach or the existence of such circumstance (or, at NFC’s election, the first Accounting Date
following such discovery), NFC will repurchase the Designated Receivable or, in the case of preceding clause (B), all Designated Receivables affected by the failure to obtain such license, from the Subsequent Transferee (if the Subsequent Transferee
is then the Owner of such Designated Receivable) on the related Distribution Date for an amount equal to the Warranty Payment (which amount shall be deposited by NFC directly into the Collection Account on the Transfer Date for the related
Distribution Date), without further notice from NFRRC hereunder. Upon the occurrence of a Repurchase Event with respect to one or more Designated Receivables for which NFRRC is the 

  

 - 12 - 

 
Owner, NFC agrees to repurchase such Designated Receivable from NFRRC for an amount and upon the same terms as NFC would be obligated to repurchase such
Designated Receivables from the Subsequent Transferee if the Subsequent Transferee was then the Owner thereof, and upon payment of such amount, NFC shall have such rights with respect to such Designated Receivables as if NFC had purchased such
Designated Receivable from the Subsequent Transferee as the Owner thereof. It is understood and agreed that the obligation of NFC to repurchase any Designated Receivable pursuant to this Section 5.04 shall, if such obligation is
fulfilled, constitute the sole remedy against NFC for such breach available to NFRRC or any Interested Party. 
 SECTON 5.05
Indemnification. NFC shall indemnify NFRRC for any liability as a result of the failure of a Designated Receivable to be originated in compliance with all requirements of law and for any breach of any of its representations and warranties
contained herein. This indemnity obligation shall be in addition to any obligation that NFC may otherwise have. 
 SECTON 5.06 Further
Assignments. NFC acknowledges that NFRRC shall, pursuant to the Further Transfer and Servicing Agreements, sell the Designated Receivables and the Related Security to the Subsequent Transferee and assign its rights hereunder to the Subsequent
Transferee, subject to the terms and conditions of the Further Transfer and Servicing Agreements, and that the Subsequent Transferee may in turn further pledge, assign or transfer its rights in the Designated Receivables, the Related Security and
this Agreement to the Indenture Trustee, for the benefit of the Financial Parties. NFC further acknowledges that NFRRC may assign its rights under the Servicing Agreement to the Subsequent Transferee and that the Subsequent Transferee may in turn
pledge, assign or transfer its rights in the Servicing Agreement to the Indenture Trustee, for the benefit of the Financial Parties. 
 SECTION 5.07 Pre-Closing Collections. Within two Business Days after the Purchase Date, NFC shall transfer to the account or accounts designated by NFRRC (or by the Subsequent Transferee under the Further Transfer and Servicing
Agreements) all collections (from whatever source) on or with respect to the Designated Receivables and the Related Security conveyed by NFC to NFRRC on the Purchase Date pursuant to Section 2.01. 
 SECTION 5.08 Limitation on Transfer of International Purchase Obligations. NFRRC acknowledges and agrees that the rights pursuant to the
International Purchase Obligations are personal to NFC, and only the proceeds of such rights have been assigned to NFRRC. NFRRC is not and is not intended to be a third-party beneficiary of such rights and, accordingly, such rights will not be
exercisable by, enforceable by or for the benefit of, or preserved for the benefit of, NFRRC, the Issuer, the Owner Trustee or the Indenture Trustee. 
 SECTION 5.09 Sale Treatment. NFC intends to treat each transfer and assignment described herein as a sale for accounting and tax purposes. 
  

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 ARTICLE VI 
 MISCELLANEOUS PROVISIONS 
 SECTION 6.01 Amendment. (a) This Agreement may be amended from time
to time (subject to any expressly applicable amendment provision of the Further Transfer and Servicing Agreements) by a written amendment duly executed and delivered by NFC and NFRRC; provided, however, that this Agreement may not be amended unless
such amendment is in accordance with the provisions of Section 5.01 of the Pooling Agreement as if such Section 5.01 were contained herein and were applicable to this Agreement. 
 (b) Notwithstanding any other provision of this Agreement, if the consent of the Swap Counterparty is required pursuant to the Swap Counterparty Rights
Agreement to amend this Agreement, any such purported amendment shall be null and void ab initio unless the Swap Counterparty consents in writing to such amendment. 
 SECTION 6.02 Survival; Termination. This Agreement shall create and constitute the continuing obligations of the parties hereto and shall remain in full force and effect until terminated in accordance with its
terms; provided, however, that this Section 6.02 and the rights and remedies with respect to Section 6.14 shall be continuing and shall survive any termination of this Agreement. This Agreement may be terminated
by NFC and NFRRC at any time following the termination of the Further Transfer and Servicing Agreements in accordance with their respective terms. 
 SECTION 6.03 Notices. All demands, notices and communications under this Agreement shall be delivered as specified in Appendix B to the Pooling Agreement. 
 SECTION 6.04 Governing Law. All questions concerning the construction, validity and interpretation of this Agreement and the PA Assignment
shall be governed by and construed and enforced in accordance with the internal laws of the State of Illinois, without giving effect to any choice of law or conflict provision or rule (whether of the State of Illinois or any other jurisdiction) that
would cause the application of the laws of any jurisdiction other than the State of Illinois. 
 SECTION 6.05 Waivers. No failure or
delay on the part of NFRRC (or the Indenture Trustee or the Agent) in exercising any power, right or remedy under this Agreement or the PA Assignment shall operate as a waiver thereof, nor shall any single or partial exercise of any such power,
right or remedy preclude any other or further exercise thereof or the exercise of any other power, right or remedy. 
 SECTION 6.06 Costs
and Expenses. NFC agrees to pay all reasonable out-of-pocket costs and expenses of NFRRC, including fees and expenses of counsel, in connection with the perfection as against third parties of NFRRC’s right, title and interest in, to and
under the Designated Receivables and Related Security and the enforcement of any obligation of NFC hereunder. 
 SECTION 6.07 Confidential
Information. NFRRC agrees that it shall neither use nor disclose to any person the names and addresses of the Obligors, except in connection with the enforcement of NFRRC’s rights hereunder, under the Designated Receivables, under the
Further Transfer and Servicing Agreements or as required by law. 
  

 - 14 - 

 SECTION 6.08 Headings. The various headings in this Agreement are for purposes of reference only
and shall not affect the meaning or interpretation of any provision of this Agreement. 
 SECTION 6.09 Counterparts. This Agreement
may be executed in two or more counterparts, and by different parties on separate counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. 
 SECTION 6.10 Severability of Provisions. If any one or more of the covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such covenants, agreements, provisions or terms shall be deemed enforceable to the fullest extent permitted, and if not so permitted, shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement or of any Securities or rights of the holders thereof. 
 SECTION 6.11 Further Assurances. NFC and NFRRC agree to do and perform, from time to time, any and all acts and to execute any and all further
instruments required or reasonably requested by the other more fully to effect the purposes of this Agreement, including the preparation of any financing statements or continuation statements relating to the Designated Receivables and Related
Security for filing under the provisions of the UCC of any applicable jurisdiction. 
 SECTION 6.12 Assignment; Third-Party
Beneficiaries. NFC may not assign any of its rights or obligations hereunder or any interest herein without the prior written consent of NFRRC and the Agent. NFRRC may not assign any of its rights or obligations hereunder or any interest herein
without the prior written consent of NFC and the Agent; provided, however, that each of the transactions contemplated in Section 5.06 may be consummated without the further consent of any Person. NFC and NFRRC agree that
the Indenture Trustee is an express third-party beneficiary with respect to this Agreement and, as such, shall have the right to enforce this Agreement and to exercise directly all of NFRRC’s rights and remedies under this Agreement (including,
without limitation, the right to give or withhold any consents or approvals of NFRRC to be given or withheld hereunder). The Swap Counterparty shall be a third-party beneficiary to this Agreement only to the extent that it has rights specified
herein or rights with respect to this Agreement specified in the Swap Counterparty Rights Agreement. Except as otherwise expressly provided in this Agreement, no other Person shall have any right or obligation hereunder. 
 SECTION 6.13 Merger and Integration. Except as specifically stated otherwise herein, this Agreement sets forth the entire understanding of the
parties relating to the subject matter hereof, and all prior understandings, written or oral, are superseded by this Agreement. This Agreement may not be modified, amended, waived, or supplemented except as provided herein. 
  

 - 15 - 

 SECTION 6.14 No Petition Covenants. Notwithstanding any prior termination of this Agreement, NFC
shall not, prior to the date which is one year and one day after the final distribution with respect to the Securities, acquiesce, petition or otherwise invoke or cause any Person to invoke the process of any court or government authority for the
purpose of commencing or sustaining a case against NFRRC or 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
NFRRC or the Issuer or any substantial part of its property, or ordering the winding up or liquidation of the affairs of NFRRC or the Issuer. 
 SECTION 6.15 MUTUAL WAIVER OF JURY TRIAL. BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND
FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION,
EACH PARTY TO THIS AGREEMENT HEREBY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE BETWEEN OR AMONG ANY OF THE PARTIES HERETO, WHETHER ARISING IN CONTRACT, TORT OR OTHERWISE, ARISING OUT OF,
CONNECTED WITH, RELATED OR INCIDENTAL TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 
 * * * * * 
  

 - 16 - 

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

			
	NAVISTAR FINANCIAL CORPORATION
		
	By:	 	 /s/ John V. Mulvaney, Sr.

	Name:	 	John V. Mulvaney, Sr.
	Title:	 	 Vice President, Chief Financial
 Officer and
Treasurer

	
	NAVISTAR FINANCIAL RETAIL RECEIVABLES CORPORATION
		
	By:	 	 /s/ John V. Mulvaney, Sr.

	Name:	 	John V. Mulvaney, Sr.
	Title:	 	Vice President, Chief Financial
Officer and Treasurer

 EXHIBIT A 
 FORM OF PA ASSIGNMENT 
 As of February 16, 2007, for value received, in accordance with the
Purchase Agreement, dated as of February 16, 2007 (the “Purchase Agreement”), between Navistar Financial Corporation, a Delaware corporation (“NFC”), and Navistar Financial Retail Receivables Corporation, a
Delaware corporation (“NFRRC”), NFC does hereby sell, assign, transfer and otherwise convey unto NFRRC, without recourse (except as provided in Section 5.04 of the Purchase Agreement), all right, title and interest of
NFC in, to and under, the Retail Notes identified on the Schedule of Retail Notes attached hereto having an aggregate Starting Receivable Balance of $461,819,737.41 (the “Designated Receivables”) and the Related Security associated
with the Designated Receivables; 
 The foregoing sale does not constitute and is not intended to result in any assumption by NFRRC of any
obligation of the undersigned to the Obligors, Dealers, insurers or any other Person in connection with the Designated Receivables, the agreements with Dealers, any Insurance Policies or any agreement or instrument relating to any of them.

 This PA Assignment is made pursuant to and upon the representations, warranties and agreements on the part of the undersigned contained in
the Purchase Agreement and is to be governed by the Purchase Agreement. 
 Capitalized terms used herein and not otherwise defined shall have
the meaning assigned to them in the Purchase Agreement. 
 * * * * * 
  

 A-1 

 IN WITNESS WHEREOF, the undersigned has caused this PA Assignment to be duly executed as of the day and
year first above written. 
  

			
	 NAVISTAR FINANCIAL CORPORATION

		
	 By:
	 	  

	 Name:
	 	
	 Title:Servicing Agreement

 Exhibit 10.6 
 EXECUTION COPY 
  
  
  

 SERVICING AGREEMENT

 AMONG 
 NAVISTAR
FINANCIAL RETAIL RECEIVABLES CORPORATION, 
 THE BANK OF NEW YORK 
 AS INDENTURE TRUSTEE, 
 NAVISTAR FINANCIAL 2007-JPM OWNER TRUST,

 AS ISSUER 
 AND

 NAVISTAR FINANCIAL CORPORATION, 
 AS SERVICER 
 DATED AS OF FEBRUARY 16, 2007 
  

  

 TABLE OF CONTENTS 
  

					
	 	    	 	  	Page
		
	 ARTICLE I DEFINITIONS
	  	1
	 SECTION 1.01
	    	 Certain Defined Terms
	  	1
		
	 ARTICLE II ADMINISTRATION AND SERVICING OF RECEIVABLES
	  	2
	 SECTION 2.01
	    	 Duties of the Servicer
	  	2
	 SECTION 2.02
	    	 Establishment of Accounts
	  	3
	 SECTION 2.03
	    	 Collection of Receivables Payments
	  	6
	 SECTION 2.04
	    	 Realization Upon Liquidating Receivables
	  	6
	 SECTION 2.05
	    	 Maintenance of Insurance Policies
	  	7
	 SECTION 2.06
	    	 Maintenance of Security Interests in Vehicles
	  	7
	 SECTION 2.07
	    	 Covenants of the Servicer
	  	7
	 SECTION 2.08
	    	 Purchase of Receivables Upon Breach of Covenant
	  	8
	 SECTION 2.09
	    	 Servicing Fee
	  	8
	 SECTION 2.10
	    	 Servicer Expenses
	  	9
	 SECTION 2.11
	    	 Deposits to Collection Account
	  	9
	 SECTION 2.12
	    	 Collections
	  	9
	 SECTION 2.13
	    	 Application of Collections
	  	9
	 SECTION 2.14
	    	 Monthly Advances
	  	10
	 SECTION 2.15
	    	 Additional Deposits
	  	10
	 SECTION 2.16
	    	 Net Deposits
	  	10
	 SECTION 2.17
	    	 Servicer’s Certificate
	  	11
		
	 ARTICLE III STATEMENTS AND REPORTS
	  	12
	 SECTION 3.01
	    	 Annual Statement as to Compliance; Notice of Servicer Default; Tax Reports
	  	12
	 SECTION 3.02
	    	 Annual Accountants’ Report
	  	12
	 SECTION 3.03
	    	 Access to Certain Documentation and Information Regarding Receivables
	  	13
	 SECTION 3.04
	    	 Maintenance of Schedule of Retail Notes
	  	13
	 SECTION 3.05
	    	 Amendments to Schedule of Retail Notes
	  	13
	 SECTION 3.06
	    	 Maintenance of Systems and Receivables List
	  	13
		
	 ARTICLE IV THE CUSTODIAN
	  	14
	 SECTION 4.01
	    	 Custody of Receivable Files
	  	14
	 SECTION 4.02
	    	 Duties of Servicer as Custodian
	  	15
	 SECTION 4.03
	    	 Custodian’s Indemnification
	  	15
	 SECTION 4.04
	    	 Effective Period and Termination
	  	16
		
	 ARTICLE V REPRESENTATIONS AND WARRANTIES OF THE SERVICER
	  	16
	 SECTION 5.01
	    	 Representations and Warranties of the Servicer
	  	16
		
	 ARTICLE VI THE SERVICER
	  	17

  

 - 1 - 

					
	 SECTION 6.01
	    	 Merger or Consolidation of, or Assumption of the Obligations of, the Servicer
	  	17
	 SECTION 6.02
	    	 Limitation on Liability of Servicer and Others
	  	17
	 SECTION 6.03
	    	 Delegation of Duties
	  	18
	 SECTION 6.04
	    	 Servicer not to Resign
	  	18
	 SECTION 6.05
	    	 Servicer Indemnification
	  	18
	 SECTION 6.06
	    	 Backup Servicer
	  	20
		
	 ARTICLE VII DEFAULT
	  	20
	 SECTION 7.01
	    	 Servicer Defaults
	  	20
	 SECTION 7.02
	    	 Consequences of a Servicer Default
	  	21
	 SECTION 7.03
	    	 Indenture Trustee to Act; Appointment of Successor
	  	21
	 SECTION 7.04
	    	 Notification to Securityholders
	  	22
	 SECTION 7.05
	    	 Repayment of Advances
	  	22
	 SECTION 7.06
	    	 Waiver of Past Defaults
	  	23
		
	 ARTICLE VIII MISCELLANEOUS
	  	23
	 SECTION 8.01
	    	 Amendment
	  	23
	 SECTION 8.02
	    	 Termination
	  	23
	 SECTION 8.03
	    	 Notices
	  	23
	 SECTION 8.04
	    	 Governing Law
	  	23
	 SECTION 8.05
	    	 Severability
	  	23
	 SECTION 8.06
	    	 Assignment
	  	24
	 SECTION 8.07
	    	 Successors and Assigns
	  	24
	 SECTION 8.08
	    	 Counterparts
	  	24
	 SECTION 8.09
	    	 Headings and Cross-References
	  	24
	 SECTION 8.10
	    	 No Petition Covenants
	  	24
	 SECTION 8.11
	    	 Limitation of Liability of the Trustees
	  	24
	 SECTION 8.12
	    	 MUTUAL WAIVER OF JURY TRIAL
	  	25
	
	 APPENDICES

		
	 Appendix A - Minimum Servicing Standards
	  	
		
	 Appendex B - Form of Servicer’s Certificate
	  	

  

 - ii - 

 SERVICING AGREEMENT 
 SERVICING AGREEMENT, dated as of February 16, 2007 (as it may be further amended, supplemented or modified, this “Agreement”), among Navistar Financial Retail Receivables
Corporation, a Delaware corporation (“NFRRC”), Navistar Financial 2007-JPM Owner Trust, a Delaware statutory trust (the “Issuer”), Navistar Financial Corporation, a Delaware corporation (hereinafter, together with
its successors and assigns, “NFC” or, in its capacity as servicer hereunder, the “Servicer”), and The Bank of New York, a New York banking corporation, acting in its capacity as Indenture Trustee pursuant to the
Indenture (the “Indenture Trustee”). 
 R E C I T A L S: 

WHEREAS, NFRRC and NFC are parties to the Purchase Agreement, pursuant to which NFRRC will purchase the Receivables and the Related
Security with respect thereto from NFC; 
 WHEREAS, the Issuer will issue Notes pursuant to the Indenture between the Issuer
and the Indenture Trustee, and exchange the Notes and the Certificates for the Receivables and the Related Security with respect thereto transferred from NFRRC pursuant to the Pooling Agreement; 
 WHEREAS, the Servicer desires to perform the servicing obligations set forth herein relating to the Receivables owned by the Issuer for
and in consideration of the fees and other benefits set forth in this Agreement; and 
 WHEREAS, the parties wish to set
forth the terms and conditions upon which the Receivables are to be serviced by the Servicer. 
 NOW, THEREFORE, in
consideration of the foregoing, the other good and valuable consideration and the mutual terms and covenants contained herein, the parties hereto agree as follows: 
 ARTICLE I 
 DEFINITIONS 
 SECTION 1.01        Certain Defined Terms.    Capitalized terms used in the above recitals and in this Agreement shall have the
respective meanings assigned them in Part I of Appendix A to the Pooling Agreement dated as of the date hereof between the Issuer and NFRRC, unless otherwise defined herein. The rules of construction set forth in Part II of Appendix A
to the Pooling Agreement shall be applicable to this Agreement. 

 ARTICLE II 
 ADMINISTRATION AND SERVICING OF RECEIVABLES 
 SECTION
2.01        Duties of the Servicer.    The Servicer is hereby appointed and authorized to act as a contractor of the Owner and the Indenture Trustee with respect to servicing the
Receivables and in such capacity 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 comparable medium and heavy duty
truck, truck chassis, bus and trailer receivables that it services for itself or others. The Servicer hereby accepts such appointment and authorization and agrees to perform the duties of Servicer with respect to the Receivables set forth herein.
The Servicer’s duties with respect to all Receivables shall include collection and posting of all payments, responding to inquiries of Obligors on the Receivables, investigating delinquencies, sending payment coupons to Obligors, reporting tax
information to Obligors, policing the collateral securing the Receivables, accounting for collections with respect thereto and performing the other duties specified herein. Subject to the provisions of Section 2.02, the Servicer shall
follow its customary standards, policies and procedures and shall have full power and authority, acting alone, to do any and all things in connection with such managing, servicing, administration and collection that it may deem necessary or
desirable. 
 Without limiting the generality of the foregoing, the Servicer is hereby authorized and empowered by the Owner
and the Indenture Trustee pursuant to this Section 2.01, to execute and deliver any and all instruments of satisfaction or cancellation, or of partial or full release or discharge, and all other comparable instruments, with respect to
the Receivables and the related Financed Vehicles. The Servicer is hereby authorized to commence in the name of the Owner or, to the extent necessary, in its own name, a legal proceeding to enforce a Liquidating Receivable as contemplated by
Section 2.04, and to commence or participate in any legal proceeding (including a bankruptcy proceeding) relating to or involving a Receivable (including a Liquidating Receivable). If the Servicer commences or participates in any such
legal proceeding in its own name, the Owner thereupon shall be deemed to have automatically assigned such Receivable to the Servicer solely for purposes of commencing and participating in any such proceeding as a party or claimant, and the Servicer
is hereby authorized and empowered by the Owner, to execute and deliver in the Servicer’s name any notices, demands, claims, complaints, responses, affidavits or other documents or instruments in connection with any such proceeding. If in any
proceeding it is held that the Servicer may not enforce a Receivable on the ground that it is not a real party in interest or a holder entitled to enforce the Receivable, the Owner shall, at the Servicer’s expense and written directions, take
such reasonable steps as the Servicer reasonably deems necessary to enforce the Receivable, including bringing suit in the name of such Person. The Owner, upon the written request of the Servicer, shall furnish the Servicer with any powers of
attorney and other documents and take any other steps which the Servicer may reasonably deem necessary or appropriate to enable the Servicer to carry out its servicing and administrative duties under this Agreement and the other Basic Documents.
Except to the extent required by the preceding three sentences, the authority and rights granted to the Servicer in this Section 2.01 shall be nonexclusive and shall not be construed to be in derogation of any equivalent authority and
rights of the Owner. 
  

 - 2 - 

 SECTION 2.02        Establishment of
Accounts. 
 (a)    (i)    The Servicer, for the benefit of the Financial
Parties, shall establish and maintain in the name of the Indenture Trustee an Eligible Deposit Account known as the Navistar Financial 2007-JPM Owner Trust Collection Account (the “Collection Account”), bearing an additional
designation clearly indicating that the funds deposited therein are held for the benefit of the Financial Parties. 
         (ii)    The Servicer, for the benefit of the Noteholders, shall establish and maintain in the name of the Indenture Trustee an Eligible Deposit Account known as the
Navistar Financial 2007-JPM Owner Trust Note Distribution Account (the “Note Distribution Account”), bearing an additional designation clearly indicating that the funds deposited therein are held for the benefit of the
Noteholders. 
         (iii)    Pursuant to the Trust Agreement,
the Servicer, for the benefit of the Certificateholders, shall establish and maintain in the name of the Trust an Eligible Deposit Account known as the Navistar Financial 2007-JPM Owner Trust Certificate Distribution Account (the
“Certificate Distribution Account”), bearing an additional designation clearly indicating that the funds deposited therein are held for the benefit of the Certificateholders. 
         (iv)    The Servicer, for the benefit of the Financial Parties, shall
establish and maintain in the name of the Indenture Trustee an Eligible Deposit Account known as the Navistar Financial 2007-JPM Owner Trust Reserve Account (the “Reserve Account”), bearing an additional designation clearly
indicating that the funds deposited therein are held for the benefit of the Financial Parties. 
 (b)    (i)    Each of the Designated Accounts shall be initially established with the Indenture Trustee and shall be maintained with the Indenture Trustee so long as (A) the short-term unsecured
debt obligations of the Indenture Trustee have the Required Deposit Rating or (B) each of the Designated Accounts qualifies as an Eligible Deposit Account. All amounts held in such accounts (including amounts, if any, which the Servicer is
required to remit daily to the Collection Account pursuant to Section 2.11) shall, to the extent permitted by applicable laws, rules and regulations, be invested, at the written direction of the Servicer, by such bank or trust company in
Eligible Investments; provided, that funds in the Collection Account in an amount not in excess of 20% of the Aggregate Receivables Balance as of the preceding Accounting Date may be invested in investments which have a rating from S&P of
“A-1” rather than “A-1+,” if such investments otherwise constitute Eligible Investments. Such written direction shall constitute certification by the Servicer that any such investment is authorized by this
Section 2.02. Funds deposited in the Reserve Account shall be invested in Eligible Investments which mature prior to the next Distribution Date; provided, that such investments may mature on a later date if the Agent
consents. Investments in Eligible Investments shall be made in the name of the Indenture Trustee or its nominee, and such investments shall not be sold or disposed of prior to their maturity. Should the short-term unsecured debt obligations of the
Indenture Trustee (or any other bank or trust company with which the Designated Accounts are maintained) no longer have the Required Deposit Rating, then the Servicer shall within 10 

  

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Business Days (or such longer period, not to exceed 30 calendar days, without consent of the Agent with respect thereto), with the Indenture Trustee’s
assistance as necessary, cause the Designated Accounts (A) to be moved to a bank or trust company, the short-term unsecured debt obligations of which shall have the Required Deposit Rating, or (B) to be moved to an Eligible Deposit
Account. Investment Earnings on funds deposited in the Designated Accounts shall be deposited into the Collection Account for distribution in accordance with Section 8.2 of the Indenture. The Indenture Trustee or the other Person holding the
Designated Accounts as provided in this Section 2.02(b)(i) shall be the “Securities Intermediary.” If the Securities Intermediary shall be a Person other than the Indenture Trustee, the Servicer shall obtain the express
agreement of such Person to the obligations of the Securities Intermediary set forth in this Section 2.02. 
 (ii)    With respect to the Designated Account Property, the Securities Intermediary agrees, by its acceptance hereof, that: 
 (A)    The Designated Accounts are accounts to which Financial Assets will be credited. 
 (B)    All securities or other property underlying any Financial Assets credited to the Designated
Accounts shall be registered in the name of the Securities Intermediary, indorsed to the Securities Intermediary or in blank or credited to another securities account maintained in the name of the Securities Intermediary and in no case will any
Financial Asset credited to any of the Designated Accounts be registered in the name of the Issuer, the Servicer or the Seller, payable to the order of the Issuer, the Servicer or the Seller or specially endorsed to the Issuer, the Servicer or the
Seller except to the extent the foregoing have been specially indorsed to the Securities Intermediary or in blank. 
 (C)    All property delivered to the Securities Intermediary pursuant to this Agreement will be promptly credited to the appropriate Designated Account. 
 (D)    Each item of property (whether investment property, Financial Asset, security, instrument or
cash) credited to a Designated Account shall be treated as a “financial asset” within the meaning of Section 8-102(a)(9) of the New York UCC. 
 (E)    If at any time the Securities Intermediary shall receive any order from the Indenture Trustee directing transfer or redemption of any Financial Asset relating to the
Designated Accounts, the Securities Intermediary shall comply with such entitlement order without further consent by the Issuer, the Servicer, the Seller or any other Person. 
 (F)    The Designated Accounts shall be governed by the laws of the State of New York, regardless of
any provision in any other agreement. For purposes of the UCC, New York shall be deemed to be the Securities Intermediary’s jurisdiction and the Designated Accounts (as well as the Securities 

  

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Entitlements related thereto) shall be governed by the laws of the State of New York. 
 (G)    The Securities Intermediary has not entered into, and until the termination of this Agreement
will not enter into, any agreement with any other person relating to the Designated Accounts and/or any Financial Assets credited thereto pursuant to which it has agreed to comply with entitlement orders (as defined in Section 8-102(a)(8) of
the New York UCC) of such other person and the Securities Intermediary has not entered into, and until the termination of this Agreement will not enter into, any agreement with the Issuer, the Seller, the Servicer, the Indenture Trustee or the Swap
Counterparty purporting to limit or condition the obligation of the Securities Intermediary to comply with entitlement orders as set forth in Section 2.02(b)(ii)(E). 
 (H)    Except for the claims and interest of the Indenture Trustee and of the Issuer in the
Designated Accounts, the Securities Intermediary knows of no claim to, or interest in, the Designated Accounts or in any Financial Asset credited thereto. If any other person asserts any lien, encumbrance or adverse claim (including any writ,
garnishment, judgment, warrant of attachment, execution or similar process) against the Designated Accounts or in any Financial Asset carried therein, the Securities Intermediary will promptly notify the Indenture Trustee, the Servicer, the Swap
Counterparty and the Issuer thereof. 
 (I)    The Securities Intermediary will promptly
send copies of all statements, confirmations and other correspondence concerning the Designated Accounts and/or any Designated Account Property simultaneously to each of the Servicer, the Indenture Trustee and the Agent at the addresses set forth in
Appendix B to the Pooling Agreement. 
 (iii)    The Servicer shall have the power, revocable by the
Indenture Trustee (or by the Issuer with the consent of the Indenture Trustee) to instruct the Indenture Trustee to make withdrawals and payments from the Designated Accounts for the purpose of permitting the Servicer or the Issuer to carry out its
respective duties hereunder or permitting the Indenture Trustee to carry out its duties under the Indenture. 
 (iv)    The Indenture Trustee shall possess all right, title and interest in and to all funds on deposit from time to time in the Designated Accounts and in all proceeds thereof. Except as otherwise provided herein or in
the Indenture, the Designated Accounts shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Financial Parties. 
 (v)    The Servicer shall not direct the Indenture Trustee to make any investment of any funds or to sell any investment held in any of the Designated Accounts unless the security interest granted
and perfected in such account shall 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 

  

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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)    Pursuant to the Trust Agreement, the Issuer shall possess all right, title and
interest in and to all funds on deposit from time to time in the Certificate Distribution Account and in all proceeds thereof. Except as otherwise provided herein or in the Trust Agreement, the Certificate Distribution Account shall be under the
sole dominion and control of the Issuer for the benefit of the Certificateholders. If, at any time, the Certificate Distribution Account ceases to be an Eligible Deposit Account, the Servicer shall within 10 Business Days (or such longer period, not
to exceed 30 calendar days, as to which the Certificateholders may consent) establish a new Certificate Distribution Account as an Eligible Deposit Account and shall cause the Issuer to transfer any cash and/or any investments in the old Certificate
Distribution Account to such new Certificate Distribution Account. 
 (d)    The Indenture Trustee, the
Issuer, the Securities Intermediary and each other Eligible Deposit Institution with whom a Designated Account or the Certificate Distribution Account is maintained waives any right of set-off, counterclaim, security interest or bankers’ lien
to which it might otherwise be entitled. 
 SECTION 2.03        Collection of
Receivables 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
practices, policies and procedures as it follows with respect to comparable medium and heavy duty truck, truck chassis, bus and trailer receivables that it services for itself or others. Except as provided in Section 2.07(c), the
Servicer is hereby authorized to grant extensions, rebates or adjustments on a Receivable without the prior consent of the Owner of such Receivable and to rewrite, in the ordinary course of its business, a Receivable to reflect the Full Prepayment
of a Receivable with respect to any related Financed Vehicle without the prior consent of the Owner of such Receivable. The Servicer is authorized in its discretion to waive any prepayment charge, late payment charge or any other fees that may be
collected in the ordinary course of servicing such Receivable. Subject to Section 2.13 of this Agreement, the Servicer shall allocate payments on Receivables between principal and interest in accordance with the customary servicing
procedures it follows with respect to all comparable medium and heavy duty truck, truck chassis, bus and trailer receivables that it services for itself or others. 
 SECTION 2.04        Realization Upon Liquidating Receivables. 
 (a)    The Servicer shall use commercially reasonable efforts, consistent with its customary servicing procedures, to repossess or otherwise comparably convert the ownership
or otherwise take possession of each Financed Vehicle that it has reasonably determined should be repossessed or otherwise converted following a default under the Receivable secured by or relating to each such Financed Vehicle. The Servicer is
authorized to follow such practices, policies and procedures as it shall deem necessary or advisable and as shall be customary and usual in its servicing of medium and heavy duty truck, truck chassis, bus and trailer receivables that it services for
itself or others, which practices, policies and procedures may include reasonable efforts to realize upon or obtain benefits of any proceeds from any Dealer Liability, proceeds from any International Purchase Obligations, proceeds from any Insurance
Policies and 

  

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proceeds from any Guaranties, in each case with respect to the Receivables, selling the related Financed Vehicle or Vehicles at public or private sale or
sales and other actions by the Servicer in order to realize upon any Receivable. The foregoing is 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 any repair or towards the repossession of such Financed Vehicle unless it shall determine in its discretion that such repair or repossession shall increase the proceeds of liquidation of the related Receivable by an amount greater than or equal
to the amount of such expenses. The Servicer shall be entitled to receive Liquidation Expenses with respect to each Liquidating Receivable at such time as the Receivable becomes a Liquidating Receivable in accordance with
Section 8.2(b)(i) of the Indenture. 
 (b)    The Servicer shall pay all costs, expenses and
liabilities incurred by it in connection with any action taken in respect of a Financed Vehicle; provided, however, that it shall be entitled to reimbursement of such costs and expenses to the extent they constitute Liquidation
Expenses or expenses recoverable under an applicable Insurance Policy. 
 SECTION
2.05        Maintenance of Insurance Policies.    The Servicer shall, in accordance with its customary servicing procedures, require that each Obligor under a Receivable shall have
obtained physical damage insurance covering each Financed Vehicle as of the execution of such Receivable, unless the Servicer has in accordance with its customary procedures permitted an Obligor to self-insure the Financed Vehicle or Financed
Vehicles securing such Receivable. The Servicer shall, in accordance with its customary servicing procedures, monitor such physical damage insurance with respect to each Financed Vehicle that secures or is related to each Receivable. 
 SECTION 2.06        Maintenance of Security Interests in
Vehicles.    The Servicer shall, in accordance with its customary servicing procedures and at its own expense, take such steps as are necessary to maintain perfection of the first priority security interest created by a
Receivable in the related Financed Vehicle or Financed Vehicles. The Owner of each Receivable hereby authorizes the Servicer to re-perfect such security interests as necessary because of the relocation of a Financed Vehicle or for any other reason.

 SECTION 2.07        Covenants of the Servicer.    The
Servicer hereby makes the following covenants on which the Issuer is relying in acquiring the Receivables under the Pooling Agreement and issuing the Securities under the Further Transfer and Servicing Agreements: 
 (a)    except as contemplated by the other Basic Documents, the Servicer shall not release any Financed Vehicle from
the security or ownership interest securing the related Receivable; 
 (b)    the Servicer shall do
nothing to impair the rights of NFRRC, the Issuer, the Securityholders or the Indenture Trustee in and to such Receivables; 
 (c)    the Servicer shall not amend or otherwise modify any Receivable such that the Starting Receivable Balance, the Annual Percentage Rate or the total number of Scheduled 

  

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Payments is altered or such that the final scheduled payment on such Receivable will be due any later than January 31, 2014; and 
 (d)    other than solely for the purpose of collecting or enforcing the Receivables for the benefit of the Owner,
(i) the Servicer shall not at any time have or in any way attempt to assert any interest in any Receivables or Related Assets or records related to the Collateral and (ii) the entire legal and equitable interest of the Owner of a
Receivable in such Receivable and the Related Assets shall at all times be vested in such Owner. 
 SECTION
2.08        Purchase of Receivables Upon Breach of Covenant. 
 (a)    Upon discovery by the Servicer or any of the Interested Parties of a breach of any of the covenants set forth in Sections 2.06 and 2.07 with respect to any Receivable, the party discovering such
breach shall give prompt written notice thereof to the others. As of the second Accounting Date (or, at the Servicer’s election, the first Accounting Date) following notice to or discovery by the Servicer of a breach of any covenant of the
Servicer that materially and adversely affects any Receivable, unless such breach is cured in all material respects, the Servicer shall, with respect to such Receivable (an “Administrative Receivable”) purchase such Administrative
Receivable from the Issuer at a price equal to the Administrative Purchase Payment. The Servicer shall pay the Administrative Purchase Payment as described in Section 2.11. 
 It is understood and agreed that the obligation of the Servicer to purchase any Receivable with respect to which such a breach has
occurred and is continuing shall, if such obligation is fulfilled, constitute the sole remedy against the Servicer for such breach available to any Interested Party for any such uncured breach. 
 (b)    Upon receipt of the Administrative Purchase Payment with respect to a Receivable which is an Administrative
Receivable, the applicable Owner shall assign, without recourse, representation or warranty, to the Servicer (and shall take such other actions as the Servicer may reasonably request in writing to perfect or confirm such assignment) all of such
Person’s right, title and interest in, to and under (i) such Administrative Receivable and all monies due thereon and (ii) all Related Security with respect to such Administrative Receivable, such assignment being an assignment
outright and not for security. Upon the assignment of such Administrative Receivable described in the preceding sentence, the Servicer shall own such Administrative Receivable, and all such Related Security, free of any further obligations to such
Person with respect thereto. 
 SECTION 2.09        Servicing
Fee.    In consideration for its services hereunder and as compensation for expenses paid as contemplated by Section 2.10, the Servicer shall be entitled to receive on each Distribution Date a servicing fee (the
“Basic Servicing Fee”) for the related Monthly Period equal to one-twelfth of 1% (the “Basic Servicing Fee Rate”) multiplied by the Aggregate Receivables Balance as of the last day of the preceding Monthly Period.
On each Distribution Date, the Servicer will be paid the Basic Servicing Fee and any unpaid Basic Servicing Fees from all prior Distribution Dates (collectively, the “Total Servicing Fee”) pursuant to Section 8.2(c) of
the Indenture to the extent of funds available therefor. In addition, the Servicer will be entitled to receive any late fees, prepayment charges or certain similar fees 

  

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and charges collected during a Monthly Period (the “Supplemental Servicing Fee”). The Servicer shall retain all Supplemental Servicing Fees
and shall not be obligated to deposit them into the Collection Account. 
 SECTION
2.10        Servicer Expenses.    The Servicer shall be required to pay all expenses incurred by it in connection with its activities hereunder, including fees and disbursements of
the Issuer, any trustees and independent accountants, taxes imposed on the Servicer and expenses incurred in connection with distributions and reports and all other fees and expenses not expressly stated under this Agreement to be for the account of
the Interested Parties, but excluding federal, state and local income taxes, if any, of the Issuer or any Securityholder. 
 SECTION 2.11        Deposits to Collection Account.    The Servicer shall remit to the Indenture Trustee for deposit to the Collection Account all Collections it receives
during each Monthly Period within two Business Days after receipt thereof. However, Collections received during the period from the Cutoff Date to the Closing Date shall be deposited to the Collection Account within 48 hours after the Closing Date.
The Servicer shall remit to the Indenture Trustee for deposit (in immediately available funds) in the Collection Account the aggregate Administrative Purchase Payments with respect to Administrative Receivables to be purchased as of the last day of
any Monthly Period on the Business Day immediately preceding the immediately succeeding Distribution Date. 
 SECTION
2.12        Collections.    In the event that: 
 (a)    NFC is the Servicer, 
 (b)    a Servicer Default shall not have
occurred and be continuing, and 
 (c)    (i)    the short-term unsecured debt of the
Servicer is rated at least A-1 by S&P and P-1 by Moody’s, or 
 (ii)    a standby letter of
credit has been issued by an Eligible Institution which, as of each date during the period that the Servicer is making monthly remittances of Collections, has an undrawn amount at least equal to 150% of all Scheduled Payments due in respect of the
Receivables for the latest Monthly Period ended prior to the next succeeding Distribution Date (and the aggregate amount of unremitted Collections does not at any time exceed 90% of the undrawn amount of such letter of credit), (each, a
“Monthly Remittance Condition”) 
 then, the Servicer shall not be required to deposit Collections into the Collection
Account until the Business Day preceding the Distribution Date following the Monthly Period during which such Collections were received. Pending deposit into the Collection Account, Collections may be employed by the Servicer at its own risk and for
its own benefit and will not be segregated from its own funds. 
 SECTION
2.13        Application of Collections.    For the purposes of this Agreement, all Collections for the related Monthly Period with respect to each Receivable shall be applied by the
Servicer as follows: 
  

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 (a)    All payments by or on behalf of the Obligor or other
collections on a Receivable (including Warranty Payments and Administrative Purchase Payments but excluding Supplemental Servicing Fees) shall be applied (i) first to reduce Outstanding Monthly Advances, if any, with respect to such
Receivable, (ii) second, to the Scheduled Payment on such Receivable for such Monthly Period, and (iii) third, the remainder shall constitute, with respect to such Receivable, a Full Prepayment or Partial Prepayment; and

 (b)    A Partial Prepayment made on a Receivable is applied to reduce the final Scheduled Payment and
will thereafter, to the extent the Partial Prepayment exceeds the final Scheduled Payment, reduce Scheduled Payments in reverse chronological order beginning with the penultimate Scheduled Payment. The Rebate related to such Partial Prepayment will
reduce the final Scheduled Payment and will thereafter, to the extent the Rebate exceeds the final Scheduled Payment, reduce Scheduled Payments in reverse chronological order beginning with the penultimate Scheduled Payment. 
 SECTION 2.14        Monthly Advances.    Subject to the following
sentence, as of each Accounting Date, if the payments received by the Servicer during the related Monthly Period by or on behalf of the Obligor on a Receivable (other than an Administrative Receivable, a Warranty Receivable or a Liquidating
Receivable) after application of such payments under Section 2.13(a) shall be less than the Scheduled Payment on such Receivable for such Monthly Period, whether as a result of any extension granted to the Obligor or otherwise, then the
Servicer shall advance any such shortfall (such amount, a “Monthly Advance”). The Servicer shall be obligated to make a Monthly Advance in respect of a Receivable only to the extent that the Servicer, in its sole discretion, shall
determine that such advance shall be recoverable (in accordance with the two immediately following sentences) from subsequent collections or recoveries on such Receivable. Subject to Section 8.2 of the Indenture, the Servicer shall be
reimbursed for unreimbursed Outstanding Monthly Advances with respect to a Receivable from the following sources with respect to such Receivable, in each case as set forth in this Agreement; (i) subsequent payments by or on behalf of the
Obligor, (ii) Liquidation Proceeds, (iii) the Administrative Purchase Payment, together with the amount of any Monthly Advance released pursuant to the definition thereof, and (iv) the Warranty Payment. At such time as the Servicer
shall determine that Outstanding Monthly Advances with respect to any Receivable shall not be recoverable from payments with respect to such Receivable, the Servicer shall be reimbursed from any Collections made on other Receivables. 
 SECTION 2.15        Additional Deposits.    The Servicer shall deposit
in the Collection Account the aggregate Monthly Advances pursuant to Section 2.14. The Servicer and the Warranty Purchaser shall deposit in the Collection Account the aggregate Administrative Purchase Payments and Warranty Payments with
respect to Administrative Receivables and Warranty Receivables, respectively. All such deposits with respect to a Monthly Period shall be made in immediately available funds on the Transfer Date with respect to the Distribution Date related to such
Monthly Period. 
 SECTION 2.16        Net Deposits.    At
any time that (i) NFC shall be the Servicer and (ii) the Servicer shall be permitted by Section 2.12 of this Agreement to remit collections on a basis other than a daily basis, the Indenture Trustee at the written request of
the Servicer may make any remittances pursuant to this Article II of this Agreement or Article VIII of the 

  

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Indenture net of amounts to be distributed by the Indenture Trustee to such remitting party. Nonetheless, each such party shall account for all of the above
described remittances and distributions as if the amounts were deposited and/or transferred separately. 
 SECTION
2.17        Servicer’s Certificate 
 (a)    Not
later than 10:00 a.m. (Chicago, Illinois time) on each Determination Date, the Servicer shall deliver to each Trustee, the Swap Counterparty and the Agent a Servicer’s Certificate with respect to the immediately preceding Monthly Period
executed by the President or any Vice President of the Servicer containing all information necessary to each such party for making the calculations, withdrawals, deposits, transfers and distributions required by Sections 8.2 and 8.10
of the Indenture, and all information required to be provided to the Interested Parties under Section 8.8 of the Indenture. Receivables to be purchased by the Servicer under Section 2.08 hereof, by NFC pursuant to
Section 5.04 of the Purchase Agreement or by NFRRC under Section 2.06 of the Pooling Agreement as of the last day of any Monthly Period shall be identified by Receivable number with respect to Retail Notes (in each case, as
set forth in the Schedule of Retail Notes). With respect to any Receivables for which the Seller is the Owner, the Servicer shall deliver to the Seller such accountings relating to such Receivables and the actions of the Servicer with respect
thereto as the Seller may reasonably request. 
 (b)    On or before each Determination Date, with
respect to the preceding Monthly Period and the related Distribution Date, the Servicer shall calculate the Collected Amount, the Total Available Amount, the Total Servicing Fee, the Noteholders’ Interest Distributable Amount (based on
information provided by the Agent), the Reserve Account Deposit Amount, the net amount, if any, payable by or to the Trust under the Interest Rate Swap (including the amount of any termination payments and the amount of any payments that are not
termination payments), the Principal Distribution Amount and all other amounts required to determine the amounts to be deposited in or paid from each of the Collection Account, the Note Distribution Account, the Certificate Distribution Account and
the Reserve Account on the next succeeding Distribution Date (or, in the case of payments due under the Interest Rate Swap, if any, on the Business Day preceding the Distribution Date) and supply such information to the Issuer and the Indenture
Trustee. 
 (c)    On the Closing Date (with respect to the remainder of calendar year 2007) and
thereafter, within 15 days prior to the end of each calendar year while this Agreement remains in effect (with respect to the next succeeding calendar year), the Servicer shall deliver to either the Indenture Trustee or the Owner Trustee, following
receipt of a written request, an Officers’ Certificate specifying the days on which banking institutions in Chicago, Illinois are authorized or obligated by law or executive order to be closed. 
  

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 ARTICLE III 
 STATEMENTS AND REPORTS 
 SECTION
3.01        Annual Statement as to Compliance; Notice of Servicer Default; Tax Reports. 
 (a)    The Servicer shall deliver to the Issuer, the Indenture Trustee, the Agent and the Swap Counterparty, on or before February 1 of each following year, beginning February 1, 2008 an
officer’s certificate signed by the Chairman of the Board, Vice Chairman of the Board, the President or any Vice President of the Servicer, dated as of the immediately preceding October 31, stating that (i) a review of the activities
of the Servicer during the Servicer’s immediately preceding fiscal year (or, with respect to the first such certificate, such period as shall have elapsed from the Closing Date to the last day of the Servicer’s immediately preceding fiscal
year) and of its performance under this Agreement has been made under such officer’s supervision, and (ii) to such officer’s knowledge, based on such review, the Servicer has fulfilled all its obligations under this Agreement
throughout such 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 certificate may be obtained by any Noteholder or
Certificateholder by a request in writing to the Indenture Trustee or Issuer, respectively, addressed to the Corporate Trust Office of the Indenture Trustee or the Owner Trustee, respectively. 
 (b)    The Servicer shall deliver to the Issuer, each Trustee, and the Agent, 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 Servicer Default under Section 7.01 or event which with the giving of notice or lapse of time, or both,
would become a Servicer Default under Section 7.01. 
 (c)    The Servicer shall prepare and
deliver to the Issuer and the Indenture Trustee the annual report described in Section 8.8(b) of the Indenture. 
 SECTION 3.02        Annual Accountants’ Report. 
 (a)    The Servicer shall cause a firm of independent accountants, who may also render other services to the Servicer or NFRRC, to deliver to the Issuer, the Swap Counterparty, each Trustee and the Agent, on or before
February 1 of each following year, beginning with February 1, 2008, with respect to the Servicer’s immediately preceding fiscal year, (or, with respect to the first such report, such period as shall have elapsed from the Closing Date
to the last day of the Servicer’s immediately preceding fiscal year), a copy of the report (the “Accountants’ Report”) addressed to the board of directors of the Servicer, the Issuer, and to each Trustee to the effect that
such firm has audited the financial statements of the Servicer and issued its report thereon and that such audit (i) was made in accordance with generally accepted auditing standards and (ii) included tests relating to Receivables serviced
for others in accordance with the requirements of the Minimum Servicing Standards set forth in Appendix A hereto. 
 (b)    The Accountants’ Report shall also indicate that the firm is independent of NFRRC and the Servicer within the meaning of the Code of Professional Ethics of the American Institute of Certified Public
Accountants. 
 (c)    A copy of the Accountant’s Report may be obtained by any Noteholder or
Certificateholder by a request in writing to the Indenture Trustee or the Issuer, addressed to the Corporate Trust Office of the Indenture Trustee or the Owner Trustee, respectively. 
  

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 SECTION 3.03        Access to Certain
Documentation and Information Regarding Receivables.    The Servicer shall provide to the Issuer, each Trustee, the Agent and Securityholders reasonable access to the Servicer’s records regarding the Receivables owned by
the Issuer. The Servicer shall provide such access to any Securityholder only in such cases where a Securityholder is 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 normal business hours at offices of the Servicer designated by the Servicer. Nothing in this Section 3.03 shall derogate from the obligation of the Servicer to observe any applicable law
prohibiting disclosure of information regarding Obligors, and the failure of the Servicer to provide access as provided in this Section 3.03 as a result of such obligation shall not constitute a breach of this Section 3.03.

 SECTION 3.04        Maintenance of Schedule of Retail
Notes.    The Servicer shall maintain at all times a current schedule of Retail Notes (the “Schedule of Retail Notes”) which shall list separately all Retail Notes which are owned by the Issuer. The Schedule
of Retail Notes shall be updated to reflect all sales of Receivables as a result of a Receivable becoming a Warranty Receivable or an Administrative Receivable. The Servicer shall deliver to the Owner Trustee, the Indenture Trustee and the Agent an
updated Schedule of Retail Notes on or before each Distribution Date. 
 SECTION
3.05        Amendments to Schedule of Retail Notes.    If the Servicer, during a Monthly Period, assigns to a Receivable an account number that differs from the account number
previously identifying such Receivable on the Schedule of Retail Notes, the Servicer shall amend the Schedule of Retail Notes to report the newly assigned account number. Each Schedule of Retail Notes delivered on a Distribution Date pursuant to
Section 3.04 shall list all new account numbers assigned to Receivables during such Monthly Period and shall show by cross reference the prior account numbers identifying such Receivables on the previously distributed Schedule of Retail
Notes. 
 SECTION 3.06        Maintenance of Systems and Receivables List.

 (a)    The Servicer shall maintain accounts and records as to each Receivable accurately and in
sufficient detail to permit (i) the reader thereof to know the status of such Receivable, including payments and recoveries made and payments owing (and the nature of each) and extensions of any scheduled payments made not less than 45 days
prior thereto, 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 with respect to such Receivable. 
 (b)    The Servicer shall maintain its computer systems so that the Servicer’s master computer records
(including any backup archives) that refer to any Receivable shall indicate clearly that the Receivable is owned by the Issuer and that such Receivable has been pledged by the Issuer to the Indenture Trustee. Indication of the Issuer’s and the
Indenture Trustee’s interest in a Receivable shall be deleted from or modified on the Servicer’s computer systems when, and only when, the Receivable shall have been paid in full, repurchased by Navistar Financial, purchased by the
Servicer or become a Liquidating Receivable as to which 

  

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the Servicer has discontinued pursuing remedies with respect to collection in accordance with its customary servicing procedures. 
 (c)    If at any time the Servicer shall propose to sell, grant a security interest in, or otherwise transfer any
interest in truck, truck chassis, bus or trailer 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 (including
any of those restored from backup archives) that, if they refer in any manner whatsoever to any Receivable, indicate clearly that such Receivable has been sold and is owned by the Issuer and has been pledged to the Indenture Trustee unless such
Receivable has been paid in full, repurchased by Navistar Financial or purchased by the Servicer. 
 (d)    The Servicer will furnish to the Issuer, the Indenture Trustee and the Agent at any time upon request a list of all Receivables then held as part of the Owner Trust Estate, together with a reconciliation of such
list to the Schedule of Retail Notes and to each of the Servicer’s Certificates furnished before such request indicating removal of Receivables from the Owner Trust Estate. Upon request, the Servicer shall furnish a copy of any such list to the
Seller. 
 (e)    The Servicer shall prepare and file such financing statements and cause to be prepared
and filed such continuation and other 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 under the Pooling Agreement in the Receivables, the Related Security
and other property conveyed thereunder (to the extent such property constitutes Code Collateral) and the Indenture Trustee’s security interest in the Receivables, the Related Security and other Collateral (to the extent such Collateral is Code
Collateral). The Servicer shall deliver (or cause to be delivered) to the Indenture Trustee and the Agent file-stamped copies of, or filing receipts for, any document filed as provided above, as soon as available following such filing. 

ARTICLE IV 
 THE CUSTODIAN

 SECTION 4.01        Custody of Receivable
Files.    To assure uniform quality in servicing the Receivables and to reduce administrative costs, the Owner of each Receivable and the Indenture Trustee hereby appoint the Servicer, and the Servicer hereby accepts such
appointment, to act as contractor of the Owner of each Receivable and the Indenture Trustee (for the benefit of the Financial Parties) as custodian to maintain custody of the following documents or instruments with respect to such Receivable (as to
each Receivable, the “Receivable File”), which will be hereby constructively delivered to the Owner of the related Receivable and the Indenture Trustee: 
 (a)    the fully executed original of the Retail Note; 
 (b)    documents evidencing or related to any related Insurance Policy; 
 (c)    a copy of the credit application of each Obligor, fully executed by each such Obligor on NFC’s customary form, or on a form approvied by NFC, for such application; 
  

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 (d)    where permitted by law, the original Certificate of Title
(when received) and otherwise such documents, if any, that NFC keeps on file in accordance with its customary procedures indicating that the Financed Vehicle is owned by the Obligor and subject to the interest of NFC as first lienholder or secured
party; and 
 (e)    any and all other documents that NFC keeps on file in accordance with its customary
procedures relating to the individual Receivable, Obligor or Financed Vehicle. 
 SECTION
4.02        Duties of Servicer as Custodian. 
 (a)    The
Servicer shall hold each Receivable File for the benefit of the Owner of the related Receivable and the Indenture Trustee (for the benefit of the Financial Parties) and maintain such accurate and complete accounts, records and computer systems
pertaining to each Receivable File as shall enable NFRRC, the Issuer and the Indenture Trustee to comply with their respective obligations under the Purchase Agreement and the Further Transfer and Servicing Agreements. Each Receivable shall be
identified as such on the books and records of the Servicer to the extent the Servicer reasonably determines to be necessary to comply with the terms and conditions of the Purchase Agreement and, if applicable, the Further Transfer and Servicing
Agreements. 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 comparable truck, truck chassis, bus
and trailer receivables that the Servicer services and holds for itself or others. The Servicer shall conduct, or cause to be conducted, periodic physical inspections of the Receivable Files held by it under this Agreement, and of the related
accounts, records and computer systems, in such manner as shall enable the Owner Trustee and the Indenture Trustee to verify the accuracy of the Servicer’s inventory and record keeping. The Servicer shall promptly report to each Owner and the
Indenture Trustee any failure on its part to hold the Receivable Files and maintain its accounts, records and computer systems as herein provided and promptly take appropriate action to remedy any such failure. 
 (b)    The Servicer shall maintain each Receivable File at its principal office at 425 N. Martingale Road, Suite
1800, Schaumburg, Illinois, 60173, or at such other office of the Servicer as shall from time to time be identified to the Owners and the Indenture Trustee upon 60 days’ prior written notice. Subject only to the Custodian’s security
requirements applicable to its own employees having access to similar records held by the Servicer and the limitations set forth in Section 3.03 hereof and otherwise in the Basic Documents, the Servicer shall permit the Owners, the
Indenture Trustee or their duly authorized representatives, attorneys or auditors to inspect the Receivable Files and the related accounts, records and computer systems maintained by the Servicer pursuant hereto at such times as such party may
reasonably request. 
 (c)    In general, the Servicer shall attend to all nondiscretionary details in
connection with maintaining custody of the Receivable Files. In addition, the Servicer shall assist the Owner Trustee generally in the preparation of routine reports to Securityholders, if any, or to regulatory bodies to the extent necessitated by
the Servicer’s custody of the Receivable Files. 
 SECTION
4.03        Custodian’s Indemnification.    The Servicer as custodian shall indemnify the Issuer, the Indenture Trustee, the Owner Trustee and the Financial Parties and 

  

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each of their officers, directors and agents 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 the Issuer, the Indenture Trustee, the Owner Trustee, any Financial Party or any of their officers, directors and agents as the result of any 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 Issuer or the Indenture Trustee for any portion of any such amount resulting from the
willful misfeasance, bad faith or negligence of such Person. 
 SECTION
4.04        Effective Period and Termination.    The Servicer’s appointment as Custodian with respect to a Receivable File hereunder shall become effective as of the Purchase
Date and shall continue in full force and effect until terminated pursuant to this Section 4.04. If the Servicer shall resign as Servicer in accordance with the provisions of this Agreement or if all of the rights and obligations of the
Servicer shall have been terminated under Article VII, the appointment of such Servicer as custodian shall be terminated and the terminated Custodian shall deliver the Receivables Files to (or at the direction of) the Indenture Trustee
pursuant to Section 7.02 of this Agreement. Upon (i) the repurchase of a Warranty Receivable by NFC pursuant to the Purchase Agreement, (ii) purchase of a Warranty Receivable by NFRRC pursuant to the Pooling Agreement or
(iii) purchase of an Administrative Receivable by the Servicer pursuant to Section 2.08(a) of this Agreement, the Servicer shall deliver the related Receivable File to or at the direction of the purchaser. Upon delivery of such
Receivable File, the Servicer’s obligations with respect to such Receivable File shall terminate. 
 ARTICLE V 
 REPRESENTATIONS AND WARRANTIES 
 OF
THE SERVICER 
 SECTION 5.01        Representations and Warranties of the
Servicer.    The Servicer hereby represents and warrants to NFRRC, the Issuer and the Indenture Trustee that as of the Purchase Date: 
 (a)    Organization and Good Standing.  The Servicer has been duly organized and is validly existing as a corporation, and in good standing under the laws of
the State of Delaware, with power and authority to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted, and had at all relevant times, and now has, power, authority and legal
right to service the Receivables as provided in this Agreement. 
 (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 (including the servicing of the Receivables as required by this Agreement) requires or shall require such qualification. 
 (c)    Power and Authority.  The Servicer has the power and authority to execute and deliver this Agreement and to perform its obligations hereunder and the execution, delivery and
performance by the Servicer of this Agreement has been duly authorized by all necessary 

  

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corporate action on the part of the Servicer. The Agreement has been duly executed and delivered by the Servicer. 
 (d)    Binding Obligation.  This Agreement each constitutes a legal, valid and binding obligation of
the Servicer enforceable against the Servicer in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors’ rights in
general and by general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law. 
 (e)    No Violation.  The execution and delivery of this Agreement by the Servicer and its performance of its obligations hereunder will not violate any Requirement of Law or
Contractual Obligation of the Servicer and will not result in, or require, the creation or imposition of any Lien on any of its property or assets pursuant to any such Requirement of Law or Contractual Obligation other than as expressly permitted by
the Basic Documents. 
 (f)    No Proceedings.  There are no actions, proceedings or, to
the Servicer’s knowledge, investigations pending or, to the Servicer’s knowledge, threatened before any Governmental Authority (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or the issuance of the Securities, or (iii) seeking any determination or ruling that would reasonably be expected to have a Material Adverse Effect with respect to the Servicer. 
 (g)    No Consent.  Except as expressly contemplated by the Basic Documents, no consent, permit,
approval or authorization of, or declaration to or filing with, or other act by or in respect of, any Governmental Authority or any other Person is required in connection with the execution, delivery, performance, validity or enforceability by or
against the Servicer of this Agreement. 
 ARTICLE VI 
 THE SERVICER 
 SECTION 6.01        Merger
or Consolidation of, or Assumption of the Obligations of, the Servicer.    Any Person (a) into which the Servicer may be merged or consolidated, (b) resulting from any merger, conversion or consolidation to which
the Servicer shall be a party, (c) succeeding to the business of the Servicer, or (d) more than 50% of the voting stock or other interest of which is owned directly or indirectly by NIC and which is otherwise servicing NFC’s
receivables, which Person in any of the foregoing cases executes an agreement of assumption to perform every obligation of the Servicer under this Agreement shall 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, notwithstanding anything in this Agreement to the contrary. The Servicer shall provide notice of any merger, consolidation or succession pursuant to this
Section 6.01 to the Agent, the Owner Trustee and the Indenture Trustee. 
 SECTION
6.02        Limitation on Liability of Servicer and Others. 
 (a) Neither the
Servicer nor any of the directors or officers or employees or agents of the Servicer shall be under any liability to the Issuer or any Noteholder, except as 

  

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specifically provided in this Agreement, for any action taken or for refraining from the taking of any action pursuant to this Agreement or any other Further
Transfer and Servicing 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 (except errors in judgment) in the performance of the Servicer’s duties or by reason of reckless disregard of obligations and duties under the Further Transfer and Servicing Agreements. The Servicer and any director, officer
or 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 is not incidental to its duties to service the Receivables in accordance with this Agreement and that in its opinion may involve it in 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 Financial Parties. In such event, the legal expenses and costs
for such action and any liability resulting therefrom shall be expenses, costs and liabilities of the Issuer and the Servicer shall be entitled to be reimbursed therefor. 
 SECTION 6.03        Delegation of Duties.    So long as NFC acts as Servicer, the Servicer may, at any time without notice or
consent, delegate any duties under this Agreement to any Person more than 50% of the voting stock or other interest of which is owned, directly or indirectly, by NIC. The Servicer may at any time perform specific duties as Servicer through
subservicers who are in the business of servicing medium and heavy duty truck, truck chassis, bus and trailer receivables; provided, however, that no such delegation shall relieve the Servicer of its responsibility with respect to such duties.

 SECTION 6.04        Servicer not to Resign.    Subject
to the provisions of Section 7.02, the Servicer shall not resign from the obligations and duties imposed on it by this Agreement as Servicer except upon determination that the performance of its duties under this Agreement is no longer
permissible under applicable law. Any such determination permitting the resignation of the Servicer shall be evidenced by an Opinion of Counsel to such effect delivered to the Indenture Trustee. No such resignation shall become effective until the
Indenture Trustee or a successor Servicer shall have assumed the responsibilities and obligations of the Servicer in accordance with Section 7.02. 
 SECTION 6.05        Servicer Indemnification. 
 (a)    The Servicer (other than the Indenture Trustee in its capacity as successor Servicer pursuant to Section 7.03 hereof) shall be liable in accordance with this Agreement only to the
extent of the obligations in this Agreement specifically undertaken by the Servicer. Such obligations shall include the following: 
 (i)     The Servicer (other than any successor Servicer who is not an affiliate of the initial Servicer, including the Indenture Trustee in its capacity as successor 

  

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Servicer pursuant to Section 7.03 hereof it being understood that the removed Servicer shall retain such liability) shall defend, indemnify and
hold harmless the Indenture Trustee, the Owner Trustee, the Issuer and the Interested Parties from and against any and all costs, expenses, losses, damages, claims and liabilities arising out of or resulting from the use, ownership or operation by
the Servicer or any Affiliate thereof of any Financed Vehicle; 
 (ii)    The Servicer (other than any
successor Servicer who is not an affiliate of the initial Servicer, including the Indenture Trustee in its capacity as successor Servicer pursuant to Section 7.03 hereof it being understood that the removed Servicer shall retain such
liability) shall indemnify, defend and hold harmless the Issuer, the Owner Trustee and the Indenture Trustee from and against any taxes that may at any time be asserted against any such Person with respect to the transactions contemplated in this
Agreement and the Pooling Agreement, including any sales, gross receipts, general corporation, Illinois corporate income, tangible personal property, privilege or license taxes (but not including any taxes asserted with respect to, and as of the
date of, the sale of the Receivables to the Owner Trustee or the issuance and original sale of the Securities, or asserted with respect to ownership of the Receivables, or federal or other income taxes arising out of distributions on the Securities,
or any fees or other compensation payable to any such Person) and costs and expenses in defending against the same; 
 (iii)    The Servicer shall indemnify, defend and hold harmless the Issuer, the Owner Trustee, the Indenture Trustee and the Interested Parties from and against any and all costs, expenses, losses, claims, damages, and
liabilities to the extent that such cost, expense, loss, claim, damage, or liability arose out of, or was imposed upon such Person through the negligence, willful misfeasance or bad faith of the Servicer in the performance of its duties under this
Agreement and any other Transfer and Servicing Agreement or by reason of reckless disregard of its obligations and duties under any of the Transfer and Servicing Agreements; 
 (iv)    The Servicer (other than any successor Servicer who is not an affiliate of the initial Servicer, including the Indenture Trustee in its capacity as successor Servicer
pursuant to Section 7.03 hereof it being understood that the removed Servicer shall retain such liability) shall indemnify, defend and hold harmless each Trustee and their respective agents, officers, directors and servants, from and
against all costs, expenses, losses, claims, damages and liabilities arising out of or incurred in connection with (x) in the case of the Owner Trustee, the Indenture Trustee’s performance of its duties under the Basic Documents,
(y) in the case of the Indenture Trustee, the Owner Trustee’s performance of its duties under the Basic Documents or (z) the acceptance, administration or performance by, or action or inaction of, the applicable Trustee of the trusts
and duties contained in this Agreement, the Basic Documents, the Indenture (in the case of the Indenture Trustee), including the administration of the Collateral, and the Trust Agreement (in the case of the Owner Trustee), including the
administration of the Owner Trust Estate, except in each case to the extent that such cost, expense, loss, claim, damage or liability: (A) is due to the willful misfeasance, bad faith or negligence (except for errors in judgment) of the Person
seeking to be indemnified, (B) to the extent otherwise payable to the Indenture Trustee, arises from the Indenture Trustee’s breach of any of its representations or warranties in Section 6.13 of the Indenture or (C) to the
extent otherwise payable to the Owner Trustee, arises from the Owner Trustee’s breach of any of its representations or warranties set forth in Section 6.6 of the Trust Agreement; and 
  

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 (v)    The Servicer (other than any successor Servicer who is not an
affiliate of the initial Servicer, including the Indenture Trustee in its capacity as successor Servicer pursuant to Section 7.03 hereof it being understood that the removed Servicer shall retain such liability) will indemnify the Owner
Trustee in accordance with the provisions specified in Section 6.9 of the Trust Agreement. 
 (b)    Indemnification under this Section 6.05 shall survive the resignation or removal of the Owner Trustee or the Indenture Trustee or the termination of this Agreement or the Trust Agreement and shall
include reasonable fees and expenses of counsel and expenses of litigation. If the Servicer has made any indemnity payments pursuant to this Section 6.05 and the recipient thereafter collects any of such amounts from others, the
recipient shall promptly repay such amounts collected to the Servicer, without interest. 
 SECTION
6.06        Backup Servicer.    On or prior to the Closing Date, NFC, as Servicer, will enter into a backup servicing agreement (the “Backup Servicing Agreement”)
with a Person who meets the criteria specified for a successor Servicer as set forth in Section 7.03 and who agrees to become a successor servicer if appointed by the Indenture Trustee pursuant to Section 7.03 (the
“Backup Servicer”). Prior to each Distribution Date, the Servicer shall deliver to the Backup Servicer a data tape or other electronic data file compiling data for the previous calendar month relating to the Receivables. The Backup
Servicer shall have within 30 days of the Closing Date mapped the Servicer’s data system as it relates to the Receivables. Unless and until a Servicer Default occurs and the Backup Servicer is appointed as the successor Servicer, the sole
obligation of the Backup Servicer will be to perform systems data mapping of NFC’s servicing computer systems. The costs and expenses associated with the Backup Servicer performing such system data mapping shall be paid for by the Servicer.

 ARTICLE VII 
 DEFAULT

 SECTION 7.01        Servicer Defaults.    Each of
the following shall constitute a “Servicer Default”: 
 (a)    any failure by the Servicer to
deliver to the Indenture Trustee for deposit in any of the Designated Accounts or to the Owner Trustee for deposit in the Certificate Distribution Account any required payment or to direct the Indenture Trustee to make any required distributions
therefrom, in each case which failure continues unremedied for five Business Days after the earlier of (i) written notice is received by the Servicer from the applicable Trustee or the Agent or (ii) after discovery of such failure by an
officer of the Servicer; 
 (b)    any failure by the Servicer duly to observe or perform in any material
respect any other covenant or agreement of the Servicer set forth in this Agreement or any other Basic Document which failure materially and adversely affects the rights of any Securityholder or any Financial Party and which continues unremedied for
60 days after the giving of written notice of such failure (A) to the Servicer by either Trustee or the Agent or (B) to the Servicer and to either Trustee by the holders of not less than 25% of the Outstanding Amount of the Controlling
Class; 
  

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 (c)    any representation, warranty or certification made by the
Servicer pursuant to this Agreement or any other Basic Document shall prove to have been incorrect in any material respect when made, and if the consequences of such representation, warranty or certification being incorrect shall be susceptible of
remedy in all material respects, such consequences shall not be remedied in all material respects within 30 days after the Servicer first becomes aware or is advised that such representation, warranty or certification was incorrect in a material
respect; 
 (d)    the occurrence of an Insolvency Event with respect to the Servicer; and 
 (e)    the failure of NFC and its affiliates to deliver the financial statements and related financial information as
provided in Section 5.01(c) of the Note Purchase Agreement and a written notice is received by the Servicer from the Agent stating that such failure constitutes a “Servicer Default.” 
 SECTION 7.02        Consequences of a Servicer Default.    If a
Servicer Default shall occur and be continuing, the Indenture Trustee or holders of Securities evidencing not less than a majority of the Outstanding Amount of the Controlling Class may, in addition to other rights and remedies available in a court
of law or equity to damages, injunctive relief and specific performance, terminate all the rights and obligations of the Servicer hereunder and under all sub-servicing agreements whereupon the Indenture Trustee will succeed to all the
responsibilities, duties and liabilities of the Servicer under this Agreement and will be entitled to similar compensation arrangements. 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 Receivables, the Receivable Files or otherwise, shall pass to and be vested in the Indenture Trustee pursuant to and under this Section 7.02. Upon the receipt of such notice, the
Servicer’s appointment as custodian shall be terminated and, upon instruction from the Indenture Trustee, the Servicer shall release all Receivable Files to the Indenture Trustee, or its respective agent or assignee, as the case may be, at such
place or places as the Indenture Trustee may designate, as soon as practicable. The Servicer shall be deemed to have received proper instructions with respect to the Receivable Files upon its receipt of written instructions signed by an officer of
the Indenture Trustee. The Indenture Trustee is hereby authorized and empowered to execute and deliver, on behalf 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 agrees to cooperate
with the Indenture Trustee or any successor Servicer in effecting the termination of the responsibilities and rights of the Servicer under this Agreement, including the transfer to the Indenture Trustee for administration by it of all cash amounts
that shall at the time be held by the predecessor Servicer for deposit, or that shall have been deposited by the Servicer in the Collection Account, the Reserve Account, the Note Distribution Account or the Certificate Distribution Account or
thereafter received that shall at any time be held with respect to the Receivables by the Servicer. 
 SECTION
7.03        Indenture Trustee to Act; Appointment of Successor.    On and after the time the Servicer receives a notice of termination pursuant to Section 7.02, the
Indenture Trustee shall be the successor in all respects to the Servicer in its capacity as servicer and 

  

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custodian under this Agreement and the transactions set forth or provided for in this Agreement and the other Basic Documents, and shall be subject to all
the responsibilities, restrictions, duties and liabilities relating thereto placed on the Servicer and Custodian by the terms and provisions of this Agreement and the other Basic Documents; provided, however, that if the Backup
Servicer satisfies the criteria for a successor servicer specified below, the Indenture Trustee shall promptly appoint the Backup Servicer as the successor Servicer; provided, further, that the predecessor Servicer shall remain liable
for, and the successor Servicer shall have no liability for, any indemnification obligations of the Servicer arising as a result of acts, omissions or occurrences during the period in which the predecessor Servicer was the Servicer; and provided,
further, that NFC shall remain liable for all such indemnification obligations of the Servicer without regard to whether it is still Servicer hereunder. As compensation therefor, the Indenture Trustee or the Backup Servicer shall be entitled to such
compensation (whether payable out of the Collection Account or otherwise) as the Servicer would have been entitled to under this Agreement if no such notice of termination had been given including, but not limited to, the Total Servicing Fee and
Supplemental Servicing Fees. Notwithstanding the above, if the Indenture Trustee does not appoint the Backup Servicer as the successor servicer then the Indenture Trustee may, if it shall be unwilling to so act, or shall, if it is legally unable to
so act, appoint, or petition a court of competent jurisdiction to appoint, a successor (i) having a net worth of not less than $100,000,000 or whose majority owner is, either directly or indirectly, a Person having a net worth on a consolidated
basis of not less than $100,000,000 and (ii) whose regular business includes the servicing of receivables of the type included in the Collateral, as the successor to the Servicer under this Agreement in the assumption of all or any part of the
responsibilities, duties or liabilities of the Servicer under this Agreement. In connection with such appointment and assumption, the Indenture Trustee may make such arrangements for the compensation of such successor out of payments on Receivables
as it and such successor shall agree; provided, however, that no such compensation shall be in excess of that permitted the Servicer under this Agreement. The Indenture Trustee and such successor shall take such action, consistent with
this Agreement, as shall be necessary to effectuate any such succession. Upon termination of the Servicer and after appointment of a successor Servicer, the Servicer shall reasonably cooperate with such successor Servicer to notify all Obligors to
cease remitting payments to bank accounts and lock boxes controlled by the Servicer and to instead remit payment directly to any bank accounts and lock boxes designated by such successor Servicer. If at any time on or after the date on which the
Servicer is terminated the Servicer receives any payment from any Obligor, then the Servicer shall promptly forward the amount of such payment, along with copies of any remittances or other documentation accompanying such payment, to the successor
Servicer. 
 SECTION 7.04        Notification to
Securityholders.    Upon any termination of, or appointment of a successor to, the Servicer pursuant to this Article VII, the Indenture Trustee shall give prompt written notice thereof to the Noteholders and the Agent
and the Owner Trustee shall give prompt written notice thereof to the Certificateholders. 
 SECTION
7.05        Repayment of Advances.    If a successor Servicer shall be appointed, the predecessor Servicer shall be entitled to receive, to the extent of available funds,
reimbursement for Outstanding Monthly Advances pursuant to Section 2.14 in the manner specified in Section 8.2 of the Indenture with respect to all Monthly Advances made by such 

  

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predecessor Servicer. The successor Servicer shall not be entitled to reimbursement for Monthly Advances made by the predecessor Servicer. 
 SECTION 7.06        Waiver of Past Defaults.    The Indenture Trustee,
at the direction of the holders of not less than a majority of the Outstanding Amount of the Controlling Class, may waive 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 any of the Designated Accounts 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 thereon. The Servicer shall give written notice of each such waiver to the Agent. 
 ARTICLE VIII 
 MISCELLANEOUS

 SECTION 8.01        Amendment.    This Agreement
may be amended from time to time (subject to any expressly applicable amendment provision of the Further Transfer and Servicing Agreements) by a written amendment duly executed and delivered by the parties hereto; provided, however,
that this Agreement may not be amended unless such amendment is in accordance with the provisions of Section 5.01 of the Pooling Agreement as if such Section 5.01 were contained herein and were applicable to this Agreement.
Prior to the execution of any such amendment, the Servicer shall furnish written notification of the substance of such amendment to the Agent. Notwithstanding any other provision of this Agreement, if the consent of the Swap Counterparty is required
pursuant to the Swap Counterparty Rights Agreement, any such purported amendment shall be null and void ab initio unless the Swap Counterparty consents in writing to such amendment. 
 SECTION 8.02        Termination.    The respective obligations and
responsibilities of the parties hereto pursuant to this Agreement shall terminate upon the earlier of: 
 (a)    the maturity or other liquidation of the last Receivable and the disposition of any amounts received upon liquidation of any such remaining Receivables or 
 (b)    the termination of the Pooling Agreement pursuant to Section 4.02 thereof. 
 SECTION 8.03        Notices.    All notices, requests and demands to
NFRRC, the Servicer, either Trustee or the Agent under this Agreement shall be delivered as specified in Appendix B to the Pooling Agreement. 
 SECTION 8.04        Governing Law.    All questions concerning the construction, validity and interpretation of this Agreement shall be governed by
and construed and enforced in accordance with the internal laws of the State of Illinois, without giving effect to any choice of law or conflict provision or rule (whether of the State of Illinois or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Illinois. 
 SECTION
8.05        Severability.    Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of

  

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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
8.06        Assignment.    Except to the extent permitted by Article VI or as required by Article VII, the Servicer may not assign its rights or delegate its
obligations hereunder. The Servicer acknowledges that the Issuer shall assign all of its rights, title and interest in this Agreement to the Indenture Trustee on behalf of the Financial Parties pursuant to the Indenture. The Servicer agrees that the
Indenture Trustee is an express third-party beneficiary with respect to this Agreement and, as such, shall have the right to enforce this Agreement and to exercise directly all rights and remedies under this Agreement (including, without limitation,
the right to give or withhold any consents or approvals of the Issuer to be given or withheld hereunder). The Servicer shall deliver copies of all statements, reports, Opinions of Counsel, notices, requests, demands and other documents to be
delivered by the Servicer to Issuer pursuant to the terms hereof to the Indenture Trustee. 
 SECTION
8.07        Successors and Assigns.    This Agreement shall inure to the benefit of and be binding upon the parties hereto, and their respective successors and permitted assigns.
Except as otherwise provided in Section 6.03 or in this Article VIII, no other Person shall have any right or obligation hereunder. 
 SECTION 8.08        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 8.09        Headings and Cross-References.    The various headings in this Agreement are included for convenience only and shall not affect the meaning or
interpretation of any provision of this Agreement. 
 SECTION 8.10        No
Petition Covenants.    Notwithstanding any prior termination of this Agreement, the Servicer shall not, prior to the date which is one year and one day after payment in full of all obligations and the final distribution with
respect to the Securities, acquiesce, petition or otherwise invoke or cause the Issuer or NFRRC to invoke or join any other Person in instituting the process of any court or government authority for the purpose of commencing or sustaining a case
against the Issuer or NFRRC any bankruptcy, reorganization, arrangement, insolvency, liquidation proceeding, or similar law of the United States or any state of the United States. 
 SECTION 8.11        Limitation of Liability of the Trustees. 
 (a)    Notwithstanding anything contained herein to the contrary, this Agreement has been acknowledged and accepted
by The Bank of New York, not in its individual capacity but solely as Indenture Trustee, and in no event shall The Bank of New York 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 pursuant hereto, as to all of which recourse shall be had solely to the assets of the Issuer. 
  

 - 24 - 

 (b)    Notwithstanding anything contained herein to the contrary,
this Agreement has been executed by Deutsche Bank Trust Company Delaware not in its individual capacity but solely in its capacity as Owner Trustee and in no event shall Deutsche Bank Trust Company Delaware in its individual capacity or, except as
expressly provided in the Trust Agreement, as Owner Trustee of the Issuer 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 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 Article VI of the Trust Agreement. 
 SECTION 8.12        MUTUAL WAIVER OF JURY TRIAL.    BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX TRANSACTIONS ARE MOST
QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH
APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, EACH PARTY TO THIS AGREEMENT HEREBY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY
DISPUTE BETWEEN OR AMONG ANY OF THE PARTIES HERETO, WHETHER ARISING IN CONTRACT, TORT OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 
 [END OF PAGE] 
 [SIGNATURE PAGE FOLLOWS]

  

 - 25 - 

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

			
	 NAVISTAR FINANCIAL CORPORATION,
 as Servicer

		
	 By:
	 	 /s/ John V. Mulvaney, Sr.

	 Name:
	 	     John V. Mulvaney, Sr.

	 Title:
	 	     Vice President, Chief Financial
     Officer and Treasurer

	
	 NAVISTAR FINANCIAL RETAIL
 RECEIVABLES CORPORATION

		
	 By:
	 	 /s/ John V. Mulvaney, Sr.

	 Name:
	 	     John V. Mulvaney, Sr.

	 Title:
	 	     Vice President, Chief Financial
     Officer and Treasurer

	
	 NAVISTAR FINANCIAL 2007-JPM OWNER TRUST

	
	 By: Deutsche Bank Trust Company Delaware, not in its individual capacity, but solely as Owner Trustee

		
	 By:
	 	 /s/ Michele HY Voon

	 Name:
	 	     Michele HY Voon

	 Title:
	 	     Attorney-in-fact

		
	 By:
	 	 /s/ Susan Barstock

	 Name:
	 	     Susan Barstock

	 Title:
	 	     Attorney-in-fact

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

		
	 By:
	 	 /s/ John Bobko

	 Name:
	 	     John Bobko

	 Title:
	 	     Vice President

	
	 The Indenture Trustee, in its role as Securities Intermediary, hereby acknowledges its undertaking as set forth in Section 2.02

		
	 By:
	 	 /s/ John Bobko

	 Name:
	 	     John Bobko

	 Title:
	 	     Vice President

 APPENDIX A 
 MINIMUM SERVICING STANDARDS 
  

	 I.
	 CUSTODIAL BANK ACCOUNTS 

  

	 	 1.
	 Reconciliations shall be prepared on a monthly basis for all custodial bank accounts and related bank clearing accounts. These reconciliations shall:

	 	 a)
	 be mathematically accurate; 

	 	 b)
	 be prepared within forty-five (45) calendar days after the cutoff date; 

	 	 c)
	 be reviewed and approved by someone other than the person who prepared the reconciliation; and 

	 	 d)
	 document explanations for reconciling items. These reconciling items shall be resolved within ninety (90) calendar days of their original identification.

  

	 	 2.
	 Each custodial account shall be maintained at a federally insured depository institution in trust for the applicable investor. 

  

	 II.
	 RETAIL CONTRACT PAYMENTS 

  

	 	 1.
	 Retail contract payments shall be deposited into the custodial bank accounts and related bank clearing accounts within two business days of receipt.

  

	 	 2.
	 Retail contract payments made in accordance with the retail contract documents shall be posted to the applicable retail contract records within two business days
of receipt. 

  

	 	 3.
	 Retail contract payments shall be allocated to principal, interest, insurance, taxes or other items, as applicable, in accordance with the Servicer’s
customary servicing procedures. 

  

	 	 4.
	 Retail contract payments identified as loan payoffs shall be allocated in accordance with the retail contract documents. 

  

	 III.
	 DISBURSEMENTS 

  

	 	 1.
	 Amounts remitted to the collection accounts per the Servicer’s investor reports shall agree with cancelled checks, or other form of payment, or custodial
bank statements. 

  

	 	 2.
	 Unused checks shall be safeguarded so as to prevent unauthorized access. 

  

	 IV.
	 INVESTOR ACCOUNTING AND REPORTING 

  

	 	 1.
	 Statements are sent on a monthly basis listing the total unpaid principal balance, 

	 	 
pool balance, and other amounts required to be reported by the transaction documents. 

  

	 V.
	 RETAIL INSTALLMENT CONTRACTS ACCOUNTING 

  

	 	 1.
	 The servicing entity’s retail contract loan records shall agree with, or reconcile to, the records of obligors with respect to the unpaid principal balance
on a monthly basis. 

  

	 VI.
	 DELINQUENCIES 

  

	 	 1.
	 The servicing entity shall maintain and update records documenting collection efforts for retail contracts during the period such loan is in default.

 APPENDIX B 
 FORM OF SERVICER’S CERTIFICATE 

			
	 Navistar Financial 2007 - JPM Owner Trust
	  	page 1 of 4

  

																
	 	  		  	 For the Month of January 2007
 Distribution Date of February 18,
2007
 Servicer Certificate #1
	  		  		  		 			 	 
	 	  	 Item #
	  		  		  	 Item #
	 			 	 
								
	 	  	1a	  	 Original Pool Amount
	  		  	 FIXED INPUT
	  	 1a
	 	$0.00	 	 	 
	 	  	1b	  	 Subsequent Receivables (transferred 00/00/00)
	  		  	 INPUT
	  	 1b
	 	$0.00	 	 	 
	 	  	1c	  	 Subsequent Receivables (transferred 00/00/00)
	  		  	 INPUT
	  	 1c
	 	$0.00	 	 	 
	 	  	1d	  	 Subsequent Receivables (transferred 00/00/00)
	  		  	 INPUT
	  	 1d
	 	$0.00	 	 	 
	 	  		  		  		  		  		 	 	 	 	 
	 	  		  	 Total Aggregate Starting Receivables Balance
	  		  		  		 	$0.00	 	 	 
	 							
	I 	  	2	  	 Beginning Receivables Balance
	  		  	 prior month [9]
	  	 2
	 	$0.00	 	 	 
	 	  	3	  	 Beginning Pool Factor
	  		  	 prior month ending
	  	 3
	 	0.0000000	 	 	 
	 	  	4	  	 (Less:) Principal Collected (Incl. Servicer Advance Repay)
	  		  		  	 4
	 	$0.00	 	 	 
	 	  	5	  	 (Less:) Mandatory Prepayments
	  		  	 INPUT
	  	 5
	 	$0.00	 	 	 
	 	  	6	  	 (Less:) Repurchase Amounts
	  		  		  	 6
	 	$0.00	 	 	 
	 	  	7	  	 (Less:) Repossessions / Chargeoffs
	  		  		  	 7
	 	$0.00	 	 	 
	 	  	8	  	 Plus: Repayment of Servicer Advances
	  		  		  	 8
	 	$0.00	 	 	 
	 	  		  		  		  		  		 	 	 	 	 
	 	  	9	  	 Ending Receivables Balance
	  		  	 [2] - [4] - [5] - [6] - [7] + [8]
	  	 9
	 	$0.00	 	 	 
	 	  		  	 Ending Pool Factor
	  		  	 [9] /([1a]+[1b]+[1c]+[1d])
	  		 	0.0000000	 	 	 
	II  	  		  		  		  		  		 			 	 
						
	 	  		  	 *  This space left intentionally blank **
  
	  		 			 	 
	 III  
	  		  	 Principal and Interest Collections:
	  		  		  		 			 	 
	 	  	10	  	 Principal Collected (Incl. Servicer Advance Repay)
	  		  	 [4]
	  	 10
	 	$0.00	 	 	 
	 	  	11	  	 Interest Collected
	  		  		  	 11
	 	$0.00	 	 	 
	 	  	12	  	 Mandatory Prepayments
	  		  	 [5]
	  	 12
	 	$0.00	 	 	 
	 	  	13	  	 Repurchase Amounts
	  		  	 [6]
	  	 13
	 	$0.00	 	 	 
	 	  	14	  	 Liquidation Proceeds / Recoveries
	  		  		  	 14
	 	$0.00	 	 	 
	 	  	15	  	 Total
	  		  	 [10]+[11]+[12]+[13]+[14]
	  	 15
	 	$0.00	 	 	 
	 	  	16	  	 (Less:) Repayment of Servicer Advances
	  		  	 [8]
	  	 16
	 	$0.00	 	 	 
	 	  		  		  		  		  		 	 	 	 	 
	 	  	17	  	 Total Available Funds
	  		  	 [15] - [16]
	  	 17
	 	$0.00	 	 	 
	 	  	18	  	 Servicing Fee
	  		  	 (1.0% / 12) * [2]
	  	 18
	 	$0.00	 	 	 
	 	  		  	 memo: Servicer will allocate $1,500.00 of
Servicing Fee as Administration Fee
	  		  		  		 			 	 
								
	  	  	 	  	 MEMO ITEMS :
	  	 	  	 	  	 	 	 	 	 	  
								
	 	  		  	   Prior Month Servicer Advances
	  	$0.00	  		  		 			 	 
	 	  		  	   Servicer Advances - Current Month
	  	$0.00	  		  		 			 	 
	 	  		  	   Total Outstanding Servicer Advances
	  	$0.00	  		  		 			 	 
	 	  		  	   Aggregate Number of Notes Charged Off
  
	  	0	  		  		 			 	 
	 	  		  	 Current Weighted Average
APR:
	 	0.000	%	 	 
	 	  		  		  		  		  		 			 	 
	 	  		  	 Current Weighted Average Remaining Term
(months):
	 	0.00	 	 	 
								
	  	  	 	  	 Delinquencies
	  	 	  	 	  	 	 	Dollars	 	 	Notes
	 	  	19	  	Installments	  	1- 30 days	  		  	 19
	 	0.00	 	 	0
	 	  	20	  		  	31- 60 days	  		  	 20
	 	0.00	 	 	0
	 	  	21	  		  	60+ days	  		  	 21
	 	0.00	 	 	0
	 	  	22	  	Total	  		  	 [19]+[20]+[21]
	  	 22
	 	0.00	 	 	0
	 	  	23	  	Balances	  	60+ days	  		  	 23
	 	0.00	 	 	0

  

			
	 Navistar Financial 2007 - JPM Owner Trust
	  	page 2 of 4

  

																			
	 	 	 For the Month of January 2007
 Distribution Date of
February 18, 2007
 Servicer Certificate #1
	 		 		 		 		 		 		 		 	 

									
	Item #	  	 	  	 	  	Item #	  	 Class A

		  		  		  		  	$0.00
		  	 Principal Distributions:
	  		  		  	
	 24
	  	 Distribution Percentages
	  	 FIXED INPUT
	  	 24
	  	0.0%
					
	 25
	  	 Total Interest + Program Fee Due
	  		  	 25
	  	$0.00
					
	 26
	  	 Collected Principal
	  	 [4] + [6] - [8]
	  	 26
	  	$0.00
	 27
	  	 Collected Interest
	  	 [11]
	  	 27
	  	$0.00
	 28
	  	 Liquidation Proceeds / Recoveries
	  	 [14]
	  	 28
	  	$0.00
	 29
	  	 Swap Payments to/(from) Trust
	  		  	 29
	  	$0.00
	 29a
	  	 Plus: Collections and Reserve Account Interest
	  		  	 29a
	  	$0.00
	 30
	  	 (Less:) Servicing Fee
	  	 [18]
	  	 30
	  	$0.00
	 30a
	  	 (Less:) Dealer Fee
	  		  	 30a
	  	$0.00
					
	 31
	  	 Total Collections Avail for Debt Service
	  	 [26] + [27] + [28] + [29] + [29a] - [30] - [30a]
	  	 31
	  	$0.00
					
	 32
	  	 Beginning Note Balance
	  	 Prior month [37]
	  	 32
	  	$0.00
		  	 (includes prior month ending + subsales)
	  		  		  	
					
	 33
	  	 Interest Fee + Program Fee Due 1
	  		  	 33
	  	$0.00
	 33a
	  	 Interest Fee + Program Fee Paid
	  	 max(0, min([33], [31]))
	  	 33a
	  	$0.00
	 34
	  	 Priority Principal Due
	  	 [32] - [9]
	  	 34
	  	$0.00
	 34a
	  	 Priority Principal Paid
	  	 max(0, min([34], [31]))
	  	 34a
	  	$0.00
	 35
	  	 Overcollateralization Principal Due
	  	 (([9] * [57]) - [43]) - ([9] - [32] + [34a])
	  	 35
	  	$0.00
	 35a
	  	 Overcollateralization Principal Paid
	  	 max(0, min([35], [31]))
	  	 35a
	  	$0.00
					
	 36
	  	 Total Principal Paid
	  	 [34a] + [35a]
	  	 36
	  	$0.00
					
	 37
	  	 Ending Note Balance
	  	 [32] - [36]
	  	 37
	  	$0.00
		  	 Note/ Certificate Pool Factor (Ending
Balance / Original Pool Amount)
	  		  		  	
					
	 38
	  	 Total Distributions
	  	 [33a] + [36]
	  	 38
	  	$0.00
					
	 39
	  	 Interest Shortfall
	  	 [33] - [33a]
	  	 39
	  	$0.00
	 40
	  	 Priority Principal Shortfall
	  	 [34] - [34a]
	  	 40
	  	$0.00
	 41
	  	 Total Shortfall
	  	 [39] + [40]
	  	 41
	  	$0.00
					
	 42
	  	 Excess Servicing
	  	 max(0,[31] - [38])
	  	 42
	  	$0.00

  

	 1
	 Based on schedule received from Agent and independently
verified. Includes allocated Program Fee + Net Interest due. 

			
	 Navistar Financial 2007 - JPM Owner Trust
	  	page 3 of 4

  

																				
	 	 	 For the Month of January 2007
 Distribution Date of
February 18, 2007
 Servicer Certificate #1
	 			 		 		 		 		 		 		 	 
	 Item #
	 	 	 	 	 	 	 	 	 Item #
	 	 	 	 	 	 	 	 	 	  
	 	 	 CREDIT ENHANCEMENT
	 			 		 		 		 		 		 		 	 
										
	 	 	 Initial Level
	 			 		 		 		 		 		 		 	 
	 43
	 	 Reserve Account
	 	1.00	%	 	 Percentage of Starting Receivables Balance
	 	43	 		 		 		 		 	 
	 44
	 	 Overcollateralization
	 	6.50	%	 	 Percentage of Starting Receivables Balance
	 	44	 		 		 		 		 	 
	 	 	 Target Level
	 			 		 		 		 		 		 		 	 
	 45
	 	 Reserve Account
	 	1.00	%	 	 Percentage of Starting Receivables Balance
	 	45	 		 		 		 		 	 
	 46
	 	 Overcollateralization
	 	5.50	%	 	 Current Aggregate Receivable Balance (LESS) Reserve Account Balance
	 	46	 		 		 		 		 	 
	 	 	 Target Level - Enhancement
 Event
	 			 		 		 		 		 		 		 	 
	 47
	 	 Reserve Account
	 	1.00	%	 	 Percentage of Starting Receivables Balance
	 	47	 		 		 		 		 	 
	 48
	 	 Overcollateralization
	 	7.50	%	 	 Current Aggregate Receivable Balance (LESS) Reserve Account Balance
	 	48	 		 		 		 		 	 
	 	 	 ENHANCEMENT EVENT
	 	Y/N	 		 		 		 		 		 	 
	 	 	 Minimum Level
	 			 		 		 		 		 		 		 	 
	 49
	 	 Reserve Account
	 	1.00	%	 	 Percentage of Starting Receivables Balance
	 	49	 		 		 		 		 	 
	 50
	 	 Overcollateralization
	 	4.00	%	 	 Percentage of Starting Receivables Balance
	 	50	 		 		 		 		 	 
	 	 	 Minimum Level - Enhancement Event
	 			 		 		 		 		 		 		 	 
	 51
	 	 Reserve Account
	 	4.00	%	 	 Percentage of Starting Receivables Balance
	 	51	 		 		 		 		 	 
	 52
	 	 Overcollateralization
	 	5.00	%	 	 Percentage of Starting Receivables Balance
	 	52	 		 		 		 		 	 
										
	 	 	 RESERVE ACCOUNT
	 			 		 		 		 		 		 		 	 
										
	 53
	 	 Opening balance
	 			 	 prior month [53]
	 	53	 		 	$0.00	 		 		 	 
	 54 +
	 	 Investment Income
	 			 	 INPUT
	 	54	 		 	$0.00	 		 		 	 
	 55 +
	 	 Excess Serv.
	 			 	 [43]
	 	55	 		 	$0.00	 		 		 	 
	 56 -
	 	 Investment Income Transfer to Collections Account
	 			 	 INPUT
	 	56	 		 	-	 		 		 	 
	 57 +
	 	 Transfer (to) Collections
Account
	 			 		 	57	 		 	$0.00	 		 		 	 
	 58
	 	 Beginning Reserve Balance
	 			 	 sum([43]: [49])
	 	58	 		 	$0.00	 		 		 	 
	 59
	 	 Specified Reserve Account Balance
	 			 	 min([9],1%*sum(1a:1d))
	 	59	 		 	$0.00	 		 		 	 
	 60
	 	 Reserve (Release) /  Deposit
	 			 	 [51] - [50]
	 	60	 		 	$0.00	 		 		 	 
	 61
	 	 Ending Reserve Balance
	 			 	 [50] + [52]
	 	61	 		 	$0.00	 		 		 	 
										
	 	 	 OVERCOLLATERALIZATION
	 			 		 		 		 		 		 		 	 
									 	 
	 62
	 	 Opening balance (Ending balance prior month)
	 			 	 [2] - [32]
	 	62	 		 	$0.00	 		 	 Memo Item:
	 	  
	 63
	 	 Target Overcollateralization Balance (Net of Reserve Account)
	 			 	 ([9] * [46]) - [53]
	 	63	 		 	-	 		 	 	 	  
	 64
	 	 Minimum OC Balance
	 			 	 ([9] * [52]) - [53]
	 	64	 		 	$0.00	 		 	 Ending Pool Balance
	 	-
	 65
	 	 Overcollateralization (Release) / Deposit
	 			 	 [9]-[37]-[56]
	 	65	 		 	$0.00	 		 	 Ending Note Balance
	 	$0.00
	 	 		 			 		 		 		 		 		 	 	 	 
	 66
	 	 Ending Overcollateralization Balance (Net of Reserve Account)
	 			 	 [54] + [60]
	 	66	 		 	$0.00	 		 	 Overcollateralization Ending Balance
	 	  
 -

	 	 		 			 		 		 	#DIV/01	 		 		 		 	 
	 	 	 TOTAL CREDIT
ENHANCEMENT
	 			 		 		 		 		 		 		 	 
	 67
	 	 Target Credit Enhancement
	 			 		 	67	 		 	-	 		 		 	 
										
	 68
	 	 Ending Reserve Account
Balance
	 			 		 	68	 		 	$0.00	 		 		 	 
	 69
	 	 Ending Overcollateralization
Balance
	 			 		 	69	 		 	$0.00	 		 		 	 
	 	 		 			 		 		 		 	 	 	 	 		 	 
	 70
	 	 TOTAL ENDING CREDIT
ENHANCEMENT
	 			 		 	70	 		 	$0.00	 		 		 	 
	 	 		 			 		 		 		 	 	 	 	 		 	 
	 	 		 			 	 [66]/[9]
	 		 	#DIV/0!	 		 		 		 	 
	 71
	 	 Excess / (Shortfall)
	 			 		 	71	 		 	$0.00	 		 		 	 

 Servicing Agreement 
  

			
	 Navistar Financial 2007 - JPM Owner Trust
	  	page 4 of 4

  

													
	 For the Month of January 2007
 Distribution Date of February 18, 2007
 Servicer Certificate #1
	  		  		  		  		  		  	 

													
							
	 ANNUALIZED LOSSES AND 60+ DAY DELINQUENCIES
	  		 		 		  		  		  	 
	  	  	5 Aug-06	 	4
Sep-06	 	3
Oct-06	  	2
Nov-06	  	1
Dec-06	  	0
Jan-07
							
	 Remaining Gross Balance
	  	$0.00	 	$0.00	 	$0.00	  	$0.00	  	$0.00	  	$0.00
							
	 A) LOSSES:
	  		 		 		  		  		  	 
							
	 Principal of Contracts Charged off
	  	$0.00	 	$0.00	 	$0.00	  	$0.00	  	$0.00	  	$0.00
							
	 Recoveries
	  	$0.00	 	$0.00	 	$0.00	  	$0.00	  	$0.00	  	$0.00
							
	 Total Charged Off (Sum: Months 5, 4, 3)
	  	N/A	 		 		  		  		  	 
	 Total Recoveries (Sum: Months 3, 2, 1)
	  	$0.00	 		 		  		  		  	 
	 	  	 	 		 		  		  		  	 
	 Net Loss / (Recoveries) for 3 Mos
	  	N/A	 	 (a)
	 		  		  		  	 
							
	 Total Balance (Sum: Months 5, 4, 3)
	  	 N/A     
	 	 (b)
	 		  		  		  	 
	  	  	 	 	 	 	 	  	 	  	 	  	  
	 Loss
Ratio Annualized [(a/b) * (12)]
	  	 N/A            
	 		 		  		  		  	 
	 Trigger: Is Ratio > 1.5%
	  	No        	 		 		  		  		  	 

  

									
	  	  	 	  	Nov-06	  	Dec-06	  	Jan-07
	 B)
	  	 DELINQUENCIES:
	  		  		  	 
	 	  	 Balance delinquency 60+ days
	  	$0.00	  	$0.00	  	$0.00
	 	  	 As % of Remaining Gross Balance
	  	0.00000%	  	0.00000%	  	0.00000%
	 	  	 Three Month Average
	  	  	  	  	  	N/A
	 	  		  	 Trigger: Is Average > 2.0%
	  	No

  

						
	 Back-up Servicer Account
	  	$	250,000.00	  	

  

			
		 	 Navistar Financial Corporation

		
	 by:
	 	 /s/ John V. Mulvaney, Sr.

		 	 John V. Mulvaney, Sr.

		 	 VP, CFO, & Treasurer

 Servicing Agreement

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