EX-4.8 4 a2134310zex-4_8.txt EXHIBIT 4.8 Exhibit 4.8 NAVISTAR FINANCIAL SECURITIES CORPORATION SELLER NAVISTAR FINANCIAL CORPORATION SERVICER AND THE BANK OF NEW YORK MASTER TRUST TRUSTEE ON BEHALF OF THE SERIES 200_-_ CERTIFICATEHOLDER ---------------------------------- SERIES 200_-_ SUPPLEMENT DATED AS OF ____ __, 200_ TO POOLING AND SERVICING AGREEMENT DATED AS OF JUNE 8, 1995 ---------------------------------- DEALER NOTE ASSET BACKED CERTIFICATE, SERIES 200_-_ NAVISTAR FINANCIAL DEALER NOTE MASTER TRUST TABLE OF CONTENTS ARTICLE I.................................................................................................4 SECTION 1.01 Designation...........................................................................4 ARTICLE II................................................................................................4 SECTION 2.01 Definitions...........................................................................4 ARTICLE III..............................................................................................10 SECTION 3.01 Servicing Compensation...............................................................10 SECTION 3.02 The Servicer to Pay Fees and Expenses of Owner Trustee and Indenture Trustee.........10 SECTION 3.03 Servicer Indemnification of the Indenture Trustee and the Owner Trustee..............11 ARTICLE IV...............................................................................................11 SECTION 4.01 Rights of the Series 200_-_ Certificateholder........................................11 SECTION 4.02 Application of Series Allocable Finance Charge Collections and Series Allocable Principal Collections......................................................12 SECTION 4.03 Shared Principal Collections.........................................................13 SECTION 4.05 Additional Rights upon the Occurrence of Certain Events..............................14 ARTICLE V................................................................................................14 SECTION 5.01 Monthly and Annual Certificateholder's Statement.....................................14 ARTICLE VI...............................................................................................16 SECTION 6.01 No Early Amortization Events.........................................................16 ARTICLE VII..............................................................................................16 SECTION 7.01 Conveyance of Dealer Notes...........................................................16 SECTION 7.02 Tax Treatment........................................................................16 ARTICLE VIII.............................................................................................16 SECTION 8.01 Sale of Investors' Interest Pursuant to Section 2.07 of the Agreement; Distributions Pursuant to Section 2.03 or 12.03 of the Agreement.....................17 SECTION 8.02 Distribution of Proceeds of Sale, Disposition or Liquidation of the Dealer Notes Pursuant to Section 9.02 of the Agreement......................................17 ARTICLE IX...............................................................................................18 SECTION 9.01 Ratification of Agreement............................................................18 SECTION 9.02 Counterparts.........................................................................18 SECTION 9.03 GOVERNING LAW........................................................................18 SECTION 9.04 Tax Disclosure.......................................................................18 SECTION 9.05 Consent to Amendment.................................................................18
- 2 - EXHIBITS Exhibit A - Form of Certificate Exhibit B - Form of Monthly Servicer Certificate and Settlement Statement - 3 - SERIES 200_-_ SUPPLEMENT TO POOLING AND SERVICING AGREEMENT SERIES 200_-_ SUPPLEMENT dated as of _______, 200_ (the "Series Supplement"), by and among NAVISTAR FINANCIAL SECURITIES CORPORATION, a Delaware corporation, as Seller (the "Seller"), NAVISTAR FINANCIAL CORPORATION, a Delaware corporation, as Servicer (the "Servicer"), and THE BANK OF NEW YORK, a New York banking corporation, as trustee (together with its successors in trust thereunder as provided in the Agreement referred to below, the "Master Trust Trustee") under the Pooling and Servicing Agreement, dated as of June 8, 1995 (as amended and supplemented, the "Agreement"), among the Seller, the Servicer and the Master Trust Trustee. Section 6.09 of the Agreement provides that the Seller may from time to time direct the Master Trust Trustee to issue, on behalf of the Master Trust, one or more new Series of Investor Certificates representing fractional undivided interests in the Master Trust. The Principal Terms of any new Series are to be set forth in a Supplement to the Agreement. Pursuant to this Series Supplement, the Seller and the Master Trust Trustee shall create a new Series of Investor Certificates and specify the Principal Terms thereof. ARTICLE I CREATION OF SERIES 200_-_ AND THE SERIES 200_-_ CERTIFICATE SECTION 1.01 DESIGNATION. (a) There is hereby created a new Series pursuant to the Agreement and this Series Supplement to be known as "Series 200_-_." The interest of the Investor Certificateholder in Series 200_-_ shall be represented by the Series 200_-_ Certificate. (b) If any term or provision contained herein shall conflict with or be inconsistent with any term or provision contained in the Agreement, the terms and provisions of this Series Supplement shall govern with respect to Series 200_-_. This Series Supplement is the Series Supplement referred to in the Master Owner Trust Agreement and the Indenture. ARTICLE II DEFINITIONS SECTION 2.01 DEFINITIONS. (a) Whenever used in this Series Supplement, the following words and phrases shall have the following meanings: "ADJUSTED INVESTED AMOUNT" shall mean, with respect to the Collateral Certificate on any Distribution Date, an amount (which shall never be less than zero) equal to the sum of the Collateral Amounts for all outstanding series of Notes determined as of the end of that Distribution Date; PROVIDED that, if a series of Notes shall no longer be in a Revolving Period, the Collateral Amount shall be determined as of the end of the last day of its Revolving Period. - 4 - "BUSINESS DAY" shall mean, with respect to the Collateral Certificate, any day other than a Saturday, a Sunday, or a day on which banking institutions in New York, New York, Chicago, Illinois, or the city in which the Corporate Trust Office is located. "CLOSING DATE" shall mean _______, 200_. "COLLATERAL AMOUNT" shall have, with respect to any series of Notes, the meaning specified in the related Indenture Supplement. "COLLATERAL CERTIFICATE" shall mean the Series 200_-_ Certificate. "COVERAGE DIFFERENTIAL" shall mean, with respect to any Due Period, the result of (a) the Portfolio Yield for such Due Period MINUS (b) the sum of (i) the Weighted Average Note Rate for the related Distribution Period and (ii) [__] percent ([__]%). Coverage Differential shall be expressed as a percentage, and shall be rounded to the nearest one-hundredth of a percentage point. "DEPOSIT ACCOUNT" shall have the meaning specified in the Indenture. "EARLY AMORTIZATION EVENT" shall not apply with respect to the Collateral Certificate. "EARLY AMORTIZATION PERIOD" shall not apply with respect to the Collateral Certificate. "INDENTURE" shall mean the Indenture, dated as of [________ ], 200_, between the Master Owner Trust and The Bank of New York, as Indenture Trustee, as amended and supplemented from time to time. "INDENTURE SUPPLEMENT" shall mean any supplement to the Indenture pursuant to which a series of Notes is issued, as amended and supplemented from time to time. "INDENTURE TRUSTEE" shall mean the indenture trustee under the Indenture. "INVESTED AMOUNT" shall mean, with respect to any Distribution Date, an amount equal to the sum of the Nominal Liquidation Amounts for all series of Notes as of the end of that Distribution Date. "INVESTMENT INCOME" shall mean, for any Due Period with respect to the Collateral Certificate, the product of (a) the Series Allocation Percentage for such Distribution Period, and (b) income (net of investment expenses and losses) from the investment of funds on deposit in the Collections Account and the Excess Funding Account. "INVESTOR SERVICING FEE" shall have the meaning specified in SECTION 3.01. "ISSUANCE DATE" shall mean, with respect to any series of Notes, the date of issuance of such series. "ISSUER DOCUMENTS" shall have the meaning specified in the Indenture. - 5 - "ITEC" shall mean International Truck and Engine Corporation. "MASTER OWNER TRUST" shall mean Navistar Financial Dealer Note Master Owner Trust, a Delaware statutory trust, and its permitted successors and assigns. "MASTER OWNER TRUST AGREEMENT" shall have the meaning specified in the Indenture. "MASTER OWNER TRUST TRUSTEE" shall have the meaning specified in the Indenture. "MASTER TRUST" shall have the meaning specified in the Indenture. "MASTER TRUST TRUSTEE" is defined in the Preamble. "MINIMUM SELLER'S INVESTED AMOUNT" shall mean, with respect to any Business Day, the sum of the Minimum Series Seller's Invested Amount for each outstanding Series of Investor Certificates, including the Collateral Certificate. "MINIMUM SERIES SELLER'S INVESTED AMOUNT" shall mean (a) for Series 200_-_, the Minimum Series Seller's Interest, and (b) for any other Series of Investor Certificates, the "Minimum Master Trust Seller's Interest" as defined in the Series Supplement for such Series. "MINIMUM SERIES SELLER'S INTEREST" shall mean, with respect to the Collateral Certificate on any Business Day, the sum of the Required Seller's Invested Amounts as of the end of the preceding Distribution Date. "MONTHLY SERVICING FEE" shall have the meaning specified in SECTION 3.01. "NOMINAL LIQUIDATION AMOUNT" shall have, with respect to any series of Notes, the meaning specified in the related Indenture Supplement. "NOTEHOLDER ALLOCATED DEALER NOTE LOSSES" shall mean, with respect to any Due Period, the product of (a) the Noteholder Floating Allocation Percentage for such Due Period and (b) Series Allocable Dealer Note Losses for such Due Period. "NOTEHOLDER AVAILABLE INTEREST AMOUNTS" shall mean, with respect to any Due Period, the sum of (i) an amount equal to the product of (a) the Noteholder Floating Allocation Percentage for such Due Period and (b) the Series Allocable Finance Charge Collections for such Due Period AND (ii) income, net of investment expenses and losses, from the investment of funds on deposit in the Deposit Account received during that Due Period. "NOTEHOLDER AVAILABLE PRINCIPAL AMOUNTS" shall mean, with respect to any Business Day, the product of (a) the Noteholder Principal Allocation Percentage for the Due Period in which such Business Day occurs and (b) the Series Allocable Principal Collections for such Business Day. "NOTEHOLDER FLOATING ALLOCATION PERCENTAGE" shall mean, with respect to any Due Period, the percentage equivalent (which percentage shall never be less than 0% or greater than 100%) of a fraction, the numerator of which is the sum of the Collateral Amounts for each - 6 - outstanding series of Notes as of the end of the immediately preceding Due Period (after giving effect to all increases and reductions thereof on such day), or, with respect to the first Distribution Date, as of the Closing Date, and the denominator of which is the product of (a) the Series Allocation Percentage for the Collateral Certificate for the Due Period for which the Noteholder Floating Allocation Percentage is being calculated and (b) the sum of the aggregate principal amount of Dealer Notes in the Master Trust and the aggregate principal amount of funds on deposit in the Excess Funding Account, both as of the end of the immediately preceding Due Period, or, with respect to the first Distribution Date, as of the Closing Date. "NOTEHOLDER PRINCIPAL ALLOCATION PERCENTAGE" shall mean with respect to any Due Period, the percentage equivalent (which percentage shall never be less than 0% or greater than 100%) of a fraction, the numerator of which is the sum of the Collateral Amounts for each outstanding series of Notes as of the end of the immediately preceding Due Period (or the Issuance Date in the case of the first Payment Date for such series) (except that if a series of Notes is no longer in its Revolving Period, its Collateral Amount, for the purpose of this calculation, shall be its Collateral Amount as of the end of the Due Period immediately prior to the last day of its Revolving Period) and the denominator of which is the product of (a) the Series Allocation Percentage for the Collateral Certificate for the Due Period for which the Noteholder Principal Allocation Percentage is being calculated and (b) the sum of (i) the aggregate principal amount of Dealer Notes in the Master Trust and (ii) the aggregate principal amount of funds on deposit in the Excess Funding Account, both as of the end of immediately preceding Due Period (or the Issuance Date in the case of the first Payment Date for such series). "NOTES" shall have, with respect to any series of Notes, the meaning specified in the Indenture. "PAYMENT DATE" shall have, with respect to any series of Notes, the meaning specified in the Indenture. "PORTFOLIO YIELD" shall mean, with respect to any Due Period, the product of (a) the quotient of (i) all Finance Charges for such Due Period and (ii) the daily average principal amount of Dealer Notes outstanding during such Due Period and (b) a fraction, the numerator of which is 365 and the denominator of which is the actual number of days elapsed during such Due Period. Portfolio Yield shall be expressed as a percentage, and shall be rounded to the nearest one-hundredth of a percentage point. "PRINCIPAL SHORTFALL" shall mean, with respect to the Collateral Certificate, the Series Available Principal Amounts Shortfall. "REASSIGNMENT AMOUNT" shall mean, with respect to any Distribution Date, the sum of the Series Reassignment Amount for all series of Notes as of the end of that Distribution Date after giving effect to any deposits and distributions otherwise to be made on such Distribution Date. "REQUIRED SELLER'S INVESTED AMOUNT" shall have, with respect to any series of Notes, the meaning specified in the related Indenture Supplement. - 7 - "REVOLVING PERIOD" shall have, with respect to any series of Notes, the meaning specified in the related Indenture Supplement. The Collateral Certificate will not have a Revolving Period. "SELLER INTEREST AMOUNTS" shall mean, with respect to any Due Period, the excess of Series Allocable Finance Charge Collections for such Due Period over Noteholder Available Interest Amounts for such Due Period. "SELLER PRINCIPAL AMOUNTS" shall mean, with respect to any Due Period, the excess of Series Allocable Principal Collections for such Due Period over Noteholder Available Principal Amounts for such Due Period. "SELLER'S INVESTED AMOUNT" shall mean "the Master Trust Seller's Interest" as defined in the Agreement. "SERIES 200_-_" shall mean the Series of Investor Certificates, the terms of which are specified in this Series Supplement. "SERIES 200_-_ CERTIFICATEHOLDER" shall mean the holder of the Collateral Certificate. Initially, the Indenture Trustee, as the pledgee of the Navistar Financial Dealer Note Master Owner Trust under the Indenture, shall be the only holder of the Collateral Certificate. "SERIES 200_-_ CERTIFICATEHOLDER'S INTEREST" shall have the meaning specified in SECTION 4.01. "SERIES 200_-_ CERTIFICATE" shall mean any certificate, substantially in the form of Exhibit A. Initially, there will be only one Series 200_-_ Certificate, which will be held by the Indenture Trustee as pledgee of the Navistar Financial Dealer Note Master Owner Trust under the Indenture. "SERIES ADJUSTED INVESTED AMOUNT" shall mean the Adjusted Invested Amount. "SERIES ALLOCABLE DEALER NOTE LOSSES" shall mean, with respect to any Due Period, the product of (a) the Series Allocation Percentage for such Due Period and (b) the Dealer Note Losses for such Due Period. "SERIES ALLOCABLE FINANCE CHARGE COLLECTIONS" shall mean, with respect to any Due Period, the product of (a) the Series Allocation Percentage for such Due Period and (b) the amount of Finance Charge Collections for such Due Period. "SERIES ALLOCABLE PRINCIPAL COLLECTIONS" shall mean, with respect to any Business Day, the product of (i) the Series Allocation Percentage for the Due Period in which such Business Day occurs and (ii) the amount of Principal Collections deposited in the Collections Account on such Business Day. "SERIES AVAILABLE INTEREST AMOUNTS SHORTFALL" shall have the meaning specified in the Indenture. - 8 - "SERIES AVAILABLE PRINCIPAL AMOUNTS SHORTFALL" shall have the meaning specified in the Indenture. "SERIES INVESTED AMOUNT" shall mean, with respect to the Collateral Certificate, the Invested Amount. "SERIES REASSIGNMENT AMOUNT" shall have, with respect to any series of Notes, the meaning specified in the related Indenture Supplement. "SERIES TERMINATION DATE" shall mean the latest legal final maturity date of any outstanding series of Notes. "SERIES VARIABLE ALLOCATION PERCENTAGE" shall have the meaning specified in the related Indenture Supplement for each Series of Notes. "WEIGHTED AVERAGE NOTE RATE" shall have, with respect to any series of Notes, the meaning specified in the related Indenture Supplement. (b) Notwithstanding anything to the contrary in this Series Supplement or the Agreement, the term "Rating Agency" shall mean, whenever used in this Series Supplement or the Agreement with respect to the Collateral Certificate, Moody's and Standard & Poor's. As used in this Series Supplement and in the Agreement with respect to the Collateral Certificate, "highest investment category" shall mean (i) in the case of Standard & Poor's, A-1+, AAA, AAAm, or AAAm-G, as applicable, and (ii) in the case of Moody's, P-1 or Aaa, as applicable. (c) All capitalized terms used herein and not otherwise defined herein have the same meanings ascribed to them in the Agreement. (d) The words "hereof," "herein" and "hereunder" and words of similar import when used in this Series Supplement shall refer to this Series Supplement as a whole and not to any particular provision of this Series Supplement; references to any Article, Section or Exhibit are references to Articles, Sections and Exhibits in or to this Series Supplement unless otherwise specified; and the term "including" shall mean "including without limitation." (e) As used in this Series Supplement, accounting terms which are not defined, and accounting terms partly defined, herein shall have the respective meanings given to them under generally accepted accounting principles as in effect on the date hereof. To the extent that the definitions of accounting terms in this Series Supplement are inconsistent with the meanings of such terms under generally accepted accounting principles, the definitions contained in this Series Supplement will control. (f) With respect to any Distribution Date or Transfer Date, the "related Due Period" and the "related Distribution Period" will mean the Due Period and Distribution Period, respectively, immediately preceding such Distribution Date or Transfer Date, and the relationships between Due Periods and Distribution Periods will be correlative to the foregoing relationships. With respect to any LIBOR Determination Date, the "related Distribution Period" will mean the Distribution Period beginning on the Distribution Date immediately following such LIBOR Determination Date. - 9 - (g) Each defined term used in this Series Supplement has a comparable meaning when used in its plural or singular form. Each gender-specific term used in this Series Supplement has a comparable meaning whether used in a masculine, feminine or gender-neutral form. ARTICLE III SERVICING SECTION 3.01 SERVICING COMPENSATION. The monthly servicing fee (the "MONTHLY SERVICING FEE") shall be payable to the Servicer, in arrears, on each Distribution Date in respect of a Due Period (or portion thereof) occurring prior to the earlier of the first Distribution Date following the Series Termination Date and the first Distribution Date on which no Notes are outstanding, in an amount equal to one-twelfth of the result of (a) 1% MULTIPLIED BY (b) the aggregate principal amount of Dealer Notes outstanding as of the last day of such Due Period MULTIPLIED BY (c) the Series Allocation Percentage for the Collateral Certificate with respect to such Due Period. A portion of the Monthly Servicing Fee shall be allocated to each series of Notes in accordance with the related Indenture Supplement (the "INVESTOR SERVICING FEE"), and such portion shall be paid in accordance with such Indenture Supplement and only to the extent of funds available for such payment pursuant to such Indenture Supplement. The remainder of the Monthly Servicing Fee, shall be paid by the Seller and in no event shall the Master Trust, the Master Trust Trustee or the Series 200_-_ Certificateholder be liable for the share of the Monthly Servicing Fee to be paid by the Seller. The Servicer will be permitted, in its sole discretion, to waive all or any portion of the Monthly Servicing Fee for any Distribution Date by notice to the Master Trust Trustee and the Indenture Trustee on or before the related Determination Date; PROVIDED, HOWEVER, that the Servicer believes that sufficient Series Allocable Finance Charge Collections will be available on any future Distribution Date to pay the Investor Servicing Fee relating to the waived Monthly Servicing Fee. If the Servicer so waives the Monthly Servicing Fee for any Distribution Date, the Monthly Servicing Fee and the Investor Servicing Fee for such Distribution Date shall be deemed to be reduced by the amount so waived for all purposes of this Series Supplement and the Agreement; PROVIDED, HOWEVER, that such Investor Servicing Fee shall be paid on a future date solely to the extent amounts are available therefor pursuant to the applicable Indenture Supplement; and, PROVIDED, FURTHER that, to the extent any such waived Investor Servicing Fee is so paid, the related portion of the Monthly Servicing Fee to be paid by the Seller shall be paid by the Seller to the Servicer. SECTION 3.02 THE SERVICER TO PAY FEES AND EXPENSES OF MASTER OWNER TRUST TRUSTEE AND INDENTURE TRUSTEE. The Servicer covenants and agrees to pay to from time to time, and each of the Master Owner Trust Trustee and the Indenture Trustee shall be entitled to receive, reasonable compensation (which shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust) for all services rendered by it in the exercise and performance of any of the powers and duties of such trustee under the Master Owner Trust Agreement or the Indenture, respectively, and the Servicer will pay or reimburse the Master Owner Trust Trustee and the Indenture Trustee (without reimbursement from any Series Account or otherwise) upon its request for all reasonable expenses, disbursements and advances incurred or made by the Master Owner Trust Trustee and the Indenture Trustee in accordance with any of the provisions of the Master Owner Trust Agreement or the Indenture, respectively, including - 10 - the reasonable fees and expenses of its agents and counsel, except any such expense, disbursement or advance as may arise from its negligence, bad faith, or willful misconduct. SECTION 3.03 SERVICER INDEMNIFICATION OF THE INDENTURE TRUSTEE AND THE MASTER OWNER TRUST TRUSTEE. (a) The Servicer shall indemnify, defend and hold harmless the Master Owner Trust Trustee, the Indenture Trustee and the Master Owner Trust 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 Series Supplement, the Agreement and any other Issuer Documents or by reason of reckless disregard of its obligations and duties under any of the Issuer Documents. (b) The Servicer (other than any successor Servicer who is not an affiliate of the initial Servicer) shall indemnify, defend and hold harmless each of the Master Owner Trust Trustee and the Indenture Trustee and each of 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 Master Owner Trust Trustee, the Indenture Trustee's performance of its duties under the Issuer Documents, (y) in the case of the Indenture Trustee, the Master Owner Trust Trustee's performance of its duties under the Issuer Documents or (z) the acceptance, administration or performance by, or action or inaction of, the applicable trustee of the rights and duties contained in this Series Supplement, the Agreement, and the other Issuer Documents 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 the Indenture or (C) to the extent otherwise payable to the Master Owner Trust Trustee, arises from the Master Owner Trust Trustee's breach of any of its representations or warranties set forth in the Master Owner Trust Agreement. (c) The Servicer (other than any successor Servicer who is not an affiliate of the initial Servicer) will indemnify the Master Owner Trust Trustee in accordance with the provisions specified in SECTION 6.9 of the Master Owner Trust Agreement. (d) Indemnification under this SECTION 3.03 shall survive the resignation or removal of the Master Owner Trust Trustee or the Indenture Trustee or the termination of this Series Supplement or the Agreement and shall include reasonable fees and expenses of counsel and expenses of litigation. If the Servicer has made any indemnity payment pursuant to this SECTION 3.03 and the recipient thereafter collects any of such amounts from others, the recipient shall promptly repay such amounts collected to the Servicer, without interest. ARTICLE IV RIGHTS OF SERIES 200_-_ CERTIFICATEHOLDER AND ALLOCATION AND APPLICATION OF COLLECTIONS SECTION 4.01 RIGHTS OF THE SERIES 200_-_ CERTIFICATEHOLDER. The Collateral Certificate shall represent fractional undivided interests in the Master Trust, consisting of the right to - 11 - receive, to the extent necessary to make the required payments with respect to the Notes at the times and in the amounts and priorities specified in the Indenture and the Indenture Supplements, Collections allocated to Series 200_-_ pursuant to ARTICLE IV of the Agreement and this ARTICLE IV and funds on deposit in the Collections Account and the Excess Funding Account allocable to the Series 200_-_ Certificateholder pursuant to ARTICLE IV of the Agreement and this ARTICLE IV (collectively, the "SERIES 200_-_ CERTIFICATEHOLDER' INTEREST"); it being understood that the Collateral Certificate shall not represent any interest in any Series Account or Enhancement for the benefit of any other Series or Class. The Servicer shall apply, or instruct the Master Trust Trustee to apply, all funds on deposit in the Collections Account and Excess Funding Account allocable to the Collateral Certificate. SECTION 4.02 APPLICATION OF SERIES ALLOCABLE FINANCE CHARGE COLLECTIONS AND SERIES ALLOCABLE PRINCIPAL COLLECTIONS. (a) Application of Series Allocable Principal Collections. (i) On each Business Day, the Master Trust Trustee, acting in accordance with instructions from the Servicer, shall withdraw from the Collections Account and allocate to the Deposit Account to the extent required Noteholder Available Principal Amounts for such Business Day. Such Noteholder Available Principal Amounts shall be further allocated and distributed to each series of Notes in accordance with the Indenture and each Indenture Supplement related to a series of Notes. (ii) On each Business Day, the Master Trust Trustee, acting in accordance with instructions from the Servicer, shall withdraw from the Collections Account and allocate Seller Principal Amounts for such Business Day in the following order of priority: (A) to the extent necessary to maintain the Seller's Invested Amount at an amount equal to (or, in the discretion of the Seller, greater than) the Minimum Seller's Invested Amount, to the Principal Funding Account, (B) in the discretion of the Seller, to make payments on the principal balance of any variable funding certificate or variable funding note, and (C) to the Seller or the holders of the Seller's Certificates. (b) Application of Series Allocable Finance Charge Collections. (i) On each Transfer Date, the Master Trust Trustee, acting in accordance with instructions from the Servicer, shall withdraw from the Collections Account and allocate to the Deposit Account Noteholder Available Interest Amounts for the related Due Period. Such Noteholder Available Interest Amounts shall be further allocated and distributed to each series of Notes in accordance with the Indenture and each Indenture Supplement related to a series of Notes. (ii) On each Transfer Date, the Master Trust Trustee, acting in accordance with instructions from the Servicer, shall withdraw from the Collections Account and pay to the Seller or the holders of the Seller's Certificates the Seller Interest Amounts for such Transfer Date. - 12 - SECTION 4.03 SHARED PRINCIPAL COLLECTIONS. (a) On each Business Day, commencing with the first Business Day following the Closing Date, the amounts, if any, received on such Business Day by the Master Trust Trustee from the Indenture Trustee which are designated as Shared Principal Collections pursuant to the Indenture shall be treated as Shared Principal Collections by the Master Trust Trustee and allocated (i) to other Series to the extent such Series provides for the use of Shared Principal Collections in respect of principal shortfalls, (ii) to the Excess Funding Account to the extent necessary to maintain the Master Trust Seller's Interest at an amount equal to (or, in the discretion of the Seller, greater than) the Minimum Master Trust Seller's Interest, (iii) in the discretion of the Seller, to make payments on the principal balance of any variable funding certificates and (iv) to the Seller or the holders of the Seller's Certificates. (b) On each Business Day following the Closing Date, the Master Trust Trustee shall, to the extent provided in the Agreement, transfer to the Indenture Trustee Shared Principal Collections, if any, in respect of such Business Day equal to the Principal Shortfall. If the aggregate amount of Shared Principal Collections for all Series for such Business Day is less than the aggregate amount of Principal Shortfalls for all Series entitled to share Shared Principal Collections for such Business Day, then the amount of Shared Principal Collections for the Collateral Certificate for such Business Day shall equal the product of (x) Shared Principal Collections for all Series for the Distribution Date preceding such Business Day and (y) a fraction, the numerator of which is the Principal Shortfall for the Collateral Certificate for the Distribution Date preceding such Business Day and the denominator of which is the aggregate amount of Principal Shortfalls for all Series entitled to share Shared Principal Collections for such Business Day. SECTION 4.04 EXCESS INTEREST COLLECTIONS (a) On each Transfer Date, commencing with the initial Transfer Date, the amounts, if any, received on such Transfer Date by the Master Trust Trustee from the Indenture Trustee which are designated as Excess Interest Collections pursuant to the Indenture shall be treated as Excess Interest Collections by the Master Trust Trustee and allocated (i) to other Series to the extent such Series provides for the use of Excess Interest Collections and (ii) to the Seller or the holders of the Seller's Certificates. (b) On each Transfer Date following the Closing Date, the Master Trust Trustee shall, to the extent provided in the Agreement, transfer to the Indenture Trustee Excess Interest Collections, if any, in respect of such Transfer Date equal to the aggregate amount of Series Available Interest Amounts Shortfalls for each series of Notes. If the aggregate amount of Excess Interest Collections for all Series for such Transfer Date is less than the aggregate amount of finance charge shortfalls for all Series entitled to share Excess Interest Collections for such Transfer Date, the amount of Excess Interest Collections for the Collateral Certificate for such Transfer Date shall equal the product of (x) Excess Interest Collections for all Series for such Transfer Date and (y) a fraction, the numerator of which is the aggregate amount of Series Available Interest Amounts Shortfalls for each series of Notes for such Transfer Date and the denominator of which is the aggregate amount of finance charge shortfalls for all Series entitled to share Excess Interest Collections for such Transfer Date. - 13 - SECTION 4.05 ADDITIONAL RIGHTS UPON THE OCCURRENCE OF CERTAIN EVENTS. Notwithstanding the provisions of SECTION 9.02(a) of the Agreement, if any Insolvency Event occurs with respect to the Seller, ITEC, NIC or NFC, on the day of such Insolvency Event, the Seller will (subject to the actions of the Certificateholder) immediately cease to transfer Dealer Notes to the Master Trust, and promptly give notice to the Master Trust Trustee, the Master Owner Trust Trustee and the Indenture Trustee of such Insolvency Event. Under the terms of the Agreement, if an insolvency event occurs with respect to the Seller prior to the date on which the Collateral Certificate issued by the Master Trust has been paid in full, then within 15 days the Master Trust Trustee shall publish a notice of such Insolvency Event stating that the Master Trust Trustee intends to sell, liquidate or otherwise dispose of the Dealer Notes in a commercially reasonable manner and on commercially reasonable terms, unless within a specified period of time Certificateholders representing more than 50% of the aggregate series invested amount of the senior most outstanding Class of Investor Certificates of each such Series and each person holding a Supplemental Certificate, instruct the Master Trust Trustee not to sell, dispose of or otherwise liquidate the Dealer Notes and to continue transferring Dealer Notes as before such Insolvency Event. ARTICLE V REPORTS TO SERIES 200_-_ CERTIFICATEHOLDER SECTION 5.01 MONTHLY AND ANNUAL CERTIFICATEHOLDER'S STATEMENT. (a) MONTHLY SERIES 200_-_ CERTIFICATEHOLDER'S STATEMENT. At least two Business Days prior to each Distribution Date, the Servicer will provide to the Master Trust Trustee and the Paying Agent, and on each Distribution Date, the Paying Agent shall forward to the Series 200_-_ Certificateholder a Monthly Servicer Certificate and Settlement Statement substantially in the form of EXHIBIT B with such changes as the Servicer shall deem necessary or appropriate, prepared by the Servicer and delivered to the Master Trust Trustee setting forth, among other things, the following information: (i) the aggregate amount of Collections, including the aggregate amount of Finance Charge Collections and the aggregate amount of Principal Collections for the related Due Period; (ii) the Series Allocation Percentage, the Noteholder Floating Allocation Percentage and the Noteholder Principal Allocation Percentage for the related Due Period; (iii) the total amount of Series Allocable Finance Charge Collections for the related Due Period and the amount thereof allocated to the Noteholders as Noteholder Available Interest Amounts and the amount thereof allocated to the Seller on such Distribution Date; (iv) the total amount of Series Allocable Principal Collections for the related Due Period and the portions thereof allocated to the Noteholders as Noteholder Available Principal Collections and the amount thereof allocated to the Seller for that Due Period; - 14 - (v) Dealer Note Losses and Noteholder Allocated Dealer Note Losses for the related Due Period; (vi) the amount of the Investor Servicing Fee to be paid on such Distribution Date; (vii) the Invested Amount and Adjusted Invested Amount (after giving effect to all distributions that will occur on such Distribution Date); (viii) the aggregate amount of Dealer Notes and funds on deposit in the Excess Funding Account as of the end of the last day of the related Due Period (after giving effect to payments and adjustments made pursuant to Article IV of the Agreement); (ix) with respect to Eligible Investments in the Excess Funding Account, as of the last day of the related Due Period, the aggregate amount of funds invested in Eligible Investments in each such Series Account, a brief description of each such Eligible Investment and amount invested in each such Eligible Investment, the rate of interest applicable to each such Eligible Investment and the rating of each such Eligible Investment; (x) the Dealers with the five largest aggregate outstanding principal amounts of Dealer Notes in the Master Trust as of the end of the related Due Period; (xi) the aggregate outstanding principal amount of Dealer Notes issued to finance each of the OEM Vehicles and used vehicles as of the end of the related Due Period; (xii) the amount of Shared Principal Collections and Excess Interest Collections allocated to the Collateral Certificate and to other Series, each for the related Due Period; and (xiii) any other information required to be supplied in the monthly reports pursuant to the Indenture. (b) A copy of the statement provided pursuant to SECTION 5.01(a) will be made available for inspection at the Corporate Trust Office. (c) ANNUAL CERTIFICATEHOLDER'S TAX STATEMENT. On or about January 31 of each calendar year, beginning with calendar year 200_, the Master Trust Trustee shall furnish to the Servicer and Paying Agent a list of each Person who at any time during the preceding calendar year was a Series 200_-_ Certificateholder and received any payment thereon and the dates such Person held a Series 200_-_ Certificate, and the Paying Agent shall furnish to each such Series 200_-_ Certificateholder a statement prepared by the Paying Agent containing the information prepared by the Master Trust Trustee which is required to be contained in the statement to Series 200_-_ Certificateholder as set forth in SECTIONS 5.02(a)(iii) AND (iv) above, aggregated for such calendar year or the applicable portion thereof during which such Person was a Series 200_-_ Certificateholder, together with such other customary information as the - 15 - Master Trust Trustee or the Servicer deems necessary or desirable to enable the Series 200_-_ Certificateholder to prepare their tax returns, including information (to be supplied by the Servicer to the Master Trust Trustee) regarding original issue discount on the Series 200_-_ Certificate, if any. Such obligation of the Paying Agent shall be deemed to have been satisfied to the extent that substantially comparable information shall be provided by the Master Trust Trustee pursuant to any requirements of the Code as from time to time in effect. ARTICLE VI EARLY AMORTIZATION EVENTS SECTION 6.01 NO EARLY AMORTIZATION EVENTS. There shall be no Early Amortization Events with respect to the Collateral Certificate, and the Collateral Certificate shall not have an Early Amortization Period. ARTICLE VII OTHER SERIES PROVISIONS SECTION 7.01 CONVEYANCE OF DEALER NOTES. Upon the date on which each Series is either no longer outstanding or the fully funded date has occurred with respect thereto, the Master Trust Trustee shall sell, assign and convey to the Seller or its designee, without recourse, representations or warranty, all right, title and interest of the Master Trust in the Dealer Notes, whether then existing or thereafter created, all security interests in the Financed Vehicles with respect thereto, all monies due or to become due and all amounts received with respect thereto and all proceeds thereof, except for amounts on deposit in the Collections Account that are allocable to Investor Certificates and amounts on deposit in any Series Account. The Master Trust Trustee shall execute and deliver such instruments of transfer and assignment, in each case without recourse, as shall be reasonably requested by the Seller to vest in the Seller or its designee all right, title and interest which the Master Trust had in all such property. SECTION 7.02 TAX TREATMENT. The Seller has entered into the Agreement and this Series Supplement and the Collateral Certificate has been issued with the intention that the Collateral Certificate will be treated under applicable tax law as disregarded from the Master Trust so long as the Collateral Certificate is owned by the Master Owner Trust and Seller is the sole owner of the Master Trust and the Master Owner Trust (as determined for federal income tax purposes). Each of the Seller and the Series 200_-_ Certificateholder, by the acceptance of the Collateral Certificate, agrees to treat the Collateral Certificate as disregarded from the Master Trust so long as the Collateral Certificate is owned by the Master Owner Trust and Seller is the sole owner of the Master Trust and the Master Owner Trust, for federal income taxes, state and local income and franchise taxes and any other taxes imposed on or measured by income in whole or in part. ARTICLE VIII FINAL DISTRIBUTIONS - 16 - SECTION 8.01 SALE OF INVESTORS' INTEREST PURSUANT TO SECTION 2.07 OF THE AGREEMENT; DISTRIBUTIONS PURSUANT TO SECTION 2.07 OR 12.03 OF THE AGREEMENT. (a) The amount to be paid by the Seller to the Collections Account with respect to the Collateral Certificate in connection with a purchase of the Certificateholders' Interest pursuant to SECTION 2.07 of the Agreement shall equal the Reassignment Amount for the Distribution Date on which such purchase occurs. (b) The Reassignment Amount, if any, deposited into the Collections Account pursuant to this SECTION 8.01 or SECTION 2.07 of the Agreement or any proceeds deposited into the Collections Account pursuant to SECTION 12.03(c) of the Agreement, shall be allocated and distributed by the Master Trust Trustee in accordance with the Indenture. (c) Notwithstanding any other provision to the contrary in this Series Supplement or the Agreement, the entire amount distributed pursuant to SECTION 8.01(b) shall be deemed to be a final distribution pursuant to SECTION 12.03 of the Agreement with respect to the Collateral Certificate. SECTION 8.02 DISTRIBUTION OF PROCEEDS OF SALE, DISPOSITION OR LIQUIDATION OF THE DEALER NOTES PURSUANT TO SECTION 9.02 OF THE AGREEMENT. (a) Not later than 12:00 noon, New York City time, on the Distribution Date following the date on which the Insolvency Proceeds are deposited into the Collections Account pursuant to SECTION 9.02(b) of the Agreement, the Master Trust Trustee shall first (in each case, after giving effect to any deposits and distributions otherwise to be made on such Distribution Date) deduct an amount equal to the Invested Amount on such Distribution Date from the portion of the Insolvency Proceeds allocated to Series Allocable Principal Collections and distribute such amount to the Indenture Trustee for application pursuant to the Indenture and Indenture Supplements; PROVIDED that the amount of such distribution shall not exceed the product of (x) the portion of the Insolvency Proceeds allocated to Series Allocable Principal Collections and (y) the Noteholder Floating Allocation Percentage with respect to the related Due Period. The remainder of the portion of the Insolvency Proceeds allocated to Series Allocable Principal Collections shall be allocated to the Master Trust Seller's Interest and shall be distributed on such Distribution Date to the Seller. (b) Not later than 12:00 noon, New York City time, on such Distribution Date, the Master Trust Trustee shall deduct (in each case, after giving effect to any deposits and distributions otherwise to be made on such Distribution Date) an amount equal to the portion of the Insolvency Proceeds allocated to Series Allocable Finance Charge Collections and distribute such amount to the Indenture Trustee for application pursuant to the Indenture and Indenture Supplements; PROVIDED that the sum of such deposits shall not exceed the product of (x) the portion of the Insolvency Proceeds allocated to Series Allocable Finance Charge Collections and (y) the Noteholder Floating Allocation Percentage with respect to the related Due Period. The remainder of the portion of the Insolvency Proceeds allocated to Series Allocable Finance Charge Collections shall be allocated to the Master Trust Seller's Interest and shall be distributed on such Distribution Date to the Seller. - 17 - (c) Notwithstanding anything to the contrary in this Series Supplement or the Agreement, the entire amount distributed pursuant to this SECTION 8.02 shall be deemed to be a final distribution pursuant to SECTION 12.03 of the Agreement with respect to the Collateral Certificate. ARTICLE IX MISCELLANEOUS PROVISIONS SECTION 9.01 RATIFICATION OF AGREEMENT. As supplemented by this Series Supplement, the Agreement is in all respects ratified and confirmed and the Agreement as so supplemented by this Series Supplement shall be read, taken and construed as one and the same instrument. SECTION 9.02 COUNTERPARTS. This Series Supplement may be executed in two or more counterparts (and by different parties on separate counterparts) each of which shall be an original, but all of which together shall constitute one and the same instrument. SECTION 9.03 GOVERNING LAW. THIS SERIES SUPPLEMENT SHALL BE CONSTRUED, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED, IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, EXCEPT THAT THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE MASTER TRUST TRUSTEE SHALL BE DETERMINED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS. SECTION 9.04 TAX DISCLOSURE. Each of the undersigned parties agrees to comply with SECTION 14.11 of the Indenture. SECTION 9.05 CONSENT TO AMENDMENT. By the acceptance of the Collateral Certificate, the Series 200__-__ Certificateholder, on its own behalf and on behalf of each Noteholder (as defined in the Indenture) hereby consents to the following amendments of the Agreement: (a) The definition of "Dealer Note" in SECTION 1.01 of the Agreement is hereby deleted in its entirety and replaced with the following: "DEALER NOTE" shall mean a promissory note acquired by NFC to finance (i) an International Vehicle or an OEM Vehicle purchased by a Dealer or (ii) a used truck, truck body, bus or trailer or a new trailer for which NFC chooses to provide financing to a Dealer. When used herein, unless the context otherwise requires, "Dealer Notes" shall refer to those Dealer Notes which are held by the Master Trust. (b) Clause (v) of the definition of "Eligible Dealer Note" in SECTION 1.01 of the Agreement is hereby deleted in its entirety and replaced with the following: (v) which finances a new class 3 or higher truck, truck body or bus produced by or for a member of the Navistar Group or an OEM Supplier, a new or used trailer, or a used class 3 or higher truck, truck body or bus. - 18 - (c) The definition of "International Vehicles" in SECTION 1.01 of the Agreement is hereby deleted in its entirety and replaced with the following: "INTERNATIONAL VEHICLES" shall mean any truck, truck body, bus or trailer produced by, or for, ITEC or an affiliate of ITEC and sold by ITEC to Dealers. (d) The definition of "OEM Vehicle" in SECTION 1.01 of the Agreement is hereby deleted in its entirety and replaced with the following: "OEM VEHICLES" shall mean a new truck, truck body, bus or trailer manufactured by, or for, a manufacturer other than ITEC. For the purpose of any vote or consent under the Pooling and Servicing Agreement or any supplement thereto, the rules of construction set forth in SECTION 10.07 of the Indenture shall apply. - 19 - IN WITNESS WHEREOF, the Seller, the Servicer and the Master Trust Trustee have caused this Series Supplement to be duly executed by their respective officers as of the day and year first above written. NAVISTAR FINANCIAL SECURITIES CORPORATION as Seller By: ------------------------ Name: Title: NAVISTAR FINANCIAL CORPORATION as Servicer By: ------------------------ Name: Title: THE BANK OF NEW YORK as Master Trust Trustee By: ------------------------ Name: Title: