Exhibit 10.1

 

 

PURCHASE AGREEMENT

dated as of September 20, 2017

between

USAA FEDERAL SAVINGS BANK

and

USAA ACCEPTANCE, LLC

 

 

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TABLE OF CONTENTS

 

         Page  

ARTICLE I

 

DEFINITIONS AND USAGE

     1  

SECTION 1.1

 

Definitions

     1  

SECTION 1.2

 

Other Interpretive Provisions

     1  

ARTICLE II

 

PURCHASE

     2  

SECTION 2.1

 

Agreement to Sell and Contribute on the Closing Date

     2  

SECTION 2.2

 

Consideration and Payment

     2  

ARTICLE III

 

REPRESENTATIONS, WARRANTIES AND COVENANTS

     2  

SECTION 3.1

 

Representations and Warranties of the Bank

     2  

SECTION 3.2

 

Representations and Warranties of the Bank Regarding the Purchased Assets

     4  

SECTION 3.3

 

Representations and Warranties of the Bank as to each Receivable

     4  

SECTION 3.4

 

Repurchase upon Breach

     5  

SECTION 3.5

 

Protection of Title

     6  

SECTION 3.6

 

Other Liens or Interests

     6  

ARTICLE IV

 

MISCELLANEOUS

     7  

SECTION 4.1

 

Transfers Intended as Sale; Security Interest

     7  

SECTION 4.2

 

Notices, Etc

     8  

SECTION 4.3

 

Choice of Law

     8  

SECTION 4.4

 

Headings

     8  

SECTION 4.5

 

Counterparts

     8  

SECTION 4.6

 

Amendment

     8  

SECTION 4.7

 

Waivers

     9  

SECTION 4.8

 

Entire Agreement

     9  

SECTION 4.9

 

Severability of Provisions

     10  

SECTION 4.10

 

Binding Effect

     10  

SECTION 4.11

 

Acknowledgment and Agreement

     10  

SECTION 4.12

 

Cumulative Remedies

     10  

SECTION 4.13

 

Nonpetition Covenant

     10  

SECTION 4.14

 

Submission to Jurisdiction; Waiver of Jury Trial

     11  

SECTION 4.15

 

Third Party Beneficiaries

     11  

 

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EXHIBITS

 

Exhibit A

  Form of Assignment Pursuant to Purchase Agreement

Schedule I

  Representations and Warranties With Respect to the Receivables

Schedule II

  Perfection Representations, Warranties and Covenants

 

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THIS PURCHASE AGREEMENT is made and entered into as of September 20, 2017 (as
amended from time to time, this “Agreement”) between USAA FEDERAL SAVINGS BANK,
a federally chartered savings association (the “Bank”), and USAA ACCEPTANCE,
LLC, a Delaware limited liability company (the “Purchaser”).

WITNESSETH:

WHEREAS, the Purchaser desires to purchase from the Bank a portfolio of motor
vehicle receivables, including retail motor vehicle installment loans that are
secured by new and used automobiles and light-duty trucks; and

WHEREAS, the Bank is willing to sell such portfolio of motor vehicle receivables
and related property to the Purchaser on the terms and conditions set forth in
this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual agreements set
forth herein, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS AND USAGE

SECTION 1.1    Definitions. Except as otherwise defined herein or as the context
may otherwise require, capitalized terms used but not otherwise defined herein
are defined in Appendix A to the Sale and Servicing Agreement dated as of the
date hereof (as from time to time amended, supplemented or otherwise modified
and in effect, the “Sale and Servicing Agreement”) among USAA Auto Owner Trust
2017-1, the Bank, as Servicer, the Purchaser, as Seller, and U.S. Bank National
Association, as Indenture Trustee, which also contains rules as to usage that
are applicable herein.

SECTION 1.2    Other Interpretive Provisions. For purposes of this Agreement,
unless the context otherwise requires: (a) accounting terms not otherwise
defined in this Agreement, and accounting terms partly defined in this Agreement
to the extent not defined, shall have the respective meanings given to them
under GAAP (provided, that, to the extent that the definitions in this Agreement
and GAAP conflict, the definitions in this Agreement shall control); (b) terms
defined in Article 9 of the UCC as in effect in the relevant jurisdiction and
not otherwise defined in this Agreement are used as defined in that Article;
(c) the words “hereof,” “herein” and “hereunder” and words of similar import
refer to this Agreement as a whole and not to any particular provision of this
Agreement; (d) references to any Article, Section, Schedule, Appendix or Exhibit
are references to Articles, Sections, Schedules, Appendices and Exhibits in or
to this Agreement and references to any paragraph, subsection, clause or other
subdivision within any Section or definition refer to such paragraph,
subsection, clause or other subdivision of such Section or definition; (e) the
term “including” and all variations thereof means “including without
limitation”; (f) except as otherwise expressly provided herein, references to
any law or regulation refer to that law or regulation as amended from time to
time and include any successor law or regulation; (g) references to any Person
include that Person’s successors and assigns; and (h) unless the context
otherwise requires, defined terms shall be equally applicable to both the
singular and plural forms.

 

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ARTICLE II

PURCHASE

SECTION 2.1    Agreement to Sell and Contribute on the Closing Date. On the
terms and subject to the conditions set forth in this Agreement, the Bank agrees
to transfer, assign, set over, sell and otherwise convey to the Purchaser
without recourse (subject to the obligations herein) on the Closing Date all of
its right, title and interest in, to and under the Receivables, the Collections
after the Cut-Off Date, the Receivable Files and the Related Security relating
thereto, described in the assignment in the form of Exhibit A (the “Assignment”)
delivered on the Closing Date (the “Purchased Assets”) having a Net Pool Balance
as of the Cut-Off Date equal to $485,898,957.57, which sale shall be effective
as of the Cut-Off Date. The sale, transfer, assignment and conveyance made
hereunder does not constitute and is not intended to result in an assumption by
the Purchaser of any obligation of the Originator to the Obligors or any other
Person in connection with the Receivables or the other assets and properties
conveyed hereunder or any agreement, document or instrument related thereto.

SECTION 2.2    Consideration and Payment. In consideration of the transfer of
the Purchased Assets conveyed to the Purchaser on the Closing Date, the
Purchaser shall pay to the Bank on such date an amount equal to the estimated
fair market value of the Purchased Assets, as determined by the Purchaser and
the Bank prior to sale, which amount shall be paid in cash to the Bank.

ARTICLE III

REPRESENTATIONS, WARRANTIES AND COVENANTS

SECTION 3.1    Representations and Warranties of the Bank. The Bank makes the
following representations and warranties as of the Closing Date on which the
Purchaser will be deemed to have relied in acquiring the Purchased Assets. The
representations and warranties will survive the conveyance of the Purchased
Assets to the Purchaser pursuant to this Agreement, the conveyance of the
Purchased Assets to the Issuer pursuant to the Sale and Servicing Agreement and
the Grant thereof by the Issuer to the Indenture Trustee pursuant to the
Indenture:

(a)    Existence and Power. The Bank is a federally chartered savings
association validly existing and in good standing under the laws of the United
States and has, in all material respects, all power and authority required to
carry on its business as now conducted. The Bank has obtained all necessary
licenses and approvals in each jurisdiction where the failure to do so would
materially and adversely affect the ability of the Bank to perform its
obligations under the Transaction Documents or the enforceability or
collectability of the Receivables or any other part of the Purchased Assets.

(b)    Authorization and No Contravention. The execution, delivery and
performance by the Bank of each Transaction Document to which it is a party
(i) have been duly authorized by all necessary action on the part of the Bank
and (ii) do not contravene or constitute a default under (A) any applicable law,
rule or regulation, (B) its organizational documents or (C) any

 

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material agreement, contract, order or other instrument to which it is a party
or its property is subject (other than violations which do not affect the
legality, validity or enforceability of any of such agreements and which,
individually or in the aggregate, would not materially and adversely affect the
transactions contemplated by, or the Bank’s ability to perform its obligations
under, the Transaction Documents).

(c)    No Consent Required. No approval or authorization by, or filing with, any
Governmental Authority is required in connection with the execution, delivery
and performance by the Bank of any Transaction Document other than (i) UCC
filings, (ii) approvals and authorizations that have previously been obtained
and filings that have previously been made and (iii) approvals, authorizations
or filings which, if not obtained or made, would not have a material adverse
effect on the enforceability or collectability of the Receivables or any other
part of the Purchased Assets or would not materially and adversely affect the
ability of the Bank to perform its obligations under the Transaction Documents.

(d)    Binding Effect. Each Transaction Document to which the Bank is a party
constitutes the legal, valid and binding obligation of the Bank enforceable
against the Bank in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium,
receivership, conservatorship or other similar laws affecting creditors’ rights
generally and, if applicable, the rights of creditors of federally chartered
savings associations from time to time in effect or by general principles of
equity.

(e)    No Proceedings. There are no actions, suits or Proceedings pending or, to
the knowledge of the Bank, threatened against the Bank before or by any
Governmental Authority that (i) assert the invalidity or unenforceability of
this Agreement or any of the other Transaction Documents, (ii) seek to prevent
the issuance of the Notes or the consummation of any of the transactions
contemplated by this Agreement or any of the other Transaction Documents,
(iii) seek any determination or ruling that would materially and adversely
affect the performance by the Bank of its obligations under this Agreement or
any of the other Transaction Documents, or (iv) relate to the Bank that would
materially and adversely affect the federal or Applicable Tax State income,
excise, franchise or similar tax attributes of the Notes.

(f)    Lien Filings. The Bank is not aware of any material judgment, ERISA or
tax Lien filings against the Bank.

(g)    Official Record. So long as the Notes remain outstanding, the Transaction
Documents to which the Bank is a party shall be treated as an official record of
the Bank within the meaning of Section 13(e) of the Federal Deposit Insurance
Act (12 U.S.C. Section 1823(e)).

(h)    Sale Treatment. The transactions contemplated by the Transaction
Documents and the Sale Agreement, dated as of the date hereof, between the
Purchaser and United Services Automobile Association, a Texas reciprocal
interinsurance exchange, result in sale treatment with respect to the
Receivables for financial accounting purposes on the standalone balance sheet of
the Bank in accordance with generally accepted accounting principles.

 

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(i)    Bank Approval. Each of the Transaction Documents to which the Bank is a
party has been approved by the board of directors, the executive committee or
the loan committee of the Bank and such approval is reflected in the minutes of
the board of directors, executive committee or loan committee.

SECTION 3.2     Representations and Warranties of the Bank Regarding the
Purchased Assets. On the date hereof, the Bank hereby makes the following
representations and warranties to the Purchaser. Such representations and
warranties will survive the conveyance of the Purchased Assets to the Purchaser
pursuant to this Agreement, the conveyance of the Purchased Assets to the Issuer
under the Sale and Servicing Agreement, and the Grant of the Purchased Assets by
the Issuer to the Indenture Trustee pursuant to the Indenture.

(a)    The Receivables were selected using selection procedures that were not
known or intended by the Bank to be adverse to the Issuer.

(b)    The Receivables and the other Purchased Assets have been validly assigned
by the Bank to the Purchaser.

(c)    The information with respect to the Receivables transferred on the
Closing Date as set forth in the Schedule of Receivables was true and correct in
all material respects as of the Cut-Off Date.

(d)    No Receivables are pledged, assigned, sold, subject to a security
interest or otherwise conveyed other than pursuant to the Transaction Documents.
The Bank has not authorized the filing of and is not aware of any financing
statements against the Bank or an Originator that includes a description of
collateral covering any Receivable other than any financing statement relating
to security interests granted under the Transaction Documents or that have been
or, prior to the assignment of such Receivables hereunder, will be terminated,
amended or released. This Agreement creates a valid and continuing security
interest in the Receivables (other than the Related Security with respect
thereto, to the extent that an ownership interest therein cannot be perfected by
the filing of a financing statement) in favor of the Purchaser which security
interest is prior to all other Liens (other than Permitted Liens) and is
enforceable as such against all other creditors of and purchasers and assignees
from the Bank.

(e)    The representations and warranties regarding creation, perfection and
priority of security interests in the Purchased Assets, which are attached to
this Agreement as Schedule I, are true and correct to the extent that they are
applicable.

SECTION 3.3    Representations and Warranties of the Bank as to each Receivable.
On the date hereof, the Bank hereby makes the representations and warranties set
forth on Schedule II as to the Receivables sold, contributed, transferred,
assigned, set over, sold and otherwise conveyed to the Purchaser under this
Agreement on which such representations and warranties the Purchaser relies in
acquiring the Receivables. Such representations and warranties shall survive the
conveyance of the Purchased Assets to the Purchaser pursuant to this Agreement,
the sale of the Receivables to the Issuer under the Sale and Servicing
Agreement, and the Grant of the Receivables by the Issuer to the Indenture
Trustee pursuant to the Indenture. Notwithstanding any statement to the contrary
contained herein or in any other Transaction

 

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Document, the Bank shall not be required to notify any insurer with respect to
any Insurance Policy obtained by an Obligor. The Bank hereby agrees that the
Issuer shall have the right to enforce any and all rights under this Agreement
assigned to the Issuer under the Sale and Servicing Agreement, including the
right to cause the Bank to repurchase any Receivable with respect to which it is
in breach of any of its representation and warranties set forth in Schedule II,
directly against the Bank as though the Issuer were a party to this Agreement,
and the Issuer shall not be obligated to exercise any such rights indirectly
through the Depositor. Any inaccuracy in any of such representations or
warranties will be deemed not to constitute a breach of such representation or
warranty if such inaccuracy does not affect the ability of the Issuer to receive
and retain payment in full on such Receivable.

If the Asset Representations Reviewer determines that there was a Test Fail with
respect to any Receivable, the Bank will investigate whether the noncompliance
of such Receivable with any of the representations and warranties made by the
Bank with respect to such Receivable and set forth on Schedule II of this
Agreement materially and adversely affects the interests of the Issuer or the
Noteholders such that the Bank would be required to make a repurchase of such
Receivable pursuant to Section 3.4. In conducting such investigation, the Bank
will refer to the information available to it, which may include the Review
Report prepared by the Asset Representations Reviewer with respect to such
Receivable.

SECTION 3.4    Repurchase upon Breach. Upon discovery by or notice to the
Purchaser or the Bank of a breach of any of the representations and warranties
set forth in Section 3.3 with respect to any Receivable at the time such
representations and warranties were made which materially and adversely affects
the interests of the Issuer or the Noteholders, the party discovering such
breach or receiving such notice shall give prompt written notice thereof to the
other party; provided, that delivery of the Servicer’s Certificate, which
identifies that Receivables are being or have been repurchased, shall be deemed
to constitute prompt notice by the Servicer and the Seller of such breach;
provided, further, that the failure to give such notice shall not affect any
obligation of the Bank hereunder. If the Bank does not correct or cure such
breach prior to the end of the Collection Period which includes the 60th day
(or, if the Bank elects, an earlier date) after the date that the Bank became
aware or was notified of such breach, then the Bank shall purchase any
Receivable materially and adversely affected by such breach from the Purchaser
(or its assignee) on the Payment Date following the end of such Collection
Period. Any such purchase by the Bank shall be at a price equal to the
Repurchase Price. In consideration for such repurchase, the Bank shall make (or
shall cause to be made) a payment to the Purchaser (or its assignee) equal to
the Repurchase Price by depositing such amount into the Collection Account prior
to 11:00 a.m., New York City time on such Payment Date. Upon payment of such
Repurchase Price by the Bank, the Purchaser (or its assignee) shall release and
shall execute and deliver such instruments of release, transfer or assignment,
in each case without recourse or representation, as may be reasonably requested
by the Bank to evidence such release, transfer or assignment or more effectively
vest in the Bank or its designee any Receivable repurchased pursuant hereto. It
is understood and agreed that the obligation of the Bank to repurchase any
Receivable as described above shall constitute the sole remedy with respect to
such breach available to the Purchaser.

 

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SECTION 3.5    Protection of Title.

(a)    The Bank shall authorize and file such financing statements and cause to
be authorized 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 Purchaser under this Agreement in the
Receivables as well as any subsequent assignee of the Receivables (other than
any Related Security with respect thereto, to the extent that the interest of
the Purchaser therein cannot be perfected by the filing of a financing
statement). The Bank shall deliver (or cause to be delivered) to the Purchaser
as well as any subsequent assignee of the Receivables file-stamped copies of, or
filing receipts for, any document filed as provided above, as soon as available
following such filing.

(b)    The Bank will notify the Purchaser in writing within ten (10) days
following the occurrence of (i) any change in the Bank’s organizational
structure as a federally chartered savings association, (ii) any change in the
Bank’s “location” (within the meaning of Section 9-307 of the UCC of all
applicable jurisdictions) and (iii) any change in the Bank’s name and shall have
taken all action prior to making such change (or shall have made arrangements to
take such action substantially simultaneously with such change, if it is not
possible to take such action in advance) reasonably necessary or advisable in
the opinion of the Purchaser to amend all previously filed financing statements
or continuation statements described in paragraph (a) above.

(c)    The Bank shall maintain (or shall cause the Servicer to maintain) its
computer systems so that, from time to time after the conveyance under this
Agreement of the Receivables, the master computer records (including any backup
archives, it being understood that any such backup archives may not reflect such
interest until thirty-five (35) days after the applicable changes are made to
such master computer records) that refer to a Receivable shall indicate clearly
the interest of the Purchaser (or any subsequent assignee of the Purchaser) in
such Receivable and that such Receivable is owned by such Person. Indication of
such Person’s interest in a Receivable shall not be deleted from or modified on
such computer systems until, and only until, the related Receivable shall have
been paid in full or repurchased.

(d)    If at any time the Bank shall propose to sell, grant a security interest
in or otherwise transfer any interest in motor vehicle receivables to any
prospective purchaser, lender or other transferee, the Bank shall give to such
prospective purchaser, lender or other transferee computer tapes, records or
printouts (including any restored from backup archives) that, if they shall
refer in any manner whatsoever to any Receivable, shall indicate clearly that
such Receivable has been sold and is owned by the Purchaser (or any subsequent
assignee of the Purchaser).

SECTION 3.6    Other Liens or Interests. Except for the conveyances and grants
of security interests pursuant to this Agreement and the other Transaction
Documents, the Bank shall not sell, pledge, assign or transfer the Receivables
or other property transferred to the Purchaser to any other Person, or grant,
create, incur, assume or suffer to exist any Lien (other than Permitted Liens)
on any interest therein, and the Bank shall defend the right, title and interest
of the Purchaser in, to and under such Receivables or other property transferred
to the Purchaser against all claims of third parties claiming through or under
the Bank.

 

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ARTICLE IV

MISCELLANEOUS

SECTION 4.1    Transfers Intended as Sale; Security Interest.

(a)    Each of the parties hereto expressly intends and agrees that the
transfers contemplated and effected under this Agreement are complete and
absolute sales and contributions rather than pledges or assignments of only a
security interest and shall be given effect as such for all purposes. It is
further the intention of the parties hereto that the Receivables and related
Purchased Assets shall not be treated as property of the Bank by the FDIC or
other governmental authority acting as conservator or receiver of the Bank in a
conservatorship, receivership, insolvency or other similar proceeding in respect
of the Bank under the Federal Deposit Insurance Act, 12 U.S.C. Section 1811 et
seq. or other applicable law. The sales and transfers by the Bank of the
Receivables and related Purchased Assets hereunder are and shall be without
recourse to, or representation or warranty (express or implied) by, the Bank,
except as otherwise specifically provided herein. The limited rights of recourse
specified herein against the Bank are intended to provide a remedy for breach of
representations and warranties relating to the condition of the property sold,
rather than to the collectability of the Receivables.

(b)    Notwithstanding the foregoing, in the event that the Receivables and
other Purchased Assets are held to be property of the Bank, or if for any reason
this Agreement is held or deemed to create indebtedness or a security interest
in the Receivables and other Purchased Assets, then it is intended that:

(i)    This Agreement shall be deemed to be a security agreement within the
meaning of Articles 8 and 9 of the New York UCC and the UCC of any other
applicable jurisdiction;

(ii)    The conveyance provided for in Section 2.1 shall be deemed to be a grant
by the Bank of, and the Bank hereby grants to the Purchaser, a security interest
in all of its right (including the power to convey title thereto), title and
interest, whether now owned or hereafter acquired, in and to the Receivables and
other Purchased Assets, to secure such indebtedness and the performance of the
obligations of the Bank hereunder;

(iii)    The possession by the Purchaser or its agent of the Receivable Files
and any other property constituting instruments, money, negotiable documents or
chattel paper shall be deemed to be “possession by the secured party” or
possession by the purchaser or a Person designated by such purchaser, for
purposes of perfecting the security interest pursuant to the New York UCC and
the UCC of any other applicable jurisdiction; and

(iv)    Notifications to Persons holding such property, and acknowledgments,
receipts or confirmations from Persons holding such property, shall be deemed to
be notifications to, or acknowledgments, receipts or confirmations from, bailees
or agents (as applicable) of the Purchaser for the purpose of perfecting such
security interest under applicable law.

 

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SECTION 4.2    Notices, Etc. All demands, notices and communications hereunder
shall be in writing and shall be delivered or mailed by registered or certified
first-class United States mail, postage prepaid, hand delivery, prepaid courier
service, by facsimile or, if so provided on Schedule I to the Sale and Servicing
Agreement, by electronic transmission, and addressed in each case as specified
on Schedule I to the Sale and Servicing Agreement or at such other address as
shall be designated by any of the specified addressees in a written notice to
the other parties hereto. Delivery will be deemed to have been given and made:
(i) upon delivery or, in the case of a letter mailed by registered or certified
first-class United States mail, postage prepaid, three days after deposit in the
mail, (ii) in the case of a facsimile, when receipt is confirmed by telephone,
reply email or reply facsimile from the recipient, (iii) in the case of
electronic transmission, when receipt is confirmed by telephone or reply email
from the recipient and (iv) in the case of an electronic posting to a
password-protected website to which the recipient has been provided access, upon
delivery (without the requirement of confirmation of receipt) and notice
(including email) to such recipient stating that such electronic posting has
occurred.

SECTION 4.3    Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL, SUBSTANTIVE LAWS OF THE STATE OF NEW YORK
WITHOUT REFERENCE TO THE RULES THEREOF RELATING TO CONFLICTS OF LAW, OTHER THAN
SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.

SECTION 4.4    Headings. The section headings hereof have been inserted for
convenience only and shall not be construed to affect the meaning, construction
or effect of this Agreement.

SECTION 4.5    Counterparts. This Agreement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all of such counterparts shall together constitute but one and the same
instrument.

SECTION 4.6    Amendment.

(a)    Any term or provision of this Agreement may be amended by the Bank and
the Purchaser without the consent of the Indenture Trustee, any Noteholder, the
Issuer, the Owner Trustee or any other Person subject to the satisfaction of one
of the following conditions:

(i)    the Bank or the Purchaser delivers to the Indenture Trustee: (a) an
Opinion of Counsel to the effect that such amendment will not materially and
adversely affect the interests of the Noteholders and (b) an Officer’s
Certificate of the Bank or the Purchaser, respectively, to the effect that such
amendment will not materially and adversely affect the interests of the
Noteholders; or

(ii)    the Rating Agency Condition is satisfied with respect to such amendment
and the Bank or the Purchaser notifies the Indenture Trustee in writing that the
Rating Agency Condition is satisfied with respect to such amendment.

 

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(b)    This Agreement may also be amended from time to time by the Bank and the
Purchaser, with the consent of the Holders of Notes evidencing not less than a
majority of the Outstanding Note Balance of the Controlling Class, voting as a
single class, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Noteholders. It will not be necessary for the
consent of Noteholders to approve the particular form of any proposed amendment
or consent, but it will be sufficient if such consent approves the substance
thereof. The manner of obtaining such consents (and any other consents of
Noteholders provided for in this Agreement) and of evidencing the authorization
of the execution thereof by Noteholders will be subject to such reasonable
requirements as the Indenture Trustee may prescribe, including the establishment
of record dates pursuant to the Note Depository Agreement.

(c)    Prior to the execution of any amendment pursuant to this Section 4.6, the
Bank shall provide written notification of the substance of such amendment to
each Rating Agency; and promptly after the execution of any such amendment or
consent, the Bank shall furnish a copy of such amendment or consent to each
Rating Agency and the Indenture Trustee; provided, that no amendment pursuant to
this Section 4.6 shall be effective which affects the rights, protections or
duties of the Indenture Trustee or the Owner Trustee without the prior written
consent of such Person (which consent shall not be unreasonably withheld or
delayed).

(d)    Prior to the execution of any amendment pursuant to this Section 4.6, the
Owner Trustee and the Indenture Trustee shall be entitled to receive and
conclusively rely upon an Opinion of Counsel stating that the execution of such
amendment is authorized or permitted by this Agreement and that all conditions
precedent to the execution and delivery of such amendment have been satisfied.
The Owner Trustee and the Indenture Trustee may, but shall not be obligated to,
enter into or execute on behalf of the Issuer any such amendment which adversely
affects the Owner Trustee’s or the Indenture Trustee’s, as applicable, own
rights, privileges, indemnities, duties or obligations under this Agreement.

SECTION 4.7    Waivers. No failure or delay on the part of the Purchaser, the
Servicer, the Bank, the Issuer or the Indenture Trustee in exercising any power
or right hereunder (to the extent such Person has any power or right hereunder)
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such power or right preclude any other or further exercise thereof or the
exercise of any other power or right. No notice to or demand on the Purchaser or
the Bank in any case shall entitle it to any notice or demand in similar or
other circumstances. No waiver or approval by either party under this Agreement
shall, except as may otherwise be stated in such waiver or approval, be
applicable to subsequent transactions. No waiver or approval under this
Agreement shall require any similar or dissimilar waiver or approval thereafter
to be granted hereunder.

SECTION 4.8    Entire Agreement. The Transaction Documents contain a final and
complete integration of all prior expressions by the parties hereto with respect
to the subject matter thereof and shall constitute the entire agreement among
the parties hereto with respect to the subject matter thereof, superseding all
prior oral or written understandings. There are no unwritten agreements among
the parties hereto with respect to the subject matter hereof.

 

  -9-   Purchase Agreement (USAA 2017-1)

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SECTION 4.9    Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall be for any reason
whatsoever held invalid, then such covenants, agreements, provisions or terms
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.

SECTION 4.10    Binding Effect. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted assigns. This Agreement shall create and constitute the continuing
obligations of the parties hereto in accordance with its terms, and shall remain
in full force and effect until such time as the parties hereto shall agree.

SECTION 4.11    Acknowledgment and Agreement. By execution below, the Bank
expressly acknowledges and consents to the sale of the Purchased Assets and the
assignment of all rights and obligations of the Bank related thereto by the
Purchaser to the Issuer pursuant to the Sale and Servicing Agreement and the
Grant of a security interest in the Receivables and the other Purchased Assets
by the Issuer to the Indenture Trustee pursuant to the Indenture for the benefit
of the Noteholders. In addition, the Bank hereby acknowledges and agrees that
for so long as the Notes are outstanding, the Indenture Trustee will have the
right to exercise all powers, privileges and claims of the Purchaser under this
Agreement pursuant to the Grant of such security interest in the event that the
Purchaser shall fail to exercise the same.

SECTION 4.12    Cumulative Remedies. The remedies herein provided are cumulative
and not exclusive of any remedies provided by law.

SECTION 4.13    Nonpetition Covenant. Each party hereto agrees that, prior to
the date which is one year and one day after payment in full of all obligations
of each Bankruptcy Remote Party in respect of all securities issued by any
Bankruptcy Remote Party (i) such party hereto shall not authorize any Bankruptcy
Remote Party to commence a voluntary winding-up or other voluntary case or other
Proceeding seeking liquidation, reorganization or other relief with respect to
such Bankruptcy Remote Party or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect in any jurisdiction or seeking the
appointment of an administrator, a trustee, receiver, liquidator, custodian or
other similar official with respect to such Bankruptcy Remote Party or any
substantial part of its property or to consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other Proceeding commenced against such Bankruptcy Remote Party, or to make a
general assignment for the benefit of its creditors generally, any party hereto
or any other creditor of such Bankruptcy Remote Party, and (ii) such party shall
not commence, join with any other Person in commencing or institute with any
other Person any Proceeding against such Bankruptcy Remote Party under any
bankruptcy, reorganization, liquidation or insolvency law or statute now or
hereafter in effect in any jurisdiction; provided, that the foregoing shall in
no way limit the rights of the parties hereto to pursue any other creditor
rights or remedies that such Persons may have against the Issuer under
applicable law. This Section shall survive the termination of this Agreement.

 

  -10-   Purchase Agreement (USAA 2017-1)

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SECTION 4.14    Submission to Jurisdiction; Waiver of Jury Trial. Each of the
parties hereto hereby irrevocably and unconditionally:

(a)    submits for itself and its property in any legal action or Proceeding
relating to this Agreement or any documents executed and delivered in connection
herewith, or for recognition and enforcement of any judgment in respect thereof,
to the nonexclusive general jurisdiction of the courts of the State of New York,
the courts of the United States of America for the Southern District of New York
and appellate courts from any thereof;

(b)    consents that any such action or Proceeding may be brought and maintained
in such courts and waives any objection that it may now or hereafter have to the
venue of such action or Proceeding in any such court or that such action or
Proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;

(c)    agrees that service of process in any such action or Proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Person at its
address determined in accordance with Section 4.2;

(d)    agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and

(e)    to the extent permitted by applicable law, each party hereto irrevocably
waives all right of trial by jury in any action, Proceeding or counterclaim
based on, or arising out of, under or in connection with this Agreement, any
other Transaction Document, or any matter arising hereunder or thereunder.

SECTION 4.15    Third Party Beneficiaries. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns and each of the Issuer and the Indenture
Trustee shall be an express third party beneficiary hereof and may enforce the
provisions hereof as if it were a party hereto. Except as otherwise provided in
this Section, no other Person will have any right hereunder.

[Remainder of Page Intentionally Left Blank]

 

  -11-   Purchase Agreement (USAA 2017-1)

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first written above.

 

USAA FEDERAL SAVINGS BANK By:                                        
                                                      Name:   Title:   USAA
ACCEPTANCE, LLC By:                                        
                                                      Name:   Title:  

 

  S-1   Purchase Agreement (USAA 2017-1)

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EXHIBIT A

FORM OF

ASSIGNMENT PURSUANT TO PURCHASE AGREEMENT

[            ], 20[    ]

For value received, in accordance with the Purchase Agreement dated as of
September 20, 2017 (the “Agreement”), between USAA Federal Savings Bank, a
federally chartered savings association (the “Bank”), and USAA Acceptance, LLC,
a Delaware limited liability company (the “Purchaser”), on the terms and subject
to the conditions set forth in the Agreement, the Bank does hereby transfer,
assign, set over, sell and otherwise convey to the Purchaser without recourse
(subject to the obligations in the Agreement) on the Closing Date, all of its
right, title and interest in, to and under the Receivables set forth on the
schedule of Receivables delivered by the Bank to the Purchaser on the date
hereof, the Collections on or after the Cut-Off Date, the Receivable Files and
the Related Security relating thereto, which sale shall be effective as of the
Cut-Off Date.

The foregoing sale does not constitute and is not intended to result in any
assumption by the Purchaser of any obligation of the undersigned or the
Originator to the Obligors or any other Person in connection with the
Receivables, or the other assets and properties conveyed hereunder or any
agreement, document or instrument related thereto.

This assignment is made pursuant to and upon the representations, warranties and
agreements on the part of the undersigned contained in the Agreement and is
governed by the Agreement.

Capitalized terms used herein and not otherwise defined shall have the meaning
assigned to them in the Agreement or if not defined in the Agreement, in
Appendix A to the Sale and Servicing Agreement, dated as of September 20, 2017
among USAA Auto Owner Trust 2017-1, the Bank, as servicer, the Purchaser, as
seller, and U.S. Bank National Association, as indenture trustee.

[Remainder of page intentionally left blank]

 

  A-1   Purchase Agreement (USAA 2017-1)

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IN WITNESS HEREOF, the undersigned has caused this assignment to be duly
executed as of the date first above written.

 

USAA FEDERAL SAVINGS BANK By:                                        
                                                      Name:   Title:  

 

  A-2   Purchase Agreement (USAA 2017-1)

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SCHEDULE I

PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS

In addition to the representations, warranties and covenants contained in the
Agreement, the Bank hereby represents, warrants and covenants to the Purchaser
as follows on the Closing Date:

General

1.    This Agreement creates a valid and continuing security interest (as
defined in the applicable UCC) in the Receivables and the other Purchased Assets
in favor of the Purchaser, which security interest is prior to all other Liens,
and is enforceable as such against creditors of and purchasers from the Bank.

2.    The Receivables constitute “chattel paper” (including “electronic chattel
paper” and “tangible chattel paper”) within the meaning of the applicable UCC.

3.    Each Receivable is secured by a first priority validly perfected security
interest in the related Financed Vehicle in favor of the Originator, as secured
party, or all necessary actions with respect to such Receivable have been taken
or will be taken to perfect a first priority security interest in the related
Financed Vehicle in favor of the Originator, as secured party.

Creation

4.    Immediately prior to the sale, transfer, assignment and conveyance of a
Receivable by the Bank to the Purchaser, the Bank owned and had good and
marketable title to such Receivable free and clear of any Lien and immediately
after the sale, transfer, assignment and conveyance of such Receivable to the
Purchaser, the Purchaser will have good and marketable title to such Receivable
free and clear of any Lien.

Perfection

5.    The Bank has caused or will have caused, within ten days after the
effective date of this Agreement, the filing of all appropriate financing
statements in the proper filing office in the appropriate jurisdictions under
applicable law in order to perfect the security interest in the Receivables
granted to the Purchaser hereunder; and the Servicer, in its capacity as
custodian, has in its possession the original copies of such tangible chattel
paper that constitute or evidence the Receivables, and all financing statements
referred to in this paragraph contain a statement that: “A purchase of or
security interest in any collateral described in this financing statement will
violate the rights of the Secured Party/Purchaser.”

6.    With respect to Receivables that constitute tangible chattel paper,
either:

 

  a. All original executed copies of each such tangible chattel paper have been
delivered to the Indenture Trustee; or

 

  Schedule I-1   Purchase Agreement (USAA 2017-1)

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  b. Such tangible chattel paper is in the possession of the Servicer and the
Indenture Trustee has received a written acknowledgment from the Servicer that
the Servicer (in its capacity as custodian) is holding such tangible chattel
paper solely on behalf and for the benefit of the Indenture Trustee; or

 

  c. The Servicer received possession of such tangible chattel paper after the
Indenture Trustee received a written acknowledgment from the Servicer that the
Servicer is acting solely as agent of the Indenture Trustee.

Priority

7.    The Bank has not authorized the filing of, and is not aware of, any
financing statements against the Bank that include a description of collateral
covering the Receivables other than any financing statement (i) relating to the
conveyance of the Receivables by the Bank to the Purchaser under the Purchase
Agreement, (ii) relating to the conveyance of the Receivables by the Seller to
the Issuer under the Sale and Servicing Agreement, (iii) relating to the
security interest granted to the Indenture Trustee under the Indenture or
(iv) that has been terminated.

8.    The Bank is not aware of any material judgment, ERISA or tax Lien filings
against the Bank.

9.    Neither the Bank nor a custodian or vaulting agent thereof holding any
Receivable that is electronic chattel paper has communicated an “authoritative
copy” (as such term is used in Section 9-105 of the UCC) of any loan agreement
that constitutes or evidences such Receivable to any Person other than the
Servicer.

10.    None of the tangible chattel paper or electronic chattel paper that
constitute or evidence the Receivables has any marks or notations indicating
that they have been pledged, assigned or otherwise conveyed to any Person other
than the Purchaser, the Issuer or the Indenture Trustee.

Survival of Perfection Representations

11.    Notwithstanding any other provision of the Purchase Agreement or any
other Transaction Document, the perfection representations, warranties and
covenants contained in this Schedule I shall be continuing, and remain in full
force and effect until such time as all obligations under the Transaction
Documents and the Notes have been finally and fully paid and performed.

No Waiver

12.    The Bank shall provide the Rating Agencies with prompt written notice of
any material breach of the perfection representations, warranties and covenants
contained in this Schedule I, and shall not, without satisfying the Rating
Agency Condition, waive a breach of any of such perfection representations,
warranties or covenants.

 

  Schedule I-2   Purchase Agreement (USAA 2017-1)

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SCHEDULE II

REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE RECEIVABLES

 

(a) Characteristics of Receivables. As of the Cut-Off Date (or such other date
as may be specifically set forth below), each Receivable:

 

  (i) as of the Closing Date, is secured by a first priority perfected security
interest in the Financed Vehicle in favor of the Originator, as secured party,
or all necessary actions have been commenced that would result in a first
priority perfected security interest in the Financed Vehicle in favor of the
Originator, as secured party, which security interest, in either case, is
assignable and has been so assigned (x) by the Bank to the Purchaser and (y) by
the Purchaser to the Issuer;

 

  (ii) contains provisions that permit the repossession and sale of the Financed
Vehicle upon a default under the Receivable by the Obligor;

 

  (iii) provided, at origination, for level periodic payments which fully
amortize the initial Outstanding Principal Balance over the original term;
provided, that the amount of the first and last payments may be different but in
no event more than three times the level monthly payment; and

 

  (iv) was originated in the United States.

 

(b) Individual Characteristics. Each Receivable has the following individual
characteristics in each case as of the Cut-Off Date:

 

  (i) the Receivable is secured by a new or used automobile or light-duty truck;

 

  (ii) the Receivable has a Contract Rate of no less than 2.00%

 

  (iii) the Receivable had an original term to maturity of not more than 84
months, and the Receivable has a remaining term to maturity of not less than 1
month;

 

  (iv) the Receivable has an Outstanding Principal Balance greater than or equal
to $600.00;

 

  (v) the Obligor on the Receivable has a FICO® score of no less than 600;

 

  (vi) the Financed Vehicle related to the Receivable is a model year 2009 or
newer;

 

  (vii) the Receivable has a scheduled maturity date on or before March 15,
2024;

 

  (viii) the Receivable is not more than 30 days past due;

 

  (ix) the Receivable was not noted in the records of the Servicer as being the
subject of any pending bankruptcy or insolvency Proceeding;

 

  Schedule II-1   Purchase Agreement (USAA 2017-1)

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  (x) the Receivable is a Simple Interest Receivable.

 

(c) Compliance with Law. The Receivable complied at the time it was originated
or made in all material respects with all requirements of law in effect at that
time and applicable to such Receivable.

 

(d) Binding Obligation. The Receivable constitutes the legal and binding payment
obligation in writing of the Obligor, enforceable in all material respects by
the holder thereof in accordance with its terms, subject, to applicable
bankruptcy, insolvency, reorganization, liquidation or other similar laws and
equitable principles, consumer protection laws and the Servicemembers Civil
Relief Act.

 

(e) Receivable in Force. As of the Cut-off Date, neither the Bank’s records nor
the Receivable Files indicates that the Receivable was satisfied, subordinated
or rescinded nor has the related Financed Vehicle been released from the Lien
granted by the Receivable in whole or in part.

 

(f) No Waiver. As of the Cut-Off Date, no provision of a Receivable has been
expressly waived in writing in any material respect, except by instruments or
documents identified in the related Receivable File.

 

(g) No Default. Except for payment delinquencies continuing for a period of not
more than 30 days as of the Cut-Off Date, the records of the Servicer did not
disclose any payment defaults under the terms of the Receivable existed as of
the Cut-Off Date.

 

(h) Insurance. Under the terms of each Receivable, the Obligor is required to
maintain physical damage insurance covering the related Financed Vehicle.

 

(i) No Government Obligor. The Obligor on each Receivable is not the United
States of America or any state thereof or any local government, or any agency,
department, political subdivision or instrumentality of the United States of
America or any state thereof or any local government.

 

(j) Assignment. The terms of the Receivable do not limit the right of the owner
of the Receivable to sell and assign the Receivable.

 

(k) Good Title. As of the Closing Date and immediately prior to the sale and
transfer contemplated in the Purchase Agreement, the Bank had good and
marketable title to and was the sole owner of each Receivable free and clear of
all Liens (other than Permitted Liens or any which will be released prior to
assignment of such Receivable hereunder), and, immediately upon the sale and
transfer thereof, the Issuer will have good and marketable title to each
Receivable, free and clear of all Liens (other than Permitted Liens).

 

(l) One Original. There is only one executed original, electronically
authenticated original or authoritative copy of the Contract (in each case
within the meaning of the UCC) related to each Receivable.

 

  Schedule II-2   Purchase Agreement (USAA 2017-1)

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(m) No Defenses. The Bank’s electronic records related to the Receivables do not
reflect any right of rescission, set-off, counterclaim or defense has been
asserted or threatened in writing by an Obligor with respect to any Receivable.

 

  Schedule II-3   Purchase Agreement (USAA 2017-1)