Exhibit 10.2

 

EXECUTION COPY

 

 

U.S. $50,000,000

 

SECOND AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

 

by and among

 

*****,
as the Originator

 

*****,
as the Servicer

 

*****,

as the LLC Borrower

 

*****,
as the Trust Borrower

 

CLST ASSET TRUST II,
as the Trust II Borrower

 

*****,
as a Guarantor

 

*****,
as a Guarantor

 

*****,
as a Lender and as the Administrative Agent

 

U.S. BANK NATIONAL ASSOCIATION,
as the Collateral Custodian

 

And

 

LYON FINANCIAL SERVICES, INC.
(d/b/a U.S. BANK PORTFOLIO SERVICES),
as the Backup Servicer

 

Dated as of December 10, 2008

 

Note: Redacted portions have been marked with *****. The redacted portions are
subject to a request for confidential treatment that has been filed with the
Securities and Exchange Commission.

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE I

DEFINITION

2

 

 

 

 

 

Section 1.1.

Certain Defined Terms

2

 

Section 1.2.

Other Terms

30

 

Section 1.3.

Computation of Time Periods

30

 

Section 1.4.

Interpretation

30

 

 

 

 

ARTICLE II

THE VARIABLE FUNDING NOTES

31

 

 

 

 

 

Section 2.1.

The Variable Funding Notes

31

 

Section 2.2.

Procedures for Loans by Lenders

32

 

Section 2.3.

Restriction on Repayments

33

 

Section 2.4.

Determination of Interest

34

 

Section 2.5.

Notations on Variable Funding Notes

34

 

Section 2.6.

Principal Repayments

35

 

Section 2.7.

Settlement Procedures During the Revolving Period

35

 

Section 2.8.

Settlement Procedures During the Amortization Period

36

 

Section 2.9.

Collections and Allocations

37

 

Section 2.10.

Payments, Computations, Etc

38

 

Section 2.11.

Fees

39

 

Section 2.12.

Increased Costs; Capital Adequacy; Illegality

39

 

Section 2.13.

Taxes

40

 

Section 2.14.

Assignment of the Sale Agreement, Purchase and Sale Agreements and Dealer
Agreements

41

 

Section 2.15.

Repurchase of Receivables

42

 

 

 

 

ARTICLE III

CONDITIONS TO CLOSING AND LOANS

42

 

 

 

 

 

Section 3.1.

Conditions to Closing and the Initial Loan

42

 

Section 3.2.

Conditions Precedent to All Loans

43

 

Section 3.3.

Permitted Investments

45

 

Section 3.4.

***** Consent

45

 

 

 

 

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

46

 

 

 

 

Section 4.1.

Representations and Warranties of the Borrowers

46

 

Section 4.2.

Representations and Warranties of the Servicer

54

 

Section 4.3.

Representations and Warranties of the Originator

56

 

Section 4.4.

Representations and Warranties of the Backup Servicer

58

 

Section 4.5.

Representations and Warranties of the Collateral Custodian

59

 

Section 4.6.

Representations and Warranties of the Principal

60

 

 

 

 

ARTICLE V

GENERAL COVENANTS

60

 

 

 

 

 

Section 5.1.

Affirmative Covenants of the Borrowers

60

 

Section 5.2.

Negative Covenants of the Borrowers

63

 

Section 5.3.

Affirmative Covenants of the Servicer

65

 

Section 5.4.

Negative Covenants of the Servicer

67

 

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TABLE OF CONTENTS

(continued)

 

 

 

Page

 

 

 

 

 

Section 5.5.

Affirmative Covenants of the Originator

68

 

Section 5.6.

Negative Covenants of the Originator

70

 

Section 5.7.

Affirmative Covenants of the Backup Servicer

71

 

Section 5.8.

Negative Covenants of the Backup Servicer

71

 

Section 5.9.

Affirmative Covenants of the Collateral Custodian

72

 

Section 5.10.

Negative Covenants of the Collateral Custodian

72

 

 

 

ARTICLE VI

ADMINISTRATION AND SERVICING OF CONTRACTS

72

 

 

 

 

 

Section 6.1.

Designation of the Servicer

72

 

Section 6.2.

Duties of the Servicer

73

 

Section 6.3.

Authorization of the Servicer

75

 

Section 6.4.

Collection of Payments; Accounts

75

 

Section 6.5.

Realization Upon Defaulted Receivables

77

 

Section 6.6.

Servicing Compensation

78

 

Section 6.7.

Payment of Certain Expenses by the Servicer

78

 

Section 6.8.

Reports

78

 

Section 6.9.

Annual Statement as to Compliance

79

 

Section 6.10.

Reserved

79

 

Section 6.11.

The Servicer Not to Resign

79

 

Section 6.12.

Servicer Defaults

79

 

Section 6.13.

Appointment of Successor Servicer

81

 

 

 

 

ARTICLE VII

THE BACKUP SERVICER

84

 

 

 

 

 

Section 7.1.

Designation of the Backup Servicer

84

 

Section 7.2.

Duties of the Backup Servicer

84

 

Section 7.3.

Merger or Consolidation

85

 

Section 7.4.

Backup Servicing Compensation

86

 

Section 7.5.

Backup Servicer Removal

86

 

Section 7.6.

Limitation on Liability

86

 

Section 7.7.

Backup Servicer Resignation

87

 

 

 

 

ARTICLE VIII

THE COLLATERAL CUSTODIAN

88

 

 

 

 

 

Section 8.1.

Designation of Collateral Custodian

88

 

Section 8.2.

Duties of Collateral Custodian

88

 

Section 8.3.

Merger or Consolidation

90

 

Section 8.4.

Collateral Custodian Compensation

90

 

Section 8.5.

Collateral Custodian Removal

90

 

Section 8.6.

Limitation on Liability

90

 

Section 8.7.

The Collateral Custodian Not to Resign

91

 

Section 8.8.

Release of Documents

92

 

Section 8.9.

Return of Required Receivable Files and Servicing Files

92

 

Section 8.10.

Access to Certain Documentation and Information Regarding the Collateral; Audits

93

 

ii

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TABLE OF CONTENTS

(continued)

 

 

 

Page

 

 

 

 

ARTICLE IX

SECURITY INTEREST

93

 

 

 

 

 

Section 9.1.

Grant of Security Interest

93

 

Section 9.2.

Release of Lien on Collateral

94

 

Section 9.3.

Further Assurances

95

 

Section 9.4.

Remedies

95

 

Section 9.5.

Waiver of Certain Laws

95

 

Section 9.6.

Power of Attorney

95

 

 

 

 

ARTICLE X

EVENTS OF DEFAULT

96

 

 

 

 

Section 10.1.

Events of Default

96

 

Section 10.2.

Remedies

98

 

 

 

ARTICLE XI

INDEMNIFICATION

99

 

 

 

 

Section 11.1.

Indemnities by the Borrowers

99

 

Section 11.2.

Indemnities by the Servicer

102

 

 

 

 

ARTICLE XII

THE ADMINISTRATIVE AGENT

103

 

 

 

 

.

Section 12.1

The Administrative Agent

103

 

 

 

 

ARTICLE XIII

MISCELLANEOUS

105

 

 

 

 

Section 13.1.

Amendments and Waivers

105

 

Section 13.2.

Notices, Etc

106

 

Section 13.3.

Ratable Payments

106

 

Section 13.4.

No Waiver; Remedies

106

 

Section 13.5.

Binding Effect; Benefit of Agreement

106

 

Section 13.6.

Term of this Agreement

106

 

Section 13.7.

Governing Law; Consent to Jurisdiction; Waiver of Objection to Venue

107

 

Section 13.8.

Waiver of Jury Trial

107

 

Section 13.9.

Costs, Expenses and Taxes

107

 

Section 13.10.

No Proceedings

108

 

Section 13.11.

Recourse Against Certain Parties

108

 

Section 13.12.

Protection of Right, Title and Interest in the Collateral; Further Action
Evidencing Loans

109

 

Section 13.13.

Confidentiality

110

 

Section 13.14.

Execution in Counterparts; Severability; Integration

112

 

Section 13.15.

Waiver of Setoff

112

 

Section 13.16.

Assignments by the Lenders

112

 

Section 13.17.

Heading and Exhibits

112

 

Section 13.18.

Right of First Refusal

113

 

Section 13.19.

Concerning Joint and Several Liability of the Borrowers

113

 

Section 13.20.

Amendment and Restatement

115

 

iii

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TABLE OF CONTENTS

(continued)

 

 

 

Page

 

 

 

 

ARTICLE XIV

GUARANTY

115

 

 

 

 

Section 14.1.

Guaranty of Trigger Events

115

 

Section 14.2.

Limited Guaranty of Payment

116

 

Section 14.3.

Guarantor Payments

117

 

Section 14.4.

Obligations Unconditional

117

 

Section 14.5.

Modifications

118

 

Section 14.6.

Waiver of Rights

118

 

Section 14.7.

Reinstatement

119

 

Section 14.8.

Remedies

119

 

Section 14.9.

Subrogation

119

 

iv

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EXHIBITS

 

EXHIBIT A-1

 

Form of Borrowing Notice

EXHIBIT A-2

 

Form of Notice of Reduction of Loans Outstanding

EXHIBIT A-3

 

Form of Borrowing Base Certificate

EXHIBIT B-1

 

Form of A-1 Variable Funding Note

EXHIBIT B-2

 

Form of A-2 Variable Funding Note

EXHIBIT C

 

Form of Servicing Report

EXHIBIT D-1

 

Form of Officer’s Certificate as to Solvency (LLC Borrower)

EXHIBIT D-2

 

Form of Officer’s Certificate as to Solvency (Trust Borrower)

EXHIBIT D-3

 

Form of Officer’s Certificate as to Solvency (Trust II Borrower)

EXHIBIT D-4

 

Form of Officer’s Certificate as to Solvency (Servicer)

EXHIBIT D-5

 

Form of Officer’s Certificate as to Solvency (Originator)

EXHIBIT E-1

 

Form of Officer’s Closing Certificate (LLC Borrower)

EXHIBIT E-2

 

Form of Officer’s Closing Certificate (Trust Borrower)

EXHIBIT E-3

 

Form of Officer’s Closing Certificate (Trust II Borrower)

EXHIBIT E-4

 

Form of Officer’s Closing Certificate (Servicer)

EXHIBIT E-5

 

Form of Officer’s Closing Certificate (Originator)

EXHIBIT F-1

 

Form of Power of Attorney (LLC Borrower)

EXHIBIT F-2

 

Form of Power of Attorney (Trust Borrower)

EXHIBIT F-3

 

Form of Power of Attorney (Trust II Borrower)

EXHIBIT F-4

 

Form of Power of Attorney (Servicer)

EXHIBIT G

 

Form of Release of Required Receivable File

EXHIBIT H

 

Form of Servicer’s Certificate

EXHIBIT I

 

Form of Joinder Supplement

EXHIBIT J

 

Form of Backup Servicer Monthly Certification

EXHIBIT K

 

Form of Collateral Receipt

 

 

 

SCHEDULES

 

 

 

SCHEDULE I

 

Condition Precedent Documents

SCHEDULE II

 

Credit and Collection Policy

SCHEDULE III

 

Location of Required Receivable Files

SCHEDULE IV

 

Receivable List

SCHEDULE V

 

SIC Codes

SCHEDULE VI

 

Approved Lockbox Accounts

SCHEDULE VII

 

Approved Sellers and Purchase and Sale Agreements

SCHEDULE VIII

 

Approved Asset/Product Classes

SCHEDULE IX

 

Approved Sub-Servicers

SCHEDULE X

 

Concentration Account

 

 

 

ANNEXES

 

 

 

ANNEX A

 

Addresses for Notices

ANNEX B

 

Lender Commitments and Percentages

 

v

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SECOND AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

 

THIS SECOND AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (as amended,
modified, waived, supplemented, restated or replaced from time to time, this
“Agreement”) is made as of this December 10, 2008, by and among:

 

(1)           *****, a Delaware limited partnership, as the originator (together
with its successors and assigns in such capacity, the “Originator”);

 

(2)           *****, a Delaware limited liability company, as a borrower
(together with its successors and assigns in such capacity, the “LLC Borrower”);

 

(3)           *****, a Delaware statutory trust, as a borrower (together with
its successors and assigns in such capacity, the “Trust Borrower”;

 

(4)           CLST ASSET TRUST II, a Delaware statutory trust, as a borrower
(together with its successors and assigns in such capacity, the “Trust II
Borrower”, and together with the LLC Borrower and the Trust Borrower, the
“Borrowers” and each a “Borrower” in its individual capacity);

 

(5)           *****, a Delaware limited partnership, as a guarantor (together
with its successors and assigns in such capacity, a “Guarantor”);

 

(6)           *****, a natural person, as a guarantor (together with his
successors and assigns in such capacity, a “Guarantor”, and together with *****,
the “Guarantors”);

 

(7)           ***** (“*****”), a Delaware corporation, as a lender (together
with its successors and assigns in such capacity, a “Lender”, and together with
such other lenders from time to time party hereto, the “Lenders”) and as the
administrative agent (together with its successors and assigns in such capacity,
the “Administrative Agent”);

 

(8)           *****, a Nevada limited liability company, as the servicer
(together with its successors and assigns in such capacity, the “Servicer”);

 

(9)           LYON FINANCIAL SERVICES, INC. (d/b/a U.S. Bank Portfolio
Services), a Minnesota corporation, as the backup servicer (together with its
successors and assigns in such capacity, the “Backup Servicer”); and

 

(10)         U.S. BANK NATIONAL ASSOCIATION, a national banking association, not
in its individual capacity but as the collateral custodian (together with its
successors and assigns in such capacity, the “Collateral Custodian”);

 

RECITALS

 

WHEREAS, the Originator, the LLC Borrower, the Trust Borrower, the Guarantors,
the Lenders, the Administrative Agent, the Servicer, the Backup Servicer and the
Collateral Custodian entered into that certain Amended and Restated Revolving
Credit Agreement, dated as of August 15, 2008 (the “Amended Agreement”), which
they now wish to amend and restate in

 

--------------------------------------------------------------------------------

 

its entirety hereby to add the Trust II Borrower, as a Borrower, and to make
further additional clarifications and amendments to the Amended Agreement as
provided herein;

 

WHEREAS, the Originator, the LLC Borrower, the Guarantors, the Lenders, the
Administrative Agent, the Servicer, Spinnaker Consumer Receivables Trust, the
Backup Servicer and the Collateral Custodian entered into that certain Revolving
Credit Agreement, dated as of September 28, 2007 (the “Original Agreement”),
which was amended and restated in its entirety by the Amended Agreement;

 

WHEREAS, the LLC Borrower has acquired and will from time to time acquire
Receivables from the Originator, the Trust Borrower will from time to time
acquire Receivables sourced by the Sourcer (as defined herein), and the Trust II
Borrower will from time to time acquire Receivables from the Trust Borrower and
the LLC Borrower, each pursuant to their separate Sale Agreements;

 

WHEREAS, the Borrowers have requested the Lenders, and the Lenders have agreed,
subject to the terms and conditions contained in this Agreement, to extend
financing to the Borrowers on the terms and conditions set forth in this
Agreement to be secured by the Collateral (as defined below).

 

NOW, THEREFORE, based upon the foregoing Recitals, the mutual premises and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:

 

ARTICLE I

DEFINITION

 

Section 1.1.                                          Certain Defined Terms.

 

Certain capitalized terms used throughout this Agreement are defined in this
Section 1.1.  As used in this Agreement and its schedules, exhibits and other
attachments, unless the context requires a different meaning, the following
terms shall have the following meanings:

 

“1940 Act”:  The Investment Company Act of 1940, as amended, and the rules and
regulations promulgated thereunder.

 

“A-1 Variable Funding Note” or “A-1 VFN”:  Defined in Section 2.1.

 

“A-2 Variable Funding Note” or “A-2 VFN”:  Defined in Section 2.1.

 

“Account”:  The Collection Account and any sub-accounts thereof deemed
appropriate or necessary by the Administrative Agent for convenience in
administering such accounts.

 

“Accrual Period”:  With respect to the Loans, (a) with respect to the first
Payment Date, the period from and including the Closing Date to and including
the last day of the calendar month preceding the first Payment Date and (b) with
respect to any subsequent Payment Date,

 

2

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the preceding calendar month; provided that on the date of any repayment of the
Loans, the Accrual Period shall extend to the date of repayment.

 

“Additional Amount”:  Defined in Section 2.11(a).

 

“Administrative Agent”:  Defined in the Preamble.

 

“Affiliate”:  With respect to a Person, means any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person.  For purposes of this definition, “control,” when used with respect to
any specified Person means the possession, directly or indirectly, of the power
to vote 25% or more of the voting securities of such Person or to direct or
cause the direction of the management or policies of such Person, whether
through the ownership of voting securities, by contract or otherwise; provided
that none of the Originator, Servicer, LLC Borrower, Trust Borrower or any
Affiliate thereof shall be considered an Affiliate of the Trust II Borrower.

 

“Aggregate Outstanding Receivable Balance”:  On any date of determination, the
sum of the Outstanding Receivable Balances of all Eligible Receivables on such
date.

 

“Aggregate Unpaids”:  At any time, an amount equal to the sum of the unpaid
Loans Outstanding, Interest and all other amounts owed by the Borrowers to the
Servicer, the Backup Servicer, the Collateral Custodian and the Secured Parties
hereunder or by the Borrowers under any fee letter delivered in connection with
the transactions contemplated by this Agreement, in each case, whether due or
accrued.

 

“Amortization Period”:  The period beginning on the day on which the Termination
Date is declared or automatically occurs and ending on the Collection Date.

 

“Applicable Law”:  For any Person or property of such Person, all then-existing
(as of any date of determination) laws, rules, regulations (including income tax
regulations), statutes, treaties, codes, ordinances, permits, certificates,
orders and licenses of and interpretations by any Governmental Authority which
are applicable to such Person or property (including, without limitation,
predatory lending laws, usury laws, the Federal Truth in Lending Act, and
Regulation Z and Regulation B of the Board of Governors of the Federal Reserve
System), and applicable judgments, decrees, injunctions, writs, awards or orders
of any court, arbitrator or other administrative, judicial, or quasi-judicial
tribunal or agency of competent jurisdiction.

 

“Approved Asset/Product Class”:  An asset or product class identified on
Schedule VIII hereto as such Schedule VIII may be updated from time to time at
the request of the initial Servicer with the prior written approval of the
Administrative Agent (which approval shall not be unreasonably withheld and may
be evidenced by an email confirmation).

 

“Approved Fund”:  Any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business,
that is managed by: (a) a Lender or (b) an Affiliate of a Lender.

 

3

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“Approved Purchase and Sale Agreement”:  A Purchase and Sale Agreement
identified on Schedule VII hereto as such Schedule VII may be updated from time
to time at the request of the initial Servicer with the prior written approval
of the Administrative Agent (which approval shall not be unreasonably withheld
and may be evidenced by an email confirmation).

 

“Approved Seller”:  A Seller identified on Schedule VII thereto as such Schedule
VII may be updated from time to time at the request of the initial Servicer with
the prior written approval of the Administrative Agent (which approval shall not
be unreasonably withheld and may be evidenced by an email confirmation).

 

“Available Funds”:  With respect to any Payment Date, all amounts on deposit in
the Collection Account (including, without limitation, any Collections and
Guarantor Payments).

 

“Backup Servicer”:  Defined in the Preamble.

 

“Backup Servicer Fee Letter”:  The Backup Servicer Fee Letter, dated as of the
Closing Date, by and between the Servicer and the Backup Servicer.

 

“Backup Servicer Monthly Certification”:  Defined in Section 7.2(b)(iii).

 

“Backup Servicer Termination Notice”:  Defined in Section 7.5.

 

“Backup Servicing Fee”:  The fee set forth as such in the Backup Servicer Fee
Letter.

 

“Backup Servicing Fee Rate”:  0.08% or such other rate consented to in writing
by the LLC Borrower, the Backup Servicer and the Administrative Agent.

 

“Bailee”:  Defined in Section 8.2(b)(i).

 

“Bankruptcy Code”:  The United States bankruptcy code, as set forth in Title 11
of the United States Code, as amended from time to time.

 

“Benefit Plan”:  Any “employee benefit plan” as defined in Section 3(3) of ERISA
in respect of which the Borrower or any ERISA Affiliate of the Borrower is, or
at any time during the preceding six years was, an “employer” as defined in
Section 3(5) of ERISA.

 

“Borrower”:  Defined in the Preamble.

 

“Borrowers”:  Defined in the Preamble.

 

“Borrowing Base”:  As of any Measurement Date, an amount equal to the sum of
(A) the Maximum Advance, plus (B) the amount on deposit on such date in the
Collection Account, less all accrued but unpaid interest and fees owed to the
Lenders plus all other Carrying Costs.

 

“Borrowing Base Certificate”:  Each certificate, in the form of Exhibit A,
required to be delivered by the Borrowers on each Measurement Date, as
applicable.

 

“Borrowing Base Deficiency”:  The amount (if any) by which the Loans Outstanding
exceed the Borrowing Base.

 

4

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“Borrowing Notice”:  Each notice required to be delivered by the Borrowers in
respect of each requested Loan, substantially in the form of Exhibit A-1.

 

“Business Day”:  Any day (other than a Saturday or a Sunday) on which banks are
not required or authorized to be closed in New York, New York or the State of
Minnesota.

 

“Carrying Costs”:  As of any Measurement Date, for the most recently ended
Collection Period, the sum of (i) Interest, (ii) the Servicing Fee, (iii) the
Sub-Servicer Fee, (iv) the Backup Servicing Fee and (v) the Collateral Custodian
Fee.

 

“Certificated Security”:  The meaning specified in Section 8-102(a)(4) of the
UCC.

 

“Change of Control”:  Any of the following:

 

(a)           the failure of *****, to own, directly or indirectly, 100% of the
equity interests in the LLC Borrower free and clear of any Lien (other than
Permitted Liens);

 

(b)           the failure of the LLC Borrower, to own, directly or indirectly,
100% of the equity interests in the Trust Borrower free and clear of any Lien
(other than Permitted Liens);

 

(c)           the failure of the CLST Asset II, LLC, to own, directly or
indirectly, 100% of the equity interests in the Trust II Borrower free and clear
of any Lien (other than Permitted Liens); or

 

(d)           any change in the management of the LLC Borrower, the initial
Servicer or the Originator (including by resignation, termination, disability or
death) the result of which is that (i) ***** or (ii) each of *****, ***** and
***** is no longer under the employ of ***** or fails to provide active and
material participation in the activities of ***** (including, but not limited
to, general management, underwriting and the credit approval process and credit
monitoring activities), for a period of three consecutive calendar months, and
in such event, a reputable, experienced individual, reasonably satisfactory to
the Administrative Agent, has not been appointed to fulfill the duties of the
departing executive within 60 days after the end of such three-month period.

 

“Change of Tax Law”:  Any change in application or public announcement of an
official position under or any change in or amendment to the laws (or any
regulations or rulings promulgated thereunder) of any jurisdiction, or any
political subdivision or taxing authority of any of the foregoing, affecting
taxation, or any change in the official application, enforcement or
interpretation of such laws, regulations or rulings (including a holding by a
court of competent jurisdiction), or any other action taken by a taxing
authority or court of competent jurisdiction in the relevant jurisdiction.

 

“Class A Default Ratio”:  As of any date of determination, the percentage
equivalent of a fraction, (i) the numerator of which is equal to the product of
(a) the Outstanding Receivable Balance of all Class A Receivables that became
Defaulted Receivables during the prior Collection Period (less the aggregate
amounts deposited into the Collection Account during such Collection Period
constituting proceeds from recourse to Sellers with respect to Class A
Receivables constituting Defaulted Receivables and the Outstanding Receivable
Balance of all

 

5

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Receivables acquired by the Borrowers from Sellers in substitution for Class A
Receivables constituting Defaulted Receivables) and (b) 12, and (ii) the
denominator of which is the Outstanding Receivable Balance of all Class A
Receivables which were Eligible Receivables as of the first day of such
Collection Period.

 

“Class A Delinquency Ratio”:  As of any date of determination, the percentage
equivalent of a fraction, (i) the numerator of which is equal to the sum of the
Outstanding Receivable Balance of the Class A Receivables that became Delinquent
Receivables during the prior Collection Period, and (ii) the denominator of
which is equal to the Outstanding Receivable Balance of the Class A Receivables
which are Eligible Receivables at such time.

 

“Class A Maximum Advance”:  On any Measurement Date, an amount equal to the
lesser of (A) if such Measurement Date is a Funding Date, the product of 
(i) 85% and (ii) the aggregate Purchase Price of the Class A Receivables
purchased or acquired by the Borrowers on such Funding Date or (B) the product
of (i) 80% and (ii) the aggregate Outstanding Receivable Balance of the pledged
Class A Receivables constituting Eligible Receivables as of such Measurement
Date.

 

“Class A Receivable”:  An Eligible Receivable the Obligor of which has a Credit
Score of greater than or equal to 650 at the time of origination of such
Receivable.

 

“Class B Default Ratio”:  As of any date of determination, the percentage
equivalent of a fraction, (i) the numerator of which is equal to the product of
(a) the Outstanding Receivable Balance of all Class B Receivables that became
Defaulted Receivables during the prior Collection Period (less the aggregate
amounts deposited into the Collection Account during such Collection Period
constituting proceeds from recourse to Sellers with respect to Class B
Receivables constituting Defaulted Receivables and the Outstanding Receivable
Balance of all Receivables acquired by the Borrowers from Sellers in
substitution for Class B Receivables constituting Defaulted Receivables) and
(b) 12, and (ii) the denominator of which is the Outstanding Receivable Balance
of all Class B Receivables which were Eligible Receivables as of the first day
of such Collection Period.

 

“Class B Delinquency Ratio”:  As of any date of determination, the percentage
equivalent of a fraction, (i) the numerator of which is equal to the sum of the
Outstanding Receivable Balance of the Class B Receivables that became Delinquent
Receivables during the prior Collection Period, and (ii) the denominator of
which is equal to the Outstanding Receivable Balance of the Class B Receivables
which were Eligible Receivables at such time.

 

“Class B Maximum Advance”: On any Measurement Date, an amount equal to the
lesser of (A) if such Measurement Date is a Funding Date, the product of 
(i) 75% and (ii) the aggregate Purchase Price of the Class B Receivables
purchased or acquired by the Borrowers on such Funding Date or (B) the product
of (i) 50% and (ii) the aggregate Outstanding Receivable Balance of the pledged
Class B Receivables constituting Eligible Receivables as of such Measurement
Date.

 

“Class B Receivable”:  An Eligible Receivable the Obligor of which has a Credit
Score of less than 650 at the time of origination of such Receivable.

 

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“Clearing Agency”:  An organization registered as a “clearing agency” pursuant
to Section 17A of the Exchange Act.

 

“Clearing Corporation”:  The meaning specified in Section 8-102(a)(5) of the
UCC.

 

“Closing Date”:  September 28, 2007.

 

“Code”:  The Internal Revenue Code of 1986, as amended from time to time.

 

“Collateral”:  All right, title, and interest (whether now owned or hereafter
acquired or arising, and wherever located) of the Borrowers in all accounts,
cash and currency, chattel paper, tangible chattel paper, electronic chattel
paper, copyrights, copyright licenses, equipment, fixtures, contract rights,
general intangibles, instruments, certificates of deposit, certificated
securities, uncertificated securities, financial assets, securities
entitlements, commercial tort claims, deposit accounts, inventory, investment
property, letter-of-credit rights, software, supporting obligations, accessions,
and other property of the Borrowers, including the following (in each case
excluding any Retained Interest and Excluded Amounts):

 

(i)            the Receivables (regardless of whether any such Receivable has
been identified on any Receivables List and regardless of whether any Required
Receivable File with respect thereto have been delivered to the Collateral
Custodian), and all monies due or to become due in payment under such
Receivables, including, but not limited to, all Collections;

 

(ii)           all Related Security with respect to the Receivables referred to
in clause (i); and

 

(iii)          all income and Proceeds of the foregoing;

 

it being understood that “Collateral” does not include any Related Security to
the extent that the grant of a security interest therein would constitute a
violation of any law, regulation, permit, order or decree of any Governmental
Authority or a violation of any restriction in favor of a third party (such as
software licenses), unless and until all required consents shall have been
obtained.

 

“Collateral Custodian”:  Defined in the Preamble.

 

“Collateral Custodian Fee”:  The fee set forth as such in the Collateral
Custodian Fee Letter.

 

“Collateral Custodian Fee Letter”:  The Collateral Custodian Fee Letter, dated
as of the Closing Date, by and among the LLC Borrower, the Servicer, the
Administrative Agent and the Collateral Custodian.

 

“Collateral Custodian Termination Notice”:  Defined in Section 8.5.

 

“Collateral Receipt”:  Defined in Section 8.2(b).

 

“Collection Account”:  Defined in Section 6.4(h).

 

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“Collection Date”:  The date on or following the Termination Date on which the
Aggregate Unpaids have been reduced to zero and paid in full.

 

“Collection Period”:  With respect to the first Payment Date, the period from
and including the Closing Date to and including the last day of the calendar
month immediately preceding the calendar month in which the first Payment Date
occurs; and thereafter, the calendar month immediately preceding the then
current Payment Date.

 

“Collections”:  (a) All cash collections and other cash proceeds of any
Receivable, including, without limitation or duplication, any (i) Interest
Collections, (ii) Principal Collections, (iii) amendment fees, late fees,
prepayment fees or waiver fees payable in accordance with the Underlying
Instruments of such Receivable, (iv) Recoveries or (v) other amounts received in
respect thereof (but excluding any Excluded Amounts), (b) any cash proceeds or
other funds received by the Borrowers or the Servicer with respect to any
Related Security (including from any guarantors), (c) all payments from a Seller
pursuant to any of its indemnity and repurchase obligations under the related
Purchase and Sale Agreement or from any Dealer in connection with its buyback or
indemnity obligations under a Dealer Agreement, (d) interest earnings on
Permitted Investments or otherwise in any Account, and (e) all payments received
under the Guaranties.

 

“Commitment”:  With respect to each Lender, the commitment of such Lender to
make Loans in accordance herewith in an amount not to exceed the dollar amount
set forth opposite such Lender’s name on Annex B hereto or the amount set forth
as such Lender’s “Commitment” on Schedule I to the Joinder Supplement relating
to such Lender, as applicable, as such Commitment may be adjusted in connection
with any assignment under Section 13.16.

 

“Concentration Account”:  That separate account maintained by the Sourcer at a
Concentration Account Bank, subject to the Concentration Account Agreement, for
the purpose of receiving Collections, with respect to Receivables acquired by
the Trust Borrower pursuant to the Sourcing and Servicing Agreement (including
those Receivables sold by the Trust Borrower to the Trust II Borrower pursuant
to the Purchase Agreement), from the applicable Lockbox Accounts, the details of
which are set forth on Schedule X.  For the avoidance of doubt, all Collections
from Receivables acquired by the LLC Borrower pursuant to its Sale Agreement
(including those Receivables sold by the LLC Borrower to the Trust II Borrower
pursuant to the Purchase Agreement) shall be transferred directly from the
applicable Lockbox Accounts to the Collection Account.

 

“Concentration Account Bank”:  The financial institution listed as Concentration
Account Bank on Schedule X.

 

“Concentration Account Agreement”:  That certain Intercreditor and Concentration
Account Administration Agreement, dated as of the Closing Date, among the
Sourcer, the Collateral Custodian and such other parties thereto, which pertains
to the Concentration Account maintained by the Sourcer.

 

“Continued Errors”:  Defined in Section 6.13(g).

 

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“Contractual Obligation”:  With respect to any Person, any material provision of
any securities issued by such Person or of any material indenture, mortgage,
deed of trust, contract, undertaking, agreement, instrument or other document to
which such Person is a party or by which it or any of its property is bound or
to which either is subject.

 

“Credit and Collection Policy”:  With respect to the initial Servicer, the
written credit policies and procedures manual of ***** set forth on Schedule II,
as such credit and collection policy may be amended or supplemented from time to
time in accordance with Section 5.3(f), or, with respect to the Backup Servicer
or any Successor Servicer, the customary collection policies and procedures of
such successor Servicer; provided, that if the Administrative Agent has approved
the credit and collection policy of the applicable Seller in connection with its
approval of such Seller as an “Approved Seller” hereunder or has approved the
collection policy of any subservicer hereunder, the “Credit and Collection
Policy” shall be the credit and collection policy of such Seller with respect to
the Receivables originated by such Seller or the collection policy of such
subservicer with respect to the Receivables subserviced by such subservicer.

 

“Credit Score”: With respect to an Obligor, its applicable FICO Score or other
credit score provided by a major credit bureau.

 

“Dealer”:  A dealer, contractor, vendor or merchant that conveyed goods or
services to an Obligor and which originated or created a Receivable on behalf of
the Seller and which may have agreed to repurchase any Defaulted Receivables or
ineligible Receivables from the Seller pursuant to a Dealer Agreement.

 

“Dealer Agreement”:  The contractual agreement between a Dealer and the Seller
pursuant to which the applicable Dealer originates or creates Receivables on
behalf of the Seller.

 

“Default Rate”:  A per annum interest rate equal to the sum of the applicable
LIBOR Rate and 6.50%.

 

“Defaulted Receivable”:  A Receivable as to which any of the following has
occurred:  (i) all or any portion of a contractual payment due under such
Receivable is 91 or more days past due, (ii) the payment terms related to such
Receivable have been restructured or modified (without the consent of the
Administrative Agent, in its sole discretion) in any way due to credit reasons
or for the purpose of preventing such Receivable from becoming a Defaulted
Receivable after its acquisition by a Borrower, (iii) a charge-off has been
taken with respect to such Receivable as a result of a bankruptcy proceeding or
otherwise, (iv) the related Obligor is subject to an Insolvency Event (without
giving effect to any cure period specified in the definition thereof), (v) the
related Obligor is not Solvent, as reasonably determined by the Servicer in
accordance with the Credit and Collection Policy, the Servicing Standard or
otherwise or (vi) the Servicer has determined (or should have determined) in
accordance with the Credit and Collection Policy, the Servicing Standard or
otherwise that such Receivable is not collectible.

 

“Deficiency”:  Has the meaning set forth in Section 8.2(b).

 

“Delinquent Receivable”: Means a Receivable with respect to which all or any
portion of a required payment thereunder is delinquent more than 30 days from
the payment due date, but in no event more than 90 days after the payment due
date.

 

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“Dollars”:  Means, and the conventional “$” signifies, the lawful currency of
the United States.

 

“Effective Date”: December 10, 2008.

 

“Eligible Obligor”:  On any Measurement Date, any Obligor that:

 

(a)           is a natural person;

 

(b)           is not an employee, principal, director or equity holder of the
applicable Seller, any Borrower, the Originator, the Servicer or the
Sub-Servicer; and

 

(c)           as of the date on which such Receivable becomes part of the
Collateral, such Obligor has not experienced a material adverse change in its
condition, financial or otherwise, such as to affect the collectibility of the
Receivable or related collateral, as determined by the Servicer.

 

“Eligible Receivable”:  On any Measurement Date, each Receivable that satisfies
each of the following eligibility requirements (unless otherwise approved by the
Administrative Agent in its sole discretion):

 

(a)           at the time of its initial inclusion in the “Collateral”
hereunder, such Receivable is not a Delinquent Receivable; provided that a
Borrower may acquire a Delinquent Receivable at the sole discretion of the
Administrative Agent if such Receivable is acquired at a discount acceptable to
the Administrative Agent;

 

(b)           such Receivable, together with the Underlying Instruments related
thereto, (i) is in full force and effect and constitutes the legal, valid and
binding obligation of the related Obligor enforceable against such Obligor in
accordance with its terms, except as such enforceability may be limited by
Insolvency Laws and by principles of equity (whether considered in a suit at law
or in equity), (ii) is not subject to any litigation, material dispute or offset
and (iii) contains provisions substantially to the effect that the Obligor’s
payment obligations thereunder are absolute and unconditional without any right
of rescission, setoff, counterclaim or defense for any reason (except as
required by Applicable Law) against the applicable originator or any assignee
thereof;

 

(c)           such Receivable is denominated and payable only in Dollars (and
not in another currency or in kind) in the United States and does not permit the
currency or country in which such Receivable is payable to be changed;

 

(d)           such Receivable is not a Defaulted Receivable or a Receivable
which would be written off in accordance with the Credit and Collection Policy;

 

(e)           all products and services associated with such Receivable have
been sold, delivered, rendered and completed and no further action or event
needs to occur in order for such Receivable to be the enforceable obligation of
the related Obligor; and, if appropriate, such delivery and completion is
evidenced by completion certificates or delivery confirmations from the related
Obligor;

 

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(f)            the vendor of the products or the service provider of the
services associated with such Receivables has been paid in full;

 

(g)           the applicable Borrower is the sole owner of such Receivable and
no participation interests have been granted to any Person with respect to such
Receivable;

 

(h)           such Receivable was originated in compliance with all Applicable
Laws and the related Underlying Instruments comply with all Applicable Laws;

 

(i)            such Receivable is eligible under its Underlying Instruments
(giving effect to the provisions of Sections 9-406 and 9-408 of the UCC) to be
acquired by the Originator as contemplated by the applicable Purchase and Sale
Agreement (if such Receivable is acquired by the Originator prior to transfer to
a Borrower) and to be acquired by the applicable Borrower as contemplated by its
Sale Agreement and to have a security interest therein granted to the
Administrative Agent, as agent for the Secured Parties, and such Receivable does
not contain any restrictions that would prohibit the further assignment or
transfer of such Receivable by the applicable Borrower;

 

(j)            such Receivable does not contain a confidentiality provision that
restricts or purports to restrict the ability of any Secured Party to exercise
its rights under this Agreement, including, without limitation, its rights to
review the related Servicing File and Underlying Instruments;

 

(k)           such Receivable provides for periodic payments of interest and/or
principal no less frequently than monthly and is either (A) fully amortizing
over its term or (B) a revolving charge contract (excluding any Retained
Interest for such Receivable);

 

(l)            all consents, licenses, approvals or authorizations of, or
registrations or declarations with, any Governmental Authority or any other
Person required to be obtained, effected or given in connection with the making,
acquisition, transfer or performance of such Receivable have, to the applicable
Borrower’s and Originator’s knowledge been duly obtained, effected or given and
are in full force and effect;

 

(m)          such Receivable has not had any of its terms, conditions or
provisions amended, modified or waived in any manner inconsistent with the
Credit and Collection Policy and has not been restructured at any time for
credit reasons;

 

(n)           such Receivable has not been selected for conveyance to the
applicable Borrower in any manner adverse to the applicable Borrower or the
Secured Parties;

 

(o)           the related Obligor has been instructed to make all payments into
a Lockbox Account;

 

(p)           there are no facts, events or occurrences existing which
materially impair the validity, enforceability or collectability of such
Receivable or reduce the amount payable or delay payment thereunder;

 

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(q)           (i) the applicable Borrower has good and marketable title to, and
is the sole owner of, such Receivable, (ii) the applicable Borrower has granted
to the Administrative Agent a valid first priority perfected security interest,
free and clear of all other Liens (other than Permitted Liens), in such
Receivable and Related Security, for the benefit of the Secured Parties, and
(iii) the Required Receivable File required to be delivered to the Collateral
Custodian, with respect to such Receivable, has been delivered to the Collateral
Custodian;

 

(r)            the Obligor with respect to such Receivable is an Eligible
Obligor;

 

(s)           all information, representations and warranties provided in
writing by the applicable Borrower, the Originator and the Servicer with respect
to such Receivable are true, correct and complete in all material respects;

 

(t)            the acquisition of such Receivable will not cause the applicable
Borrower or the pool of Collateral to be required to register as an investment
company under the 1940 Act;

 

(u)           such Receivable does not constitute Margin Stock;

 

(v)           such Receivable is not subject to U.S. withholding tax and is not
subject to any foreign withholding tax unless the Obligor thereon is required
under the terms of the related Underlying Instrument to make “gross-up” payments
that cover the full amount of such withholding tax on an after-tax basis in the
event of a Change of Tax Law; and

 

(w)          the Receivable (i) relates to an Approved Asset/Product Class and
is included in a pool of Receivables being acquired from an Approved Seller
pursuant to an Approved Purchase and Sale Agreement or (ii) was acquired by
either the Trust Borrower or the Trust II Borrower in accordance with the terms
of its Sale Agreement.

 

“Eligible Repurchase Obligations”:  Repurchase obligations with respect to any
security that is a direct obligation of, or fully guaranteed by, the United
States or any agency or instrumentality thereof the obligations of which are
backed by the full faith and credit of the United States, in either case entered
into with a depository institution or trust company (acting as principal).

 

“Entitlement Holder”:  The meaning specified in Section 8-102(a)(7) of the UCC.

 

“Environmental Laws”:  Any and all federal, state and local laws, statutes,
ordinances, rules, regulations, permits, licenses, approvals, interpretations
and orders of courts or Governmental Authorities, relating to the protection of
the environment, including, but not limited to, requirements pertaining to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transportation, handling, reporting, licensing, permitting, investigation or
remediation of Hazardous Materials.  Environmental Laws include, without
limitation, the Comprehensive Environmental Response, Compensation, and
Liability Act (42 U.S.C. § 9601 et seq. (“CERCLA”)), the Hazardous Material
Transportation Act (49 U.S.C. § 331 et seq.), the Resource Conservation and
Recovery Act (42 U.S.C. § 6901 et seq.), the Federal Water Pollution Control Act
(33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the
Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Safe Drinking Water
Act (42 U.S.C. § 300, et seq.), the Environmental Protection Agency’s
regulations relating to

 

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underground storage tanks (40 C.F.R. Parts 280 and 281), and the Occupational
Safety and Health Act (29 U.S.C. § 651 et seq.), and the rules and regulations
thereunder, each as amended or supplemented from time to time.

 

“ERISA”:  The United States Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.

 

“ERISA Affiliate”:  With respect to any Borrower, (a) any corporation that is a
member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as such Borrower, (b) a trade or business (whether
or not incorporated) under common control (within the meaning of
Section 414(c) of the Code) with such Borrower, or (c) a member of the same
affiliated service group (within the meaning of Section 414(m) of the Code) as
such Borrower, any corporation described in clause (a) above or any trade or
business described in clause (b) above.

 

“Errors”:  Defined in Section 6.13(g).

 

“Event of Default”:  Defined in Section 10.1.

 

“Excepted Persons”:  Defined in Section 13.13(a).

 

“Excess Concentration Amount”:  As of any Measurement Date, for purposes of
determining the Maximum Advance, the sum of the following; provided that any
such excess amounts shall be calculated in such order and attributed to the
particular Outstanding Receivable Balances necessary to ensure that (i) there is
no duplication of amounts disallowed due to separate concentration limits and
(ii) the minimum aggregate amount which could be disallowed while still
complying with the concentration limits is so determined; provided further that
the Eligible Receivables acquired by the Trust Borrower pursuant to the Sourcing
and Servicing Agreement (or the Trust II Borrower pursuant to the Purchase
Agreement) shall not be subject to the concentration limits set forth below but
the Outstanding Receivable Balance of each such Eligible Receivable shall be
included in the Aggregate Outstanding Receivable Balance referenced in any
concentration limit:

 

(a)           the amount by which the sum of the Outstanding Receivable Balances
of all Eligible Receivables relating to a single Vendor exceeds 25% of the
Aggregate Outstanding Receivable Balance;

 

(b)           the amount by which the sum of the Outstanding Receivable Balances
of all Eligible Receivables that are “balance of payment” Receivables exceeds 5%
of the discounted Aggregate Outstanding Receivable Balance; provided that for
the avoidance of doubt Receivables that are “flat payment” Receivables shall be
excluded from this calculation;

 

(c)           the amount by which the sum of the Outstanding Receivable Balances
of all Eligible Receivables that are Class B Receivables exceeds 50% of the
Aggregate Outstanding Receivable Balance;

 

(d)           the amount by which the sum of the Outstanding Receivable Balances
of all Class A Receivables which with the addition of a Class A Receivable to
the Collateral would

 

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cause the weighted average FICO Score of the Eligible Receivables in the
Collateral to be less than 670;

 

(e)           the amount by which the sum of the Outstanding Receivable Balances
of all Class B Receivables which with the addition of a Class B Receivable to
the Collateral would cause the weighted average FICO Score of the Eligible
Receivables in the Collateral to be less than 600;

 

(f)            the amount by which the sum of the Outstanding Receivable
Balances of all Eligible Receivables, which with the addition of a Receivable to
the Collateral would cause the weighted average Gross Effective Yield to be less
than 17% for Class A Receivables and 19% for Class B Receivables; and

 

(g)           the amount by which the sum of the Outstanding Receivable Balances
of all Eligible Receivables the Obligors of which are classified (i) in the
largest single industry (“industry” to be defined by the SIC Codes) shall not
exceed 40% of the Aggregate Outstanding Receivables Balance, (ii) in the second
largest single industry shall not exceed 30% of the Aggregate Outstanding
Receivables Balance, and (iii) in any other industry shall not exceed 25% of the
Aggregate Outstanding Receivables Balance.

 

“Excess Spread”:  With respect to any calendar month, a per annum rate equal to
(I) the Gross Effective Yield of all Eligible Receivables minus (II) the sum of
(A) the Servicing Fee Rate, (B) the weighted average Interest Rate for such
calendar month, and (C) the Backup Servicing Fee Rate.

 

“Exchange Act”:  The United States Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.

 

“Excluded Amounts”:  (a) Any amount received in a Lockbox Account with respect
to any Receivable, which amount is attributable to the payment of any tax, fee
or other charge imposed by any Governmental Authority on such Receivable and
(b) any amount received in a Lockbox Account or other Account representing (i) a
reimbursement of insurance premiums, (ii) any escrows relating to taxes,
insurance and other amounts in connection with Receivables which are held in an
escrow account for the benefit of the Obligor (or its client) and the secured
party pursuant to escrow arrangements under the Underlying Instruments and
(iii) amounts related to any Receivable retransferred or substituted for upon
the occurrence of a Warranty Event or that is otherwise replaced by a Substitute
Receivable, to the extent such amount is attributable to a time after the
effective date of such retransfer, substitution, replacement or sale.

 

“Facility Amount”: On any Measurement Date, an amount equal to (i) $50,000,000
less (ii) the outstanding principal balance of the Term Loan.

 

“FDIC”: The Federal Deposit Insurance Corporation, and any successor thereto.

 

“FICO Score”:  The FICO® scores established by the Fair Isaac Corporation (or
any successor entity thereto).

 

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“Finance Charges”:  With respect to any Receivable, any interest or finance
charges payable by an Obligor pursuant to or with respect to such Receivable.

 

“Financial Asset”:  The meaning specified in Section 8-102(a)(9) of the UCC.

 

“*****”:  Defined in the Preamble.

 

“Full Prepayment Make-Whole Fee”:  An amount equal to the product of (a) the
Interest Rate on the Business Day immediately prior to the date the Loans
Outstanding are paid in full and (b) the Facility Amount on such Business Day.

 

“Funding Date”:  With respect to any Loan, the Business Day the related Loan has
been made.

 

“Funding Request”:  A Borrowing Notice in the form of Exhibit A-1 requesting a
Loan and including the items required by Section 2.2.

 

“GAAP”:  Generally accepted accounting principles as in effect from time to time
in the United States.

 

“Governmental Authority”:  With respect to any Person, any nation or government,
any state or other political subdivision thereof, any central bank (or similar
monetary or regulatory authority) thereof, any body or entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government and any court or arbitrator having jurisdiction over
such Person.

 

“Gross Effective Yield”:  With respect to any class of Receivables, the internal
rate of return of the Purchase Price and the gross projected principal and
interest payment cashflows to the Borrowers from such Receivables.

 

“Guaranteed Amounts”:  Defined in Article 14.1.

 

“Guaranties”:  Collectively, the Guaranty and the Limited Guaranty.

 

“Guarantors”:  Defined in the Preamble.

 

“Guarantor Payments”:  Any payment made a Guarantor pursuant to either of the
Guaranties.

 

“Guaranty”:  The guaranty provided by the Guarantors to the Secured Parties
pursuant to Section 14.1.

 

“Hazardous Materials”: All materials subject to any Environmental Law,
including, without limitation, materials listed in 49 C.F.R. § 172.010,
materials defined as hazardous pursuant to § 101(14) of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended,
flammable, explosive or radioactive materials, hazardous or toxic wastes or
substances, lead-based materials, petroleum or petroleum distillates or asbestos
or material containing asbestos, polychlorinated biphenyls, radon gas, urea
formaldehyde and any

 

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substances classified as being “in inventory”, “usable work in process” or
similar classification that would, if classified as unusable, be included in the
foregoing definition.

 

“Hedge Breakage Costs”:  With respect to any applicable Interest Rate Hedge
Transaction, the net amount, if any, payable by a Borrower to such Hedge
Counterparty for the early termination of that Interest Rate Hedge Transaction
or any portion thereof.

 

“Hedge Counterparty”: A hedge counterparty acceptable to the Administrative
Agent in its reasonable discretion.

 

“Hedging Agreement”:  Each agreement between a Borrower and a Hedge Counterparty
that governs one or more Interest Rate Hedge Transactions entered into by such
Borrower and such Hedge Counterparty, which agreement shall consist of a “Master
Agreement” in a form published by the International Swaps and Derivatives
Association, Inc., together with a “Schedule” thereto in such form as the
Administrative Agent shall have approved in writing (such approval not to be
unreasonably withheld), and each “Confirmation” thereunder confirming the
specific terms of each such Interest Rate Hedge Transaction.

 

“Highest Required Investment Category”:  (i)  With respect to ratings assigned
by Moody’s, “Aa2” or “P-1” for one month instruments, “Aa2” or “P-1” for
three-month instruments, “Aa3” or “P-1” for six-month instruments and “Aa2” or
“P-1” for instruments with a term in excess of six months and (ii) with respect
to ratings assigned by S&P, “A-1” for short-term instruments and “A” for
long-term instruments.

 

“Increased Costs”:  Any amounts required to be paid by a Borrower to a Lender
pursuant to Section 2.12.

 

“Indebtedness”:  With respect to any Person at any date, (a) all indebtedness of
such Person for borrowed money or for the deferred purchase price of property or
services (other than liabilities incurred in the ordinary course of business and
payable in accordance with customary trade practices) or that is evidenced by a
note, bond, debenture or similar instrument or other evidence of indebtedness
customary for indebtedness of that type, (b) all obligations of such Person
under leases that have been or should be, in accordance with GAAP, recorded as
capital leases, (c) all obligations of such Person in respect of acceptances
issued or created for the account of such Person and all letters of credit for
which such Person is the account party, (d) all liabilities secured by any Lien
on any property owned by such Person even though such Person has not assumed or
otherwise become liable for the payment thereof, (e) all net obligations or
liabilities of that Person in respect of derivatives, and (f) all obligations
under direct or indirect guaranties in respect of obligations (contingent or
otherwise) to purchase or otherwise acquire, or to otherwise assure a creditor
against loss in respect of, indebtedness or obligations of others of the kind
referred to in clauses (a) through (e) above.

 

“Indemnified Amounts”:  Defined in Section 11.1.

 

“Indemnified Parties”:  Defined in Section 11.1.

 

“Indorsement”:  The meaning specified in Section 8-102(a)(11) of the UCC, and
“Indorsed” has a corresponding meaning.

 

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“Insolvency Event”:  With respect to a specified Person, (a) the filing of a
decree or order (i) for relief by a court having jurisdiction over such Person
or any substantial part of its property in an involuntary case under any
applicable Insolvency Law now or hereafter in effect, or (ii) appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or
(iii) ordering the winding-up or liquidation of such Person’s affairs, provided
that such decree or order shall remain unstayed and in effect for a period of 60
consecutive days, (b) the commencement by such Person of a voluntary case under
any applicable Insolvency Law now or hereafter in effect, or the consent by such
Person to the entry of an order for relief in an involuntary case under any such
law, (c) the consent by such Person to the appointment of or taking possession
by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or the
making by such Person of any general assignment for the benefit of creditors,
(d) the failure by such Person generally to pay its debts as such debts become
due, or (e) the taking of action by such Person in furtherance of any of the
foregoing.

 

“Insolvency Laws”:  The Bankruptcy Code and all other applicable liquidation,
conservatorship, bankruptcy, moratorium, rearrangement, receivership,
insolvency, reorganization, suspension of payments, or similar debtor relief
laws from time to time in effect affecting the rights of creditors generally.

 

“Insolvency Proceeding”:  Any case, action or proceeding before any court or
other Governmental Authority relating to any Insolvency Event.

 

“Instrument”:  The meaning specified in Section 9-102(a)(47) of the UCC.

 

“Interest”:  For each Accrual Period, the sum of the products (for each day
during such Accrual Period) of:

 

 

 IR x P x 1

 

 

D

 

 

where:

 

IR            =              the Interest Rate applicable on such day;

 

P              =              the principal amount of the Loan on such day; and

 

D             =              360;

 

provided that (i) no provision of this Agreement shall require the payment or
permit the collection of Interest in excess of the maximum permitted by
Applicable Law and (ii) Interest shall not be considered paid by any
distribution if at any time such distribution is rescinded or must otherwise be
returned for any reason.

 

“Interest Collections”:  Any and all amounts received with respect to the
Collateral other than Principal Collections that are deposited into the
Collection Account, or received by or on behalf of a Borrower, the Servicer or
the Originator in respect of a Receivable whether in the form of cash, checks,
wire transfers, electronic transfers or any other form of cash payment.

 

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“Interest Rate”:  A per annum interest rate equal to the sum of the LIBOR Rate
and 4.50%.

 

“Interest Rate Hedge Transaction”:  Each interest rate hedge transaction between
a Borrower and a Hedge Counterparty under a Hedging Agreement, including, for
the avoidance of doubt, any interest rate swap and interest rate cap.

 

“Investment”:  With respect to any Person, any direct or indirect loan, advance
or investment by such Person in any other Person, whether by means of share
purchase, capital contribution, loan or otherwise, excluding the acquisition of
Receivables pursuant to the applicable Sale Agreement and the LLC Borrower’s
ownership of the Trust Borrower.

 

“Joinder Supplement”:  An agreement among the Borrowers, a Lender and the
Administrative Agent in the form of Exhibit I to this Agreement (appropriately
completed) delivered in connection with a Person becoming a Lender hereunder
after the Closing Date, as contemplated by Section 13.16.

 

“Key Employees”:  Each of *****, *****, ***** and *****.

 

“Lender”:  Defined in the Preamble.

 

“LIBOR Rate”:  For any day during any Accrual Period and the Loans, or any
applicable portion thereof, a per annum interest rate equal to:

 

(i)            the posted rate for one-month deposits in United States Dollars
appearing on Telerate page 3750, or any successor page thereto, as of 11:00 a.m.
(London time) on the Business Day which is the second Business Day preceding the
initial borrowing of such Loans (or portion thereof) (with respect to the
initial Accrual Period therefor) and as of the second Business Day preceding the
first day of the applicable Accrual Period (with respect to all subsequent
Accrual Periods therefor); or

 

(ii)           if no such rate appears on Telerate page 3750, or any successor
page thereto, at such time and day, then the LIBOR Rate shall be the arithmetic
mean of the offered rates for one month deposits in United States Dollars
appearing on the Reuters Screen LIBO Page as of 11:00 a.m. (London time) on the
Business Day which is the second Business Day preceding the initial borrowing of
such Loans (or portion thereof) (with respect to the initial Accrual Period
therefor) and as of the second Business Day preceding the first day of the
applicable Accrual Period (with respect to all subsequent Accrual Periods
therefor).

 

“Lien”:  Any mortgage, lien, pledge, charge, right, claim, security interest or
encumbrance of any kind of or on any Person’s assets or properties in favor of
any other Person (including any UCC financing statement or any similar
instrument filed against such Person’s assets or properties).

 

“Limited Guaranty”:  The Limited Guaranty provided by ***** to the Secured
Parties pursuant to Section 14.2.

 

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“Liquidation Expenses”:  With respect to any Receivable, the aggregate amount of
all out-of-pocket expenses reasonably incurred by the Servicer in accordance
with the Servicer’s customary procedures in connection with the repossession,
refurbishing and disposition of any Receivable or Related Security, upon or
after the expiration or earlier termination of such Receivable (including
without limitation any brokerage or legal fees), and other out-of-pocket costs
related to the liquidation of any such assets, including the attempted
collection of any amount owing under such Receivable, as documented by the
Servicer upon the request of the Administrative Agent, in writing providing a
breakdown of the Liquidation Expenses for such Receivable, along with any
supporting documentation therefor.

 

“Loan”:  Any loan made by the Lenders to the Borrowers hereunder, as applicable.

 

“Loans Outstanding”:  On any day, the aggregate principal amount of the Loans
outstanding on such day, after giving effect to all repayments on such day.

 

“Lockbox Accounts”:  Each of the separate lockbox accounts or blocked accounts
maintained at the applicable Lockbox Account Bank for the purpose of receiving
Collections, the details of which are set forth on Schedule VI, as such schedule
may be amended from time to time.

 

“Lockbox Account Banks”:  The financial institutions listed as Lockbox Account
Banks on Schedule VI, and such other financial institutions that may from time
to time become Lockbox Account Banks hereunder.

 

“Margin Stock”:  “Margin Stock” as defined under Regulation U.

 

“Material Adverse Effect”:  With respect to any event or circumstance, means a
material adverse effect on (a) the business, financial position, results of
operations, performance or properties of the Originator, the Servicer, the
Guarantors or a Borrower, (b) the validity or enforceability of this Agreement
or any other Transaction Document against the Originator, the Servicer, the
Guarantors or a Borrower or the validity, enforceability or collectibility of
the Collateral taken as a whole or any material portion of the Collateral,
(c) the rights and remedies of the Secured Parties with respect to matters
arising under this Agreement or any other Transaction Document, (d) the ability
of a Borrower, the Originator, the Guarantors or the Servicer to perform its
obligations under this Agreement or any other Transaction Document, or (e) the
status, existence, perfection, priority or enforceability of the Administrative
Agent’s lien on a material portion of the Collateral, taken as a whole.

 

“Maturity Date”:  September 28, 2010, as such date may be extended pursuant to
Section 2.1(c).

 

“Maximum Advance”:  On any Measurement Date, an amount equal to (A) the sum of
(i) the Class A Maximum Advance and (ii) the Class B Maximum Advance minus
(B) the Excess Concentration Amount.

 

“Maximum Committed Amount”:  As of any date of determination, $50,000,000 (which
amount shall be subject to increases pursuant to Section 2.1(d)).

 

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“Maximum Lawful Rate”:  Defined in Section 2.4(b).

 

“Maximum Outstanding Loan Amount”:  At any time, an amount equal to the lesser
of (i) the Facility Amount, and (ii) the Borrowing Base.

 

“Measurement Date”:  Each of the following:  (i) each Funding Date; (ii) the
last day of each calendar month; (iii) any date on which a substitution or a
repurchase of a Receivable occurs; and (iv) the date as of which any Servicing
Report, as provided for in Section 6.9, is calculated.

 

“Moody’s”:  Moody’s Investors Service, Inc., and any successor thereto.

 

“Multiemployer Plan”:  With respect to any Borrower, a “multiemployer plan” as
defined in Section 4001(a)(3) of ERISA that is or was at any time during the
current year or the preceding five (5) years contributed to by such Borrower or
any ERISA Affiliate thereof on behalf of its employees.

 

“Notice of Reduction of Loans Outstanding”:  Each notice required to be
delivered by the Borrowers in respect of any reduction of the Loans Outstanding,
substantially in the form of Exhibit A-2.

 

“Obligor”:  With respect to any Receivable, any Person or Persons obligated to
make payments pursuant to or with respect to such Receivable, including any
guarantor thereof.

 

“Officer’s Certificate”:  A certificate signed by a Responsible Officer of the
Person providing the applicable certification.

 

“Opinion of Counsel”:  A written opinion of counsel, which opinion and counsel
are acceptable to the Administrative Agent in its reasonable discretion.

 

“Originator”:  Defined in the Preamble.

 

“Other Costs”:  Defined in Section 13.9(c).

 

“Outstanding Receivable Balance”:  As of any Measurement Date, with respect to
any Receivable, (A) the balance of principal and accrued and unpaid interest
outstanding for such Receivable as of the date it is acquired by a Borrower,
minus (B) the sum of (i) the principal portion of the Scheduled Payments on such
Receivable received during each Collection Period ending prior to the most
recent Payment Date, and (ii) all other Principal Collections on such
Receivable, to the extent deposited by the Servicer in the Collection Account.
The Outstanding Receivable Balance of any Prepaid Receivable which has been
prepaid in full shall equal $0.

 

“Partial Prepayment Make-Whole Fee”:  An amount equal to the greater of (a) $0
and (b) the product of (i) the difference between (A) $30 million and (B)(x) the
weighted average Loans Outstanding hereunder plus (y) the weighted average of
the outstanding principal balance of the Term Loan during the eighteen (18)
month period since the Closing Date and (ii) the Interest Rate in effect on the
eighteen (18) month anniversary of the Closing Date.

 

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“Payment Date”:  Monthly on the 15th day of each calendar month, or, if such day
is not a Business Day, the next succeeding Business Day, commencing November 15,
2007.

 

“Payment Duties”:  Defined in Section 8.2(b).

 

“Permitted Investments”:  Means negotiable instruments or securities or other
investments that (i) except in the case of demand or time deposits, investments
in money market funds and Eligible Repurchase Obligations, are represented by
instruments in bearer or registered form or ownership of which is represented by
book entries by a Clearing Agency or by a Federal Reserve Bank in favor of
depository institutions eligible to have an account with such Clearing Agency or
such Federal Reserve Bank who hold such investments on behalf of their
customers, (ii) as of any date of determination, mature by their terms on or
prior to the Business Day preceding the next Payment Date, and (iii) evidence:

 

(a)                                direct obligations of, and obligations fully
guaranteed as to full and timely payment by, the United States (or by any agency
thereof to the extent such obligations are backed by the full faith and credit
of the United States);

 

(b)                               demand deposits, time deposits or certificates
of deposit of depository institutions or trust companies incorporated under the
laws of the United States or any state thereof and subject to supervision and
examination by federal or state banking or depository institution authorities;
provided that at the time of a Borrower’s investment or contractual commitment
to invest therein, the commercial paper, if any, and short-term unsecured debt
obligations (other than such obligation whose rating is based on the credit of a
Person other than such institution or trust company) of such depository
institution or trust company shall have a credit rating from each Rating Agency
in the Highest Required Investment Category granted by such Rating Agency;

 

(c)                                commercial paper, or other short term
obligations, having, at the time of a Borrower’s investment or contractual
commitment to invest therein, a rating in the Highest Required Investment
Category granted by each Rating Agency;

 

(d)                               demand deposits, time deposits or certificates
of deposit that are fully insured by the FDIC and either have a rating on their
certificates of deposit or short-term deposits from Moody’s and S&P of “P-1” and
“A-1”, respectively;

 

(e)                                notes that are payable on demand or bankers’
acceptances issued by any depository institution or trust company referred to in
clause (b) above;

 

(f)                                  investments in taxable money market funds
or other regulated investment companies having, at the time of a Borrower’s
investment or contractual commitment to invest therein, a rating of the Highest
Required Investment Category from each Rating Agency; any such fund may be
managed by the Collateral Custodian or its Affiliates;

 

(g)                               time deposits (having maturities of not more
than 90 days) by an entity the commercial paper of which has, at the time of a
Borrower’s investment or contractual commitment to invest therein, a rating of
the Highest Required Investment Category granted by each Rating Agency; or

 

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(h)                               Eligible Repurchase Obligations with a rating
acceptable to the Rating Agencies, which in the case of S&P, shall be “A-1” and
in the case of Moody’s, shall be “P-1”.

 

“Permitted Liens”:  Include (i) Liens granted pursuant to or by the Transaction
Documents, (ii) Liens for Taxes less than thirty (30) days overdue provided an
adequate reserve for such Taxes has been established on the books of the
Borrowers, as applicable, in accordance with GAAP, and (iii) Liens arising under
the Term Credit Agreement (or the other “Transaction Documents” as defined
therein).

 

“Person”:  An individual, partnership, corporation, limited liability company,
joint stock company, trust (including a statutory or business trust),
unincorporated association, sole proprietorship, joint venture, government (or
any agency or political subdivision thereof) or other entity.

 

“Predecessor Servicer Work Product”:  Defined in Section 6.13(g).

 

“Prepaid Receivable”:  Any Receivable (other than a Defaulted Receivable) that
has been terminated or has been prepaid in full or in part prior to its
scheduled expiration date.

 

“Prepayment Amount”:  Defined in Section 6.4(b).

 

“Prepayment Premium”:  Means, (a) if the Borrowers repay the Loans Outstanding
pursuant to Section 2.3 after the eighteen (18) month anniversary of the Closing
Date but prior to the thirty-six (36) month anniversary of the Closing Date, an
amount equal to the product of (i) 2%, and (ii) the Facility Amount; and
(b) after the thirty-six (36) month anniversary of the Closing Date, $0.  For
the avoidance of doubt, no Prepayment Premium shall be applicable with respect
to principal payments in the ordinary course under Sections 2.7 or 2.8.

 

“Prepayments”:  Any and all partial or full prepayments on or with respect to a
Receivable (including, with respect to any Receivable and any Collection Period,
any Scheduled Payment, Finance Charge or portion thereof that is due in a
subsequent Collection Period that the Servicer has received in advance of its
scheduled due date, and that will satisfy such Scheduled Payment on such due
date).

 

“Principal”:  ***** or any successor(s) thereto approved in writing by the
Administrative Agent.

 

“Principal Collections”:  Any and all amounts of Collections received in respect
of any principal due and payable under the Receivables, from or on behalf of
Obligors that are deposited into the Collection Account (including, without
limitation, the principal portion of any Scheduled Payment or of any repurchase
amount paid by the Originator to repurchase a Receivable pursuant the LLC
Borrower’s Sale Agreement and by the applicable Seller to repurchase a
Receivable pursuant to the applicable Purchase and Sale Agreement or, in the
case of the Trust Borrower, any amount paid by the Sourcer to repurchase a
Receivable pursuant to the Sourcing and Servicing Agreement or, in the case of
the Trust II Borrower, any amount paid by the Trust Borrower or the LLC Borrower
to repurchase a Receivable pursuant to the Purchase Agreement), or received by
or on behalf of a Borrower by the Servicer or the Originator in

 

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respect of a Receivable and all Recoveries, whether in the form of cash, checks,
wire transfers, electronic transfers or any other form of cash payment.

 

“Proceeds”:  With respect to any Collateral, all property that is receivable or
received when such Collateral is collected, sold, liquidated, foreclosed,
exchanged, or otherwise disposed of, whether such disposition is voluntary or
involuntary, and includes all rights to payment with respect to any insurance
relating to such Collateral.

 

“Pro Rata Share”:  With respect to any Lender, (a) prior to the termination of
the Commitments, the percentage obtained by dividing such Lender’s Commitment by
the total Commitments of all Lenders hereunder, and (b) on and after the date of
the termination of the Commitments, the percentage obtained by dividing the
Loans funded by such Lender by the aggregate Loans Outstanding.

 

“Proposed Facility”:  Has the meaning provided in Section 13.18.

 

“Purchase Agreement”:  That certain purchase agreement, dated as of December 10,
2008, between the Trust I Borrower, the LLC Borrower and the Trust II Borrower,
as amended from time to time.

 

“Purchase and Sale Agreement”:  Individually, each receivables purchase
agreement among a Seller, the Originator and the other parties thereto pursuant
to which the Originator acquires Receivables.

 

“Purchase Price”:  As applicable, (i) the aggregate purchase price paid by the
Originator to the applicable Seller for Receivables pursuant to the applicable
Purchase and Sale Agreement, (ii) the initial amount funded by the Trust
Borrower with respect to Receivables pursuant to the Sourcing and Servicing
Agreement or (iii) the “Purchase Price” as defined in the Purchase Agreement for
any sale of Receivables by the Trust Borrower or the LLC Borrower, as
applicable, to the Trust II Borrower).

 

“Qualified Institution”:  A depository institution or trust company reasonably
acceptable to the Administrative Agent and the Borrowers, that is organized
under the laws of the United States of America or any one of the States thereof
or the District of Columbia (or any domestic branch of a foreign bank),
(i)(a) that has either (1) a long-term unsecured debt rating of “A” or better by
S&P and “A2” or better by Moody’s or (2) a short-term unsecured debt rating or
certificate of deposit rating of “A-1” or better by S&P and “P-1” by Moody’s,
(b) the parent corporation of which has either (1) a long-term unsecured debt
rating of “A” or better by S&P and “A2” or better by Moody’s or (2) a short-term
unsecured debt rating or certificate of deposit rating of “A-1” or better by S&P
and “P-1” by Moody’s or (c) is otherwise acceptable to the Administrative Agent
and (ii) the deposits of which are insured by the FDIC.

 

“Rating Agency”:  Each of S&P and Moody’s.

 

“Receivables”:  Any (i) consumer loan originated or created by a Seller (or by a
Dealer on behalf of a Seller) and subsequently sold by such Seller to the
Originator pursuant to a Purchase and Sale Agreement and sold by the Originator
to the LLC Borrower pursuant to the

 

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Sale Agreement or (ii) “Eligible Investment” (as defined in the Sourcing and
Servicing Agreement) acquired by the Trust Borrower pursuant to the Sourcing and
Servicing Agreement.

 

“Receivables List”:  The list of Receivables in the form of Schedule IV hereto,
that identifies each (i) Obligor name, (ii) original principal balance of the
Receivable, (iii) contract number or other identifying number, (iv) the
applicable Dealer name (if applicable), and (v) whether such Receivable is a
revolving contract, as such list may be amended, supplemented or modified from
time to time in accordance with this Agreement.

 

“Records”:  All documents relating to the Receivables, including books, records
and other information executed in connection with the origination or acquisition
of the Receivables and Related Security or maintained with respect to the
Receivables and Related Security and the related Obligors that the Borrowers,
the Originator, or the Servicer have generated, in which the applicable Borrower
has acquired an interest pursuant to its Sale Agreement or in which such
Borrower or the Servicer have otherwise obtained an interest.

 

“Recoveries”:  With respect to any Defaulted Receivable, the proceeds from the
sale or other disposition of the Receivable (including any amounts received from
a Dealer under its buyback obligations under its Dealer Agreement), any other
recoveries with respect to such Defaulted Receivable, the Related Security and
amounts representing late fees and penalties, net of Liquidation Expenses and
amounts, if any, received that are required under such Defaulted Receivable, to
be refunded to the related Obligor.

 

“Regulation U”:  Regulation U of the Board of Governors of the Federal Reserve
System, 12 C.F.R. §221, or any successor regulation.

 

“Related Security”:  As used in (1) the LLC Borrower’s Sale Agreement, all
right, title and interest of the Originator in and to the following clauses (a),
(b), (c), (d), (f), (g), (h) and (i), and (2) this Agreement, all right, title
and interest of the Borrowers in and to the following clauses (a) through (i):

 

(a)                                any and all Recoveries related to a
Receivable, all payments paid in respect thereof and all monies due, to become
due and paid in respect thereof and all liquidation proceeds;

 

(b)                               the Required Receivable Files and Servicing
Files related to any Receivable, any Records, and the documents, agreements, and
instruments included in the Servicing File or Records;

 

(c)                                all Liens, guaranties, indemnities,
warranties, letters of credit, accounts, bank accounts and property subject
thereto from time to time purporting to secure or support payment of any
Receivable, together with all UCC financing statements, mortgages or similar
filings signed or authorized by an Obligor relating thereto;

 

(d)                               the Accounts, the Concentration Account and
the Lockbox Accounts, to the extent amounts on deposit therein or credited
thereto relate to the Collateral, together with all cash and investments in each
of the foregoing other than amounts earned on investments therein (excluding any
Excluded Amounts that may be on deposit therein);

 

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(e)                                such Borrower’s respective Sale Agreement and
the assignment of such Sale Agreement (including, without limitation, rights of
recovery of the LLC Borrower against the Originator and any guaranty, indemnity
and repurchase obligations of the Originator thereunder and the Trust Borrower
and the Trust II Borrower against the Sourcer and any guaranty, indemnity and
repurchase obligations of the Sourcer thereunder);

 

(f)                                  with respect to the LLC Borrower, each
Purchase and Sale Agreement and the assignment of such Purchase and Sale
Agreement (including, without limitation, rights of recovery of the Originator
against the Seller and any guaranty, indemnity and repurchase obligations of the
Seller thereunder) and the Dealer Agreements and the assignment of such Dealer
Agreements (including, without limitation, rights of recovery against the
Dealers, and the buyback obligations (if any) of the applicable Dealers
thereunder);

 

(g)                               the assignment to the Administrative Agent, as
agent for the Secured Parties, of all UCC financing statements filed by (i) the
LLC Borrower against the Originator under or in connection with its Sale
Agreement, (ii) the Trust II Borrower against the LLC Borrower and the Trust
Borrower under or in connection with its Sale Agreement and (iii) the Originator
against the Sellers under or in connection with the Purchase and Sale
Agreements;

 

(h)                               all records (including computer records) with
respect to the foregoing; and

 

(i)                                   all collections, income, payments,
proceeds and other benefits of each of the foregoing.

 

“Reporting Date”:  The date that is five (5) Business Days prior to each Payment
Date.

 

“Required Lenders”:  As of any date, the Lenders holding an aggregate of more
than 66.67% of the Loans Outstanding as of such date.

 

“Required Receivable File”:  For each Receivable, (i) the original executed
contract (or a copy of the original executed contract to the extent that such
contract evidences two separate financings and the original executed contract
has previously been delivered to the Collateral Custodian with respect to one of
the financings evidenced by such contract), (ii) all principal security
documents related thereto as indicated on the Receivables List, (iii) on a
receivables program by receivables program basis, each other category of
documents identified by the Administrative Agent for such program as indicated
in writing to the Collateral Custodian, and (iv) the original executed Purchase
and Sale Agreement with respect to such Receivable, if applicable (provided that
a Purchase and Sale Agreement need only be delivered/included one time in
connection with the initial acquisition thereunder).

 

“Required Reduction Amount”:  As of any Measurement Date, an amount equal to the
positive difference, if any, of (a) the Loans Outstanding on such day over
(b) the Maximum Outstanding Loan Amount.

 

“Required Reports”:  Collectively, the Servicing Report, the Servicer’s
Certificate required pursuant to Section 6.8, and the annual statements as to
compliance required pursuant to Section 6.9.

 

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“Responsible Officer”:  With respect to any Person, any duly authorized officer
of such Person with direct responsibility for the administration of this
Agreement and also, with respect to a particular matter, any other duly
authorized officer of such Person to whom such matter is referred because of
such officer’s knowledge of and familiarity with the particular subject and, for
purposes of the LLC Borrower and the Trust Borrower, the initial Servicer and
the Originator, the Responsible Officers shall be the Key Employees.

 

“Retained Interest”:  With respect to a Receivable with an unfunded commitment
that does not provide by its terms that funding thereunder is in the applicable
Borrower’s sole and absolute discretion, all of the obligations of the lender
thereunder or holder thereof to provide additional funding with respect to such
Receivable.

 

“Review Criteria”:  Defined in Section 8.2(b).

 

“Revolving Period”:  The period commencing on the Closing Date and ending on the
Termination Date.

 

“S&P”:  Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., and
any successor thereto.

 

“Sale Agreement”:  With respect to the LLC Borrower, the Purchase and
Contribution Agreement, dated as of the Closing Date, with respect to both the
Trust Borrower, the Sourcing and Servicing Agreement, and, with respect to the
Trust II Borrower, the Purchase Agreement.

 

“Scheduled Payment”:  Each scheduled payment of principal and/or interest
required to be made by an Obligor on the related Receivable, as adjusted
pursuant to the terms of the related Required Receivable File, if applicable.

 

“Secured Party”:  Each Lender and the Administrative Agent.

 

“Securities Account”:  The meaning specified in Section 8-501 of the UCC.

 

“Securities Account Control Agreement”:  The Securities Account Control
Agreement, dated as of the Closing Date, among the LLC Borrower, the Servicer,
the Administrative Agent, and the Collateral Custodian, as the Securities
Intermediary (as amended from time to time).

 

“Securities Intermediary”:  (i) A Clearing Corporation; or (ii) a Person,
including a bank or broker, that in the ordinary course of its business
maintains Securities Accounts for others and is acting in that capacity.

 

“Security”:  The meaning specified in Section 9-102(a)(15) of the UCC.

 

“Security Certificate”:  The meaning specified in Section 8-102(a)(16) of the
UCC.

 

“Security Entitlement”:  The meaning specified in Section 8-102(a)(17) of the
UCC.

 

“Seller”:  Each Person party to a Purchase and Sale Agreement (as a Seller) with
the Originator, and, with respect to the Sourcing and Servicing Agreement, the
Sourcer.

 

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“Servicer”: Defined in the Preamble.

 

“Servicer Default”:  Defined in Section 6.12.

 

“Servicer Termination Notice”:  Defined in Section 6.12.

 

“Servicer’s Certificate”:  Defined in Section 6.8(b).

 

“Servicing Fee”:  The servicing fee payable to the Servicer or the successor
Servicer on each Payment Date in arrears in respect of each Collection Period,
which fee shall be equal to the product of (i) the Servicing Fee Rate, (ii) the
Aggregate Outstanding Receivable Balance as of the first Business Day of the
related Collection Period and (iii) the actual number of days in such Collection
Period divided by 360.

 

“Servicing Fee Rate”:  0.50% or such other rate consented to in writing by the
LLC Borrower, the Servicer and the Administrative Agent.

 

“Servicing File”:  For each Receivable, (i) copies (as opposed to originals) of
each of the documents included in the Required Receivable File definition,
(ii) to the extent applicable for the related Receivable, the original executed
(a) guaranty, (b) credit agreement, (c) loan agreement, (d) note purchase
agreement, (e) promissory note, (f) acquisition agreement (or similar
agreement), (g) security agreement and (h) UCC financing statement(s), in each
case as set forth on the Receivables List, (iii) to the extent applicable for
the related Receivable, copies of (a) the phone verification form confirming
that goods financed were received by the Obligor, (b) the Obligor’s credit
report, (c) the related credit application and (d) any and all other items
required by the credit and underwriting guidelines of the applicable Seller, and
(iv) to the extent applicable for the related Receivable, a copy of the
applicable Dealer Agreement (if any) with respect to such Receivable.

 

“Servicing Report”:  Defined in Section 6.8(a).

 

“Servicing Standard”:  With respect to any Receivables, to service and
administer such Receivables on behalf of the Secured Parties in accordance with
the Underlying Instruments and all customary and usual servicing practices
(a) which are consistent with the higher of:  (i) the customary and usual
servicing practices that a prudent loan lender would use in servicing loans like
the Receivables for its own account, and (ii) the same care, skill, prudence and
diligence with which the Servicer services and administers loans for its own
account or for the account of others; (b) with a view to maximize the value of
the Receivables; and (c) without regard to:  (i) any relationship that the
Servicer or any Affiliate of the Servicer may have with any Obligor or any
Affiliate of any Obligor, (ii) the Servicer’s obligations to incur servicing and
administrative expenses with respect to a Receivable, (iii) the Servicer’s right
to receive compensation for its services hereunder or with respect to any
particular transaction, (iv) the ownership by the applicable Borrower of any
Receivables, (v) the ownership, servicing or management for others by the
Servicer of any other loans or property by the Servicer or (vi) any relationship
that the Servicer or any Affiliate of the Servicer may have with any holder of
other loans of the Obligor with respect to such Receivables; provided that, with
respect to any successor Servicer, the “Servicing Standard” shall be the higher
of the same care, skill and

 

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diligence with which such successor Servicer services and administers loans for
its own account or for the account of others.

 

“SIC Codes”:  In connection with any Receivable, the “standard industrial
classification code” assigned to the industry in which such Receivable is
utilized, as set forth in Schedule V. The initial Servicer shall determine the
industrial classification code unless the Administrative Agent in its sole
discretion disagrees with such determination, in which case the decision of the
Administrative Agent as to such industrial classification code shall be
conclusive and binding on the parties hereto absent manifest error.

 

“Solvent”:  As to any Person at any time, having a state of affairs such that
all of the following conditions are met:  (a) the fair value of the property of
such Person is greater than the amount of such Person’s liabilities (including
disputed, contingent and unliquidated liabilities) as such value is established
and liabilities evaluated for purposes of Section 101(32) of the Bankruptcy
Code; (b) the present fair saleable value of the property of such Person in an
orderly liquidation of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its debts and other
liabilities as they become absolute and matured; (c) such Person is able to
realize upon its property and pay its debts and other liabilities (including
disputed, contingent and unliquidated liabilities) as they mature in the normal
course of business; (d) such Person does not intend to, and does not believe
that it will, incur debts or liabilities beyond such Person’s ability to pay as
such debts and liabilities mature; and (e) such Person is not engaged in a
business or a transaction, and does not propose to engage in a business or a
transaction, for which such Person’s property assets would constitute
unreasonably small capital.

 

“Sourcer”:  *****, a Delaware limited liability company.

 

“Sourcing and Servicing Agreement”:  That certain sourcing and servicing
agreement, dated as of the Effective Date, between the Sourcer and the Trust
Borrower (as amended from time to time).

 

“Structuring Fee”:  Defined in Section 2.11(b).

 

“Sub-Servicer”:  Each Person retained by the Servicer as a sub-servicer of a
pool of Receivables from time to time; provided that such sub-servicer must be
selected from the list of sub-servicers approved by the Administrative Agent on
the attached Schedule IX (as such schedule may be amended from time to time) or
otherwise approved in writing by the Administrative Agent in its sole
discretion.

 

“Sub-Servicer Fee”:  A monthly fee payable by the Servicer out of the Servicing
Fee as set forth in the related Sub-Servicing Agreement.

 

“Sub-Servicer Fee Letter”:  With respect to each Sub-Servicer and its related
Sub-Servicing Agreement, the sub-servicer fee letter by and among the LLC
Borrower, the Servicer and the applicable Sub-Servicer executed in connection
with such Sub-Servicing Agreement.

 

“Sub-Servicing Agreement”:  Each sub-servicing agreement entered into by the
Servicer in accordance with the terms of this Agreement.

 

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“Subsidiary”:  As to any Person, a corporation, partnership or other entity of
which shares of stock or other ownership interests having ordinary voting power
(other than stock or such other ownership interests having such power only by
reason of the happening of a contingency) to elect a majority of the board of
directors or other managers of such corporation, partnership or other entity are
at the time owned, or the management of which is otherwise controlled, directly
or indirectly, through one or more intermediaries, or both, by such Person.

 

“Substitute Receivable”:  Defined in Section 2.15.

 

“Successor Servicer”:  Defined in Section 6.13(a).

 

“Tangible Net Worth”:  With respect to any Person, as of any date of
determination, the total equity of such Person as of such date (including all
subordinated debt maturing after the Maturity Date) less the goodwill and other
intangibles, if any, all determined on a consolidated basis in accordance with
GAAP.

 

“Tape”:  Defined in Section 7.2(b).

 

“Taxes”:  Any present or future taxes, levies, imposts, duties, charges,
assessments or fees of any nature (including interest, penalties, and additions
thereto) that are imposed by any Governmental Authority.

 

“Term Credit Agreement”:  That certain Credit Agreement, dated as of July 20,
2007, among *****, as originator and guarantor, *****, as servicer, *****, as
borrower, *****, as administrative agent, and the other parties thereto.

 

“Termination Date”:  The earliest of (a) the Business Day designated by the
Borrowers (collectively) to the Administrative Agent as the Termination Date at
any time following two Business Days’ prior written notice thereof to the
Administrative Agent, (b) the Maturity Date, and (c) the date of the declaration
of the Termination Date or the date of the automatic occurrence of the
Termination Date pursuant to Section 10.2(a) as a result of an Event of Default.

 

“Term Loan”:  The “Loan” as defined under the Term Credit Agreement.

 

“Transaction”:  Defined in Section 3.2.

 

“Transaction Documents”:  This Agreement, the Sale Agreements, the Securities
Account Control Agreement, the Concentration Account Agreement, the Variable
Funding Notes, any Joinder Supplement, each Purchase and Sale Agreement, each
Sub-Servicing Agreement, the Backup Servicer Fee Letter, the Collateral
Custodian Fee Letter, each Sub-Servicer Fee Letter and any additional document
the execution of which is necessary or incidental to carrying out the terms of
the foregoing documents.

 

“Transition Expenses”:  The reasonable costs (including reasonable attorneys’
fees) of the Backup Servicer incurred in connection with transferring the
servicing obligations under this Agreement and amending this Agreement to
reflect such transfer.

 

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“Trigger Event”:  Defined in Section 14.1.

 

“Trust Borrower”: Defined in the Preamble.

 

“Trust II Borrower”: Defined in the Preamble.

 

“UCC”:  The Uniform Commercial Code as from time to time in effect in the
applicable jurisdiction or jurisdictions.

 

“Uncertificated Security”:  The meaning specified in Section 8-102(a)(l8) of the
UCC.

 

“Underlying Instruments”:  With respect to any Receivable, each agreement that
governs the terms of or secures the obligations represented by such Receivable
or of which the holders of such Receivable are the beneficiaries.

 

“United States”:  The United States of America.

 

“Unmatured Event of Default”:  Any event that, solely with the giving of notice
or the lapse of time, or both, would become an Event of Default.

 

“Unused Fee”:  Defined in Section 2.11(a).

 

“Variable Funding Notes” or “VFNs”:  Defined in Section 2.1.

 

“Warranty Event”:  As to any Receivable, the discovery that as of the Closing
Date there existed a material breach of any representation or warranty relating
to such Receivable and the failure of the applicable Borrower to cure such
breach, or cause the same to be cured, within 30 days after the earlier to occur
of receipt of notice thereof by a Responsible Officer of such Borrower or actual
knowledge thereof by a Responsible Officer of such Borrower; it being understood
that Warranty Events are not intended to have the effect of credit recourse for
uncollectible Receivables or for future diminution in value of the Collateral.

 

Section 1.2.                                          Other Terms.

 

All accounting terms used but not specifically defined herein shall be construed
in accordance with GAAP. All terms used in Article 9 of the UCC in the State of
New York, and used but not specifically defined herein, are used herein as
defined in such Article 9.

 

Section 1.3.                                          Computation of Time
Periods.

 

Unless otherwise stated in this Agreement, in the computation of a period of
time from a specified date to a later specified date, the word “from” means
“from and including” and the words “to” and “until” each mean “to but
excluding.”

 

Section 1.4.                                          Interpretation.

 

In each Transaction Document, unless a contrary intention appears:

 

(a)                                  the singular number includes the plural
number and vice versa;

 

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(b)                                 reference to any Person includes such
Person’s successors and assigns but, if applicable, only if such successors and
assigns are permitted by the Transaction Documents;

 

(c)                                  reference to any gender includes each other
gender;

 

(d)                                 reference to day or days without further
qualification means calendar days;

 

(e)                                  reference to any time means New York City
time;

 

(f)                                    reference to any agreement (including any
Transaction Document), document or instrument means such agreement, document or
instrument as amended, modified, waived, supplemented, restated or replaced and
in effect from time to time in accordance with the terms thereof and, if
applicable, the terms of the other Transaction Documents, and reference to any
promissory note includes any promissory note that is an extension or renewal
thereof or a substitute or replacement therefor; and

 

(g)                                 reference to any Applicable Law means such
Applicable Law as amended, modified, codified, replaced or reenacted, in whole
or in part, and in effect from time to time, including rules and regulations
promulgated thereunder and reference to any Section or other provision of any
Applicable Law means that provision of such Applicable Law from time to time in
effect and constituting the substantive amendment, modification, codification,
replacement or reenactment of such Section or other provision.

 

ARTICLE II

 

THE VARIABLE FUNDING NOTES

 

Section 2.1.                                        The Variable Funding Notes.

 

(a)                                  On the terms and conditions hereinafter set
forth, the Borrowers shall deliver on the Effective Date to the Administrative
Agent, on behalf of the Lenders, two duly executed variable funding notes in
substantially the form of Exhibit B-1 (the “A-1 Variable Funding Note” or “A-1
VFN”) and Exhibit B-2 (the “A-2 Variable Funding Note” or “A-2 VFN”, and,
together with the A-1 Variable Funding Note, the “Variable Funding Notes” or
“VFNs”), dated as of the date of this Agreement, and otherwise duly completed.
The face amount and maximum principal balance of the A-1 Variable Funding Note
shall be $25,000,000 and the face amount and maximum principal balance of the
A-2 Variable Funding Note shall equal the difference between the amount of the
aggregate Commitments and the maximum principal balance of the A-1 Variable
Funding Note (which amount shall be $25,000,000 on the Closing Date).  Each
Lender’s Commitment shall be allocated ratably to the A-1 Variable Funding Note
and the A-2 Variable Funding Note in accordance with its Pro Rata Share.

 

(b)                                 During the Revolving Period, a Borrower may,
at its option, request the Lenders to make Loans of funds under the VFNs
pursuant to a Funding Request delivered to the Administrative Agent. Following
the receipt of a Funding Request, the Administrative Agent shall promptly notify
the Lenders of receipt thereof, and subject to the terms and conditions
hereinafter set forth, the Lenders shall fund such Loan. Notwithstanding
anything to the contrary herein, no Lender shall be obligated to provide a
Borrower with funds in connection with a Loan

 

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that would exceed the Lender’s unused Commitment then in effect. Notwithstanding
anything to the contrary contained herein, (i)  Loans shall be made solely under
the A-1 Variable Funding Note, up to the maximum principal balance thereof,
before any Loans shall be made under the A-2 Variable Funding Note, and (ii) in
the event of any reduction in the outstanding principal balance of the
A-1 Variable Funding Note after such time as such balance has reached the
maximum principal balance of the A-1 Variable Funding Note, Loans thereafter
shall again be made solely under the A-1 Variable Funding Note, up to the
maximum principal balance thereof, before any Loans shall be made under the
A-2 Variable Funding Note.

 

(c)                                  The Borrowers may, within 60 days but not
less than 30 days prior to the Maturity Date, by written notice to the
Administrative Agent, make a request for each Lender to extend the Maturity Date
for an additional period of 364 days. The Administrative Agent shall promptly
notify each Lender of receipt of such notice. The Administrative Agent and each
Lender shall make a determination, in their sole discretion, within 15 days of
the date of the applicable Borrower’s request for such extension, as to whether
or not it will agree to the applicable extension requested. The failure of the
Administrative Agent and each Lender to provide timely notice of its decision to
the Borrowers shall be deemed to constitute a refusal by the Administrative
Agent and each Lender to extend the applicable date. Each Borrower confirms that
the Administrative Agent and each Lender, in their sole and absolute discretion,
without regard to the value or performance of the Collateral or any other
factor, may elect not to extend the Maturity Date. The Borrowers shall give
prompt notice to the Backup Servicer and the Collateral Custodian as to whether
or not the Maturity Date has been extended. In the event that the Administrative
Agent rejects (or is deemed to reject) a request by the Borrowers under this
Section 2.1(c), then the Administrative Agent acknowledges that the right of
first refusal set forth in Section 13.18 shall not apply with respect to any
facilities proposed to close on or after the Facility Termination Date.

 

(d)                                 The Borrowers may, with the written consent
of the Administrative Agent and the applicable Lender, add additional Persons as
Lenders or cause an existing Lender to increase its Commitment in connection
with a corresponding increase in the Facility Amount. Each additional Lender
shall become a party hereto by executing and delivering to the Administrative
Agent and the Borrowers a Joinder Supplement.

 

Section 2.2.                                          Procedures for Loans by
Lenders.

 

(a)                                  No later than (I) two (2) Business Days
prior to each proposed Funding Date with respect to Receivables being acquired
from Sellers of Receivables included in the Collateral on a prior Funding Date
and (II) five (5) Business Days prior to each proposed Funding Date with respect
to Receivables being acquired from Sellers of Receivables not previously
included in the Collateral, the Borrowers shall deliver (or cause to be
delivered):

 

(i)                                     to the Administrative Agent, the Backup
Servicer and the Collateral Custodian, written notice of such proposed Funding
Date (including a duly completed Borrowing Base Certificate updated to the date
such Loan is requested and giving pro forma effect to the Loan requested and the
use of the proceeds thereof);

 

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(ii)                                  to the Administrative Agent, a wire
disbursement and authorization form, to the extent not previously delivered; and

 

(iii)                               to the Administrative Agent and the
Collateral Custodian, a duly completed Funding Request which shall (a) specify
the desired amount of such Loan, which amount must be at least equal to
$250,000, (b) specify the proposed Funding Date of such Loan, (c) specify the
Receivables to be financed on such Funding Date, including the appropriate file
number and Outstanding Receivable Balance for each such Receivable, and
(d) include a representation that all conditions precedent for a Loan described
in Article III hereof have been met.

 

(b)                                 Each Funding Request shall be irrevocable
and the Borrowers shall be limited to two (2) Loans per week (in total);
provided that the Lenders in their sole discretion may allow for additional
Loans to be made in excess of the above limitation; provided further that each
such additional Loan, if approved, shall be subject to a $2,500 administration
fee.

 

(c)                                  On the proposed Funding Date, subject to
the limitations set forth in Section 2.1(b) and upon satisfaction of the
applicable conditions set forth in Article III, each Lender shall make available
to the applicable Borrower in same day funds, at such bank or other location
reasonably designated by the applicable Borrower in the Funding Request given
pursuant to this Section 2.2, an amount equal to such Lender’s Pro Rata Share of
the least of (i) the amount requested by the Borrowers for such Loan, (ii) the
aggregate unused Commitments then in effect, and (iii) an amount equal to the
Maximum Outstanding Loan Amount on such Funding Date.

 

(d)                                 On each Funding Date, the obligation of each
Lender to remit its Pro Rata Share of any such Loan shall be several from that
of each other Lender and the failure of any Lender to so make such amount
available to the Borrowers shall not relieve any other Lender of its obligation
hereunder.

 

Section 2.3.                                          Restriction on Repayments.

 

No Borrower shall be permitted to repay the Loans Outstanding applicable to it
prior to the eighteen (18) month anniversary of the Closing Date. Thereafter,
the Borrowers shall be entitled, at their option, to repay in whole or in part
the Loans Outstanding; provided that (i) the Borrowers shall give ten
(10) Business Days’ prior written notice of such repayment substantially in the
form of Exhibit A-2 to the Administrative Agent and (ii) the Borrowers shall pay
the related Prepayment Premium in connection therewith. Notwithstanding the
foregoing, (A) if the Borrowers repay the Loans Outstanding in full prior to the
eighteen (18) month anniversary of the Closing Date, the Borrowers shall pay the
Full Prepayment Make-Whole Fee to the Administrative Agent, for the benefit of
the Lenders and (B) if the Borrowers repay the Loans Outstanding in part prior
to the eighteen (18) month anniversary of the Closing Date, the Borrowers shall
pay the Partial Prepayment Make-Whole Fee to the Administrative Agent, for the
benefit of the Lenders on the first Business Day following the eighteen (18)
month anniversary of the Closing Date. In connection with any such reduction of
Loans Outstanding, the Borrowers shall deliver to the Administrative Agent
(i) instructions to reduce such Loans Outstanding and (ii) funds sufficient to
repay such Loans Outstanding and all accrued interest

 

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with respect thereto. The Administrative Agent shall promptly notify the Lenders
of receipt of such instructions and shall apply amounts received from the
Borrowers pursuant to this Section 2.3 to the payment of Loans Outstanding. Any
Notice of Reduction of Loans Outstanding relating to any repayment pursuant to
this Section 2.3 shall be irrevocable. Reductions of Loans Outstanding shall be
applied ratably to the A-1 VFN and A-2 VFN based on the respective outstanding
principal balances thereof. For the avoidance of doubt, the application of
Collections received in the ordinary course shall not constitute a “repayment”
or “prepayment” by the Borrowers for purposes of this Section 2.3.

 

Section 2.4.                                          Determination of Interest.

 

(a)                                  The Administrative Agent shall determine,
in accordance with the terms of this Agreement, the Interest Rate and the
Interest (including unpaid Interest related thereto, if any, due and payable on
a prior Payment Date) to be paid by the Borrowers with respect to the Loans on
each Payment Date for the related Accrual Period and shall advise the Servicer
and each Lender thereof not later than 2:00 p.m. on the third Business Day
following the end of each Collection Period. The Borrowers shall pay all
Interest due for each applicable Accrual Period pursuant to Section 2.7 or 2.8,
as applicable.

 

(b)                                 Anything in this Agreement or the other
Transaction Documents to the contrary notwithstanding, if at any time the rate
of interest payable by any Person under this Agreement and the Transaction
Documents exceeds the highest rate of interest permissible under Applicable Law
(the “Maximum Lawful Rate”), then, so long as the Maximum Lawful Rate would be
exceeded, the rate of interest under this Agreement and the Transaction
Documents shall be equal to the Maximum Lawful Rate. If at any time thereafter
the rate of interest payable under this Agreement and the Transaction Documents
is less than the Maximum Lawful Rate, such Person shall continue to pay interest
under this Agreement and the Transaction Documents at the Maximum Lawful Rate
until such time as the total interest received from such Person is equal to the
total interest that would have been received had Applicable Law not limited the
interest rate payable under this Agreement and the Transaction Documents. In no
event shall the total interest received by a Lender under this Agreement and the
Transaction Documents exceed the amount that such Lender could lawfully have
received, had the interest due under this Agreement and the Transaction
Documents been calculated since the Closing Date at the Maximum Lawful Rate.

 

Section 2.5.                                          Notations on Variable
Funding Notes.

 

The Administrative Agent is hereby authorized to enter on a schedule attached to
the VFNs a notation (which may be computer generated) or to otherwise record in
its internal books and records or computer system with respect to each Loan
under the applicable VFN made by each Lender of (a) the date and principal
amount thereof and (b) each payment and repayment of principal thereof. Any such
recordation shall, absent manifest error, constitute prima facie evidence of the
Loans Outstanding under such VFN. The failure of the Administrative Agent to
make any such notation on the schedule attached to a VFN shall not limit or
otherwise affect the obligation of the Borrowers to repay the Loan in accordance
with the terms set forth herein.

 

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Section 2.6.                                          Principal Repayments.

 

(a)                                  Unless sooner prepaid pursuant to
Section 2.3, Section 2.7, Section 2.8 or Section 10.2, the Loans Outstanding
shall be repaid in full on the Termination Date (with such payments to be
applied ratably to the A-1 VFN and the A-2 VFN based on the respective
outstanding principal balances thereof).

 

(b)                                 If at any time the Loans Outstanding exceed
the Maximum Outstanding Loan Amount (including as a result of an Eligible
Receivable becoming a Defaulted Receivable), the Borrowers shall within five
(5) Business Days of the actual knowledge of such shortfall by a Responsible
Officer cure such shortfall by (i) depositing into the Collection Account
amounts sufficient to reduce the Loans Outstanding (with such payments to be
applied ratably to the A-1 VFN and the A-2 VFN based on the respective
outstanding principal balances thereof) or (ii) adding additional Eligible
Receivables to the Collateral.

 

Section 2.7.                                          Settlement Procedures
During the Revolving Period.

 

On each Payment Date during the Revolving Period, the Servicer shall direct the
Collateral Custodian to pay pursuant to the Servicing Report (and the Collateral
Custodian shall make payment from the Collection Account to the extent of
Available Funds in reliance on the information set forth in such Servicing
Report) to the following Persons, the following amounts in the following order
of priority:

 

(1)                                  to each Hedge Counterparty, pro rata, based
on the respective amounts owed under all Interest Rate Hedge Transactions
related thereto, including any unpaid Hedge Breakage Costs with respect thereto;

 

(2)                                  (A) first, to each Sub-Servicer, in an
amount equal to the lesser of (I) any accrued and unpaid Sub-Servicer Fees and
(II) an amount equal to the Servicing Fees accrued with respect to the
Receivables subserviced by the applicable Sub-Servicer and (B) second, to the
Servicer, in an amount equal to any accrued and unpaid Servicing Fees (less any
Sub-Servicer Fees distributed under clause (A)) and any reimburseable expenses
of any successor Servicer; provided that for so long as ***** is the Servicer it
shall not be entitled to any Servicing Fees pursuant to this clause (2);

 

(3)                                  pro rata in accordance with the amounts due
under this clause and to the extent not paid by the Originator, to the Backup
Servicer and the Collateral Custodian, pro rata, in an amount equal to (i) any
accrued and unpaid Backup Servicing Fees, Collateral Custodian Fees and
Transition Expenses, and (ii) incurred but unreimbursed reasonable third-party,
out-of-pocket expenses relating to their respective duties as Backup Servicer or
Collateral Custodian hereunder, in respect of which the Backup Servicer or the
Collateral Custodian, as applicable, has provided prior written notice setting
forth such expenses in reasonable detail to the Servicer and the Administrative
Agent, for the payment thereof, provided that amounts payable pursuant to this
sub-clause (ii) shall not exceed $5,000 for any Payment Date;

 

(4)                                  to the Administrative Agent, on behalf of
the Lenders, in an amount equal to any accrued and unpaid Interest, Unused Fees
and any other fees or expenses due and payable to the Lenders hereunder;

 

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(5)                                  to the Administrative Agent, for the
account of each applicable Lender in reduction of the Loans Outstanding, an
amount equal to the Required Reduction Amount, if any;

 

(6)                                  to *****, for so long as it is the
Servicer, in an amount equal to any accrued and unpaid Servicing Fees (less any
Sub-Servicer Fees paid pursuant to clause (2)(A) above);

 

(7)                                  pro rata in accordance with the amounts due
under this clause, to the Administrative Agent, any applicable Lender, the
Backup Servicer, the Collateral Custodian, any successor Servicer, the
Indemnified Parties or the Secured Parties, all other amounts, including any
expenses, Increased Costs, Taxes or Indemnified Amounts, but other than the
principal and interest of the Loans Outstanding, then due under this Agreement;
and

 

(8)                                  to the extent that, after giving effect to
such release, the Maximum Outstanding Loan Amount would exceed $0, any remaining
amounts shall be distributed to the Borrowers as directed by the Servicer.

 

Section 2.8.                                          Settlement Procedures
During the Amortization Period.

 

On each Payment Date during the Amortization Period, the Servicer shall direct
the Collateral Custodian to pay pursuant to the Servicing Report (and the
Collateral Custodian shall make payment from the Collection Account to the
extent of Available Funds in reliance on the information set forth in such
Servicing Report) to the following Persons, the following amounts in the
following order of priority:

 

(1)                                  to each Hedge Counterparty, pro rata, based
on the respective amounts owed under all Interest Rate Hedge Transactions
related thereto, including any unpaid Hedge Breakage Costs with respect thereto;

 

(2)                                  (A) first, to each Sub-Servicer, in an
amount equal to the lesser of (I) any accrued and unpaid Sub-Servicer Fees and
(II) an amount equal to the Servicing Fees accrued with respect to the
Receivables subserviced by the applicable Sub-Servicer and (B) second, to the
Servicer, in an amount equal to any accrued and unpaid Servicing Fees (less any
Sub-Servicer Fees distributed under clause (A)) and any reimburseable expenses
of any successor Servicer; provided that for so long as ***** is the Servicer it
shall not be entitled to any Servicing Fees pursuant to this clause (2);

 

(3)                                  pro rata in accordance with the amounts due
under this clause and to the extent not paid by the Originator, to the Backup
Servicer and the Collateral Custodian, pro rata, in an amount equal to (i) any
accrued and unpaid Backup Servicing Fees, Collateral Custodian Fees and
Transition Expenses, and (ii) incurred but unreimbursed reasonable third-party,
out-of-pocket expenses relating to their respective duties as Backup Servicer or
Collateral Custodian hereunder, in respect of which the Backup Servicer or the
Collateral Custodian, as applicable, has provided prior written notice setting
forth such expenses in reasonable detail to the Servicer and the Administrative
Agent, for the payment thereof; provided that amounts payable pursuant to this
sub-clause (ii) shall not exceed $5,000 for any Payment Date;

 

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(4)                                  to the Administrative Agent, on behalf of
the Lenders, in an amount equal to any accrued and unpaid Interest, Unused Fee
and any other fees or expenses due and payable to the Lenders hereunder;

 

(5)                                  to the Administrative Agent, for the
account of each applicable Lender, an amount necessary to reduce the Loans
Outstanding and other Aggregate Unpaids payable to the Lender hereunder to zero;

 

(6)                                  to *****, for so long as it is the
Servicer, in an amount equal to any accrued and unpaid Servicing Fees (less any
Sub-Servicer Fees period pursuant to clause(2)(A) above);

 

(7)                                  pro rata in accordance with the amounts due
under this clause, to the Backup Servicer, the Collateral Custodian, any
successor Servicer, the Indemnified Parties or the Secured Parties, all other
amounts, including any Increased Costs, Taxes or Indemnified Amounts; and

 

(8)                                  any remaining amounts shall be distributed
to the Borrowers as directed by the Servicer.

 

Section 2.9.                                          Collections and
Allocations.

 

(a)                                  Collections. The Servicer shall (or shall
cause the applicable Sub-Servicer to do so on its behalf) direct each Obligor on
the Receivables to make payments only to one of the Lockbox Accounts listed on
Schedule VI, as such Schedule VI may be amended from time to time. The LLC
Borrower, the Servicer and the Trust II Borrower shall wire transfer, or cause
to be wire transferred, all Collections received in the Lockbox Accounts related
to Receivables acquired by the LLC Borrower pursuant to its Sale Agreement (or,
in the case of the Trust II Borrower, the Receivables acquired by it from the
LLC Borrower pursuant to the Purchase Agreement) or received directly by it to
the Collection Account by the close of business on the Business Day following
receipt. The Trust Borrower and the Trust II Borrower shall wire transfer, or
cause to be wire transferred, to the Concentration Account by the close of
business on each Business Day, all Collections received in the Lockbox Accounts
related to Receivables acquired by either of the Trust Borrower and the Trust II
Borrower pursuant to the Sourcing and Servicing Agreement or the Purchase
Agreement, as applicable, or received directly by either of them. Pursuant to
the Concentration Account Agreement, both the Trust Borrower and the Trust II
Borrower shall cause the applicable Collections to be transferred from the
Concentration Account to the Collection Account within one (1) Business Day of
deposit therein. The Servicer shall further include a statement as to the amount
of Collections on deposit in the Collection Account on each Reporting Date in
the Servicing Report delivered pursuant to Section 6.8(a).

 

(b)                                 Excluded Amounts. With the prior written
consent of the Administrative Agent, the Servicer may withdraw from the
Collection Account (not more than once per week) any deposits thereto
constituting Excluded Amounts if the Servicer has, prior to such withdrawal and
consent, delivered to the Administrative Agent a report (a copy of which
(together with the written consent of the Administrative Agent) will be provided
by the Servicer to the Backup

 

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Servicer and Collateral Custodian) setting forth the calculation of such
Excluded Amounts in form and substance reasonably satisfactory to the
Administrative Agent.

 

(c)                                  Initial Deposits. On the Funding Date with
respect to any Loan, the Servicer will direct (which direction may take the form
of standing instructions) the Collateral Custodian in writing to deposit into
the Collection Account all Collections received in respect of such Receivable
after the applicable cutoff date established in connection with the acquisition
thereof (if other than the Funding Date) and delivered to the Collateral
Custodian.

 

(d)                                 Investment of Funds. Prior to the occurrence
and continuance of an Event of Default, to the extent there are uninvested
amounts deposited in the Collection Account, all such amounts shall be invested
in Permitted Investments selected by the initial Servicer in written
instructions delivered to the Collateral Custodian (which may be in the form of
standing instructions); during the continuance of an Event of Default, to the
extent there are uninvested amounts in the Collection Account, all such amounts
may be invested in Permitted Investments selected by the Administrative Agent.
All earnings (net of losses and investment expenses) thereon shall be retained
or deposited into the Collection Account and shall be applied on each Payment
Date pursuant to the provisions of Section 2.7 or Section 2.8, as applicable.
All investments shall be subject to availability. Absent receipt of instructions
as contemplated herein, the Collateral Custodian shall have no obligation to
invest any funds. Each Permitted Investment may be purchased by or through the
Collateral Custodian or its Affiliates. The Collateral Custodian shall have no
responsibility for the performance of any Permitted Investment.

 

Section 2.10.                                   Payments, Computations, Etc.

 

(a)                                  Unless otherwise expressly provided herein,
all amounts to be paid or deposited by the Borrowers or the initial Servicer
hereunder shall be paid or deposited in accordance with the terms hereof no
later than 2:00 p.m. on the day when due in lawful money of the United States in
immediately available funds and any amount not received before such time shall
be deemed received on the next Business Day. The Borrowers or the initial
Servicer, as applicable, shall, to the extent permitted by law, pay to the
Administrative Agent (for the benefit of the applicable Secured Parties)
interest on all amounts not paid or deposited when due hereunder at the Default
Rate upon written notice of same, as applicable, payable on demand; provided
that such interest rate shall not at any time exceed the maximum rate permitted
by Applicable Law. Such interest shall be for the account of the applicable
Secured Party. All computations of interest and other fees hereunder shall be
made on the basis of a year consisting of 360 days for the actual number of days
elapsed.

 

(b)                                 Whenever any payment hereunder shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of the payment of Interest or any fee
payable hereunder, as the case may be.

 

(c)                                  If any Loan is requested by the Borrowers
pursuant to Section 2.2 and is not effectuated as a result of a Borrower’s
actions or failure to fulfill any condition under Section 3.2, as the case may
be, on the date specified therefor, the applicable Borrower shall indemnify

 

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the applicable Lenders against any reasonable direct loss, cost or expense
actually incurred by such Lenders, including, without limitation, any loss, cost
or expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by the applicable Lender to fund or maintain such Loan.

 

Section 2.11.                                   Fees.

 

(a)                                  The Borrowers shall pay in accordance with
Section 2.7(4) and Section 2.8(4) an unused fee (the “Unused Fee”), monthly in
arrears, in an amount equal to (i) the Maximum Committed Amount minus (ii) the
sum of the average daily balance of each of (w) the Loans Outstanding, and
(x) the outstanding principal balance of the Term Loan times (iii) 0.25% divided
by (iv) 12.  No Unused Fee shall accrue during the Amortization Period.

 

Section 2.12.                                   Increased Costs; Capital
Adequacy; Illegality.

 

(a)                                  If after the Closing Date either (i) the
introduction of or any change (including, without limitation, any change by way
of imposition or increase of reserve requirements) in or in the interpretation
of any Applicable Law or (ii) the compliance by a Lender with any guideline or
request from any central bank or other Governmental Authority (whether or not
having the force of law), shall (1) subject a Lender to any Tax (except net
income, gross income or franchise and similar taxes imposed on any Lender by a
taxing jurisdiction in which any such Person is organized, conducts business or
is paying taxes (as the case may be)), duty or other charge with respect to any
interest in the Collateral, or any right or obligation to make the Loan
hereunder, or on any payment made hereunder, (2) impose, modify or deem
applicable any reserve requirement (including, without limitation, any reserve
requirement imposed by the Board of Governors of the Federal Reserve System, but
excluding any reserve requirement, if any, included in the determination of
Interest), special deposit or similar requirement against assets of, deposits
with or for the amount of, or credit extended by, any Lender under this
Agreement or any other Transaction Document or (3) impose any other condition
affecting the ownership or security interest in the Collateral conveyed to the
Lenders hereunder or any Lender’s rights hereunder or under any other
Transaction Document, the result of which is to increase the cost to any Lender
or to reduce the amount of any sum received or receivable by a Lender under this
Agreement or under any other Transaction Document, then on the Payment Date
following demand by such Lender (or the next Payment Date, if such demand is
given less than five (5) days prior to a Payment Date) (which demand shall be
accompanied by a statement setting forth in reasonable detail the basis for such
demand), the Borrowers shall pay directly to such Lender such additional amount
or amounts as will compensate such Lender for such additional or increased cost
incurred or such reduction suffered.

 

(b)                                 If either (i) the introduction of or any
change in or in the interpretation of any law, guideline, rule, regulation,
directive or request or (ii) compliance by any Lender with any law, guideline,
rule, regulation, directive or request from any central bank or other
governmental authority or agency (whether or not having the force of law),
including, without limitation, compliance by a Lender with any request or
directive regarding capital adequacy, has or would have the effect of reducing
the rate of return on the capital of any Lender as a consequence of its
obligations hereunder or arising in connection herewith to a level below that
which any such Lender could have achieved but for such introduction, change or
compliance

 

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(taking into consideration the policies of such Lender with respect to capital
adequacy) by a material amount, then from time to time, on the Payment Date
following demand by such Lender (or the next Payment Date, if such demand is
given less than five (5) days prior to a Payment Date) (which demand shall be
accompanied by a statement setting forth in reasonable detail the basis for such
demand), the Borrowers shall pay directly to such Lender such additional amount
or amounts as will compensate such Lender for such reduction.  For the avoidance
of doubt, if the issuance of any amendment or supplement to Interpretation
No. 46 or to Statement of Financial Accounting Standards No. 140 by the
Financial Accounting Standards Board or any other change in accounting standards
or the issuance of any other pronouncement, release or interpretation, causes or
requires the consolidation of all or a portion of the assets and liabilities of
the Originator or the Borrowers with the assets and liabilities of any Lender or
shall otherwise impose any loss, cost, expense, reduction of return on capital
or other loss or any Lender, such event shall constitute a circumstance on which
such Lender may base a claim for reimbursement under this Section 2.12.

 

(c)                                  In determining any amount provided for in
this Section 2.12, the Lender may use any reasonable averaging and attribution
methods.  Any Lender making a claim under this Section 2.12 shall submit to the
Servicer a written description in reasonable detail as to such additional or
increased cost or reduction and the calculation thereof, which written
description shall be conclusive absent manifest error.

 

(d)                                 Failure or delay on the part of any Lender
to demand compensation pursuant to this Section 2.12 shall not constitute a
waiver of such Lender’s right to demand or receive such compensation.  The
Borrowers shall not be required to compensate a Lender for any loss, cost or
expense under this Section unless a claim therefor has been made within 180 days
of knowledge thereof by such Lender.

 

Section 2.13.                                   Taxes.

 

(a)                                  All payments made by a Borrower or the
initial Servicer (on behalf of the Borrowers) under this Agreement will be made
free and clear of and without deduction or withholding for or on account of any
Taxes.  If any Taxes are required to be withheld from any amounts payable
hereunder, then the amount payable to such Person will be increased (the amount
of such increase, the “Additional Amount”) such that every net payment made
under this Agreement after withholding for or on account of any Taxes
(including, without limitation, any Taxes on such increase) is not less than the
amount that would have been paid had no such deduction or withholding been made;
provided that no Additional Amount shall be payable hereunder to any Person to
the extent such amount is payable as a result of the failure of such Person to
comply with Section 2.13(d).  The foregoing obligation to pay Additional Amounts
with respect to payments required to be made by the Borrowers under this
Agreement will not, however, apply with respect to net income, gross income or
franchise and similar taxes imposed on the Administrative Agent or any Lender.

 

(b)                                 The initial Servicer will indemnify (and to
the extent the indemnification provided by the initial Servicer is insufficient,
the Borrowers will indemnify) each Lender for the full amount of Taxes payable
by such Persons in respect of Additional Amounts and any liability (including
interest and expenses) arising therefrom or with respect thereto; provided that
no

 

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indemnification shall be payable hereunder to any Person to the extent such
amount is payable as a result of the failure of such Person to comply with
Section 2.13(d).  All payments in respect of this indemnification shall be made
on the Payment Date following the date a written invoice therefor setting forth
in reasonable detail the basis and calculation of such amounts is delivered to
the Borrowers.  In the event any Secured Party receives a refund of any amount
paid by a Borrower or the initial Servicer pursuant to this Section 2.13, as
long as no Event of Default has occurred and is continuing, such Secured Party
shall promptly remit such refunded amount to the applicable Borrower(s) or the
initial Servicer, as applicable.

 

(c)                                  Within thirty (30) days after the date of
any payment by the Borrowers of any Taxes, the Borrowers will furnish to the
Administrative Agent appropriate evidence of payment thereof.

 

(d)                                 If any Lender is not created or organized
under the laws of the United States or a political subdivision thereof, such
Lender (or the Administrative Agent on the Lender’s behalf) shall deliver to the
Borrowers, with a copy to the Administrative Agent, the Collateral Custodian and
the Servicer, (i) within fifteen (15) days after the date such Lender becomes
party to the applicable Transaction Documents, two (or such other number as may
from time to time be prescribed by Applicable Law) duly completed copies of IRS
Form W-8BEN or Form W-8ECI (or any successor forms or other certificates or
statements that may be required from time to time by the relevant United States
taxing authorities or Applicable Law), as appropriate, to permit the Borrowers
to make payments hereunder for the account of such Lender without deduction or
withholding of United States federal income or similar Taxes and (ii) upon the
obsolescence of or after the occurrence of any event requiring a change in, any
form or certificate previously delivered pursuant to this Section 2.13(d),
copies (in such numbers as may from time to time be prescribed by Applicable Law
or regulations) of such additional, amended or successor forms, certificates or
statements as may be required under Applicable Law to permit the Borrowers to
make payments hereunder for the account of such Lender without deduction or
withholding of United States federal income or similar Taxes (and, in either
case, the Borrowers shall be permitted to withhold, without penalty or
liability, amounts it deems reasonably necessary if such documentation is not
delivered hereunder).  Notwithstanding the foregoing, any additional costs or
expenses that are due to the fact that a Lender is not created or organized in
the United States shall not be passed through to the Borrowers.

 

(e)                                  Without prejudice to the survival of any
other agreement of the Borrowers hereunder, the agreements and obligations of
the Borrowers and the Servicer contained in this Section 2.13 shall survive the
termination of this Agreement.

 

Section 2.14.                                   Assignment of the Sale
Agreement, Purchase and Sale Agreements and Dealer Agreements.

 

Each Borrower hereby assigns to the extent of its interest therein, to the
Administrative Agent, for the ratable benefit of the Secured Parties hereunder,
all of such Borrower’s right, title and interest in and to, but none of its
obligations under, the Sale Agreements, each Purchase and Sale Agreement
(including all recourse obligations of the applicable Sellers), the Dealer
Agreements (including all buyback obligations of the applicable Dealers) and any
UCC financing statements filed under or in connection therewith with respect to
the Receivables.  In

 

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furtherance and not in limitation of the foregoing, each of the Borrowers hereby
assigns to the Administrative Agent, for the benefit of the Secured Parties, its
right to indemnification under the Sale Agreements and the Purchase and Sale
Agreements with respect to the Receivables.  The Borrowers confirm that (i) at
any time during the continuance of an Event of Default and (ii) otherwise, upon
written notice to the Borrowers and the Servicer by the Administrative Agent,
the Administrative Agent, on behalf of the Secured Parties, shall have the sole
right to enforce a Borrower’s rights and remedies under the Sale Agreements, the
Purchase and Sale Agreements (including all recourse guaranty obligations of the
Sellers) and the Dealer Agreements (including all buyback obligations of the
applicable Dealers) with respect to the Receivables for the benefit of the
Secured Parties.

 

Section 2.15.                                   Repurchase of Receivables.

 

Within ten (10) Business Days of the day a Receivable is (or becomes) subject to
a Warranty Event, the Borrowers shall either: (i) make a deposit to the
Collection Account (for allocation pursuant to Sections 2.7 or 2.8, as
applicable) in immediately available funds in an amount equal to the Outstanding
Receivable Balance of such Receivable on the date of such payment, and any
accrued and unpaid interest thereon, or (ii) replace such Receivable with a
substitute Receivable (a “Substitute Receivable”), provided, that such
Substitute Receivable: (a) shall be an Eligible Receivable, and (b) prior to
such Substitution, the Borrowers shall deliver the related Required Receivable
File to the Collateral Custodian and the Collateral Custodian shall have
provided a Collateral Receipt with no exceptions to the Administrative Agent.

 

ARTICLE III

 

CONDITIONS TO CLOSING AND LOANS

 

Section 3.1.                                          Conditions to Closing and
the Initial Loan.

 

No Lender shall be obligated to make any Loan hereunder after the Effective Date
until the following conditions have been satisfied in the sole discretion of, or
waived in writing by, the Administrative Agent:

 

(a)                                  The Trust II Borrower has provided evidence
satisfactory to the Administrative Agent that such entity has been duly
organized, and is validly existing in good standing, under the laws of the state
of its formation, with all requisite power and authority to own or lease its
properties and conduct its business as such business is presently conducted, and
had at all relevant times and now has all necessary power, authority and legal
right to acquire, own, sell and pledge the Receivables, as applicable;

 

(b)                                 Each Transaction Document shall have been
duly executed by, and delivered to, the parties thereto, and the Administrative
Agent shall have received such other documents, instruments, agreements,
financing statements, control agreements, security agreements, insurance
certificates and legal opinions as the Administrative Agent shall reasonably
request in connection with the transactions contemplated by this Agreement,
including, without limitation, all those specified in the schedule of condition
precedent

 

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documents attached hereto as Schedule I, in each such case in form and substance
reasonably satisfactory to the Administrative Agent;

 

(c)                                  The Administrative Agent shall have
received (i) reasonably satisfactory evidence that the Trust II Borrower has
obtained all required consents and approvals of all Persons, including all
requisite Governmental Authorities, to the execution, delivery and performance
of this Agreement and the other Transaction Documents to which each is a party
and the consummation of the transactions contemplated hereby or thereby or
(ii) an Officer’s Certificate from the Trust II Borrower in form and substance
reasonably satisfactory to the Administrative Agent affirming that no such
consents or approvals are required;

 

(d)                                 The Borrowers, the Servicer and the
Originator shall each be in compliance in all material respects with all
Applicable Laws and shall have delivered to the Administrative Agent as to this
and other closing matters a certification in the form of Exhibits E-1, E-2, E-3,
E-4 and E-5, as applicable;

 

(e)                                  The Borrowers and the initial Servicer
shall have delivered to the Administrative Agent duly executed Powers of
Attorney in the form of Exhibits F-1, F-2, F-3 and F-4, as applicable;

 

(f)                                    The Borrowers, the Servicer and the
Originator shall each have delivered to the Administrative Agent a certificate
as to Solvency in the form of Exhibits D-1, D-2, D-3 D-4 and D-5, as applicable;

 

(g)                                 The Administrative Agent shall have received
a duly executed copy of the A-1 Variable Funding Note, in a principal amount of
$25,000,000 and a duly executed copy of the A-2 Variable Funding Note, in a
principal amount of $25,000,000; and

 

(h)                                 The Backup Servicer has taken, and the
Servicer and each applicable Sub-Servicer have permitted, all necessary action
to obtain access and the information from the Servicer’s and Sub-Servicer’s
servicing system to perform its responsibilities hereunder.

 

Section 3.2.                                          Conditions Precedent to
All Loans.

 

Each Loan under this Agreement (each, a “Transaction”) shall be subject to the
further conditions precedent that:

 

(a)                                  The Borrowers shall have delivered (or
caused to be delivered on their behalf) to the Administrative Agent (with a copy
to the Collateral Custodian and the Backup Servicer) no later than (I) two
(2) Business Days prior to the related Funding Date with respect to Receivables
being acquired from Sellers of Receivables included in the Collateral on a prior
Funding Date and (II) five (5) Business Days prior to the related Funding Date
with respect to Receivables being acquired from Sellers of Receivables not
previously included in the Collateral:

 

(i)                                     a Borrowing Notice, a Borrowing Base
Certificate, a Receivables List and, if applicable, a Servicing Report; and

 

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(ii)                                  if applicable, a Sale Assignment
substantially in the form of Exhibit A to the Sale Agreement (with respect to
the LLC Borrower only) including Schedule I thereto and containing such
additional information as may be reasonably requested by the Administrative
Agent; and

 

(b)                                 On the date of such Transaction the
following shall be true and correct (both before and immediately after giving
effect to such Transaction) and the Borrowers and the Servicer shall have
certified in the related Borrowing Notice that all conditions precedent to the
requested Transaction have been satisfied and shall thereby be deemed to have
certified that:

 

(i)                                     The representations and warranties
contained in Section 4.1 and Section 4.3 are true and correct in all material
respects on and as of such day (except to the extent such representations and
warranties relate to an earlier date, in which case they shall be true and
correct in all material respects as of such earlier date) as though made on and
as of such day and shall be deemed to have been made on such day;

 

(ii)                                 No event has occurred, or would result from
such Transaction, that constitutes (A) an Event of Default (unless such Event of
Default has been waived in writing by the Administrative Agent) or Unmatured
Event of Default (unless such Unmatured Event of Default is no longer
continuing) or (B) an “Event of Default” (unless such event has been waived in
writing pursuant to the terms of the Term Credit Agreement) or “Unmatured Event
of Default” (unless such event is no longer continuing) under (and as defined
in) the Term Credit Agreement or any other credit facility between any Affiliate
of the Originator and any Affiliate of the Administrative Agent;

 

(iii)                              On and as of such day, after giving effect to
such Transaction, the Maximum Outstanding Loan Amount shall be greater than or
equal to $0; and

 

(iv)                             To the knowledge of the Borrowers, no
Applicable Law shall prohibit or enjoin the Borrowers from entering into such
Transaction.

 

(c)                                  The applicable Borrower shall have
delivered to the Collateral Custodian, no later than 2:00 p.m. (I) two
(2) Business Days prior to the related Funding Date with respect to Receivables
being acquired from Sellers of Receivables included in the Collateral on a prior
Funding Date and (II) five (5) Business Days prior to the related Funding Date
with respect to Receivables being acquired from Sellers of Receivables not
previously included in the Collateral, the Required Receivable File;

 

(d)                                 The Amortization Period shall not have
commenced and no Event of Default shall have occurred and be continuing;

 

(e)                                  On the date of such Transaction, the
Administrative Agent shall have received such other approvals, opinions or
documents as the Administrative Agent may reasonably require; and

 

(f)                                    The Administrative Agent shall have
received from the Borrowers or the Servicer on behalf of the Borrowers, a copy
of the Purchase and Sale Agreement with respect to the Receivables, if any,
being acquired by the LLC Borrower (if not previously delivered to the

 

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Administrative Agent), all hedging confirmations required in connection with
such Transaction, any Sub-Servicing Agreements then in effect with respect to
the Receivables being acquired (if not previously delivered to the
Administrative Agent), and copies of the applicable Dealer Agreement (if any)
for each such Receivable, in each case in form and substance reasonably
satisfactory to the Administrative Agent.

 

Section 3.3.                                          Permitted Investments.

 

Each time that the Borrowers (or the initial Servicer on behalf of the
Borrowers) shall direct or cause the acquisition of any Permitted Investment,
the Borrowers shall (or the initial Servicer on behalf of the Borrowers), if
such Permitted Investment has not already been transferred or credited to the
Collection Account, cause all Permitted Investments acquired by the Borrowers to
be transferred to the Collateral Custodian for credit to the appropriate
Account, in each case for the benefit of the Administrative Agent by one of the
following means (and shall take any and all other actions necessary to create in
favor of the Administrative Agent a valid, perfected, first priority security
interest (subject to Permitted Liens) in each Permitted Investment granted to
the Administrative Agent under laws and regulations (including without
limitation Articles 8 and 9 of the UCC, as applicable) in effect at the time of
such grant):

 

(i)                                     in the case of an Instrument or a
Certificated Security represented by a Security Certificate in registered form
by having it specially Indorsed to the Administrative Agent or in blank by an
effective Indorsement or registered in the name of the Administrative Agent and
by (A) delivering such Instrument or Security Certificate to the Collateral
Custodian at the address specified in Schedule III hereto and (B) causing the
Collateral Custodian to maintain (on behalf of the Administrative Agent)
continuous possession of such Instrument or Security Certificate at the address
specified in Schedule III hereto;

 

(ii)                                 in the case of an Uncertificated Security,
by (A) causing the Administrative Agent to become the registered owner of such
Uncertificated Security and (B) cooperating in causing such registration to
remain effective and not take any action to the contrary;

 

(iii)                              in the case of any Security Entitlement, by
causing the Administrative Agent to become the Entitlement Holder of such
Security Entitlement; or

 

(iv)                             in the case of general intangibles (including
any loan not evidenced by an Instrument) by filing, maintaining and continuing
the effectiveness of financing statements naming each Borrower as a debtor and
the Administrative Agent as secured party and describing the Permitted
Investment as the collateral at the filing office of the Secretary of State for
the State of Delaware (in the case of Borrowers).

 

Section 3.4.                                          ***** Consent

 

(a)                                  *****, in its capacity as Administrative
Agent under the Term Credit Agreement, hereby (i) consents to the amendment of
the LLC Borrower’s limited liability company agreement in order to permit the
LLC Borrower to enter into this Agreement and the other Transaction Documents,
as applicable, and (ii) agrees that LLC Borrower’s execution and delivery of and
performance under this Agreement and the other Transaction Documents

 

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(including the LLC Borrower’s ownership of the Trust Borrower) shall not
constitute a breach or violation of any of the representations, warranties,
covenants or other agreements set forth in the Term Credit Agreement or the
other “Transaction Documents” (as defined in the Term Credit Agreement) and the
security interest granted in the Collateral hereunder shall constitute a
“Permitted Lien” (under and as defined in the Term Credit Agreement) for
purposes of all of the “Transaction Documents” (as defined in the Term Credit
Agreement).

 

(b)                                 *****, in its capacity as Administrative
Agent under this Agreement, hereby agrees that LLC Borrower’s execution and
delivery of and performance under the Term Credit Agreement and the other
“Transaction Documents” (as defined in the Term Credit Agreement) shall not
constitute a breach or violation of any of the representations, warranties,
covenants or other agreements set forth in this Agreement or the other
Transaction Documents and the security interest granted in the Collateral
hereunder or thereunder shall constitute a Permitted Lien for purposes of all of
the Transaction Documents.

 

(c)                                  *****, in its capacity as Administrative
Agent under this Agreement, hereby consents to the sale and assignment from time
to time of certain receivables and related assets by the Trust Borrower and the
LLC Borrower, as applicable, to the Trust II Borrower upon the terms and
conditions set forth in the Purchase Agreement.

 

ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

 

Section 4.1.                                          Representations and
Warranties of the Borrowers.

 

Each Borrower represents and warrants as to itself and the Collateral in which
it has an interest as follows as of the Effective Date, each Funding Date, and
as of each other date provided under this Agreement or the other Transaction
Documents on which such representations and warranties are required to be (or
deemed to be) made:

 

(a)                                  Organization and Good Standing.  It has
been duly formed, and is validly existing as a limited liability company or
statutory trust, as applicable, in good standing, under the laws of the State of
Delaware, with all requisite power and authority to own or lease its properties
and conduct its business as such business is presently conducted, and had at all
relevant times, and now has all necessary power, authority and legal right to
acquire, own, sell and pledge the Collateral.

 

(b)                                 Due Qualification.  It is duly qualified to
do business as a limited liability company or statutory trust, as applicable,
and has obtained all necessary qualifications, licenses and approvals, in all
jurisdictions in which the conduct of its business requires such qualifications,
licenses or approvals except to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect.

 

(c)                                  Power and Authority; Due Authorization;
Execution and Delivery.  It (i) has all necessary power, authority and legal
right to (a) execute and deliver this Agreement and the other Transaction
Documents to which it is a party, and (b) carry out the terms of the

 

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Transaction Documents to which it is a party, and (ii) has duly authorized, by
all necessary limited liability company or statutory trust, as applicable,
action, the execution, delivery and performance of this Agreement and the other
Transaction Documents to which it is a party and the assignment of a security
interest in the Collateral on the terms and conditions herein provided.  This
Agreement and each other Transaction Document to which it is a party have been
duly executed and delivered by it.

 

(d)                                 Binding Obligation.  This Agreement and each
other Transaction Document to which it is a party constitutes a legal, valid and
binding obligation of it enforceable against it in accordance with its
respective terms, except as such enforceability may be limited by Insolvency
Laws and by general principles of equity (whether considered in a suit at law or
in equity).

 

(e)                                  No Violation.  The consummation of the
transactions contemplated by this Agreement and the other Transaction Documents
to which it is a party and the fulfillment of the terms hereof and thereof will
not (i) conflict with, result in any breach of any of the terms and provisions
of, or constitute (with or without notice or lapse of time or both) a default
under, its applicable organizational documents or any Contractual Obligation of
it, (ii) result in the creation or imposition of any Lien (other than Permitted
Liens) upon any of its properties pursuant to the terms of any such Contractual
Obligation, other than this Agreement, or (iii) violate in any Applicable Law
applicable to it, in each case except to the extent that failure to do so could
not reasonably be expected to have Material Adverse Effect.

 

(f)                                    No Proceedings.  There is no litigation,
proceeding or investigation pending or, to the best knowledge of it, threatened
against it, before any Governmental Authority (i) asserting the invalidity of
this Agreement or any other Transaction Document to which it is a party,
(ii) seeking to prevent the consummation of any of the transactions contemplated
by this Agreement or any other Transaction Document to which it is a party or
(iii) seeking any determination or ruling that could reasonably be expected to
have Material Adverse Effect.

 

(g)                                 Consents.  All approvals, authorizations,
consents, orders, licenses or other actions of any Person or of any Governmental
Authority (if any) required to be made or obtained by it for the due execution,
delivery and performance by it of this Agreement and any other Transaction
Document to which it is a party have been obtained except to the extent that
failure to do so could not reasonably be expected to have Material Adverse
Effect.

 

(h)                                 Solvency.  It is not the subject of any
Insolvency Proceedings or Insolvency Event.  The transactions under this
Agreement and any other Transaction Document to which it is a party do not and
will not render it not Solvent.

 

(i)                                     Taxes.  It has filed or caused to be
filed all tax returns that are required to be filed by it (or has been granted
appropriate extensions) and has paid or made adequate provisions for the payment
of all Taxes and all assessments made against it or any of its property (other
than (i) any amount of Tax the validity of which is currently being contested in
good faith by appropriate proceedings and with respect to which reserves in
accordance with GAAP have been provided on the books of it, (ii) any Tax less
than thirty (30) days overdue and (iii) any filings that the failure to so file
could not reasonably be expected to have a Material Adverse

 

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Effect), and no tax lien has been filed and, to its knowledge, no claim is being
asserted, with respect to any such Tax or assessment.

 

(j)                                     Exchange Act Compliance; Regulations T,
U and X.  None of the transactions contemplated herein or in the other
Transaction Documents will cause it to violate or result in a violation by it of
Section 7 of the Exchange Act, or any regulations issued pursuant thereto,
including, without limitation, Regulations T, U and X of the Board of Governors
of the Federal Reserve System, 12 C.F.R., Chapter II.  It does not own or intend
to carry or purchase, and no proceeds from the Loans will be used to carry or
purchase, any “margin stock” within the meaning of Regulation U or to extend
“purpose credit” within the meaning of Regulation U.

 

(k)                                  Security Interest.

 

(i)                                     This Agreement creates a valid and
continuing security interest (as defined in the applicable UCC) in the
Collateral in favor of the Administrative Agent, on behalf of the Secured
Parties, which security interest is prior to all other Liens (except for
Permitted Liens);

 

(ii)                                 the Receivables and Related Security
constitute “instruments”, “general intangibles”, “tangible chattel paper” or
“accounts” (each as defined in the applicable UCC);

 

(iii)                              with respect to Collateral that constitute
“security entitlements”:

 

(1)                                  all of such security entitlements have been
credited to one of the Accounts and the securities intermediary for each Account
has agreed to treat all assets credited to such Account as “financial assets”
within the meaning of the applicable UCC;

 

(2)                                  it has taken all steps necessary to cause
the securities intermediary to identify in its records the Administrative Agent
as the Person having a security entitlement against the securities intermediary
in each of the Accounts; and

 

(3)                                  the Accounts are not in the name of any
Person other than the LLC Borrower.  The LLC Borrower has not authorized or
allowed the securities intermediary of any Account to comply with the
entitlement order of any Person other than the Administrative Agent; provided
that until the Administrative Agent delivers a notice of exclusive control under
the Securities Account Control Agreement, the Borrowers and the Servicer may
cause cash in the Accounts to be invested in Permitted Investments.

 

(iv)                             all Accounts constitute “securities accounts”
as defined in the applicable UCC;

 

(v)                                it owns and has good and marketable title to
the Collateral (including all Receivables added to the Collateral on the
applicable Funding Date therefor) free and clear of any Lien (other than
Permitted Liens) of any Person;

 

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(vi)                             it has received all consents and approvals
required by the terms of any Receivable to the granting of a security interest
in such Receivable hereunder to the Administrative Agent, on behalf of the
Secured Parties;

 

(vii)                         all appropriate financing statements have been
filed in the proper filing office in the appropriate jurisdictions under
Applicable Law in order to perfect the security interest granted to the
Administrative Agent, on behalf of the Secured Parties, under this Agreement in
the Receivables and in the other Collateral, to the extent that a security
interest in such other Collateral may be perfected by the filing of a financing
statement;

 

(viii)                      other than the security interest granted to the
Administrative Agent, on behalf of the Secured Parties, pursuant to this
Agreement or as otherwise permitted in accordance with the Transaction
Documents, it has not pledged, assigned, sold, granted a security interest in or
otherwise conveyed any of the Collateral.  It has not authorized the filing of
and is not aware of any financing statements against itself that includes a
description of collateral covering the Collateral other than any financing
statement that has been terminated and/or fully and validly assigned to the
Administrative Agent on or prior to the date hereof.  It is not aware of the
filing of any judgment or tax lien filings against itself;

 

(ix)                              all original executed copies of each
instrument that constitute or evidence each Receivable has been delivered to the
Collateral Custodian;

 

(x)                                 it has received, or subject to the delivery
requirements contained herein will receive, a written acknowledgment from the
Collateral Custodian that the Collateral Custodian or its bailee is holding each
instrument that constitutes or evidences each Receivable solely on behalf of and
for the benefit of the Secured Parties;

 

(xi)                              none of the Underlying Instruments 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 Administrative Agent, on behalf of the Secured Parties, and other than
markings related to debt paid in full prior to the inclusion of such Receivable
in the Collateral;

 

(xii)                           with respect to Collateral that constitutes a
“certificated security,” such certificated security has been delivered to the
Collateral Custodian on behalf of the Administrative Agent and, if in registered
form, has been specially Indorsed to the Administrative Agent or in blank by an
effective Indorsement or has been registered in the name of the Administrative
Agent upon original issue or registration of transfer by it of such certificated
security; and

 

(xiii)                        with respect to Collateral that constitutes an
“uncertificated security”, the Administrative Agent is registered as the
registered owner of such uncertificated security.

 

(l)                                     Reports Accurate.  All Servicing Reports
(if prepared by it, or to the extent that information contained therein is
supplied by it), information, exhibits, financial statements, documents, books,
records or reports furnished by it to the Administrative Agent, Servicer,

 

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Backup Servicer, Collateral Custodian or any Secured Party pursuant to this
Agreement are true, complete and correct in all material respects.

 

(m)                               Location of Offices.  Its location (within the
meaning of Article 9 of the UCC) is Delaware.  The office where it keeps all the
Records is at the address of it referred to in Annex A hereto (or at such other
locations as to which the notice and other requirements specified in
Section 5.2(g) shall have been satisfied).  Its Federal Employee Identification
Number is correctly set forth on Exhibit E-1.  It has not changed its name
(whether by amendment of its certificate of formation, by reorganization or
otherwise) or its jurisdiction of organization and has not changed its location
for purposes of the applicable UCC within the four (4) months preceding the
Closing Date.

 

(n)                                 Tradenames.  It has no trade names,
fictitious names, assumed names or “doing business as” names or other names
under which it has done or is doing business.

 

(o)                                 Sale Agreement.  The Sale Agreement is the
only agreement pursuant to which it acquires Receivables and Related Security.

 

(p)                                 Value Given.  It shall have given reasonably
equivalent value to the Originator or the applicable Seller in consideration for
the transfer to it of the Receivables and Related Security as contemplated by
the applicable Sale Agreement and no such transfer shall have been made for or
on account of an antecedent debt.

 

(q)                                 Accounting.  It accounts for the transfers
to it of interests in the Receivables and Related Security under the Sale
Agreement as financings of such Receivables and Related Security for tax
purposes and sales for legal and all other purposes.

 

(r)                                    Special Purpose Entity.  It has not and
shall not:

 

(i)                                     engage in any business or activity other
than the purchase and receipt of Receivables and related assets, the pledge of
Collateral and other transactions contemplated by the Transaction Documents, the
transactions contemplated by the Term Credit Agreement (if applicable) and
related transaction documents, and such other activities as are incidental to
the foregoing;

 

(ii)                                  acquire or own any material assets other
than (a) the Receivables and rights in the Related Security and the
“Receivables” and “Related Security” (as defined in the Term Credit Agreement),
(b) with respect to the LLC Borrower, the equity interests of the Trust Borrower
and (c) incidental property as may be necessary for the operation of it and the
performance of its obligations under the Transaction Documents and the
“Transaction Documents” (as defined in the Term Credit Agreement);

 

(iii)                               merge into or consolidate with any Person or
dissolve, terminate or liquidate in whole or in part, transfer or otherwise
dispose of all or substantially all of its assets or change its legal structure,
without in each case first obtaining the consent of the Administrative Agent,
except as otherwise provided by the Transaction Documents and the “Transaction
Documents” (as defined in the Term Credit Agreement);

 

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(iv)                              fail to preserve its existence as an entity
duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization or formation, or, without the prior written
consent of the Administrative Agent, make any material amendment or
modification, or terminate or fail to comply with the material provisions of its
organizational documents (which includes the special purpose entity
limitations), or fail to observe limited liability company formalities;

 

(v)                                 own any Subsidiary or make any Investment in
any Person without the consent of the Administrative Agent (provided that the
LLC Borrower’s ownership of the Trust Borrower is hereby consented to by the
Administrative Agent);

 

(vi)                              except as permitted by the Transaction
Documents and the “Transaction Documents” (as defined in the Term Credit
Agreement), commingle its assets or liabilities with the assets or liabilities
of any of its Affiliates or any other Person;

 

(vii)                           incur any debt, secured or unsecured, direct or
contingent (including guaranteeing any obligation), other than indebtedness
under the Term Credit Agreement (with respect to the LLC Borrower) and the
transaction documents related thereto, indebtedness to the Secured Parties
hereunder or in conjunction with a repayment of all Aggregate Unpaids owed
hereunder, except for trade payables in the ordinary course of its business, or
as otherwise permitted in accordance with the Transaction Documents; provided
that such debt is not evidenced by a note and is paid within thirty (30) days
(or longer if in the normal course such debt is paid on terms greater than 30
days) of when due (unless otherwise contested in good faith by appropriate
proceedings) and as otherwise permitted by the Transaction Documents;

 

(viii)                        become insolvent or fail to pay its debts and
liabilities from its assets as the same shall become due (unless otherwise
contested in good faith by appropriate proceedings);

 

(ix)                                fail to maintain its records, books of
account and bank accounts separate and apart from those of any other Person;

 

(x)                                   enter into any contract or agreement with
any Person, except upon terms and conditions that are commercially reasonable
and substantially similar to those that would be available on an arms-length
basis with third parties other than such Person in its reasonable judgment;

 

(xi)                                seek its dissolution or winding up in whole
or in part;

 

(xii)                             fail to correct any known misunderstandings
regarding the separate identity of the LLC Borrower, the Trust Borrower and the
Originator (and, with respect to the Trust II Borrower, CLST Asset II, LLC) or
any other Person;

 

(xiii)                          make any loan or advances to any third party,
including any principal or Affiliate, or hold evidence of indebtedness issued by
any other Person (other than the

 

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Receivables, cash and Permitted Investments and as otherwise permitted by the
Transaction Documents and the “Transaction Documents” (as defined in Term Credit
Agreement));

 

(xiv)                         fail to file its own separate tax return, or file
a consolidated federal income tax return with any other Person, except as may be
required by the Code and regulations;

 

(xv)                            actively hold itself out to the public such to
represent that it is not a legal entity separate and distinct from any other
Person or to suggest that it is responsible for the debts of any third party
(including any of its principals or Affiliates);

 

(xvi)                         fail to maintain adequate capital for the
reasonably foreseeable obligations of its business and contemplated business
operations;

 

(xvii)                      file or consent to the filing of any petition,
either voluntary or involuntary, to take advantage of any applicable insolvency,
bankruptcy, liquidation or reorganization statute, or make an assignment for the
benefit of creditors;

 

(xviii)                   permit any transfer (whether in any one or more
transactions) of any direct or indirect ownership interest in itself to the
extent it has the ability to control the same, unless it delivers to the
Administrative Agent an acceptable non-consolidation opinion and the
Administrative Agent consents to such transfer;

 

(xix)                           fail to pay the salaries of its own employees,
if any, in light of its contemplated business operations;

 

(xx)                              acquire the securities of its Affiliates
(except for the LLC Borrower’s ownership of the Trust Borrower);

 

(xxi)                           fail to allocate fairly and reasonably any
overhead expenses that are shared with an Affiliate, including paying for office
space and services performed by any employee of an Affiliate;

 

(xxii)                        fail to use separate invoices bearing its own
name;

 

(xxiii)                     pledge or permit the pledge of its assets for the
benefit of any other Person, other than with respect to payment of the
indebtedness to the Secured Parties hereunder and the indebtedness to the
“Secured Parties” under the Term Credit Agreement or as otherwise permitted in
accordance with the Transaction Documents;

 

(xxiv)                    with respect to the LLC Borrower, fail at any time to
have at least one independent manager or independent director (an “Independent
Manager” or “Independent Director”) acceptable to the Administrative Agent (who
is an employee of Lord Securities Corporation or another entity acceptable to
the Administrative Agent) and who is not currently a director, officer,
employee, trade creditor shareholder, manager or member (or spouse, parent,
sibling or child of the foregoing) of (a) the Servicer, (b) any Borrower,
(c) the Originator or (d) any principal or Affiliate of the Servicer, any
Borrower or the Originator; provided that such Independent Manager may be an
independent manager or an independent director of another special purpose entity
affiliated with any Borrower, the Servicer or Originator; or fail to ensure

 

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that all limited liability company action relating to the selection or
replacement of the Independent Manager or Independent Director, as applicable,
are duly authorized by the unanimous vote of the board of managers (including
the Independent Manager or Independent Director, as applicable); and

 

(xxv)                       with respect to the LLC Borrower, fail to provide in
its organizational documents that the unanimous consent of all managers, as
applicable (including the consent of the Independent Manager or Independent
Director, as applicable) is required for the LLC Borrower to (a) dissolve or
liquidate, in whole or part, or institute proceedings to be adjudicated bankrupt
or insolvent, (b) institute or consent to the institution of bankruptcy or
insolvency proceedings against it, (c) file a petition seeking or consent to
reorganization or relief under any applicable federal or state law relating to
bankruptcy or insolvency, (d) seek or consent to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator, custodian or any similar official
for the LLC Borrower, (e) make any assignment for the benefit of the LLC
Borrower’s creditors, and (f) take any action in furtherance of any of the
foregoing; and

 

(xxvi)                    take or refrain from taking, as applicable, each of
the activities specified in the non-consolidation opinion of Foley & Lardner
LLP, dated as of August 15, 2008 or Jackson Walker LLP , dated as of the date
hereof, upon which the conclusions expressed therein are based.

 

(s)                                  Investment Company Act.  It is not, and is
not controlled by, an “investment company” within the meaning of the 1940 Act or
is exempt from the provisions of the 1940 Act.

 

(t)                                    ERISA.  Neither it nor any ERISA
Affiliate thereof has any Benefit Plans or Multiemployer Plans.

 

(u)                                 Compliance with Law.  It has complied with
all Applicable Laws to which it may be subject, and no item of Collateral
contravenes any Applicable Law (including, without limitation, all applicable
predatory and abusive lending laws, laws, rules and regulations relating to
licensing, truth in lending, fair credit billing, fair credit reporting, equal
credit opportunity, fair debt collection practices and privacy), in each case
except to the extent that failure to do so could not be reasonably expected to
have a Material Adverse Effect.

 

(v)                                 Lockbox Accounts.  The name and address of
the Lockbox Account Banks, together with the account numbers of the Lockbox
Accounts of each Borrower at the applicable Lockbox Account Banks, is specified
in Schedule VI (as may be amended).  The Lockbox Accounts are the only accounts
to which Collections on the Collateral are to be sent.  The Borrowers have not
granted any Person an interest in the Lockbox Accounts other than any master
collection account arrangement consented to by the Administrative Agent.

 

(w)                               Amendments.  No Receivable has been amended,
modified or waived following inclusion in the Collateral, except for amendments,
modifications or waivers, if any, to such Receivable otherwise permitted under
Section 6.4(a) of this Agreement and in accordance with the Credit and
Collection Policy and the Servicing Standard.

 

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(x)                                   USA PATRIOT Act.  Neither it nor any
Affiliate of such Borrower is (i) a country, territory, organization, person or
entity named on an Office of Foreign Asset Control (OFAC) list; (ii) a Person
that resides or has a place of business in a country or territory named on such
lists or which is designated as a “Non-Cooperative Jurisdiction” by the
Financial Action Task Force on Money Laundering, or whose subscription funds are
transferred from or through such a jurisdiction; (iii) a “Foreign Shell Bank”
within the meaning of the USA PATRIOT Act, i.e., a foreign bank that does not
have a physical presence in any country and that is not affiliated with a bank
that has a physical presence and an acceptable level of regulation and
supervision; or (iv) a person or entity that resides in or is organized under
the laws of a jurisdiction designated by the United States Secretary of the
Treasury under Sections 311 or 312 of the USA PATRIOT Act as warranting special
measures due to money laundering concerns.

 

(y)                                 Eligibility of Collateral.  The Receivables
List is an accurate and complete listing of all Receivables and the information
contained therein with respect to the identity of such Receivables and the
amounts owing thereunder is true, correct and complete in all material respects,
and each such Receivable included in the Borrowing Base is an Eligible
Receivable.

 

(z)                                   No Fraud.  Each Receivable was originated,
to the best knowledge of it, without any fraud or material misrepresentation by
the Seller, the applicable dealer or the Obligor.

 

Section 4.2.                                          Representations and
Warranties of the Servicer.

 

The initial Servicer represents and warrants as follows as of the Effective Date
and as of each Measurement Date:

 

(a)                                  Organization and Good Standing.  The
Servicer has been duly organized and is validly existing as a limited liability
company, in good standing under the laws of its jurisdiction of organization,
with all requisite organizational power and authority to conduct its business as
such business is presently conducted and to enter into and perform its
obligations pursuant to this Agreement.

 

(b)                                 Due Qualification.  The Servicer is duly
qualified to do business as a limited liability company and has obtained all
necessary licenses and approvals in all jurisdictions in which the conduct of
its business requires such qualification, licenses or approvals except to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect.

 

(c)                                  Power and Authority; Due Authorization;
Execution and Delivery.  The Servicer (i) has all necessary power, authority and
legal right to (a) execute and deliver this Agreement and the other Transaction
Documents to which it is a party, (b) carry out the terms of the Transaction
Documents to which it is a party, and (ii) has duly authorized, by all necessary
organizational action, the execution, delivery and performance of this Agreement
and the other Transaction Documents to which it is a party.  This Agreement and
each other Transaction Document to which the Servicer is a party have been duly
executed and delivered by the Servicer.

 

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(d)                                 Binding Obligation.  This Agreement and each
other Transaction Document to which the Servicer is a party constitutes a legal,
valid and binding obligation of the Servicer enforceable against the Servicer in
accordance with its respective terms, except as such enforceability may be
limited by Insolvency Laws and general principles of equity (whether considered
in a suit at law or in equity).

 

(e)                                  No Violation.  The consummation of the
transactions contemplated by this Agreement and the other Transaction Documents
to which it is a party and the fulfillment of the terms hereof and thereof will
not (i) conflict with, result in any breach of any of the terms and provisions
of, or constitute (with or without notice or lapse of time or both) a default
under, the organizational documents or any Contractual Obligation of the
Servicer, or (ii) violate any Applicable Law, in each case except to the extent
that failure to do so could not reasonably be expected to have a Material
Adverse Effect.

 

(f)                                    No Proceedings.  There is no litigation,
proceeding or investigation pending or, to the best knowledge of the Servicer,
threatened against the Servicer, before any Governmental Authority (i) asserting
the invalidity of this Agreement or any other Transaction Document to which the
Servicer is a party, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or any other Transaction Document to
which the Servicer is a party or (iii) seeking any determination or ruling that
could reasonably be expected to have a Material Adverse Effect.

 

(g)                                 Consents.  All approvals, authorizations,
consents, orders, licenses or other actions of any Person or of any Governmental
Authority (if any) required to be made or obtained by the Servicer for the due
execution, delivery and performance by the Servicer of this Agreement and any
other Transaction Document to which the Servicer is a party have been obtained
except to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.

 

(h)                                 Reports Accurate.  All Servicer
Certificates, Servicing Reports, Borrowing Base Certificates and other written
or electronic information, exhibits, financial statements, documents, books,
records or reports furnished by the Servicer to the Administrative Agent or any
Lender pursuant to with this Agreement are true, correct and complete in all
material respects.

 

(i)                                     Credit and Collection Policy.  The
Servicer has complied in all material respects with the Credit and Collection
Policy with regard to the origination, underwriting and servicing of the
Receivables.

 

(j)                                     Solvency.  The Servicer is not the
subject of any Insolvency Proceedings or Insolvency Event.  The transactions
under this Agreement and any other Transaction Document to which the Servicer is
a party do not and will not render the Servicer not Solvent.

 

(k)                                  Taxes.  The Servicer has filed or caused to
be filed all tax returns that are required to be filed by it (or has been
granted appropriate extensions).  The Servicer has paid or made adequate
provisions for the payment of all Taxes and all assessments made against it or
any of its property (other than (i) any amount of Tax the validity of which is
currently being

 

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contested in good faith by appropriate proceedings and with respect to which
reserves in accordance with GAAP have been provided on the books of the
Servicer, (ii) any Tax less than thirty (30) days overdue and (iii) any filings
that the failure to so file could not reasonably be expected to have a Material
Adverse Effect), and no tax lien has been filed and, to the Servicer’s
knowledge, no claim is being asserted, with respect to any such Tax or
assessment.

 

(l)                                     Security Interest.  The Servicer will
cooperate with the Administrative Agent to ensure that (i) the Administrative
Agent has a security interest (as defined in the UCC) in the Collateral, which
is enforceable in accordance with Applicable Law upon execution and delivery of
this Agreement and (ii) upon the filing of UCC-1 financing statements naming the
Administrative Agent as secured party and each Borrower as debtor, the
Administrative Agent, as agent for the Secured Parties, shall have a valid and
first priority perfected security interest (subject to any Permitted Liens) in
the Receivables and that portion of the Collateral in which a security interest
may be perfected by filing.

 

(m)                               Lockbox Accounts and Concentration Account. 
The Servicer has sent the name and address of each Lockbox Account Bank,
together with the account number of each Lockbox Account at the applicable
Lockbox Account Bank, and the account number of the Concentration Account, to
the Collateral Custodian, the Backup Servicer and Administrative Agent.  The
Servicer has not granted and shall not grant any Person an interest in the
Lockbox Accounts or the Concentration Account.

 

(n)                                 USA PATRIOT Act.  Neither the Servicer nor
any Affiliate of the Servicer is (i) a country, territory, organization, person
or entity named on an OFAC list; (ii) a Person that resides or has a place of
business in a country or territory named on such lists or which is designated as
a “Non-Cooperative Jurisdiction” by the Financial Action Task Force on Money
Laundering, or whose subscription funds are transferred from or through such a
jurisdiction; (iii) a “Foreign Shell Bank” within the meaning of the USA PATRIOT
Act, i.e., a foreign bank that does not have a physical presence in any country
and that is not affiliated with a bank that has a physical presence and an
acceptable level of regulation and supervision; or (iv) a person or entity that
resides in or is organized under the laws of a jurisdiction designated by the
United States Secretary of the Treasury under Sections 311 or 312 of the USA
PATRIOT Act as warranting special measures due to money laundering concerns.

 

(o)                                 Compliance with Law.  The Servicer has
complied with all Applicable Laws to which it may be subject, and, to the
knowledge of the Servicer, no Receivable in the Collateral contravenes any
Applicable Laws, in each case except to the extent that failure to do so could
not reasonably be expected to have a Material Adverse Effect.

 

Section 4.3.                                          Representations and
Warranties of the Originator.

 

The Originator represents and warrants as follows as of the Effective Date and
each Measurement Date:

 

(a)                                  Organization and Good Standing.  The
Originator has been duly organized and is validly existing as a limited
partnership, in good standing under the laws of its jurisdiction of
organization, with all requisite organizational power and authority to conduct
its business as

 

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such business is presently conducted and to enter into and perform its
obligations pursuant to this Agreement.

 

(b)                                 Due Qualification.  The Originator is duly
qualified to do business as a limited partnership, and has obtained all
necessary licenses and approvals in all jurisdictions in which the conduct of
its business requires such qualification, licenses or approvals except to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect.

 

(c)                                  Power and Authority; Due Authorization;
Execution and Delivery.  The Originator (i) has all necessary power, authority
and legal right to (a) execute and deliver this Agreement and the other
Transaction Documents to which it is a party, (b) carry out the terms of the
Transaction Documents to which it is a party, and (ii) has duly authorized by
all necessary organizational action the execution, delivery and performance of
this Agreement and the other Transaction Documents to which it is a party.  This
Agreement and each other Transaction Document to which the Originator is a party
has been duly executed and delivered by the Originator.

 

(d)                                 Binding Obligation.  This Agreement and each
other Transaction Document to which the Originator is a party constitutes a
legal, valid and binding obligation of the Originator enforceable against the
Originator in accordance with its respective terms, except as such
enforceability may be limited by Insolvency Laws and general principles of
equity (whether considered in a suit at law or in equity).

 

(e)                                  No Violation.  The consummation of the
transactions contemplated by this Agreement and the other Transaction Documents
to which it is a party and the fulfillment of the terms hereof and thereof will
not (i) conflict with, result in any breach of any of the terms and provisions
of, or constitute (with or without notice or lapse of time or both) a default
under, the organizational documents or any Contractual Obligation of the
Originator, or (ii) violate any Applicable Law, in each case except to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect.

 

(f)                                    No Proceedings.  There is no litigation,
proceeding or investigation pending or, to the best knowledge of the Originator,
threatened against the Originator, before any Governmental Authority
(i) asserting the invalidity of this Agreement or any other Transaction Document
to which the Originator is a party, (ii) seeking to prevent the consummation of
any of the transactions contemplated by this Agreement or any other Transaction
Document to which the Originator is a party or (iii) seeking any determination
or ruling that could reasonably be expected to have a Material Adverse Effect.

 

(g)                                 Consents.  All approvals, authorizations,
consents, orders, licenses or other actions of any Person or of any Governmental
Authority (if any) required to be made or to be obtained by the Originator for
the due execution, delivery and performance by the Originator of this Agreement
and any other Transaction Document to which the Originator is a party have been
obtained except to the extent that failure to do so could not reasonably be
expected to have a Material Adverse Effect.

 

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(h)                                 Taxes.  The Originator has filed or caused
to be filed all tax returns that are required to be filed by it, or has been
granted appropriate extensions.  The Originator has paid or made adequate
provisions for the payment of all Taxes and all assessments made against it or
any of its property (other than (i) any amount of Tax the validity of which is
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in accordance with GAAP have been provided on the
books of the Originator, (ii) any Tax less than thirty (30) days overdue and
(iii) any filings that the failure to so file could not reasonably be expected
to have a Material Adverse Effect), and no tax lien has been filed and, to the
Originator’s knowledge, no claim is being asserted, with respect to any such Tax
or assessment.

 

(i)                                     USA PATRIOT Act.  Neither the Originator
nor any Affiliate of the Originator is (i) a country, territory, organization,
person or entity named on an OFAC list; (ii) a Person that resides or has a
place of business in a country or territory named on such lists or which is
designated as a “Non-Cooperative Jurisdiction” by the Financial Action Task
Force on Money Laundering, or whose subscription funds are transferred from or
through such a jurisdiction; (iii) a “Foreign Shell Bank” within the meaning of
the USA PATRIOT Act, i.e., a foreign bank that does not have a physical presence
in any country and that is not affiliated with a bank that has a physical
presence and an acceptable level of regulation and supervision; or (iv) a person
or entity that resides in or is organized under the laws of a jurisdiction
designated by the United States Secretary of the Treasury under Sections 311 or
312 of the USA PATRIOT Act as warranting special measures due to money
laundering concerns.

 

(j)                                     Compliance with Law.  The Originator has
complied with all Applicable Laws to which it may be subject, and, to the
knowledge of the Originator, no Receivable in the Collateral contravenes any
Applicable Laws, in each case except to the extent that failure to do so could
not reasonably be expected to have a Material Adverse Effect.

 

Section 4.4.                                          Representations and
Warranties of the Backup Servicer.

 

The Backup Servicer in its individual capacity and as Backup Servicer represents
and warrants as follows:

 

(a)                                  Organization; Power and Authority.  It is a
duly organized and validly existing corporation in good standing under the laws
of the State of Minnesota.  It has full power, authority and legal right to
execute, deliver and perform its obligations as Backup Servicer under this
Agreement.

 

(b)                                 Due Authorization.  The execution and
delivery of this Agreement and the consummation of the transactions provided for
herein have been duly authorized by all necessary action on its part, either in
its individual capacity or as Backup Servicer, as the case may be.

 

(c)                                  No Conflict.  The execution and delivery of
this Agreement, the performance of the transactions contemplated hereby and the
fulfillment of the terms hereof will not conflict with, result in any breach of
its organizational documents or any of the material terms and provisions of, or
constitute (with or without notice or lapse of time or both) a default under any
indenture, contract, agreement, mortgage, deed of trust, or other instrument to
which the Backup Servicer is a party or by which it or any of its property is
bound.

 

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(d)                                 No Violation.  The execution and delivery of
this Agreement, the performance of the transactions contemplated hereby and the
fulfillment of the terms hereof will not conflict with or violate, in any
material respect, any Applicable Law.

 

(e)                                  Consents.  All approvals, authorizations,
consents, orders or other actions of any Person or Governmental Authority
applicable to the Backup Servicer, required in connection with the execution and
delivery of this Agreement, the performance by the Backup Servicer of the
transactions contemplated hereby and the fulfillment by the Backup Servicer of
the terms hereof have been obtained.

 

(f)                                    Validity, Etc.  This Agreement
constitutes the legal, valid and binding obligation of the Backup Servicer,
enforceable against the Backup Servicer in accordance with its terms, except as
such enforceability may be limited by applicable Insolvency Laws or general
principles of equity (whether considered in a suit at law or in equity).

 

Section 4.5.                                          Representations and
Warranties of the Collateral Custodian.

 

The Collateral Custodian in its individual capacity and as Collateral Custodian
represents and warrants as follows:

 

(a)                                  Organization; Power and Authority.  It is a
duly organized and validly existing national banking association in good
standing under the laws of the United States.  It has full power, authority and
legal right to execute, deliver and perform its obligations as Collateral
Custodian under this Agreement.

 

(b)                                 Due Authorization.  The execution and
delivery of this Agreement and the consummation of the transactions provided for
herein have been duly authorized by all necessary action on its part, either in
its individual capacity or as Collateral Custodian, as the case may be.

 

(c)                                  No Conflict.  The execution and delivery of
this Agreement, the performance of the transactions contemplated hereby and the
fulfillment of the terms hereof will not conflict with, result in any breach of
its organizational documents or any of the material terms and provisions of, or
constitute (with or without notice or lapse of time or both) a default under any
indenture, contract, agreement, mortgage, deed of trust, or other instrument to
which the Collateral Custodian is a party or by which it or any of its property
is bound.

 

(d)                                 No Violation.  The execution and delivery of
this Agreement, the performance of the Transactions contemplated hereby and the
fulfillment of the terms hereof will not conflict with or violate, in any
material respect, any Applicable Law.

 

(e)                                  Consents.  All approvals, authorizations,
consents, orders or other actions of any Person or Governmental Authority
applicable to the Collateral Custodian, required in connection with the
execution and delivery of this Agreement, the performance by the Collateral
Custodian of the transactions contemplated hereby and the fulfillment by the
Collateral Custodian of the terms hereof have been obtained.

 

(f)                                    Validity, Etc.  The Agreement constitutes
the legal, valid and binding obligation of the Collateral Custodian, enforceable
against the Collateral Custodian in

 

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accordance with its terms, except as such enforceability may be limited by
applicable Insolvency Laws and general principles of equity (whether considered
in a suit at law or in equity).

 

Section 4.6.                                          Representations and
Warranties of the Principal.

 

The Principal in its individual capacity and as a Guarantor represents and
warrants as follows:

 

(a)           Power and Authority.  The Principal is over eighteen (18) years of
age and is a resident and citizen of the state of Nevada.  The Principal has
never gone by any name other than *****.

 

(b)           No Conflict.  The execution and delivery of this Agreement, the
performance of the transactions contemplated hereby and the fulfillment of the
terms hereof by the Principal will not conflict with, or result in any breach of
any of the material terms and provisions of, or constitute (with or without
notice or lapse of time or both) a default under any indenture, contract,
agreement, mortgage, deed of trust, or other instrument to which the Principal
is a party or by which it or any of its property is bound, in each case except
to the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect.

 

(c)           No Violation.  The execution and delivery of this Agreement, the
performance of the transactions contemplated hereby and the fulfillment of the
terms hereof by the Principal will not conflict with or violate, in any material
respect, any Applicable Law.

 

(d)           Consents.  All approvals, authorizations, consents, orders or
other actions of any Person or Governmental Authority applicable to the
Principal, required in connection with the execution and delivery of this
Agreement, the performance by the Principal of the transactions contemplated
hereby and the fulfillment by the Principal of the terms hereof have been
obtained.

 

(e)           Validity, Etc.  This Agreement constitutes the legal, valid and
binding obligation of the Principal, enforceable against the Principal in
accordance with its terms, except as such enforceability may be limited by
applicable Insolvency Laws or general principles of equity (whether considered
in a suit at law or in equity).

 

ARTICLE V

GENERAL COVENANTS

 

Section 5.1.                                          Affirmative Covenants of
the Borrowers.

 

From the date hereof until the Collection Date, each Borrower hereby covenants
and agrees as to itself and the Collateral in which it has an interest as
follows:

 

(a)           Compliance with Laws.  It will comply in all material respects
with all Applicable Laws, including those with respect to the Collateral or any
part thereof, except if the failure to comply could not reasonably be expected
to have a Material Adverse Effect.

 

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(b)           Preservation of Company Existence.  It will preserve and maintain
its limited liability company or statutory trust, as applicable, existence,
rights, franchises and privileges in the jurisdiction of its formation, and
qualify and remain qualified in good standing as a limited liability company or
statutory trust, as applicable, in each jurisdiction where the failure to
preserve and maintain such existence, rights, franchises, privileges and
qualification has had, or could reasonably be expected to have, a Material
Adverse Effect.

 

(c)           Performance and Compliance with Collateral.  It will, at its
expense, timely and fully perform and comply (or enforce its contractual rights
against the Originator or Sourcer to cause the Originator or Sourcer to perform
and comply pursuant to the applicable Sale Agreement or enforce its contractual
rights against the applicable Seller to cause such Seller to perform and comply
pursuant to the applicable Purchase and Sale Agreement) in all material respects
with all provisions, covenants and other promises required to be observed by it
under the Collateral and all other agreements related to such Collateral.

 

(d)           Keeping of Records and Books of Account.  It will maintain and
implement administrative and operating procedures (including, without
limitation, an ability to recreate records evidencing the Collateral in the
event of the destruction of the originals thereof) and keep and maintain all
documents, books, records and other information reasonably necessary or
advisable for the collection of all or any portion of the Collateral.

 

(e)           Protection of Interest in Collateral.  With respect to the
Receivables and Related Security, it will (i) acquire such Receivables and
Related Security pursuant to and in accordance with the terms of its Sale
Agreement, (ii) take all action necessary to perfect, protect and more fully
evidence such Borrower’s ownership of such Receivables and Related Security free
and clear of any Lien other than Permitted Liens, including, without limitation,
(a) with respect to the Receivables and that portion of the Collateral in which
a security interest may be perfected by filing, maintaining effective financing
statements against the Originator in all necessary or appropriate filing offices
(including any amendments thereto or assignments thereof) and filing
continuation statements, amendments or assignments with respect thereto in such
filing offices (including any amendments thereto or assignments thereof) and
(b) executing or causing to be executed such other instruments or notices as may
be reasonably necessary or appropriate, (iii) subject to Section 13.9, permit
the Administrative Agent or its respective agents or representatives to visit
its offices during normal office hours and upon reasonable notice examine and
make copies of all documents, books, records and other information concerning
the Collateral and discuss matters related thereto with any of its officers
having knowledge of such matters (it shall pay the costs and expenses for all
such visits), and (iv) take all additional action that the Administrative Agent
may reasonably request to perfect, protect and more fully evidence the
respective interests of the parties to this Agreement in the Collateral.

 

(f)            Deposit of Collections.  It shall direct each Obligor to make all
payments directly into the applicable Lockbox Account and (i) the LLC Borrower
shall promptly (but in no event later than one (1) Business Day after receipt)
deposit all Collections received by it into the Collection Account and (ii) each
of the Trust Borrower and Trust II Borrower shall promptly (but in no event
later than one (1) Business Day after receipt) deposit all Collections received
by it into the Concentration Account.

 

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(g)           Special Purpose Entity.  It shall take all necessary action
required to maintain compliance with the Special Purpose Entity requirements set
forth in Section 4.1(r).

 

(h)           Taxes.  It will file all appropriate tax returns and pay any and
all required Taxes (other than the amount of any Taxes the validity of which is
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in accordance with GAAP have been provided on its
books).

 

(i)            Use of Proceeds.  It will use the proceeds of the Loans only to
acquire Collateral and pay transaction expenses related hereto or other expenses
of itself.

 

(j)            Obligor Notification Forms.  It shall furnish the Administrative
Agent with an appropriate power of attorney to send (at the Administrative
Agent’s discretion after the occurrence of an Event of Default) Obligor
notification forms to give notice to the Obligors of the Secured Parties’
interest in the Collateral and the obligation to make payments as directed by
the Administrative Agent.

 

(k)           Notices.  It will furnish to the Administrative Agent:

 

(i)            Income Tax Liability.  Within ten (10) Business Days after the
receipt by a Responsible Officer of revenue agent reports or other written
proposals, determinations or assessments of the Internal Revenue Service or any
other taxing authority which propose, determine or otherwise set forth positive
adjustments to the Tax liability of any affiliated group (within the meaning of
Section 1504(a)(l) of the Code) of which it is a member which equal or exceed
$100,000 in the aggregate, telephonic or facsimile notice (confirmed in writing
within five (5) Business Days thereafter) specifying the nature of the items
giving rise to such adjustments and the amounts thereof;

 

(ii)           Auditors’ Management Letters.  Promptly after the receipt
thereof, any auditors’ management letters that are received by it;

 

(iii)          Representations and Warranties.  Forthwith upon its Responsible
Officer receiving knowledge of the same, it shall notify the Administrative
Agent if any representation or warranty set forth in Article IV was incorrect in
any material respect at the time it was given or deemed to have been given and
at the same time deliver to the Administrative Agent a written notice setting
forth in reasonable detail the nature of such facts and circumstances;

 

(iv)          Proceedings.  As soon as possible and in any event within five
(5) Business Days after its Responsible Officer receives notice or obtains
knowledge thereof, notice of any settlement of, judgment (including a judgment
with respect to the liability phase of a bifurcated trial) in or commencement of
any labor controversy, litigation, action, suit or proceeding before any court
or governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, which could reasonably be expected to have
a Material Adverse Effect; provided that notwithstanding the foregoing, any
settlement, judgment, labor controversy, litigation, action, suit or proceeding
affecting the Collateral, the Transaction Documents, the Secured Parties’
interest in the Collateral or in an amount in excess of $250,000 shall be
required to be reported;

 

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(v)           Notice of Material Events.  Promptly upon its Responsible Officer
becoming aware thereof, notice of any other event or circumstances that, in its
reasonable judgment, could reasonably be expected to have a Material Adverse
Effect;

 

(vi)          Events of Default.  Prompt (and in any event within one Business
Day) written notice of the occurrence of each Event of Default and each
Unmatured Event of Default of which its Responsible Officer has knowledge or has
received notice.  In addition, no later than three (3) Business Days following
its Responsible Officer’s knowledge or notice of the occurrence of any Event of
Default or Unmatured Event of Default, it will provide to the Administrative
Agent a written statement of a Responsible Officer of such Borrower setting
forth the details of such event and the action that such Borrower proposes to
take with respect thereto; and

 

(vii)         Accounting Changes.  As soon as possible and in any event within
ten (10) Business Days after the effective date thereof, notice of any material
change in its accounting policies.

 

(l)            Compliance With Transaction Documents.  It will comply in all
respects with the terms of this Agreement and the other Transaction Documents to
which it is a party.

 

(m)          Hedging.  If for any calendar month the Excess Spread is less that
6.00%, it shall be required to enter into Hedge Transactions, in form and
substance (and with counterparties) acceptable to the Administrative Agent in
its reasonable discretion, within 10 Business Days of the end of such calendar
month.

 

(n)           Other.  It will furnish to the Administrative Agent promptly, from
time to time, such other information, documents, records or reports respecting
the Collateral or the condition or operations, financial or otherwise, of it or
the Originator as the Administrative Agent may from time to time reasonably
request in order to protect the interests of the Secured Parties under or as
contemplated by this Agreement.

 

Section 5.2.                                          Negative Covenants of the
Borrowers.

 

From the date hereof until the Collection Date, each Borrower hereby covenants
and agrees as to itself and the Collateral in which it has an interest as
follows:

 

(a)           Other Business.  It will not (i) engage in any business other than
the transactions contemplated by the Transaction Documents and the “Transaction
Documents” (as defined in the Term Credit Agreement), (ii) incur any
Indebtedness, other than pursuant to or permitted by this Agreement or under the
other Transaction Documents and the “Transaction Documents” (as defined in the
Term Credit Agreement), or (iii) form any Subsidiary or make any Investment in
any other Person (other than Permitted Investments, “Permitted Investments” (as
defined in the Term Credit Agreement) and the LLC Borrower’s ownership of the
Trust Borrower).

 

(b)           Collateral Not to be Evidenced by Instruments.  It will take no
action to cause any Receivable that is not, as of the Closing Date, evidenced by
an Instrument, to be so evidenced except in connection with the enforcement or
collection of such Receivable.

 

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(c)           Security Interests.  Except as permitted by the Transaction
Documents and the “Transaction Documents” (as defined in the Term Credit
Agreement), it will not sell, pledge, assign or transfer, or grant, create,
incur, assume or suffer to exist any Lien (except for Permitted Liens) on, any
Collateral, whether now existing or hereafter transferred hereunder, or any
interest therein, to any other Person.  It will promptly notify the
Administrative Agent of the existence of any Lien (other than Permitted Liens)
on any Collateral and it shall defend the right, title and interest of the
Administrative Agent, as agent for the Secured Parties in, to and under the
Collateral against all claims of third parties.

 

(d)           Mergers, Acquisitions, Sales, etc.  It will not be a party to any
merger or consolidation, or purchase or otherwise acquire all or substantially
all of the assets, any stock of any class of, or any partnership or joint
venture interest in, any other Person, or sell, transfer, convey or lease any of
its assets, or sell or assign with or without recourse any Collateral or any
interest therein (in each case other than as expressly permitted pursuant to
this Agreement, its Sale Agreement, the Term Credit Agreement or the
“Transaction Documents” (as defined in the Term Credit Agreement) or in the
ordinary course of business).

 

(e)           Deposits to Collection Account.  It will not deposit or otherwise
credit, or cause or permit to be so deposited or credited, to the Collection
Account cash or cash proceeds other than Collections in respect of the
Collateral.

 

(f)            Restricted Payments.  It shall not declare or pay any dividends
or distributions (i) except as permitted under its organizational documents, and
(ii) at any time when an Event of Default or Unmatured Event of Default has
occurred and is continuing or would result therefrom.

 

(g)           Change of Name or Location of Servicing Files.  It shall not
(x) change its name, move the location of its principal place of business and
chief executive office, change the offices where it keeps the records from the
location referred to on Annex A hereto, or change the jurisdiction of its
organization, or (y) move, or consent to the Collateral Custodian or Servicer
moving, the Required Receivable Files or the Servicing Files from the location
thereof on the Closing Date, unless in each case it has given at least ten
(10) days’ written notice to the Administrative Agent and has taken all actions
required under the UCC of each relevant jurisdiction in order to continue the
first priority perfected security interest (subject to Permitted Liens) of the
Administrative Agent, as agent for the Secured Parties, in the Collateral.

 

(h)           Accounting of Purchases.  Other than for tax and consolidated
accounting purposes, it will not account for or treat (whether in financial
statements or otherwise) the transactions contemplated by its Sale Agreement in
any manner other than as a sale of the Receivables and Related Security to it.

 

(i)            ERISA Matters.  It will not establish or permit any ERISA
Affiliate to establish any Benefit Plan or Multiemployer Plan.

 

(j)            Organizational Documents; Sale Agreement.  It will not amend,
modify, waive or terminate any provision of its Sale Agreement without the prior
written consent of the Administrative Agent (such consent not to be unreasonably
withheld).  In addition, it will not

 

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amend any material portion of its organizational documents without the prior
written consent of the Administrative Agent (such consent not to be unreasonably
withheld).

 

(k)           Changes in Payment Instructions to Obligors.  It will not add or
terminate any bank as a Lockbox Account Bank or any Lockbox Account listed in
Schedule VI or make any change, or permit the Servicer to make any change, in
its instructions to Obligors regarding payments to be made with respect to the
Collateral to the applicable Lockbox Account, unless the Administrative Agent
has consented to such addition, termination or change and it has notified the
Collateral Custodian.

 

(l)            Extension or Amendment of Collateral.  It will not, except as
otherwise permitted in Section 6.4(a), extend, amend or otherwise modify, or
permit the any other Person to extend, amend or otherwise modify, the material
terms of any Receivable (including the Related Security).

 

Section 5.3.                                          Affirmative Covenants of
the Servicer.

 

From the date hereof until the Collection Date the Servicer covenants and agrees
as follows:

 

(a)           Compliance with Law.  The Servicer will comply in all material
respects with all Applicable Laws, including those with respect to the
Collateral or any part thereof, except if the failure to comply could not
reasonably be expected to have a Material Adverse Effect.

 

(b)           Preservation of Company Existence.  The Servicer will preserve and
maintain its organizational existence, rights, franchises and privileges in the
jurisdiction of its formation, and qualify and remain qualified in good standing
as a limited liability company (or other applicable entity in the case of a
successor Servicer), in each jurisdiction where the failure to preserve and
maintain such existence, rights, franchises, privileges and qualification has
had, or could reasonably be expected to have, a Material Adverse Effect.

 

(c)           Obligations and Compliance with Collateral.  The Servicer will
duly fulfill and comply with all obligations on the part of each Borrower to be
fulfilled or complied with under or in connection with the Collateral and will
do nothing to impair the rights of the Administrative Agent, as agent for the
Secured Parties, in, to and under the Collateral except as otherwise permitted
in the Transaction Documents.

 

(d)           Keeping of Records and Books of Account.

 

(i)            The Servicer will maintain and implement administrative and
operating procedures (including, without limitation, an ability to recreate
records evidencing Collateral in the event of the destruction of the originals
thereof), and keep and maintain all documents, books, records and other
information reasonably necessary or advisable for the collection and the
identification of the Collateral.

 

(ii)           Subject to Section 13.9, the Servicer shall permit the
Administrative Agent, the Backup Servicer, each Lender or their respective
agents or

 

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representatives, to visit the offices of the Servicer during normal office hours
and upon reasonable notice and examine and make copies of all documents, books,
records and other information concerning the Collateral and discuss matters
related thereto with any of the officers or executive employees of the Servicer
having knowledge of such matters; the Servicer shall pay the costs and expenses
for all such visits; provided, however, that any successor Servicer shall not be
required to pay any such costs and expenses, shall be given five Business Days
notice of any such visit and shall be subject to only two visits per calendar
year.

 

(iii)          The initial Servicer will on or prior to each Funding Date, mark
its master data processing records and other books and records relating to the
Collateral with a legend, acceptable to the Administrative Agent, describing
(A) the sale of the Collateral to a Borrower pursuant to its Sale Agreement and
(B) the grant of a security interest by the Borrowers to the Administrative
Agent as agent for the Secured Parties hereunder.

 

(e)           [Reserved].

 

(f)            Credit and Collection Policy.  The Servicer will (i) comply in
all material respects with the Credit and Collection Policy in regard to the
Collateral, and (ii) furnish to the Administrative Agent, prior to its effective
date, written notice of any proposed changes in the Credit and Collection
Policy.  The Servicer will not agree to or otherwise permit to occur any
material change in the Credit and Collection Policy or the credit and collection
policy of any Sub-Servicer without the prior written consent of the
Administrative Agent; provided that no consent shall be required from the
Administrative Agent in connection with any change mandated by Applicable Law or
a Governmental Authority as evidenced by an Opinion of Counsel to that effect
delivered to the Administrative Agent.

 

(g)           Events of Default.  The Servicer will provide the Administrative
Agent with prompt (and in any event within one Business Day) written notice of
the occurrence of each Event of Default and each Unmatured Event of Default of
which a Responsible Officer of the Servicer has knowledge or has received
notice.  In addition, no later than three (3) Business Days following a
Responsible Officer of the Servicer’s knowledge or notice of the occurrence of
any Event of Default or Unmatured Event of Default, the Servicer will provide to
the Administrative Agent a written statement of the chief financial officer or
chief accounting officer of the Servicer setting forth the details of such event
and the action that the Servicer proposes to take with respect thereto.

 

(h)           Taxes.  The Servicer will file all appropriate tax returns and pay
any and all required Taxes (other than the amount of any Taxes the validity of
which is currently being contested in good faith by appropriate proceedings and
with respect to which reserves in accordance with GAAP have been provided on the
books of the Servicer).

 

(i)            Other.  The Servicer will promptly furnish to the Administrative
Agent such other information, documents, records or reports respecting the
Collateral or the condition or operations, financial or otherwise, of each
Borrower or the Servicer as the Administrative Agent may from time to time
reasonably request in order to protect the interests of the Administrative Agent
and the Secured Parties under or as contemplated by this Agreement.

 

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(j)            Proceedings.  As soon as possible and in any event within five
(5) Business Days after a Responsible Officer of the Servicer receives notice or
obtains knowledge thereof, the Servicer will furnish to the Administrative Agent
notice of any settlement of, judgment (including a material judgment with
respect to the liability phase of a bifurcated trial) in or commencement of any
labor controversy, litigation, action, suit or proceeding before any court or
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, in each case, relating to the Servicer, which could
reasonably be expected to have a Material Adverse Effect.

 

(k)           Deposit of Collections.  The Servicer shall direct each Obligor to
make payments directly to the applicable Lockbox Account and shall promptly (but
in no event later than one (1) Business Day after receipt) deposit into the
Collection Account any and all Collections received directly by it or by each
Borrower (in the case of the initial Servicer, in which case the initial
Servicer will be acting on each Borrower’s behalf).

 

(l)            Change of Control.  Upon the occurrence of a Change of Control of
the Servicer, the initial Servicer shall provide the Administrative Agent, the
Backup Servicer and each Lender with written notice of such Change of Control
within two (2) Business Days after the occurrence of the same.

 

(m)          Special Purpose Entity Requirements.  The initial Servicer shall
take such actions as are necessary to cause each Borrower to be in compliance
with the Special Purpose Entity requirements set forth in Section 4.1(r).

 

(n)           Servicing System Changes.  As soon as possible and in any event
within five (5) Business Days after the effective date thereof, the Servicer
will provide the Backup Servicer notice of any material changes to its servicing
systems.

 

(o)           Notices.  The Servicer will furnish to the Administrative Agent
and the Backup Servicer prior written notice of any changes to its name or
location of its principal place of business or chief executive office.

 

Section 5.4.                                          Negative Covenants of the
Servicer.

 

From the date hereof until the Collection Date, the Servicer hereby covenants
and agrees:

 

(a)           Deposits to Collection Account.  The Servicer will not deposit or
otherwise credit, or cause or permit to be so deposited or credited, to the
Collection Account cash or cash proceeds other than Collections in respect of
the Collateral.

 

(b)           Mergers, Acquisition, Sales, etc.  The Servicer will not
consolidate with or merge into any other Person or convey or transfer its
properties and assets substantially as an entirety to any Person, unless the
Servicer is the surviving entity and unless:

 

(i)            the Servicer has delivered to the Administrative Agent an
Officer’s Certificate stating that any such consolidation, merger, conveyance or
transfer and any supplemental agreement executed in connection therewith comply
with this Section 5.4 and that all conditions precedent herein provided for
relating to such transaction have been complied with

 

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and, in the case of a supplemental agreement, the delivery of an Opinion of
Counsel stating that such supplemental agreement is legal, valid and binding
with respect to the Servicer and such other matters as the Administrative Agent
may reasonably request;

 

(ii)           the Servicer shall have delivered notice of such consolidation,
merger, conveyance or transfer to the Administrative Agent and obtained the
consent of the Administrative Agent (such consent not to be unreasonably
withheld); and

 

(iii)          after giving effect thereto, no Unmatured Event of Default or
Event of Default shall have occurred.

 

(c)           Change of Location of Servicing Files.  The Servicer shall not
(x) change the offices where it keeps records concerning the Collateral from the
location referred to on Annex A hereto, or (y) move, or consent to the
Collateral Custodian moving, the Required Receivable Files or Servicing Files
from the location thereof on the Closing Date, unless the Servicer has given at
least ten (10) days’ written notice to the Administrative Agent.

 

(d)           Change in Payment Instructions to Obligors.  The Servicer will not
add or  terminate any bank as a Lockbox Account Bank or any Lockbox Account
listed in Schedule VI or make any change in its instructions to Obligors
regarding payments to be made to the applicable Lockbox Account, unless the
Administrative Agent has consented to such addition, termination or change and
the Collateral Custodian has been notified.

 

(e)           Extension or Amendment of Receivables.  The Servicer will not,
except as otherwise permitted in Section 6.4(a), extend, amend or otherwise
modify the terms of any Receivable (including the Related Security).

 

Section 5.5.                                          Affirmative Covenants of
the Originator.

 

From the date hereof until the Collection Date, the Originator hereby covenants
and agrees as follows:

 

(a)           Compliance with Law.  The Originator will comply with all
Applicable Laws, including those with respect to the Collateral or any part
thereof, except if the failure to comply could not reasonably be expected to
have a Material Adverse Effect.

 

(b)           Preservation of Company Existence.  The Originator will preserve
and maintain its organizational existence, rights, franchises and privileges in
the jurisdiction of its formation, and qualify and remain qualified in good
standing as a limited partnership, in each jurisdiction where the failure to
preserve and maintain such existence, rights, franchises, privileges and
qualification has had, or could reasonably be expected to have, a Material
Adverse Effect.

 

(c)           Obligations and Compliance with Collateral.  The Originator will
do nothing to impair the rights of the Administrative Agent, as agent for the
Secured Parties, in, to and under the Collateral.

 

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(d)           Keeping of Records and Books of Account.

 

(i)            The Originator will maintain and implement administrative and
operating procedures (including, without limitation, an ability to recreate
records evidencing Collateral in the event of the destruction of the originals
thereof), and keep and maintain all documents, books, records and other
information reasonably necessary or advisable for the collection and the
identification of the Collateral.

 

(ii)           Subject to Section 13.9, the Originator shall permit the
Administrative Agent, the Backup Servicer, each Lender or their respective
agents or representatives, to visit the offices of the Originator during normal
office hours and upon reasonable notice and examine and make copies of all
documents, books, records and other information concerning the Collateral and
discuss matters related thereto with any of the officers or executive employees
of the Originator having knowledge of such matters; the Originator shall pay the
costs and expenses for all such visits.

 

(iii)          The Originator will on or prior to each Funding Date, mark its
master data processing records and other books and records relating to the
Collateral with a legend, acceptable to the Administrative Agent, describing
(A) the sale of the Collateral to the LLC Borrower pursuant to its Sale
Agreement and (B) the grant of a security interest by the LLC Borrower to the
Administrative Agent as agent for the Secured Parties hereunder.

 

(e)           Events of Default.  The Originator will provide the Administrative
Agent with prompt (and in any event within one Business Day) written notice of
the occurrence of each Event of Default and each Unmatured Event of Default of
which a Responsible Officer of the Originator has knowledge or has received
notice.

 

(f)            Taxes.  The Originator will file all appropriate tax returns and
pay any and all required Taxes (other than the amount of any Taxes the validity
of which is currently being contested in good faith by appropriate proceedings
and with respect to which reserves in accordance with GAAP have been provided on
the books of the Originator).

 

(g)           Other.  The Originator will promptly furnish to the Administrative
Agent such other information, documents, records or reports respecting the
Collateral or the condition or operations, financial or otherwise, of the LLC
Borrower or the Originator as the Administrative Agent may from time to time
reasonably request in order to protect the interests of the Administrative Agent
and the Secured Parties under or as contemplated by this Agreement.

 

(h)           Proceedings.  As soon as possible and in any event within five
(5) Business Days after a Responsible Officer of the Originator receives notice
or obtains knowledge thereof, the Originator will furnish to the Administrative
Agent notice of any settlement of, judgment (including a material judgment with
respect to the liability phase of a bifurcated trial) in or commencement of any
labor controversy, litigation, action, suit or proceeding before any court or
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, in each case, relating to the Originator, which could
reasonably be expected to have a Material Adverse Effect.

 

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(i)            Deposit of Collections.  The Originator shall promptly (but in no
event later than one (1) Business Day after receipt) deposit into the Collection
Account any and all Collections received directly by it.

 

(j)            Change of Control.  Upon the occurrence of a Change of Control of
the Originator, the Originator shall provide the Administrative Agent and each
Lender with notice of such Change of Control within two (2) Business Days after
the occurrence of the same.

 

(k)           Special Purpose Entity Requirements.  The Originator shall take
such actions as are necessary to cause the Borrowers to be in compliance with
the Special Purpose Entity requirements set forth in Section 4.1(r).

 

(l)            Notices.  The Originator will furnish to the Administrative Agent
and the Backup Servicer prior written notice of any changes to its name or
location of its principal place of business or chief executive office.

 

(m)          E&O Insurance.  The Originator shall at all times maintain an
errors and omissions insurance policy, in form and substance reasonably
acceptable to Administrative Agent, of the type customarily in force with
respect to entities engaged in similar financings, with at all times a principal
face amount of no less than $1,000,000 under which the Administrative Agent, on
behalf of the Secured Parties, will be named both beneficiary and loss payee. 
The Originator shall, no less than annually, provide the Administrative Agent
with written evidence of policy renewal and payment of premiums.

 

(n)           Fidelity Bond.  The Originator shall at all times maintain a
fidelity bond, in form and substance reasonably acceptable to Administrative
Agent, of the type customarily in force with respect to entities engaged in
similar financings, with at all times a principal face amount of no less than
$1,000,000 under which the Administrative Agent, on behalf of the Secured
Parties, will be named both beneficiary and loss payee.  The Originator shall,
no less than annually, provide the Administrative Agent with written evidence of
policy renewal and payment of premiums.

 

Section 5.6.                                          Negative Covenants of the
Originator.

 

From the date hereof until the Collection Date, the Originator hereby covenants
and agrees as follows:

 

(a)           Deposits to Collection Account.  The Originator will not deposit
or otherwise credit, or cause or permit to be so deposited or credited, to the
Collection Account cash or cash proceeds other than Collections in respect of
the Collateral.

 

(b)           Mergers, Acquisition, Sales, etc.  The Originator will not
consolidate with or merge into any other Person or convey or transfer its
properties and assets substantially as an entirety to any Person, unless the
Originator is the surviving entity and unless:

 

(i)            the Originator has delivered to the Administrative Agent an
Officer’s Certificate stating that any such consolidation, merger, conveyance or
transfer and any supplemental agreement executed in connection therewith comply
with this Section 5.6 and that

 

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all conditions precedent herein provided for relating to such transaction have
been complied with and, in the case of a supplemental agreement, the delivery of
an Opinion of Counsel stating that such supplemental agreement is legal, valid
and binding with respect to the Originator and such other matters as the
Administrative Agent may reasonably request;

 

(ii)           the Originator shall have delivered notice of such consolidation,
merger, conveyance or transfer to the Administrative Agent and obtained the
consent of the Administrative Agent (such consent not to be unreasonably
withheld); and

 

(iii)          after giving effect thereto, no Unmatured Event of Default or
Event of Default shall have occurred.

 

(c)           Change of Location of Servicing Files.  The Originator shall not
(x) change the offices where it keeps records concerning the Collateral from the
location referred to on Annex A hereto, or (y) move, or consent to the
Collateral Custodian moving, the Required Receivable Files or Servicing Files
from the location thereof on the Closing Date, unless the Originator has given
at least ten (10) days’ written notice to the Administrative Agent.

 

(d)           Change in Payment Instructions to Obligors.  The Originator will
not add or  terminate any bank as a Lockbox Account Bank or any Lockbox Account
listed in Schedule VI or make any change in the instructions to Obligors
regarding payments to be made to the applicable Lockbox Account, unless the
Administrative Agent has consented to such addition and the Collateral Custodian
has been notified.

 

(e)           Extension or Amendment of Receivables.  The Originator will not,
except as otherwise permitted in Section 6.4(a), extend, amend or otherwise
modify the terms of any Receivable (including the Related Security).

 

Section 5.7.                                          Affirmative Covenants of
the Backup Servicer.

 

From the date hereof until the Collection Date, the Backup Servicer hereby
covenants and agrees as follows:

 

(a)           Compliance with Law.  The Backup Servicer will comply with all
Applicable Law.

 

(b)           Preservation of Existence.  The Backup Servicer will preserve and
maintain its existence, rights, franchises and privileges in the jurisdiction of
its formation, and qualify and remain qualified in good standing in each
jurisdiction where the failure to preserve and maintain such existence, rights,
franchises, privileges and qualification has had, or could reasonably be
expected to have, a Material Adverse Effect.

 

Section 5.8.                                          Negative Covenants of the
Backup Servicer.

 

From the date hereof until the Collection Date, the Backup Servicer will not
make any changes to the Backup Servicing Fee set forth in the Backup Servicer
Fee Letter without the prior written approval of the Administrative Agent.

 

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Section 5.9.                                          Affirmative Covenants of
the Collateral Custodian.

 

From the date hereof until the Collection Date, the Collateral Custodian hereby
covenants and agrees as follows:

 

(a)           Compliance with Law.  The Collateral Custodian will comply in all
material respects with all Applicable Law.

 

(b)           Preservation of Existence.  The Collateral Custodian will preserve
and maintain its existence, rights, franchises and privileges in the
jurisdiction of its formation and qualify and remain qualified in good standing
in each jurisdiction where failure to preserve and maintain such existence,
rights, franchises, privileges and qualification has had, or could reasonably be
expected to have, a Material Adverse Effect.

 

(c)           Location of Required Receivable Files.  Subject to Section 8.8,
the Required Receivable Files shall remain at all times in the possession of the
Collateral Custodian at the address set forth on Annex A to this Agreement
unless notice of a different address is given in accordance with the terms
hereof or unless the Administrative Agent agrees to allow certain Required
Receivable Files to be released to the Servicer on a temporary basis in
accordance with the terms hereof, except as such Required Receivable Files may
otherwise be released pursuant to this Agreement.

 

Section 5.10.                                   Negative Covenants of the
Collateral Custodian.

 

From the date hereof until the Collection Date, the Collateral Custodian hereby
covenants and agrees as follows:

 

(a)           Required Receivable Files.  The Collateral Custodian will not
dispose of any Required Receivable File documents in any manner that is
inconsistent with the performance of its obligations as the Collateral Custodian
pursuant to this Agreement and will not dispose of any Collateral except as
contemplated by this Agreement.

 

(b)           No Changes to Collateral Custodian Fee.  The Collateral Custodian
will not make any changes to the Collateral Custodian Fee set forth in the
Collateral Custodian Fee Letter without the prior written approval of the
Administrative Agent.

 

ARTICLE VI

 

ADMINISTRATION AND SERVICING OF CONTRACTS

 

Section 6.1.                                          Designation of the
Servicer.

 

(a)           Initial Servicer.  The servicing, administering and collection of
the Collateral shall be conducted by the Person designated as the Servicer
hereunder from time to time in accordance with this Section 6.1.  Until the
Administrative Agent gives to ***** a Servicer Termination Notice, ***** is
hereby appointed as, and hereby accepts such appointment and agrees to perform
the duties and responsibilities of, the Servicer pursuant to the terms hereof.

 

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(b)           Successor Servicer.  Upon the Servicer’s receipt of a Servicer
Termination Notice from the Administrative Agent pursuant to Section 6.12, the
Servicer agrees that it will terminate its activities as Servicer hereunder in a
manner that will facilitate the transition of the performance of such activities
to a successor Servicer, as reasonably determined by the Administrative Agent,
and the successor Servicer shall assume each and all of the Servicer’s
obligations to service and administer the Collateral, on the terms and subject
to the conditions herein set forth, and the Servicer shall use its best efforts
to assist the successor Servicer in assuming such obligations.

 

(c)           Subcontracts.  The Servicer may, with the prior written consent of
the Administrative Agent and with notice to the Backup Servicer, subcontract
with any other Person for servicing, administering or collecting the Collateral;
provided that (i) the Servicer shall remain liable for the performance of the
duties and obligations of the Servicer pursuant to the terms hereof without
regard to any subcontracting arrangement, (ii) any sub-servicing agreement with
a Sub-Servicer will permit the Administrative Agent on-site inspection rights at
such Sub-Servicer’s offices twice per calendar year prior to a Servicer Default
or an Event of Default and unlimited inspection rights at such Sub-Servicer’s
office after a Servicer Default or an Event of Default, (iii) any such
sub-servicing agreement shall be terminable by notice from the Administrative
Agent upon the occurrence of a Servicer Default, and (iv) any such sub-servicing
agreement will include provisions that (A) the Administrative Agent on behalf of
the Secured Parties is a third party beneficiary thereof, and (B) no amendments
thereto will be permitted without the consent of the Administrative Agent.  The
Administrative Agent hereby consents to the delegation by the Servicer of the
servicing of the Receivables of the Trust Borrower (including those Receivables
sold by the Trust Borrower to the Trust II Borrower pursuant to the Purchase
Agreement) to ***** under the Sourcing and Servicing Agreement and the Servicer
hereby does so delegate.

 

(d)           Servicing Programs.  In the event that the initial Servicer or any
Sub-Servicer uses any software program in servicing the Collateral that it
licenses from a third party, the initial Servicer or such Sub-Servicer, as
applicable, shall use commercially reasonable efforts to obtain, either before
the applicable Funding Date for the related Receivables or as soon as possible
thereafter, whatever licenses or approvals are necessary to allow the
Administrative Agent and the Backup Servicer to use such program and to allow
the initial Servicer or the Sub-Servicer, as applicable, to assign such licenses
to the Backup Servicer or to any other Successor Servicer appointed as provided
in this Agreement.

 

Section 6.2.                                          Duties of the Servicer.

 

(a)           Appointment.  Each Borrower hereby appoints the Servicer as its
agent, as from time to time designated pursuant to Section 6.1, to service the
Collateral and enforce its rights in, to and under such Collateral.  The
Servicer hereby accepts such appointment and agrees to perform the duties and
obligations with respect thereto as set forth herein.  The Servicer and each
Borrower hereby acknowledges that the Administrative Agent and the other Secured
Parties are third party beneficiaries of the obligations undertaken by the
Servicer hereunder.

 

(b)           Duties.  The Servicer (or the Sub-Servicer on its behalf) shall
take or cause to be taken all such actions as may be reasonably necessary or
advisable to collect on the

 

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Collateral from time to time, all in accordance with Applicable Law, the Credit
and Collection Policy and the Servicing Standard.  Without limiting the
foregoing, the duties of the Servicer  shall include the following:

 

(i)            preparing and submitting claims to, and acting as post-billing
liaison with, Obligors on each Receivable;

 

(ii)           maintaining all reasonably necessary servicing records with
respect to the Collateral and providing such reports, information and servicing
records to the Administrative Agent and Collateral Custodian in respect of the
servicing of the Collateral (including information relating to its performance
under this Agreement) as may be required hereunder or as the Administrative
Agent and the Collateral Custodian may reasonably request;

 

(iii)          maintaining and implementing administrative and operating
procedures (including, without limitation, an ability to recreate servicing
records evidencing the Collateral in the event of the destruction of the
originals thereof) and keeping and maintaining all documents, books, records and
other information reasonably necessary or advisable for the collection of the
Collateral;

 

(iv)          identifying each Receivable clearly and unambiguously in its
servicing records to reflect that such Receivable is owned by the applicable
Borrower and that such Borrower is granting a security interest therein to the
Administrative Agent for the benefit of the Secured Parties pursuant to this
Agreement;

 

(v)           notifying the Administrative Agent of any material action, suit,
proceeding, dispute, offset, deduction, defense or counterclaim (1) that is, or
to the Servicer’s knowledge threatened to be, asserted by an Obligor with
respect to any Receivable (or portion thereof) of which it has knowledge or has
received notice; and (2) that could reasonably be expected to have a Material
Adverse Effect;

 

(vi)          providing written notice to the Administrative Agent, prior to the
effective date thereof, of any material proposed changes in the Credit and
Collection Policy;

 

(vii)         maintaining the first priority perfected security interest
(subject to Permitted Liens) of the Administrative Agent, as agent for the
Secured Parties, in the Collateral;

 

(viii)        maintaining the Servicing Files with respect to Receivables; and

 

(ix)           directing the Collateral Custodian to make payments pursuant to
the terms of the Servicing Report in accordance with Section 2.7 and
Section 2.8, as applicable.

 

(c)           Notwithstanding anything to the contrary contained herein, the
exercise by the Secured Parties of their rights hereunder shall not release the
Servicer, the Originator or the Borrowers from any of their duties or
responsibilities with respect to the Collateral.  The Secured Parties, the
Backup Servicer and the Collateral Custodian shall not have any obligation or
liability with respect to any Collateral (except as otherwise provided herein in
the case of the Collateral Custodian and the Backup Servicer), nor shall any of
them be obligated to perform any of the obligations of the Servicer hereunder.

 

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(d)           Any payment by an Obligor in respect of any indebtedness owed by
it to the applicable Borrower shall, except as otherwise specified by such
Obligor or otherwise required by contract or law and unless otherwise instructed
by the Administrative Agent, be applied as a collection of a payment by such
Obligor (starting with the oldest such outstanding payment due) to the extent of
any amounts then due and payable thereunder before being applied to any other
receivable or other obligation of such Obligor.

 

Section 6.3.           Authorization of the Servicer.

 

(a)           Each of the Borrowers and the Administrative Agent hereby
authorizes the Servicer (including any successor thereto) to take any and all
reasonable steps in its name and on its behalf necessary or desirable in the
determination of the Servicer and not inconsistent with the sale of the
Collateral from a Seller to the Originator pursuant to a Purchase and Sale
Agreement and from the Originator to the LLC Borrower under its Sale Agreement
and, thereafter, the pledge by the Borrowers to the Administrative Agent, on
behalf of the Secured Parties, hereunder, to collect all amounts due under any
and all Collateral, including, without limitation, endorsing any of their names
on checks and other instruments representing Collections, executing and
delivering any and all instruments of satisfaction or cancellation, or of
partial or full release or discharge, and all other comparable instruments, with
respect to the Collateral and, after the delinquency of any Collateral and to
the extent permitted under and in compliance with Applicable Law, to commence
proceedings with respect to enforcing payment thereof.  The Originator, the
Borrowers and the Administrative Agent, on behalf of the Secured Parties, shall
furnish the Servicer (and any successors thereto) with any powers of attorney
and other documents necessary or appropriate to enable the Servicer to carry out
its servicing and administrative duties hereunder, and shall cooperate with the
Servicer to the fullest extent in order to ensure the collectibility of the
Collateral.  In no event shall the Servicer be entitled to make any Secured
Party, the Collateral Custodian or the Administrative Agent a party to any
litigation without such party’s express prior written consent, or to make a
Borrower a party to any litigation (other than any routine foreclosure or
similar collection procedure) without the Administrative Agent’s consent.

 

(b)           After the declaration of the Termination Date, at the direction of
the Administrative Agent, the Servicer shall take such action as the
Administrative Agent may reasonably deem necessary or advisable to enforce
collection of the Collateral; provided that the Administrative Agent may, at any
time that an Event of Default has occurred and is continuing, notify any Obligor
with respect to any Collateral of the assignment of such Collateral to the
Administrative Agent, on behalf of the Secured Parties, and direct that payments
of all amounts due or to become due be made directly to the Administrative Agent
or any servicer, collection agent or account designated by the Administrative
Agent and, upon such notification and at the expense of the Borrowers, the
Administrative Agent may enforce collection of any such Collateral, and adjust,
settle or compromise the amount or payment thereof.

 

Section 6.4.                                          Collection of Payments;
Accounts.

 

(a)           Collection Efforts, Modification of Collateral.  The Servicer will
use commercially reasonable efforts to collect, or cause to be collected, all
payments called for under the terms and provisions of the Receivables included
in the Collateral as and when the same

 

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become due in accordance with the Credit and Collection Policy and the Servicing
Standard.  The Servicer may not waive, modify or otherwise vary any provision of
an item of Collateral in a manner that would impair the collectibility of the
Collateral or in any manner contrary to the Credit and Collection Policy and the
Servicing Standard.

 

(b)           Prepaid Receivable.  The Servicer may not consent to a Receivable
becoming a Prepaid Receivable, in whole or in part, unless (x) the applicable
Borrower provides a Substitute Receivable in accordance with Section 2.15 or
(y) such prepayment (plus any concurrent deposits made by the Servicer) (i) will
not result in the Collection Account receiving an amount less than the sum of
(a) the outstanding principal balance thereof (or portion thereof to be prepaid)
on the date of such payment, and (b) any accrued and unpaid interest thereon
(such sum, the “Prepayment Amount”) or (ii) is in compliance with the Underlying
Instruments for the applicable Receivable and such prepayment is consented to by
the Servicer in accordance with the Servicing Standard.

 

(c)           Acceleration.  If required by the Credit and Collection Policy or
if consistent with the Servicing Standard and the related Underlying
Instruments, the Servicer shall accelerate the maturity of all or any Scheduled
Payments and other amounts due under any Receivable promptly after such
Receivable becomes a Defaulted Receivable.

 

(d)           Taxes and other Amounts.  The Servicer will use commercially
reasonable efforts in accordance with the Servicing Standard to collect all
payments with respect to amounts due for Taxes, assessments and insurance
premiums relating to each Receivable to the extent required to be paid to a
Borrower for such application under the Underlying Instrument and remit such
amounts to the appropriate Governmental Authority or insurer as required by the
Underlying Instruments.

 

(e)           Payments to Lockbox Account.  On or before the Closing Date, the
Servicer shall have instructed all Obligors to make all payments in respect of
the Collateral directly to the applicable Lockbox Account.

 

(f)            Accounts.  Each of the parties hereto hereby agrees that (i) each
Account shall be deemed to be a Securities Account and (ii) except as otherwise
expressly provided herein, the Administrative Agent shall be exclusively
entitled to exercise the rights that comprise each Financial Asset held in each
Account.  Each of the parties hereto hereby agrees to cause the Collateral
Custodian or any other Securities Intermediary that holds any money or other
property for Borrowers in an Account to agree with the parties hereto that
(A) the cash and other property (subject to Section 6.4(g) below with respect to
any property other than investment property, as defined in Section 9-102(a)(49)
of the UCC) is to be treated as a Financial Asset under Article 8 of the UCC and
(B) the “securities intermediary’s jurisdiction” (within the meaning of
Section 8-110 of the UCC) for that purpose shall be the State of New York.  In
no event may any Financial Asset held in any Account be registered in the name
of, payable to the order of, or specially Indorsed to, a Borrower, unless such
Financial Asset has also been Indorsed in blank or to the Collateral Custodian
or other Securities Intermediary that holds such Financial Asset in such
Account.

 

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(g)           Underlying Instruments.  Notwithstanding any term hereof (or any
term of the UCC that might otherwise be construed to be applicable to a
“securities intermediary” as defined in the UCC) to the contrary, none of the
Collateral Custodian nor any Securities Intermediary shall be under any duty or
obligation in connection with the acquisition by a Borrower of or the grant by a
Borrower to the Administrative Agent of a security interest in any Receivable to
examine or evaluate the sufficiency of the documents or instruments delivered to
it by or on behalf of a Borrower under the related Underlying Instruments, or
otherwise to examine the Underlying Instruments, in order to determine or compel
compliance with any applicable requirements of or restrictions on transfer
(including without limitation any necessary consents).  The Collateral Custodian
shall hold any Instrument delivered to it evidencing any Receivable hereunder as
custodial agent for the Administrative Agent in accordance with the terms of
this Agreement.

 

(h)           Establishment of the Collection Account.  The Servicer shall cause
to be established, on or before the Closing Date, with the Collateral Custodian,
and maintained in the name of the LLC Borrower, subject to the Lien of the
Administrative Agent, a segregated corporate trust account entitled “Collection
Account for *****” (the “Collection Account”), over which the Administrative
Agent as agent for the Secured Parties, shall have control and from which none
of the Originator, the Servicer, the Sub-Servicer nor the Borrowers shall have
any right of withdrawal.

 

(i)            Adjustments.  If (i) the Servicer makes a deposit into the
Collection Account in respect of a Collection of a Receivable and such
Collection was received by the Servicer in the form of a check that is not
honored for any reason or (ii) the Servicer makes a mistake with respect to the
amount of any Collection and deposits an amount that is less than or more than
the actual amount of such Collection, the Servicer shall appropriately adjust
the amount subsequently deposited into the Collection Account to reflect such
dishonored check or mistake.  Any Scheduled Payment in respect of which a
dishonored check is received shall be deemed not to have been paid.

 

Section 6.5.                                          Realization Upon Defaulted
Receivables.

 

The Servicer will use commercially reasonable efforts consistent with Applicable
Law to secure the repurchase of any Defaulted Receivable from the applicable
Dealer to the extent permitted by and in accordance with the applicable Dealer
Agreement.  In the event that the Servicer cannot secure such repurchase for any
reason, the Servicer will use commercially reasonable efforts consistent with
Applicable Law to recover on the Defaulted Receivables from the applicable
Seller in accordance with its guaranty obligation (if any) pursuant to the
applicable Purchase and Sale Agreement.  In the event that the Servicer cannot
secure such repurchase or recovery for any reason, the Servicer will use
commercially reasonable efforts in accordance with the Credit and Collection
Policy and consistent with the Servicing Standard and Applicable Law in
realizing upon such Defaulted Receivable and Related Security, and employ
practices and procedures including commercially reasonable efforts to enforce
all obligations of Obligors.  Without limiting the generality of the foregoing,
unless the Administrative Agent has specifically given instruction to the
contrary, the Servicer may (i) foreclose upon any property securing the
Defaulted Receivable and cause the sale of any such property, (ii) turn the
Defaulted Receivable over to a collection agency for collection, or (iii) sell
the Defaulted Receivable for its fair market

 

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value (as determined by the Servicer in good faith) to an independent
third-party purchaser.  The Servicer will remit to the Collection Account the
Recoveries received in connection with the sale or disposition of a Defaulted
Receivable.

 

Section 6.6.                                          Servicing Compensation.

 

As compensation for its servicing activities hereunder and reimbursement for its
expenses, the Servicer shall be entitled to receive the Servicing Fee to the
extent of funds available therefor pursuant to the provisions of Sections 2.7
and 2.8, as applicable.

 

Section 6.7.                                          Payment of Certain
Expenses by the Servicer.

 

The Servicer will be required to pay all expenses incurred by it in connection
with its activities under this Agreement, including fees and disbursements of
its independent accountants, Taxes imposed on the Servicer, expenses incurred by
the Servicer in connection with payments pursuant to this Agreement, and all
other fees and expenses not expressly stated under this Agreement for the
account of the Borrowers, but excluding Liquidation Expenses incurred as a
result of activities contemplated by Section 6.5.  The initial Servicer will be
required to pay all reasonable fees and expenses owing to any bank or trust
company in connection with the maintenance of the Accounts and each Lockbox
Account.  The initial Servicer shall be required to pay such expenses for its
own account and shall not be entitled to any payment therefor other than the
Servicing Fee.  Notwithstanding the foregoing, if the Backup Servicer is
appointed successor Servicer hereunder, it shall be entitled to reimbursement
from the Borrowers for all reasonable out-of-pocket expenses incurred by it in
connection with its servicing activities hereunder.

 

Section 6.8.                                          Reports.

 

(a)           Servicing Report.  On each Reporting Date, the Servicer will
provide to the Borrowers, the Administrative Agent, the Backup Servicer and the
Collateral Custodian, a monthly statement (a “Servicing Report”) including (i) a
calculation of the Borrowing Base as of the most recent date of determination,
with respect to the related calendar month, (ii) an updated Receivables List,
(iii) an identification of each Receivable owned by the related Borrower,
(iv) the Loans Outstanding attributable to each Borrower, and (v) such other
pool portfolio data and information as reasonably requested by Administrative
Agent from time to time, signed by a Responsible Officer of the Servicer and the
Borrowers and substantially in the form of Exhibit C.

 

(b)           Servicer’s Certificate.  Together with each Servicing Report, the
Servicer shall submit to the Administrative Agent (with a copy to the Backup
Servicer and the Collateral Custodian) a certificate substantially in the form
of Exhibit H (a “Servicer’s Certificate”), signed by a Responsible Officer of
the Servicer, which shall include a certification by such Responsible Officer
that, to its knowledge, no Event of Default or Unmatured Event of Default has
occurred.

 

(c)           Financial Statements.  (i) For so long as the Servicer is ***** or
an Affiliate thereof, the Servicer will submit to the Administrative Agent and
the Backup Servicer, (A) within thirty (30) days after the end of each of its
fiscal months and quarters (excluding the fiscal quarter ending on the date
specified in subclause (B) below), commencing September 30, 2008, consolidated
unaudited financial statements of ***** and consolidated unaudited financial

 

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statements of ***** (which shall include either consolidating financial
statements showing the separate financial performance of the LLC Borrower and
the Trust Borrower or discrete financial information specific to each such
Borrower) for the most recent fiscal month or quarter, as applicable, and
(B) within one hundred twenty (120) days after the end of each fiscal year,
commencing with the fiscal year ended December 31, 2008, consolidated unaudited
financial statements of *****and consolidated audited financial statements of
***** (which shall include either consolidating financial statements showing the
separate financial performance of the LLC Borrower and the Trust Borrower or
discrete financial information specific to each such Borrower), audited by a
firm of nationally recognized independent public accountants.  Except as
otherwise set forth herein, the Backup Servicer shall have no duty to review any
of the information set forth in such financial statements.

 

Section 6.9.                                          Annual Statement as to
Compliance.

 

The Servicer will provide to the Administrative Agent and the Backup Servicer,
within ninety (90) days following the end of each fiscal year of the Servicer,
commencing with the fiscal year ending on December 31, 2008, a fiscal report
signed by a Responsible Officer of the Servicer certifying that (a) a review of
the activities of the Servicer, and the Servicer’s performance pursuant to this
Agreement, for the fiscal period ending on the last day of such fiscal year has
been made under such Person’s supervision and (b) the Servicer has performed or
has caused to be performed in all material respects all of its obligations under
this Agreement throughout such year and no Servicer Default has occurred.

 

Section 6.10.                                   Reserved.

 

Section 6.11.                                   The Servicer Not to Resign.

 

The Servicer shall not resign from the obligations and duties hereby imposed on
it except upon the Servicer’s determination that the performance of its duties
hereunder is or has become illegal under Applicable Law.  Any such determination
permitting the resignation of the Servicer shall be evidenced by an Opinion of
Counsel to such effect addressed and delivered to the Administrative Agent.  No
such resignation shall become effective until a successor servicer shall have
assumed the responsibilities and obligations of the Servicer in accordance with
Section 6.2.

 

Section 6.12.                                   Servicer Defaults.

 

If any one of the following events (a “Servicer Default”) shall occur:

 

(a)           any failure by the Servicer to make any payment, transfer or
deposit or, if applicable, to give instructions or notices to any third party to
make any payment, transfer, or deposit (including, without limitation, with
respect to the remittance of Collections) as required by this Agreement or the
other Transaction Documents which continues unremedied for a period of two (2)
Business Days;

 

(b)           any failure on the part of the Servicer duly to observe or perform
in any material respect any other covenants or agreements of the Servicer set
forth in this Agreement or the other Transaction Documents to which the Servicer
is a party and the same continues

 

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unremedied for a period of five (5) Business Days (if such failure can be
remedied) after the earlier to occur of (i) the date on which written notice of
such failure requiring the same to be remedied shall have been given to a
Responsible Officer of the Servicer by the Administrative Agent or any Lender or
(ii) the date on which a Responsible Officer of the Servicer acquires actual
knowledge thereof;

 

(c)                                  (I) the failure of the initial Servicer to
make any payment when due with respect to any of its debt or other obligations
(which payment default relates to debt facilities or other obligations in excess
of $250,000 in the aggregate) or (II) the occurrence of any event or condition
that would cause or permit acceleration of such debt or other obligations in
excess of $250,000 in the aggregate, unless (1) such event or condition has been
waived and (2) any such debt or other obligations shall have not been declared
to be due and payable or required to be prepaid (other than by scheduled
payment) prior to maturity, in the case of each of clauses (I) and
(II) (i) subject to the initial Servicer’s right to contest in good faith any
claim which could lead to acceleration and (ii) after all applicable cure and
grace periods have expired; or

 

(d)                                 an Insolvency Event with respect to the
Servicer;

 

(e)                                  an Event of Default (which has not been
waived in writing by the Administrative Agent) or a default by any Sub-Servicer
under the applicable Sub-Servicing Agreement which shall be continuing;

 

(f)                                    the Servicer fails in any material
respect to comply with the Credit and Collection Policy and the Servicing
Standard regarding the servicing of the Collateral and the same continues
unremedied for a period of ten (10) Business Days (if such failure can be
remedied) after the earlier to occur of (i) the date on which written notice of
such failure requiring the same to be remedied shall have been given to a
Responsible Officer of the Servicer by the Administrative Agent or any Lender or
(ii) the date on which a Responsible Officer of the Servicer acquires actual
knowledge thereof;

 

(g)                                 ***** ceases to be the Servicer (other than
as provided for under the terms of this Agreement);

 

(h)                                 the occurrence or existence of any event
which causes a Material Adverse Effect with respect to the Servicer;

 

(i)                                     any failure by the Servicer to deliver
any required Servicing Report or other Required Reports hereunder and the same
continues unremedied for a period of one Business Day after the earlier to occur
of (i) the date on which written notice of such failure shall have been given to
a Responsible Officer of the Servicer by the Administrative Agent or Collateral
Custodian, or (ii) the date on which a Responsible Officer of the Servicer has
actual knowledge thereof; or

 

(j)                                     any representation, warranty or
certification made by the Servicer in any Transaction Document or in any
certificate delivered pursuant to any Transaction Document shall prove to have
been incorrect when made and continues to be unremedied for a period of thirty
(30) Business Days after the earlier to occur of (i) the date on which written
notice of such incorrectness requiring the same to be remedied shall have been
given to the a Responsible

 

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Officer of Servicer by the Administrative Agent or any Lender or (ii) the date
on which a Responsible Officer of the Servicer acquires knowledge thereof;

 

then notwithstanding anything herein to the contrary, the Administrative Agent,
by written notice to the Servicer (with a copy to the Collateral Custodian and
Backup Servicer) (a “Servicer Termination Notice”), may terminate all of the
rights and obligations of the Servicer as Servicer under this Agreement (other
than fees or expenses owed to the Servicer which have accrued or been incurred
prior to the delivery of the Servicer Termination Notice) and appoint the Backup
Servicer to perform its duties pursuant to the terms of this Agreement.

 

Section 6.13.                                   Appointment of Successor
Servicer.

 

(a)                                  On and after the receipt by the Servicer
and the Backup Servicer of a Servicer Termination Notice pursuant to
Section 6.12, the Servicer shall continue to perform all servicing functions
under this Agreement until the date specified in the Servicer Termination Notice
or as otherwise specified by the Administrative Agent in writing or, if no such
date is specified in such Servicer Termination Notice or otherwise specified by
the Administrative Agent, until a date mutually agreed upon by the Servicer and
the Administrative Agent and shall be entitled to receive, to the extent of
funds available therefor pursuant to Section 2.6, the Servicing Fee therefor
until such date; provided that any fees or expenses owed to the Servicer
attributable to the period prior to such date shall accrue and remain payable. 
The Administrative Agent may at any time following delivery of a Servicer
Termination Notice in written notice to the Backup Servicer, in its sole
discretion (provided the Administrative Agent will not appoint a direct
competitor of the Originator or an Affiliate thereof as Backup Servicer without
the Servicer’s prior written consent), appoint the Backup Servicer as the
Servicer hereunder, and the Backup Servicer shall on such date assume all
obligations of the Servicer hereunder with respect to servicing of the
Collateral, and all authority and power of the Servicer under this Agreement
shall pass to and be vested in the Backup Servicer.  As compensation therefor,
the Backup Servicer shall thereafter be entitled to the Servicing Fee together
with the one-time successor servicer fee specified in the Backup Servicing Fee
Letter, any other rights to reimbursement to which the Servicer is entitled as
specified herein, plus Transition Expenses.  In the event that the
Administrative Agent does not so appoint the Backup Servicer (which it may or
may not do in its discretion), there is no Backup Servicer or the Backup
Servicer is unable to assume such obligations on such date, the Administrative
Agent shall as promptly as possible appoint a successor servicer (the “Successor
Servicer”), and such Successor Servicer shall accept its appointment by a
written assumption in a form acceptable to the Administrative Agent and each
Lender.  In the event that a Successor Servicer has not accepted its appointment
at the time when the Servicer ceases to act as Servicer, the Administrative
Agent may petition a court of competent jurisdiction to appoint any established
financial institution, having a net worth of not less than United States
$50,000,000 and whose regular business includes the servicing of loans, as the
Successor Servicer hereunder.

 

(b)                                 The Backup Servicer as a successor Servicer
undertakes to perform only such duties and obligations as are specifically set
forth in this Agreement, it being expressly understood by all parties hereto
that there are no implied duties or obligations of any successor Servicer
hereunder.

 

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(c)                                  The Servicer agrees to cooperate and use
commercially reasonable efforts in effecting the transition of the
responsibilities and rights of servicing of the Receivables, including, without
limitation, the transfer to the Backup Servicer as successor Servicer for the
administration by it of all cash amounts that shall at the time be held by
Servicer for deposit, or have been deposited by the Servicer, or thereafter
received with respect to the Receivables and the delivery to the Backup Servicer
as successor Servicer in an orderly and timely fashion of all files and records
with respect to the Receivables and a computer tape in readable form containing
all information necessary to enable the Backup Servicer as successor Servicer to
service the Receivables.  In addition, the Servicer agrees to cooperate and use
commercially reasonable efforts in providing at the Servicer’s expense to the
Backup Servicer, as a successor Servicer, with a list of key servicing personnel
and contact information, reasonable access (including at the premises of the
Servicer) to the Servicer’s employees, and any and all of the books, records (in
electronic or other form) or other information reasonably requested by it to
enable the Backup Servicer, as a successor Servicer, to assume the servicing
functions hereunder.

 

(d)                                 The Backup Servicer as a successor Servicer
is authorized and empowered to execute and deliver, on behalf of the Servicer as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do so or accomplish all other acts or things necessary or appropriate to
effect the purposes of such notice of termination or to perform the duties of
the Servicer.  The Servicer will provide the Backup Servicer, as a successor
Servicer, with a power of attorney stating such (at such time as the Backup
Servicer becomes a successor Servicer).

 

(e)                                  Upon its appointment, the Backup Servicer
(subject to Section 6.13(a)) or the Successor Servicer, as applicable, shall be
the successor in all respects to the Servicer with respect to servicing
functions under this Agreement and shall be subject to all the responsibilities,
duties and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof, and all references in this Agreement to the Servicer shall be
deemed to refer to the Backup Servicer or the Successor Servicer, as applicable;
provided that the Backup Servicer or Successor Servicer, as applicable, shall
have (i) no liability with respect to any action performed by the terminated
Servicer prior to the date that the Backup Servicer or Successor Servicer, as
applicable, becomes the successor to the Servicer or any claim of a third party
based on any alleged action or inaction of the terminated Servicer, (ii) no
obligation to perform any repurchase or advancing obligations, if any, of the
Servicer unless it elects to in its sole discretion, (iii) no obligation to pay
any taxes required to be paid by the Servicer (provided that the Backup Servicer
or Successor Servicer, as applicable, shall pay any income taxes for which it is
liable), (iv) no obligation to pay any of the fees and expenses of any other
party to the transactions contemplated hereby, (v) no liability or obligation
with respect to any indemnification obligations of any prior Servicer, (vi) no
obligation to make payments with respect to any losses on investments made by or
at the direction of the Servicer, (vii) no obligation to take any legal action
which the Backup Servicer in its reasonable opinion believes subjects it to any
liability in connection with such legal action unless it shall have been assured
to its reasonable satisfaction that it will be indemnified for such liabilities,
and (viii) no liability with respect to any action performed, or breaches or
defaults caused by any prior Servicer prior to its appointment, or any claim of
a third party based on any alleged action of any prior Servicer.  The
indemnification obligations of the Backup Servicer or the Successor Servicer, as
applicable, upon becoming a successor Servicer, are expressly limited to those
arising on account of its failure to act in good faith and with reasonable care
under the circumstances.  In addition,

 

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the Backup Servicer or Successor Servicer, as applicable, shall have no
liability relating to the representations and warranties of the initial Servicer
contained in Article IV.  In no event shall the Backup Servicer or the Successor
Servicer be liable for any indirect, special or consequential damages (including
lost profits) whether or not it has been advised of the likelihood of such
damages.

 

(f)                                    Upon the Backup Servicer receiving notice
that it is required to serve as the Servicer hereunder pursuant to the foregoing
provisions of this Section 6.13, the Backup Servicer will promptly begin the
transition to its role as Servicer.  In the event the Backup Servicer declines
to continue to act as Servicer hereunder, the Backup Servicer shall solicit, by
public announcement, bids from banks, specialty finance companies, asset
managers and servicing institutions meeting the qualifications set forth in
Section 6.13(a).  Such public announcement shall specify that the Successor
Servicer shall be entitled to the full amount of the Servicing Fee as servicing
compensation.  Within thirty (30) days after any such public announcement, the
Backup Servicer shall negotiate and effect the sale, transfer and assignment of
the servicing rights and responsibilities hereunder to a qualified party
acceptable to the Administrative Agent submitting a qualifying bid.  The Backup
Servicer shall deduct from any sum received by the Backup Servicer from the
successor to the Servicer in respect of such sale, transfer and assignment, all
costs and expenses of any public announcement, of conducting such sale and of
any sale, transfer and assignment of the servicing rights and responsibilities
hereunder.  After such deductions, the remainder of such sum shall be paid by
the Backup Servicer to the Servicer at the time of such sale, transfer and
assignment to the Servicer’s successor.  If no bid from a qualified potential
Successor Servicer is received or if no sale, transfer and assignment of the
servicing rights and responsibilities hereunder shall have been concluded within
thirty (30) days after such public announcement, the Backup Servicer may, in its
discretion, appoint, or petition a court of competent jurisdiction to appoint,
any established servicing institution as the successor to the Servicer hereunder
in the assumption of all or any part of the responsibilities, duties or
liabilities of the Servicer hereunder. As compensation, any Successor Servicer
(including, without limitation, the Administrative Agent) so appointed shall be
entitled to receive the Servicing Fee, including, without limitation, transition
expenses.  The Backup Servicer and such successor shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession.  No appointment of a successor to the Servicer hereunder shall be
effective until written notice of such proposed appointment shall have been
provided by the Backup Servicer to the Administrative Agent and the
Administrative Agent shall have consented thereto.  The Backup Servicer shall
not resign as Servicer until a Successor Servicer has been appointed and
accepted such appointment.  Notwithstanding anything to the contrary contained
herein, in no event shall the Backup Servicer or Successor Servicer be liable
for any Servicing Fee or for any differential in the amount of the Servicing Fee
paid hereunder and the amount necessary to induce any Successor Servicer under
this Agreement and the transactions set forth or provided for by this Agreement.

 

(g)                                 Notwithstanding anything contained in this
Agreement to the contrary, any successor Servicer is authorized to accept and
rely on all of the accounting, records (including computer records) and work of
the prior Servicer relating to the Receivables (collectively, the “Predecessor
Servicer Work Product”) without any audit or other examination thereof, and such
successor Servicer shall have no duty, responsibility, obligation or liability
for the acts and omissions of the prior Servicer.  If any error, inaccuracy,
omission or incorrect or non-standard

 

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practice or procedure (collectively, “Errors”) exists in any Predecessor
Servicer Work Product and such Errors make it materially more difficult to
service or should cause or materially contribute to the successor Servicer
making or continuing any Errors (collectively, “Continued Errors”), such
successor Servicer shall have no duty, responsibility, obligation or liability
for such Continued Errors; provided that such successor Servicer agrees to use
commercially reasonable efforts to prevent further Continued Errors.  In the
event that the successor Servicer becomes aware of Errors or Continued Errors,
it shall, with the prior consent of the Administrative Agent, use commercially
reasonable efforts to reconstruct and reconcile such data as is commercially
reasonable to correct such Errors and Continued Errors and to prevent future
Continued Errors.  Such successor Servicer shall be entitled to recover its
costs thereby expended in accordance with Sections 2.7 and 2.8, as applicable.

 

ARTICLE VII

 

THE BACKUP SERVICER

 

Section 7.1.                                          Designation of the Backup
Servicer.

 

(a)                                  Initial Backup Servicer.  The backup
servicing role with respect to the Collateral shall be conducted by the Person
designated as Backup Servicer hereunder from time to time in accordance with
this Section 7.1.  Until the Administrative Agent shall give to Lyon Financial
Services, Inc. (d/b/a U.S. Bank Portfolio Services) a Backup Servicer
Termination Notice, Lyon Financial Services, Inc. (d/b/a U.S. Bank Portfolio
Services) is hereby designated as, and hereby agrees to perform the duties and
obligations of, a Backup Servicer pursuant to the terms hereof.

 

(b)                                 Successor Backup Servicer.  Upon the Backup
Servicer’s receipt of Backup Servicer Termination Notice from the Administrative
Agent of the designation of a replacement Backup Servicer pursuant to the
provisions of Section 7.5, the Backup Servicer agrees that it will terminate its
activities as Backup Servicer hereunder.

 

Section 7.2.                                          Duties of the Backup
Servicer.

 

(a)                                  Appointment.  Each Borrower and the
Administrative Agent, as agent for the Secured Parties, each hereby appoints
Lyon Financial Services, Inc. (d/b/a U.S. Bank Portfolio Services) to act as
Backup Servicer, for the benefit of the Secured Parties, as from time to time
designated pursuant to Section 7.1.  The Backup Servicer hereby accepts such
appointment and agrees to perform the duties and obligations with respect
thereto set forth herein.

 

(b)                                 Duties.  From the Closing Date and until its
removal pursuant to Section 7.5, the Backup Servicer shall perform, on behalf of
the Administrative Agent and the Secured Parties, the following duties and
obligations:

 

(i)                                     On or before the Closing Date, the
Servicer shall deliver and Backup Servicer shall accept from the Servicer
delivery of the information required to be set forth in the Servicing Reports
(if any) in hard copy and in Excel® or a comparable format.

 

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(ii)                                  Not later than 12:00 noon on each
Reporting Date, the Servicer shall deliver to the Backup Servicer the loan tape,
which shall include but not be limited to the following information:  (x) for
each Receivable, the name and number of the related Obligor, the collection
status, the loan status, the date of each Scheduled Payment and the Outstanding
Receivable Balance, (y) the Borrowing Base and (z) the outstanding principal
balance of all Receivables included on such loan tape (the “Tape”).  The Backup
Servicer shall accept delivery of the Tape.

 

(iii)                               Prior to each Payment Date, the Backup
Servicer shall review the related Servicing Report to ensure that it is complete
on its face and that the following items in such Servicing Report have been
accurately calculated, if applicable, and reported:  (A) the Borrowing Base,
(B) the Backup Servicing Fee, (C) the Receivables that are 30 or more days past
due and 90 or more days past due and (D) the Aggregate Outstanding Receivable
Balance.  The Backup Servicer shall provide the Administrative Agent and the
Servicer with a monthly certification substantially in the form attached hereto
as Exhibit J (the “Backup Servicer Monthly Certification”) confirming the
accurate calculation of such items in the Servicing Report and that the
Servicing Report is complete on its face.  In the event of any discrepancy with
the Servicing Report based on such review, the Backup Servicer shall notify the
Administrative Agent and the Servicer of such discrepancy not later than the
Business Day preceding such Payment Date.

 

(iv)                              If the Servicer disagrees with the report
provided under paragraph (iii) above by the Backup Servicer or if the Servicer
has not reconciled any material discrepancy, the Backup Servicer agrees to
confer with the Servicer to resolve such disagreement on or prior to the next
succeeding date of determination and shall settle such discrepancy with the
Servicer if possible, and notify the Administrative Agent of the resolution
thereof.  The Servicer hereby agrees to cooperate at its own expense with the
Backup Servicer in reconciling any discrepancies herein.  If within twenty (20)
days after the delivery of the report provided under paragraph (iii) above by
the Backup Servicer, such discrepancy is not resolved, the Backup Servicer shall
promptly notify the Administrative Agent of the continued existence of such
discrepancy.  Following receipt of such notice by the Administrative Agent, the
Servicer shall deliver to the Administrative Agent and the Backup Servicer no
later than the next Payment Date a certificate describing the nature and amount
of such material discrepancies and the actions the Servicer proposes to take
with respect thereto.

 

(c)                                  Reliance on Tape.  With respect to the
duties described in Section 7.2(b), except as expressly set forth herein, the
Backup Servicer is entitled to rely conclusively, and shall be fully protected
in so relying, on the contents of each Tape provided by the Servicer, including,
but not limited to, the completeness and accuracy thereof.

 

Section 7.3.                                          Merger or Consolidation.

 

Any Person (i) into which the Backup Servicer may be merged or consolidated,
(ii) that may result from any merger or consolidation to which the Backup
Servicer shall be a party, or (iii) that may succeed to the properties and
assets of the Backup Servicer substantially as a whole, which Person in any of
the foregoing cases executes an agreement of assumption to perform every
obligation of the Backup Servicer hereunder, shall be the successor to the
Backup Servicer under this Agreement without further act on the part of any of
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Agreement, provided (A) such Person is organized under the laws of the United
States of America or any one of the states thereof or the District of Columbia
(or any domestic branch of a foreign bank), and (B)(a) has either (1) a
long-term unsecured debt rating of “A” or better by S&P and “A2” or better by
Moody’s or (2) a short-term unsecured debt rating or certificate of deposit
rating of “A-1” or better by S&P or “P-1” by Moody’s, (b) has a parent
corporation which has either (1) a long-term unsecured debt rating of “A” or
better by S&P and “A2” or better by Moody’s or (2) a short-term unsecured debt
rating or certificate of deposit rating of “A-1” or better by S&P and “P-1” by
Moody’s or (c) is otherwise acceptable to the Administrative Agent and, except
following the occurrence of an Event of Default or a Servicer Default (unless,
in each case, waived in writing by the Administrative Agent), each Borrower
(such consent not to be unreasonably withheld).

 

Section 7.4.                                          Backup Servicing
Compensation.

 

As compensation for its backup servicing activities hereunder, the Backup
Servicer shall be entitled to receive the Backup Servicing Fee and other amounts
payable in accordance with the Backup Servicer Fee Letter to the extent of funds
available therefor pursuant to Section 2.7 and 2.8, as applicable.  The Backup
Servicer’s entitlement to receive the Backup Servicing Fee shall cease
(excluding any unpaid outstanding amounts as of that date) on the earliest to
occur of:  (i) it becoming a successor Servicer, (ii) its removal as Backup
Servicer pursuant to Section 7.5, or (iii) the termination of this Agreement. 
In each such case, the Backup Servicer shall be entitled to its Backup Servicer
Fee earned and reimbursable expenses incurred through the date of such event. 
Upon becoming a successor Servicer pursuant to Section 6.13, the Backup Servicer
shall be entitled to the Servicing Fee, Transition Expenses and reimbursement
rights to which a successor Servicer is entitled hereunder.

 

Section 7.5.                                          Backup Servicer Removal.

 

The Backup Servicer may be removed, with or without cause, by the Administrative
Agent by notice given in writing to the Backup Servicer (the “Backup Servicer
Termination Notice”); provided that if the Backup Servicer is removed prior to
the first anniversary of the Closing Date it shall receive the early removal fee
specified in the Backup Servicer Fee Letter.  In the event of any such removal,
a replacement Backup Servicer may be appointed by the Administrative Agent, and
except following the occurrence of an Event of Default or a Servicer Default
(unless, in each case, waived in writing by the Administrative Agent), with the
consent of each Borrower (such consent not to be unreasonably withheld).

 

Section 7.6.                                          Limitation on Liability.

 

(a)                                  The Backup Servicer undertakes to perform
only such duties and obligations as are specifically set forth in this
Agreement, it being expressly understood by all parties hereto that there are no
implied duties or obligations of the Backup Servicer hereunder.  Without
limiting the generality of the foregoing, the Backup Servicer, except as
expressly set forth herein, shall have no obligation to supervise, verify,
monitor or administer the performance of the Servicer.  The Backup Servicer may
act through its agents, nominees, attorneys and custodians in performing any of
its duties and obligations under this Agreement, it being understood by the
parties hereto that the Backup Servicer will be responsible for any bad faith or

 

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willful misconduct or gross negligence on the part of such agents, attorneys or
custodians.  Neither the Backup Servicer nor any of its officers, directors,
employees or agents shall be liable, directly or indirectly, for any damages or
expenses arising out of the services performed under this Agreement other than
damages or expenses that result from the gross negligence, bad faith or willful
misconduct of it or them or the failure to perform materially in accordance with
this Agreement.  In no event shall the Backup Servicer be required to expend or
risk its own funds or otherwise incur any financial liability in the performance
of its duties hereunder or in the exercise of any of its rights and powers
hereunder if, in its sole judgment, it shall believe that repayment of such
funds or adequate indemnity against such risk or liability is not assured to it.

 

(b)                                 The Backup Servicer shall not be liable for
any obligation of the Servicer contained in this Agreement or for any errors of
the Servicer contained in any computer tape, certificate or other data or
document delivered to the Backup Servicer hereunder or on which the Backup
Servicer must rely in order to perform its obligations hereunder, and the
Secured Parties, the Administrative Agent and the Collateral Custodian each
agree to look only to the Servicer to perform such obligations.  Except as
expressly set forth herein, the Backup Servicer shall have no responsibility and
shall not be in default hereunder or incur any liability for any failure, error,
malfunction or any delay in carrying out any of its duties under this Agreement
if such failure or delay results from the Backup Servicer acting in accordance
with information prepared or provided by a Person other than the Backup Servicer
or the failure of any such other Person to prepare or provide such information. 
The Backup Servicer shall have no responsibility, shall not be in default and
shall incur no liability for (i) any act or failure to act of any third party,
including the Servicer, (ii) any inaccuracy or omission in a notice or
communication received by the Backup Servicer from any third party, (iii) the
invalidity or unenforceability of any Collateral under Applicable Law, (iv) the
breach or inaccuracy of any representation or warranty made with respect to any
Collateral, or (v) the acts or omissions of any successor Backup Servicer.

 

(c)                                  Notwithstanding anything to the contrary
herein, the Backup Servicer shall not be liable for any delays in performance
for causes beyond its control, including, but not limited to, acts of war or
terrorism, powerline failures, fire, flood, epidemic, acts of the Borrowers, the
Servicer or the Administrative Agent or restriction by civil or military
authority in their sovereign or contractual capacities.  In the event of any
such delay, performance shall be extended for so long as such period of delay.

 

Section 7.7.                                          Backup Servicer
Resignation.

 

The Backup Servicer may resign as Backup Servicer under this Agreement upon not
less than ninety (90) days notice to the Borrowers and the Administrative
Agent.  In the event of such resignation, the Backup Servicer shall return to
the Servicer any and all documents, materials, work products and all copies made
thereof, which were obtained by the Backup Servicer from the Servicer (other
than such copies that the Backup Servicer is required to retain by law, rule or
regulation) within three (3) Business Days of its resignation.

 

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ARTICLE VIII

 

THE COLLATERAL CUSTODIAN

 

Section 8.1.                                          Designation of Collateral
Custodian.

 

(a)                                  Initial Collateral Custodian.  The role of
collateral custodian with respect to the Required Receivable File shall be
conducted by the Person designated as Collateral Custodian hereunder from time
to time in accordance with this Section 8.1.  Until the Administrative Agent
shall give to U.S. Bank National Association a Collateral Custodian Termination
Notice, U.S. Bank National Association is hereby appointed as, and hereby
accepts such appointment and agrees to perform the duties and obligations of,
Collateral Custodian pursuant to the terms hereof.

 

(b)                                 Successor Collateral Custodian.  Upon the
Collateral Custodian’s receipt of a Collateral Custodian Termination Notice from
the Administrative Agent of the designation of a successor Collateral Custodian
pursuant to the provisions of Section 8.5, the Collateral Custodian agrees that
it will terminate its activities as Collateral Custodian hereunder.

 

Section 8.2.                                          Duties of Collateral
Custodian.

 

(a)                                  Appointment.  Each Borrower and the
Administrative Agent each hereby appoints U.S. Bank National Association to act
as Collateral Custodian, for the benefit of the Administrative Agent, as agent
for the Secured Parties.  The Collateral Custodian hereby accepts such
appointment and agrees to perform the duties and obligations with respect
thereto set forth herein.

 

(b)                                 Duties.  On or before the Closing Date, and
until its removal pursuant to Section 8.5, the Collateral Custodian shall
perform, on behalf of the Administrative Agent and the Secured Parties, the
following duties and obligations:

 

(i)                                     The Collateral Custodian shall take and
retain custody of the Required Receivable Files delivered by the Borrowers
pursuant to Section 3.1 in accordance with the terms and conditions of this
Agreement, as bailee for the purposes of the relevant UCC (a “Bailee”), all for
the benefit of the Secured Parties and subject to the Lien thereon in favor of
the Administrative Agent, as agent for the Secured Parties. Within (i) two
(2) Business Days of its receipt of any Required Receivable File with respect to
Receivables being acquired from Sellers of Receivables included in the
Collateral on a prior Funding Date and (ii) five (5) Business Days of its
receipt of any Required Receivable File with respect to Receivables being
acquired from Sellers of Receivables not previously included in the Collateral,
the Collateral Custodian shall review such Required Receivable File to confirm
that (A) the loan documents and instruments in such Required Receivable File
have been properly executed and have no missing or mutilated pages, and (B) the
related original principal balance of the Receivable (for closed end contracts
only), contract or other identifying number and Obligor name with respect to
such Receivable is referenced on the related Receivables List and is not a
duplicate Receivable (based on the contract number or other identifying number)
(such items (A) and (B) collectively, the “Review Criteria”).  In order to
facilitate the foregoing review by the Collateral Custodian, in connection

 

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with the delivery of Required Receivable Files hereunder to the Collateral
Custodian, the Servicer shall provide to the Collateral Custodian an electronic
file (in Excel® or a comparable format) that contains the contract number,
Obligor name and original loan balance (if applicable).  At the conclusion of
such review, the Collateral Custodian shall deliver to the Servicer, the
Borrowers and the Administrative Agent a collateral receipt in the form of
Exhibit K attached hereto (a “Collateral Receipt”).  If any Collateral Receipt
discloses any deficiencies (a “Deficiency”) in any of the Required Receivable
Files, the Collateral Custodian shall promptly notify the Administrative Agent
and the Servicer of such Deficiency and provide them with an exception report
specifying the Receivables which have a Deficiency and the Review Criteria that
they fail to satisfy.  The Servicer shall have five (5) Business Days to correct
any non-compliance with any Review Criteria.  If after the conclusion of such
time period the Servicer has still not cured any non-compliance by a Receivable
with any Review Criteria, the Collateral Custodian shall promptly notify the
Borrowers and the Administrative Agent of such determination by providing an
updated exception report to such Persons identifying, with particularity, each
Receivable and each of the applicable Review Criteria that such Receivable fails
to satisfy.  In addition, if requested in writing by the Servicer and approved
by the Administrative Agent within ten (10) Business Days of the Collateral
Custodian’s delivery of such report, the Collateral Custodian shall return any
Receivable which fails to satisfy a Review Criteria to the Borrowers or their
applicable designee.  Other than the foregoing, the Collateral Custodian shall
not have any responsibility for reviewing, inspecting or examining any Required
Receivable File to determine that the contents thereof are genuine, enforceable
or appropriate for the represented purpose or that they are other than what they
purport to be on their face.

 

(ii)                                  In taking and retaining custody of the
Required Receivable Files, the Collateral Custodian shall be deemed to be acting
as the Bailee of the Secured Parties; provided that the Collateral Custodian
makes no representations as to the enforceability of any Required Receivable
File documents or the existence, perfection or priority of any Lien on the
Required Receivable Files or the instruments therein; and provided further that,
the Collateral Custodian’s duties as agent shall be limited to those expressly
contemplated herein.

 

(iii)                               All Required Receivable File documents that
are originals or copies shall be kept in fire resistant facilities in accordance
with the Collateral Custodian’s customary standards for such custody, at the
locations specified on Schedule III attached hereto, or at such other office as
shall be specified to the Administrative Agent and the Servicer by the
Collateral Custodian in a written notice delivered at least forty-five (45) days
prior to such change.  All Required Receivable File documents that are originals
or copies shall be identified using a barcode system and maintained in such a
manner so as to permit retrieval and access.

 

(iv)                              The Collateral Custodian shall make payments
pursuant to the terms of the Servicing Report in accordance with Section 2.7 and
2.8, as applicable, (the “Payment Duties”).

 

(v)                                 On the third Business Day of each month, the
Collateral Custodian shall provide to the Administrative Agent and the Servicer
(in a form acceptable to the Administrative Agent and the Collateral Custodian)
an updated list of Receivables in its possession and an updated exceptions
report.

 

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(vi)                              In performing its duties, the Collateral
Custodian shall use the same degree of care and attention as it employs with
respect to similar collateral that it holds as collateral custodian for others.

 

Section 8.3.                                          Merger or Consolidation.

 

Any Person (i) into which the Collateral Custodian may be merged or
consolidated, (ii) that may result from any merger or consolidation to which the
Collateral Custodian shall be a party, or (iii) that may succeed to the
properties and assets of the Collateral Custodian substantially as a whole,
which Person in any of the foregoing cases executes an agreement of assumption
to perform every obligation of the Collateral Custodian hereunder, shall be the
successor to the Collateral Custodian under this Agreement without further act
of any of the parties to this Agreement.

 

Section 8.4.                                          Collateral Custodian
Compensation.

 

As compensation for its collateral custodian activities hereunder, the
Collateral Custodian shall be entitled to a Collateral Custodian Fee and other
amounts payable to it pursuant to the Collateral Custodian Fee Letter and
pursuant to the provisions of Section  2.7 and 2.8, as applicable.  The
Collateral Custodian’s entitlement to receive the Collateral Custodian Fee and
such other amounts shall cease (excluding any outstanding amounts unpaid as of
such date) on the earlier to occur of:  (i) its removal as Collateral Custodian
pursuant to Section 8.5 or (ii) the termination of this Agreement.

 

Section 8.5.                                          Collateral Custodian
Removal.

 

The Collateral Custodian may be removed, with or without cause, by the
Administrative Agent by notice given in writing to the Collateral Custodian (the
“Collateral Custodian Termination Notice”); provided that notwithstanding its
receipt of a Collateral Custodian Termination Notice, the Collateral Custodian
shall continue to act in such capacity until a successor Collateral Custodian
has been appointed, has agreed to act as Collateral Custodian hereunder, and has
received all Required Receivable Files held by the previous Collateral
Custodian.

 

Section 8.6.                                          Limitation on Liability.

 

(a)                                  The Collateral Custodian may conclusively
rely on and shall be fully protected in acting upon, and need not verify, any
certificate, instrument, opinion, notice, letter, telegram or other document
delivered to it and that in good faith it reasonably believes to be genuine and
that has been signed by the proper party or parties.  The Collateral Custodian
may rely conclusively on and shall be fully protected in acting upon the written
instructions of any designated officer of the Administrative Agent.

 

(b)                                 The Collateral Custodian may consult counsel
satisfactory to it and the advice or opinion of such counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with the advice or
opinion of such counsel.

 

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(c)                                  The Collateral Custodian shall not be
liable for any error of judgment, or for any act done or step taken or omitted
by it, in good faith, or for any mistakes of fact or law, or for anything that
it may do or refrain from doing in connection herewith except, notwithstanding
anything to the contrary contained herein, in the case of its willful
misconduct, bad faith or grossly negligent performance or omission of its duties
and in the case of the negligent performance of its Payment Duties and in the
case of its negligent performance of its duties in taking and retaining custody
of the Required Receivable Files.

 

(d)                                 The Collateral Custodian makes no warranty
or representation and shall have no responsibility (except as expressly set
forth in this Agreement) as to the content, enforceability, completeness,
validity, sufficiency, value, genuineness, ownership or transferability of the
Collateral, and will not be required to, and will not, make any representations
as to the validity or value of any of the Collateral.  The Collateral Custodian
shall not be obligated to take any legal action hereunder that might in its
judgment involve any expense or liability unless it has been furnished with an
indemnity reasonably satisfactory to it.

 

(e)                                  The Collateral Custodian shall have no
duties or responsibilities except such duties and responsibilities as are
specifically set forth in this Agreement and no covenants or obligations shall
be implied in this Agreement against the Collateral Custodian.

 

(f)                                    The Collateral Custodian shall not be
required to expend or risk its own funds in the performance of its duties
hereunder.

 

(g)                                 It is expressly agreed and acknowledged that
the Collateral Custodian is not guaranteeing performance of or assuming any
liability for the obligations of the other parties hereto or any parties to the
Collateral.

 

(h)                                 Notwithstanding anything to the contrary
herein, the Collateral Custodian shall not be liable for any delays in
performance for causes beyond its control, including, but not limited to, acts
of war or terrorism, powerline failures, fire, flood, epidemic, acts of the
Borrowers, the Servicer or the Administrative Agent or restriction by civil or
military authority in their sovereign or contractual capacities.  In the event
of any such delay, performance shall be extended for so long as such period of
delay.

 

(i)                                     The Collateral Custodian shall not be
responsible for preparing or filing any reports or returns relating to federal,
state or local income taxes with respect to this Agreement on behalf of the
Borrowers, the initial Servicer or the Secured Parties.

 

Section 8.7.                                          The Collateral Custodian
Not to Resign.

 

The Collateral Custodian shall not resign from the obligations and duties hereby
imposed on it except upon the Collateral Custodian’s determination that (i) the
performance of its duties hereunder is or has become illegal under Applicable
Law and (ii) there is no reasonable action that the Collateral Custodian could
take to make the performance of its duties hereunder legal under Applicable
Law.  Any such determination permitting the resignation of the Collateral
Custodian shall be evidenced as to clause (i) above by an Opinion of Counsel to
such effect delivered to the Administrative Agent.  No such resignation shall
become effective until a

 

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successor Collateral Custodian shall have assumed the responsibilities and
obligations of the Collateral Custodian hereunder.

 

Section 8.8.                                          Release of Documents.

 

(a)                                  Release for Servicing.  From time to time
and as appropriate for the enforcement or servicing of any of the Collateral,
the Collateral Custodian is hereby authorized, upon receipt from the Servicer of
a written request for release in the form annexed hereto as Exhibit G and
consented to by the Administrative Agent, to release to the Servicer (or the
Sub-Servicer) within two Business Days of receipt of such request, the related
Required Receivable Files set forth in such request and receipt to the
Servicer.  All documents so released to the Servicer shall be held by the
Servicer in trust for the benefit of the Administrative Agent in accordance with
the terms of this Agreement.  The Servicer shall return to the Collateral
Custodian the Required Receivable Files (i) promptly upon the request of the
Administrative Agent, or (ii) when the Servicer’s need therefor in connection
with such foreclosure or servicing no longer exists, unless the Receivable shall
be liquidated, in which case, upon receipt of an additional request for release
of documents and receipt certifying such liquidation from the Servicer to the
Collateral Custodian in the form annexed hereto as Exhibit G, the Servicer’s
request and receipt submitted pursuant to the first sentence of this subsection
shall be released by the Collateral Custodian to the Servicer.

 

(b)                                 Release for Payment.  Upon receipt by the
Collateral Custodian of the Servicer’s request for release in the form annexed
hereto as Exhibit G (which certification shall include a statement to the effect
that all amounts received in connection with such payment or repurchase have
been credited to the Collection Account as provided in this Agreement), the
Collateral Custodian shall promptly release the related Required Receivable File
to the Servicer.

 

Section 8.9.                                          Return of Required
Receivable Files and Servicing Files.

 

The Borrowers may, with the prior written consent of the Administrative Agent,
require that the Collateral Custodian return each Required Receivable File
(a) delivered to the Collateral Custodian in error, (b) for which the applicable
Borrower has paid all required amounts pursuant to Section 2.15 with respect to
the related Receivables, (c) related to any Receivable for which a Substitute
Receivable has been substituted in accordance with Section 2.15, or (d) that is
required to be redelivered to the applicable Borrower in connection with the
termination of this Agreement, in each case by submitting to the Collateral
Custodian and the Administrative Agent a written request in the form of
Exhibit G hereto (signed by both the applicable Borrower and the Administrative
Agent) specifying the Collateral to be so returned and reciting that the
conditions to such release have been met (and specifying the Section or Sections
of this Agreement being relied upon for such release).  The Collateral Custodian
shall upon its receipt of each such request for return executed by the
applicable Borrower and the Administrative Agent promptly, but in any event
within five (5) Business Days, return the Required Receivable File so requested
to the applicable Borrower.

 

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Section 8.10.                                   Access to Certain Documentation
and Information Regarding the Collateral; Audits.

 

The Servicer, the Originator, the Borrowers and the Collateral Custodian shall
provide to the Administrative Agent access to the Required Receivable Files and
all other documentation regarding the Collateral including in such cases where
the Administrative Agent and each Lender are required in connection with the
enforcement of the rights or interests of the Secured Parties, or by applicable
statutes or regulations, to review such documentation, such access being
afforded without charge but only (i) upon two Business Days’ prior written
request, (ii) during normal business hours and (iii) subject to the Borrowers’,
the Originator’s, the Servicer’s and Collateral Custodian’s normal security and
confidentiality procedures.  Periodically at the discretion of the
Administrative Agent, the Administrative Agent may review the Servicer’s
collection and administration of the Collateral in order to assess compliance by
the Servicer with the Credit and Collection Policy and the Servicing Standard,
as well as with this Agreement and may conduct an audit of the Collateral and
Required Receivable Files in conjunction with such a review.  The Borrowers, the
Servicer and the Originator shall permit the Administrative Agent, or its
respective agents or representatives, to visit the offices of each such Person
during normal office hours and upon reasonable notice to examine and make copies
of all documents, books, records and other information concerning the Collateral
and discuss matters related thereto with any of the officers of the Borrowers,
the Servicer or the Originator having knowledge of such matters, and the
Borrowers shall pay the costs and expenses for all such visits by the
Administrative Agent, subject to the limitations in Section 13.9; provided that
prior to an Event of Default or Unmatured Event of Default, such visits by the
Administrative Agent shall occur no more than four times per calendar year. 
Notwithstanding the foregoing, following the appointment of a successor Servicer
to the initial Servicer, any such visits or reviews of the Servicer shall be at
the reviewer’s expense, shall require at least five Business Days’ prior written
notice and shall occur no more than twice per calendar year.  Without limiting
the foregoing provisions of this Section 8.10, from time to time on request of
the Administrative Agent, the Collateral Custodian shall permit certified public
accountants or other independent auditors acceptable to the Administrative Agent
to conduct, at the Originator’s expense, a review of the Required Receivable
Files and all other documentation regarding the Collateral.

 

ARTICLE IX

 

SECURITY INTEREST

 

Section 9.1.                                          Grant of Security
Interest.

 

This Agreement constitutes a security agreement and the transactions effected
hereby constitute secured loans by the Lenders to the Borrowers under Applicable
Law.  For such purpose, each Borrower hereby transfers, conveys, assigns and
grants as of the date hereof to the Administrative Agent, as agent for the
Secured Parties, a lien and continuing security interest in all of such
Borrower’s right, title and interest in, to and under (but none of the
obligations under) all Collateral and all cash, loans, securities (whether or
not marketable), liquidation proceeds of repossessed assets, accounts, insurance
policies (including any life insurance or disability insurance policies
maintained by obligors) and proceeds thereon, contract rights, amounts or funds
in escrow and accounts thereto, chattel paper, financial assets, investment
property,

 

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instruments, general intangibles, payment intangibles, accounts, deposit
accounts, money, documents, agreements, investments and all other property and
assets of any type or nature in which such Borrower has an interest, whether now
existing or hereafter arising or acquired by such Borrower, and wherever the
same may be located, to secure the prompt and complete payment and performance
in full when due, whether by lapse of time, acceleration or otherwise, of all
Aggregate Unpaids of the Borrowers arising in connection with this Agreement and
each other Transaction Document, whether now or hereafter existing, due or to
become due, direct or indirect, or absolute or contingent.  The grant of a
security interest under this Section 9.1 does not constitute and is not intended
to result in a creation or an assumption by any of the Secured Parties of any
obligation of the Borrowers or any other Person in connection with any or all of
the Collateral or under any agreement or instrument relating thereto.  Anything
herein to the contrary notwithstanding, (a) the Borrowers shall remain liable
under the Collateral to the extent set forth therein to perform all of its
duties and obligations thereunder to the same extent as if this Agreement had
not been executed, (b) the exercise by the Administrative Agent, as agent for
the Secured Parties, of any of its rights in the Collateral shall not release
the Borrowers from any of its duties or obligations under the Collateral, and
(c) no Secured Party shall have any obligations or liability under the
Collateral by reason of this Agreement, nor shall any Secured Party be obligated
to perform any of the obligations or duties of the Borrowers thereunder or to
take any action to collect or enforce any claim for payment assigned hereunder.
The Borrowers hereby authorize Mayer Brown LLP to file, on behalf of the
Administrative Agent, a “Record” or “Records” (as such term is defined in the
applicable UCC), including financing or continuation statements, and amendments
thereto, in all jurisdictions and with all filing offices as the Administrative
Agent may determine, in its sole discretion, are necessary or advisable to
perfect the security interests granted to the Administrative Agent in connection
herewith.  Such financing statements may describe the collateral in the same
manner as described herein or in any security agreement or pledge agreement
entered into by the parties in connection herewith or may contain an indication
or description of collateral that describes such property in any other manner as
the Administrative Agent may determine, in its sole discretion, is necessary,
advisable or prudent to ensure the perfection of the security interests in the
Collateral granted to the Administrative Agent in connection herewith, including
describing such property as “all assets” or “all personal property.”

 

Section 9.2.                                          Release of Lien on
Collateral.

 

On the date (i) any Receivable expires by its terms and all amounts in respect
thereof have been paid in full by the related Obligor and deposited in the
Collection Account, (ii) any Receivable becomes a Prepaid Receivable and all
amounts in respect thereof have been paid in full by the related Obligor and
deposited in the Collection Account, (iii) on which the applicable Borrower has
paid all required amounts pursuant to Section 2.15 with respect to the related
Receivable, (iv) any Receivable is substituted for in accordance with
Section 2.15, or (v) this Agreement terminates in accordance with Section 13.6,
the Administrative Agent, as agent for the Secured Parties, shall automatically
and without further action be deemed to transfer, assign and set-over to the
applicable Borrower, without recourse, representation or warranty, all the
right, title and interest of the Administrative Agent, as agent for the Secured
Parties in, to and under such Receivable (or all Receivables in the case of
clause (v)), all related Collateral and all future monies due or to become due
with respect thereto.  The Administrative Agent, as agent for the Secured
Parties, shall, at the sole expense of such Borrower, (i) execute such
instruments of

 

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release in favor of such Borrower with respect to the portion of the Collateral
to be released from the Lien of this Agreement as applicable Borrower may
reasonably request (in recordable form if necessary), (ii) deliver any portion
of the Collateral to be released from the Lien of this Agreement in its
possession to the applicable Borrower and (iii) otherwise take such actions, and
cause or permit the Collateral Custodian to take such actions, as are necessary
and appropriate to release the Lien of the Administrative Agent and the Secured
Parties on the portion of the Collateral to be released and deliver to the
applicable Borrower such portion of the Collateral to be released to the
applicable Borrower.

 

Section 9.3.                                          Further Assurances.

 

The provisions of Section 13.12 shall apply to the security interest granted
under Section 9.1 as well as to the Loans hereunder.

 

Section 9.4.                                          Remedies.

 

Subject to the provisions of Section 10.2, upon the occurrence and continuance
of an Event of Default, the Administrative Agent shall have, with respect to the
Collateral granted pursuant to Section 9.1, and in addition to all other rights
and remedies available to the Administrative Agent and the other Secured Parties
under this Agreement or other Applicable Law, all rights and remedies of a
secured party upon default under the UCC.

 

Section 9.5.                                          Waiver of Certain Laws.

 

Each of the Borrowers and the Servicer agree, to the full extent that it may
lawfully so agree, that neither it nor anyone claiming through or under it will
set up, claim or seek to take advantage of any appraisal, valuation, stay,
extension or redemption law now or hereafter in force in any locality where any
Collateral may be situated in order to prevent, hinder or delay the enforcement
or foreclosure of this Agreement or any Transaction Document, or the absolute
sale of any of the Collateral or any part thereof, or the final and absolute
putting into possession thereof, immediately after such sale, of the purchasers
thereof, and each of the Borrowers and the Servicer, for itself and all who may
at any time claim through or under it, hereby waives, to the full extent that it
may be lawful so to do, the benefit of all such laws, and any and all right to
have any of the properties or assets constituting the Collateral marshaled upon
any such sale, and agrees that the Administrative Agent or any court having
jurisdiction to foreclose the security interests granted in this Agreement may
sell the Collateral as an entirety or in such parcels as the Administrative
Agent or such court may determine.

 

Section 9.6.                                          Power of Attorney.

 

Each of the Borrowers and the initial Servicer hereby irrevocably appoints the
Administrative Agent to act upon and during the continuance of an Event of
Default as its true and lawful attorney (with full power of substitution) in its
name, place and stead and at its expense, in connection with the enforcement of
the rights and remedies provided for in this Agreement, in each case to the
extent so permitted hereunder, including without limitation the following
powers: (a) to give any necessary receipts or acquittance for amounts collected
or received hereunder, (b) to make all necessary transfers of the Collateral in
connection with any sale or other disposition made pursuant to Section 9.4,
(c) to execute and deliver for value all

 

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necessary or appropriate bills of sale, assignments and other instruments in
connection with any such sale or other disposition and (d) to sign any
agreements, orders or other documents in connection with or pursuant to any
Transaction Document, the Borrowers and the initial Servicer (as the case may
be) hereby ratifying and confirming all that such attorney (or any substitute)
shall lawfully do hereunder and pursuant hereto.  Nevertheless, if so requested
by the Administrative Agent, the Borrowers shall ratify and confirm any such
sale or other disposition by executing and delivering to the Administrative
Agent or such purchaser all proper bills of sale, assignments, releases and
other instruments as may be designated in any such request.

 

ARTICLE X

 

EVENTS OF DEFAULT

 

Section 10.1.                                   Events of Default.

 

Each of the following events shall be an Event of Default (an “Event of
Default”) hereunder:

 

(a)                                  failure on the part of any Borrower, the
Servicer, the Originator or any Guarantor to make any payment or deposit
(including, without limitation, the payment in full of the Loans and other
Obligations on the Termination Date and any failure to remit Collections or make
any other payment or deposit required to be made by the terms of the Transaction
Documents) required by the terms of any Transaction Document on the day such
payment or deposit is required to be made and the same continues unremedied for
two (2) Business Days; or

 

(b)                                 the failure of any Borrower, the Originator,
or the Servicer (for purposes of this Section 10.1, references to the “Servicer”
shall only apply while ***** or one of its Affiliates is the Servicer) to make
any payment when due with respect to any of its debt or other obligations in
excess of $150,000 in the aggregate, whether or not such debt or other
obligations shall be declared to be due and payable or required to be prepaid
(other than by scheduled payment) prior to maturity; in each case, after all
grace and cure periods thereunder have elapsed and subject to such Person’s
right to contest in good faith any claim that could lead to acceleration; or

 

(c)                                  a Borrowing Base Deficiency occurs and the
same continues unremedied for five (5) Business Days; or

 

(d)                                 any representation, warranty, or
certification made by any Borrower, the Servicer, the Originator or any
Guarantor in any Transaction Document or in any certificate delivered pursuant
to any Transaction Document shall prove to have been materially incorrect when
made, and which continues to be unremedied for a period of fifteen (15) Business
Days after the earlier to occur of (i) the date on which written notice of such
incorrectness requiring the same to be remedied shall have been given to the
applicable Borrower, the Servicer, the Originator or the applicable Guarantor,
as the case may be, by the Administrative Agent or (ii) the date on which a
Responsible Officer of the applicable Borrower, the Servicer, the Originator or
the applicable Guarantor, as the case may be, acquires knowledge thereof; or

 

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(e)                                  any failure on the part of any Borrower,
the Servicer or the Originator duly to observe or perform in any material
respect any of its respective covenants or agreements set forth in this
Agreement or the other Transaction Documents, including without limitation
making a material change to the Credit and Collection Policy or other
underwriting guidelines without the prior consent of the Administrative Agent,
and the same continues unremedied for a period of five (5) Business Days (if
such failure is susceptible to cure) after the earlier to occur of (i) the date
on which written notice of such failure requiring the same to be remedied shall
have been given to such Borrower, the Servicer or the Originator, as the case
may be, by the Administrative Agent or (ii) the date on which a Responsible
Officer of such Borrower, the Servicer or the Originator, as the case may be,
acquires knowledge thereof; or

 

(f)                                    the occurrence of an Insolvency Event
relating to a Borrower, the Servicer, the Originator or any Guarantor; or

 

(g)                                 the occurrence of a Servicer Default; or

 

(h)                                 the rendering of one or more final
judgments, decrees or orders by a court or arbitrator of competent jurisdiction
for the payment of money in excess individually or in the aggregate of $250,000,
against a Borrower, the initial Servicer or the Originator, and such Borrower,
the initial Servicer or the Originator, as applicable, shall not have either
(i) discharged or provided for the discharge of any such judgment, decree or
order in accordance with its terms or (ii) perfected a timely appeal of such
judgment, decree or order and caused the execution of same to be stayed during
the pendency of the appeal; or

 

(i)                                     (1)                                  any
Transaction Document, or any Lien granted thereunder, shall, in whole or in
material part, terminate, cease to be effective or cease to be the legally
valid, binding and enforceable obligation of the applicable Borrower, the
Servicer, the Originator or any Guarantor; or

 

(2)                                  any Borrower, the Servicer, the Originator
or any Guarantor shall, directly or indirectly, contest in any manner the
effectiveness, validity, binding nature or enforceability of any Transaction
Document or any lien or security interest thereunder; or

 

(3)                                  any security interest securing Collateral
or any obligation under any Transaction Document shall, in whole or in part,
cease, after a cure period of three (3) Business Days has elapsed, to be a first
priority perfected security interest (subject to Permitted Liens) except as
otherwise expressly permitted to be released in accordance with the applicable
Transaction Document; or

 

(j)                                     the occurrence of any event which causes
a Material Adverse Effect; or

 

(k)                                  the occurrence of a Change of Control
(without the prior written consent of the Administrative Agent); or

 

(l)                                     any Borrower or the Originator (without
the prior written consent of the Administrative Agent) enters into any
transaction or agreement to merge into or consolidate with any Person in which
such Borrower or Originator is not the surviving entity; or

 

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(m)                               the annual audited financial statements of a
Borrower, the Servicer or the Originator are qualified in any manner; or

 

(n)                                 the three-month rolling average Class A
Delinquency Ratio shall exceed 15.0% or the three-month rolling average Class B
Delinquency Ratio shall exceed 30.0%; or

 

(o)                                 the three-month rolling average Class A
Default Ratio shall exceed 5.0% or the three-month rolling average Class B
Default Ratio shall exceed 12.0%; or

 

(p)                                 any Borrower shall become required to
register as an “investment company” within the meaning of the 1940 Act or the
arrangements contemplated by the Transaction Documents shall require
registration as an “investment company” within the meaning of the 1940 Act; or

 

(q)                                 the Internal Revenue Service shall file
notice of a lien pursuant to Section 6323 of the Code with regard to any assets
of a Borrower, the Servicer, the Originator or either Guarantor and such lien
shall not have been released within ten (10) Business Days, or the Pension
Benefit Guaranty Corporation shall file notice of a lien pursuant to
Section 4068 of ERISA with regard to any of the assets of a Borrower, the
Servicer, the Originator or either Guarantor and such lien shall not have been
released within ten (10) Business Days; or

 

(r)                                    the Excess Spread with respect to any
calendar month is less than 5.00% and a Borrower has not entered into an
interest rate swap, cap or other hedging arrangement in form and with
counterparties acceptable to the Administrative Agent in its reasonable
discretion; or

 

(s)                                  as of any date of determination, the
Tangible Net Worth of the Originator shall be less than $4,500,000; or

 

(t)                                    the annual net income of the Originator
as of the end of any fiscal year ending after the Closing Date shall fail to be
positive; or

 

(u)                                 the occurrence of any “Default” under (and
as defined in) the Term Credit Agreement.

 

Section 10.2.                                   Remedies.

 

(a)                                  Upon the occurrence of an Event of Default
(unless otherwise waived in writing by the Required Lenders), the Administrative
Agent shall, at the request of, or may, with the consent of, the Required
Lenders, by notice to the Borrowers (with copies to the Backup Servicer and the
Collateral Custodian), declare the Termination Date to have occurred and the
Variable Funding Notes to be immediately due and payable in full (without
presentment, demand, protest or notice of any kind all of which are hereby
waived by the Borrowers); provided that in the case of any event described in
Section 10.1(f), the Variable Funding Notes shall be immediately due and payable
in full (without presentment, demand, notice of any kind, all of which are
hereby expressly waived by the Borrowers) and the Termination Date shall be
deemed to have occurred automatically upon the occurrence of any such event.

 

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(b)                                 On and after the declaration or occurrence
of the Termination Date, all Commitments shall terminate, all Loans Outstanding
and other Aggregate Unpaids shall bear interest at the Default Rate and the
Administrative Agent, for the benefit of the Secured Parties, shall have, in
addition to all other rights and remedies under this Agreement or otherwise, all
other rights and remedies provided under the UCC of each applicable jurisdiction
and other Applicable Laws, which rights shall be cumulative, and also may
require the Borrowers, the initial Servicer and the Originator to, and the
Borrowers, the initial Servicer and the Originator hereby agree that they will
at the initial Servicer’s expense and upon request of the Administrative Agent
forthwith, (i) assemble all or any part of the Collateral as directed by the
Administrative Agent and make the same available to the Administrative Agent at
a place to be designated by the Administrative Agent and (ii) without notice,
except as specified below, sell the Collateral or any part thereof in one (1) or
more tranches at a public or private sale, at any of the Administrative Agent’s
offices or elsewhere, for cash, on credit or for future delivery, and upon such
other terms as the Administrative Agent may deem commercially reasonable.  In
the event that the Administrative Agent elects to sell the Collateral or any
part thereof, bids will be accepted for a period of no less than thirty (30)
days and the Collateral shall be sold to the highest bidder, provided that the
Administrative Agent, in its sole discretion, shall have received adequate
assurances of such bidder’s ability to pay the purchase price.  The Borrowers
agree that, to the extent notice of sale shall be required by law, at least
thirty (30) days’ notice to the Borrowers of the time and place of any public
sale or the time after which any private sale is to be made shall constitute
reasonable notification.  The Administrative Agent shall not be obligated to
make any sale of the Collateral regardless of notice of sale having been given. 
The Administrative Agent may adjourn any public or private sale from time to
time by announcement at the time and place fixed therefor, and such sale may,
without further notice, be made at the time and place to which it was so
adjourned.  All cash Proceeds received by the Administrative Agent in respect of
any sale of, collection from, or other realization upon, all or any part of the
Collateral shall be deposited into the Collection Account and to be applied
pursuant to the settlement procedures set forth in Section 2.10.

 

ARTICLE XI

 

INDEMNIFICATION

 

Section 11.1.                                   Indemnities by the Borrowers.

 

(a)                                  Without limiting any other rights that any
such Person may have hereunder or under Applicable Law, the Borrowers hereby
jointly and severally agree to indemnify the Backup Servicer, the Collateral
Custodian, any successor Servicer, the Secured Parties and each of their
respective assigns and officers, directors, employees and agents (collectively,
the “Indemnified Parties”), forthwith on demand, from and against any and all
damages (exclusive of consequential damages), losses, claims, liabilities and
related costs and expenses, including reasonable attorneys’ fees and
disbursements (all of the foregoing being collectively referred to as the
“Indemnified Amounts”) awarded against or incurred by such Indemnified Party
arising out of or as a result of this Agreement or the other Transaction
Documents or the Collateral or in respect of any Receivable included in the
Collateral, excluding, however, Indemnified Amounts to the extent resulting from
gross negligence, bad faith or willful misconduct on the part of such
Indemnified Party and excluding disputes among

 

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the Indemnified Parties.  Without limiting the foregoing, the Borrowers shall
indemnify each Indemnified Party for Indemnified Amounts relating to or
resulting from:

 

(i)                                     any representation or warranty made or
deemed made by any Borrower, the Servicer, the Originator, any Guarantor or any
of their respective officers under or in connection with this Agreement or any
other Transaction Document, which shall have been false or incorrect when made
or deemed made or delivered;

 

(ii)                                  the failure by any Borrower, the Servicer,
the Originator or any Guarantor to comply with any term, provision or covenant
contained in this Agreement, any of the other Transaction Documents or any
agreement executed in connection therewith, or with any Applicable Law,
including with respect to any Collateral or the nonconformity of any Collateral
with any such Applicable Law;

 

(iii)                              the failure to vest and maintain vested in
the Administrative Agent, as agent for the Secured Parties, a perfected security
interest in the Collateral, free and clear of any Lien (other than Permitted
Liens) whether existing at the time of any Loan or at any time thereafter
(including, without limitation, as the result of the failure to file, or any
delay in filing, financing statements, continuation statements or other similar
instruments or documents under the UCC of any applicable jurisdiction or other
Applicable Law with respect to any Collateral);

 

(iv)                              the failure to maintain, as of the close of
business on each Business Day prior to the Termination Date, an amount of Loans
Outstanding that is less than or equal to the Maximum Outstanding Loan Amount on
such Business Day;

 

(v)                                 any dispute, claim, offset or defense (other
than the discharge in bankruptcy of any Obligor) of any Obligor to the payment
with respect to any Collateral (including, without limitation, a defense based
on the Collateral not being a legal, valid and binding obligation of such
Obligor enforceable against it in accordance with its terms), or any other claim
related to such Collateral;

 

(vi)                              any failure of any Borrower, the Servicer or
the Originator to perform its respective duties under the Transaction Documents
with respect to any Collateral;

 

(vii)                           the failure of any Lockbox Account Bank or
Concentration Account Bank to remit any amounts held in a Lockbox Account or the
Concentration Account pursuant to the instructions of the Servicer or the
Administrative Agent (to the extent such Person is entitled to give such
instructions in accordance with the terms hereof) whether by reason of the
exercise of set-off rights or otherwise;

 

(viii)                        any inability to obtain any judgment in, or
utilize the court or other adjudication system of, any state in which an Obligor
may be located as a result of the failure of any Borrower, the Servicer or the
Originator to qualify to do business or file any notice or business activity
report or any similar report;

 

(ix)                               any action taken by any Borrower, the
Servicer or the Originator in the enforcement or collection of any Collateral;

 

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(x)                                   any claim, suit or action of any kind
arising out of or in connection with any Environmental Laws, including any
vicarious liability;

 

(xi)                                the failure by any Borrower, the Servicer or
the Originator to pay when due any Taxes for which such Person is liable,
including without limitation, sales, excise or personal property taxes payable
in connection with the Collateral;

 

(xii)                            any repayment by a Secured Party of any amount
previously distributed in reduction of Loans Outstanding or payment of Interest
or any other amount due hereunder or under any other Transaction Document, in
each case which amount such Secured Party believes in good faith is required to
be repaid;

 

(xiii)                         the commingling of Collections by any Borrower,
the Originator or the Servicer on the Collateral at any time with other funds;

 

(xiv)                         any investigation, litigation or proceeding
related to this Agreement or the use of proceeds of Loans or the security
interest in the Collateral (other than as related to the acts of the
Administrative Agent, the Secured Parties, the Backup Servicer or the Collateral
Custodian);

 

(xv)                            any failure by any Borrower to give reasonably
equivalent value to the Originator or the Seller, as applicable, in
consideration for the transfer to such Borrower of any item of Collateral or any
attempt by any Person to void or otherwise avoid any such transfer under any
statutory provision or common law or equitable action, including, without
limitation, any provision of the Bankruptcy Code; or

 

(xvi)                         the use of the proceeds of any Loan in a manner
other than as provided in this Agreement and the applicable Sale Agreement.

 

(b)                                 Any amounts subject to the indemnification
provisions of this Section 11.1 shall be paid by the Borrowers to the
Indemnified Party on the Payment Date following such Person’s written demand
therefor to the Borrowers setting forth the basis for such Indemnified Amounts
in reasonable detail.

 

(c)                                  If for any reason the indemnification
provided above in this Section 11.1 is unavailable to the Indemnified Party or
is insufficient to hold an Indemnified Party harmless, then the Borrowers shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such loss, claim, damage or liability in such proportion as is appropriate to
reflect not only the relative benefits received by such Indemnified Party on the
one hand and the Borrowers on the other hand but also the relative fault of such
Indemnified Party as well as any other relevant equitable considerations.

 

(d)                                 The obligations of the Borrowers under this
Section 11.1 shall survive the resignation or removal of the Administrative
Agent, the Servicer, the Backup Servicer, Successor Servicer or the Collateral
Custodian and the termination of this Agreement.

 

(e)                                  Notwithstanding the above provisions of
this Section 11.1, nothing in this Section shall be construed to require the
Borrowers to provide any indemnification under this

 

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Agreement or the other Transaction Documents for any damages, losses, claims,
liabilities and related costs and expenses, including reasonable attorneys’ fees
and disbursements arising out of or in connection with credit losses with
respect to any of the Receivables or any Related Security or the diminution in
market value of the Collateral.

 

(f)                                    If any Indemnified Party receives any
Indemnified Amount from the Borrowers and is subsequently reimbursed for such
amounts by another party, such Indemnified Party hereby agrees to promptly
reimburse the Borrowers for such reimbursed amounts.

 

Section 11.2.                         Indemnities by the Servicer.

 

(a)                                  Without limiting any other rights that any
such Person may have hereunder or under Applicable Law, the Servicer hereby
agrees to indemnify each Indemnified Party, forthwith on demand, from and
against any and all Indemnified Amounts awarded against or incurred by any such
Indemnified Party by reason of any acts or omissions of the Servicer (other than
with respect to disputes among Indemnified Parties), including, but not limited
to (i) any representation or warranty made by the Servicer under or in
connection with any Transaction Document, any Servicing Report, Servicer’s
Certificate or any other information or report delivered by or on behalf of the
Servicer pursuant hereto, which shall have been false, incorrect or misleading
in any respect when made or deemed made, (ii) the failure by the Servicer to
comply with any Applicable Law, (iii) the failure of the Servicer to comply with
its covenants under this Agreement or the other Transaction Documents, or
(iv) any litigation, proceedings or investigation against the Servicer (other
than as related to acts of bad faith, breach of contract, negligence or willful
misconduct of the Administrative Agent, the Secured Parties or the Collateral
Custodian).

 

(b)                                 Any amounts subject to the indemnification
provisions of this Section 11.2 shall be paid by the Servicer to the Indemnified
Party within five (5) Business Days following such Person’s written demand
(setting forth the basis for such Indemnified Amounts in reasonable detail)
therefor to the Servicer.

 

(c)                                  The obligations of the Servicer under this
Section 11.2 shall survive the resignation or removal of the Administrative
Agent, the Backup Servicer or Successor Servicer or the Collateral Custodian and
the termination of this Agreement.

 

(d)                                 Any indemnification payable by the Servicer
pursuant to this Section 11.2 shall not be payable from the Collateral.

 

(e)                                  Notwithstanding the above provisions of
this Section 11.2, nothing in this Section shall be construed to require the
Servicer to provide any indemnification under this Agreement or the other
Transaction Documents for any damages, losses, claims, liabilities and related
costs and expenses, including reasonable attorneys’ fees and disbursements
arising out of or in connection with credit losses with respect to any of the
Receivables or any Related Security or the diminution in market value of the
Collateral.

 

(f)                                    If any Indemnified Party receives any
Indemnified Amount from the Servicer and is subsequently reimbursed for such
amounts by another party, such Indemnified Party hereby agrees to promptly
reimburse the Servicer for such reimbursed amounts.

 

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ARTICLE XII

 

THE ADMINISTRATIVE AGENT

 

Section 12.1.                         The Administrative Agent.

 

(a)                                  Appointment.  Each Secured Party hereby
appoints and authorizes the Administrative Agent as its agent and bailee for
purposes of perfection pursuant to the applicable UCC and hereby further
authorizes the Administrative Agent to appoint additional agents and bailees to
act on its behalf and for the benefit of each Secured Party.  Each Secured Party
further authorizes the Administrative Agent to take such action as agent on its
behalf and to exercise such powers under this Agreement and the other
Transaction Documents as are delegated to the Administrative Agent by the terms
hereof and thereof, together with such powers as are reasonably incidental
thereto.  In furtherance, and without limiting the generality, of the foregoing,
each Secured Party hereby appoints the Administrative Agent as its agent to
execute and deliver all further instruments and documents, and take all further
action that the Administrative Agent may deem necessary or appropriate or that a
Secured Party may reasonably request in order to perfect, protect or more fully
evidence the security interests granted by the Borrowers hereunder, or to enable
any of them to exercise or enforce any of their respective rights hereunder,
including, without limitation, the execution by the Administrative Agent as
secured party/assignee of such financing or continuation statements, or
amendments thereto or assignments thereof, relative to all or any of the
Collateral now existing or hereafter arising, and such other instruments or
notices, as may be necessary or appropriate for the purposes stated
hereinabove.  The Lenders may direct the Administrative Agent to take any such
incidental action hereunder.  With respect to other actions which are incidental
to the actions specifically delegated to the Administrative Agent hereunder, the
Administrative Agent shall not be required to take any such incidental action
hereunder, but shall be required to act or to refrain from acting (and shall be
fully protected in acting or refraining from acting) upon the direction of the
Required Lenders; provided that the Administrative Agent shall not be required
to take any action hereunder if the taking of such action, in the reasonable
determination of the Administrative Agent, shall be in violation of any
Applicable Law or contrary to any provision of this Agreement or shall expose
the Administrative Agent to liability hereunder or otherwise.  In the event the
Administrative Agent requests the consent of a Lender pursuant to the foregoing
provisions and the Administrative Agent does not receive a consent (either
positive or negative) from such Person within ten Business Days of such Person’s
receipt of such request, then such Lender shall be deemed to have declined to
consent to the relevant action.

 

(b)                                 Standard of Care.  The Administrative Agent
shall exercise such rights and powers vested in it by this Agreement and the
other Transaction Documents, and use the same degree of care and skill in its
exercise as a prudent person would exercise or use under the circumstances in
the conduct of such person’s own affairs.

 

(c)                                  Administrative Agent’s Reliance, Etc. 
Neither the Administrative Agent nor any of its directors, officers, agents or
employees shall be liable to any Lender for any action taken or omitted to be
taken by it or them as Administrative Agent under or in connection with this
Agreement or any of the other Transaction Documents, except for its or their own
gross negligence or willful misconduct. Without limiting the foregoing, the
Administrative Agent: 

 

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(i) may consult with legal counsel (including counsel for the Borrowers, the
Servicer or the Originator), independent public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (ii) makes no warranty or representation and shall not
be responsible to any Lender for any statements, warranties or representations
made in or in connection with this Agreement; (iii) shall not have any duty to
any Lender to ascertain or to inquire as to the performance or observance of any
of the terms, covenants or conditions of this Agreement or any of the other
Transaction Documents on the part of the Borrowers, the Originator or the
Servicer or to inspect the property (including the books and records) of the
Borrowers, the Originator or the Servicer; (iv) shall not be responsible to any
Lender for the due execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement, any of the other Transaction Documents
or any other instrument or document furnished pursuant hereto or thereto; and
(v) shall incur no liability to any Lender under or in respect of this Agreement
or any of the other Transaction Documents by acting upon any notice (including
notice by telephone), consent, certificate or other instrument or writing (which
may be by facsimile) believed by it to be genuine and signed or sent by the
proper party or parties.

 

(d)                                 Credit Decision with Respect to the
Administrative Agent.  Each Secured Party acknowledges that it has,
independently and without reliance upon the Administrative Agent, or any of the
Administrative Agent’s Affiliates, and based upon such documents and information
as it has deemed appropriate, made its own evaluation and decision to enter into
this Agreement and the other Transaction Documents to which it is a party.  Each
Secured Party also acknowledges that it will, independently and without reliance
upon the Administrative Agent, or any of the Administrative Agent’s Affiliates,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own decisions in taking or not taking action under
this Agreement and the other Transaction Documents to which it is a party.

 

(e)                                  Indemnification of the Administrative
Agent.  Each Lender agrees to indemnify the Administrative Agent (to the extent
not reimbursed by the Borrowers, the initial Servicer or the Originator),
ratably in accordance with its Pro Rata Share from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by, or asserted against the Administrative Agent in any way
relating to or arising out of this Agreement or any of the other Transaction
Documents, or any action taken or omitted by the Administrative Agent hereunder
or thereunder; provided that, the Lenders shall not be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from the Administrative
Agent’s gross negligence or willful misconduct. Without limitation of the
foregoing, each Lender agrees to reimburse the Administrative Agent, ratably in
accordance with its Pro Rata Share, promptly upon demand for any out-of-pocket
expenses (including counsel fees) incurred by the Administrative Agent in
connection with the administration, modification, amendment or enforcement
(whether through negotiations, legal proceedings or otherwise) of, or legal
advice in respect of rights or responsibilities under, this Agreement and the
other Transaction Documents, to the extent that such expenses are incurred in
the interests of or otherwise in respect of the Lenders hereunder and/or
thereunder and to the extent that the Administrative Agent is not reimbursed for
such expenses by the Borrowers, the Servicer or the Originator.

 

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(f)                                    Successor Administrative Agent.  The
Administrative Agent may resign at any time, effective upon the appointment and
acceptance of a successor Administrative Agent as provided below, by giving at
least five (5) days’ written notice thereof to each Lender and the Borrowers and
may be removed at any time with cause by the Lenders acting jointly.  Upon any
such resignation or removal, the Lenders acting jointly shall appoint a
successor Administrative Agent reasonably acceptable to the Borrowers.  Each
Lender agrees that it shall not unreasonably withhold or delay its approval of
the appointment of a successor Administrative Agent.  If no such successor
Administrative Agent shall have been so appointed, and shall have accepted such
appointment, within 30 days after the retiring Administrative Agent’s giving of
notice of resignation or the removal of the retiring Administrative Agent, then
the retiring Administrative Agent may, on behalf of the Secured Parties, appoint
a successor Administrative Agent which successor Administrative Agent shall be
either (i) a commercial bank or other financial institution organized under the
laws of the United States or of any state thereof and have a combined capital
and surplus of at least $50,000,000 or (ii) an Affiliate of such a bank or
financial institution.  Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor Administrative Agent, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Administrative Agent, and
the retiring Administrative Agent shall be discharged from its duties and
obligations under this Agreement.  After any retiring Administrative Agent’s
resignation or removal hereunder as Administrative Agent, the provisions of this
Article XII shall continue to inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this
Agreement.

 

(g)                                 Payments by the Administrative Agent. 
Unless specifically allocated to a specific Lender pursuant to the terms of this
Agreement, all amounts received by the Administrative Agent on behalf of the
Lenders shall be paid by the Administrative Agent to the Lenders in accordance
with their related Pro Rata Shares, on the Business Day received by the
Administrative Agent, unless such amounts are received after 12:00 noon on such
Business Day, in which case the Administrative Agent shall use its reasonable
efforts to pay such amounts to each Lender on such Business Day, but, in any
event, shall pay such amounts to such Lenders not later than the following
Business Day.

 

ARTICLE XIII

MISCELLANEOUS

 

Section 13.1.                         Amendments and Waivers.

 

Except as provided in this Section 13.1, no amendment, waiver or other
modification of any provision of this Agreement shall be effective without the
written agreement of the Borrowers, the Servicer, the Originator, the
Administrative Agent and the Required Lenders; provided that, (i) any amendment
of the Agreement that is solely for the purpose of adding a Lender may be
effected with the written consent of the Administrative Agent and the Borrowers;
and (ii) no such amendment, waiver or modification adversely affecting the
rights or obligations of the Backup Servicer (in such role or as successor
Servicer), the Collateral Custodian or any Guarantor shall be effective without
the written agreement of such Person.  The Borrowers shall deliver promptly to
the Backup Servicer, the Collateral Custodian and each Guarantor a copy of

 

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any amendment, waiver or other modification of this Agreement not executed by 
such Person in accordance with this Section.

 

Section 13.2.                         Notices, Etc.

 

All notices, reports and other communications provided for hereunder shall,
unless otherwise stated herein, be in writing (including communication by
facsimile copy or electronic mail) and mailed, e-mailed, faxed, transmitted or
delivered, as to each party hereto, at its address (or specified addresses) set
forth on Annex A to this Agreement or at such other address as shall be
designated by such party in a written notice to the other parties hereto.  All
such notices and communications shall be effective upon receipt, or in the case
of (a) notice by e-mail, when verbal or electronic communication of receipt is
obtained, or (b) notice by facsimile copy, when verbal communication of receipt
is obtained.

 

Section 13.3.                         Ratable Payments.

 

If any Secured Party, whether by setoff or otherwise, has payment made to it
with respect to any portion of the Aggregate Unpaids owing to such Secured Party
(other than payments received pursuant to Article XI) in a greater proportion
than that received by any other Secured Party, such Secured Party agrees,
promptly upon demand, to purchase for cash without recourse or warranty a
portion of the Aggregate Unpaids held by the other Secured Parties so that after
such purchase each Secured Party will hold its ratable proportion of the
Aggregate Unpaids; provided, that if all or any portion of such excess amount is
thereafter recovered from such Secured Party, such purchase shall be rescinded
and the purchase price restored to the extent of such recovery, but without
interest.

 

Section 13.4.                         No Waiver; Remedies.

 

No failure on the part of the Administrative Agent, the Lenders, the Collateral
Custodian, the Backup Servicer or a Secured Party to exercise, and no delay in
exercising, any right or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any right or remedy hereunder preclude
any other or further exercise thereof or the exercise of any other right.  The
rights and remedies herein provided are cumulative and not exclusive of any
rights and remedies provided by law.

 

Section 13.5.                         Binding Effect; Benefit of Agreement.

 

This Agreement shall be binding upon and inure to the benefit of the parties
hereto, the Secured Parties and their respective successors and permitted
assigns.

 

Section 13.6.                         Term of this Agreement.

 

This Agreement, including, without limitation, the Borrowers’, the Servicer’s,
the Originator’s and the Principal’s representations, warranties and covenants
set forth herein, create and constitute the continuing obligation of the parties
hereto in accordance with its terms, and shall remain in full force and effect
until the Collection Date; provided that the rights and remedies with respect to
any breach of any representation and warranty made or deemed made by the
Borrowers, the Servicer, the Originator or the Principal, the indemnification
and payment

 

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provisions of Article XI and the provisions of Section 13.9, Section 13.10,
Section 13.11 and Section 13.13 shall be continuing and shall survive any
termination of this Agreement.

 

Section 13.7.                         Governing Law; Consent to Jurisdiction;
Waiver of Objection to Venue.

 

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW PROVISIONS
THEREOF (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK).  EACH OF THE PARTIES HERETO HEREBY AGREES TO THE
NON-EXCLUSIVE JURISDICTION OF ANY FEDERAL COURT LOCATED WITHIN THE STATE OF NEW
YORK.  EACH OF THE PARTIES HERETO HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON
CONVENIENS, AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER IN ANY
OF THE AFOREMENTIONED COURTS AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR
EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT.

 

Section 13.8.                         Waiver of Jury Trial.

 

TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE PARTIES HERETO HEREBY
WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE PARTIES HERETO ARISING OUT
OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP BETWEEN ANY OF
THEM IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. 
INSTEAD, ANY SUCH DISPUTE RESOLVED IN COURT WILL BE RESOLVED IN A BENCH TRIAL
WITHOUT A JURY.

 

Section 13.9.                         Costs, Expenses and Taxes.

 

(a)                                  In addition to the rights of
indemnification granted to the Indemnified Parties under Article XI hereof, the
Borrowers (or if the Borrowers fail to do so, the Originator) agree to pay on
demand all reasonable costs and expenses of the Administrative Agent, the
Lenders, the Backup Servicer, the Successor Servicer, the Collateral Custodian
and the Secured Parties incurred in connection with the preparation, execution,
delivery, third party administration (such term to include, subject to the
proviso below, periodic auditing), renewal, amendment or modification of, or any
waiver or consent issued in connection with, this Agreement and the other
documents to be delivered hereunder or in connection herewith, including,
without limitation, reasonable expenses for travel and lodging, background
checks, auditor fees and the reasonable fees and out-of-pocket expenses of
counsel for such Persons with respect thereto and with respect to advising such
Persons as to their respective rights and remedies under this Agreement and the
other documents to be delivered hereunder or in connection herewith, and all
costs and expenses, if any (including reasonable counsel fees and out-of-pocket
expenses), incurred in connection with the enforcement of this Agreement and the
other documents to be delivered hereunder or in connection herewith; provided
that, prior to an

 

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Event of Default or Unmatured Event of Default, any expenses in connection with
periodic audits shall be limited to $25,000 per calendar year.

 

(b)                                 The Borrowers covenant to pay (or if the
Borrowers fail to do so, the Originator shall pay) on demand any and all stamp,
sales, excise and other taxes and fees payable or determined to be payable to
any Governmental Authority in connection with the execution, delivery, filing
and recording of this Agreement and the other documents to be delivered
hereunder.

 

(c)                                  The Borrowers, the Originator and the
initial Servicer, as applicable, severally, covenant to pay on demand all other
reasonable costs, expenses incurred by the Administrative Agent which are the
responsibility of the Borrowers, the Originator or the initial Servicer, as the
case may be, hereunder (“Other Costs”), including, without limitation, all costs
and expenses incurred in connection with periodic audits of the Borrowers’, the
Originator’s or the initial Servicer’s, as the case may be, books and records.

 

Section 13.10.                  No Proceedings.

 

Each of the parties hereto (other than the Administrative Agent) hereby agrees
that it will not institute against, or join any other Person in instituting
against, a Borrower any Insolvency Proceeding so long as there shall not have
elapsed one year and one day (or such longer preference period as shall then be
in effect) since the Collection Date.

 

Section 13.11.                  Recourse Against Certain Parties.

 

(a)                                  No recourse under or with respect to any
obligation, covenant or agreement of any party hereto as contained in this
Agreement or any other agreement, instrument or document entered into by it
pursuant hereto or in connection herewith shall be had against any incorporator,
affiliate, stockholder, officer, employee or director of any party hereto, by
the enforcement of any assessment or by any legal or equitable proceeding, by
virtue of any statute or otherwise; it being expressly agreed and understood
that the agreements of each party hereto contained in this Agreement and all of
the other agreements, instruments and documents entered into by it pursuant
hereto or in connection herewith are, in each case, solely the corporate
obligations of such party hereto (other than with respect to Mr. *****, in the
capacity of Guarantor), and that no personal liability whatsoever shall attach
to or be incurred by any incorporator, stockholder, affiliate, officer, employee
or director of such party (other than with respect to Mr. *****, in the capacity
of Guarantor) under or by reason of any of the obligations, covenants or
agreements of such party hereto contained in this Agreement or in any other such
instruments, documents or agreements, or that are implied therefrom, and that
any and all personal liability of each incorporator, stockholder, affiliate,
officer, employee of such party, or any of them, for breaches by any party
hereto of any such obligations, covenants or agreements, which liability may
arise either at common law or at equity, by statute or constitution, or
otherwise, is hereby expressly waived as a condition of and in consideration for
the execution of this Agreement (other than with respect to Mr. *****, in the
capacity of Guarantor).  Notwithstanding the foregoing, the Administrative Agent
and the Lenders shall not be deemed to have waived any legal rights which they
may have and, to the extent of such rights, shall have recourse against any
incorporator, affiliate, stockholder, officer, employee or director any

 

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Borrower, the initial Servicer or the Originator, to the extent of any loss,
cost or expense incurred in whole or in part from any such Person’s (A) willful
misconduct; (B) fraud; (C) theft or misappropriation of funds; (D) criminal
acts; (E) intentional interference with the Administrative Agent’s Lien in the
Collateral or rights with respect thereto (except pursuant to a court order or
otherwise as required by applicable law); (F) disposition of any Eligible
Receivables or other Collateral in violation of the terms of this Agreement
(except pursuant to a court order or otherwise as required by applicable law);
(G) filing, initiating or consenting to the filing of an involuntary petition
under any chapter of the Bankruptcy Code with respect to any Borrower;
(H) violation of the separateness covenants of any Borrower set forth herein
and/or such Borrower’s organizational documents resulting in the consolidation
of such Borrower’s assets with the assets of any other Person; or
(I) voluntarily seeking, causing or taking any action to effect a dissolution or
liquidation of such Borrower.

 

(b)                                 Notwithstanding any contrary provision set
forth herein, no claim may be made by any party hereto against any other party
hereto or their respective Affiliates, directors, officers, employees, attorneys
or agents for any special, indirect, consequential or punitive damages in
respect to any claim for breach of contract or any other theory of liability
arising out of or related to the transactions contemplated by this Agreement, or
any act, omission or event occurring in connection therewith; and each of the
parties hereto hereby waives, releases, and agrees not to sue upon any claim for
any such damages, whether or not accrued and whether or not known or suspected.

 

(c)                                  No obligation or liability to any Obligor
under any of the Receivables is intended to be assumed by the Secured Parties
under or as a result of this Agreement and the transactions contemplated hereby.

 

Section 13.12.                  Protection of Right, Title and Interest in the
Collateral; Further Action Evidencing Loans.

 

(a)                                  The Servicer shall cooperate with the
Administrative Agent with respect to all financing statements and continuation
statements and any other necessary documents covering the right, title and
interest of the Administrative Agent, as agent for the Secured Parties, to the
Collateral to be promptly recorded, registered and filed, and at all times to be
kept recorded, registered and filed, all in such manner and in such places as
may be required by law fully to preserve and protect the first priority security
interest (subject to Permitted Liens) of the Administrative Agent, as agent the
Secured Parties, hereunder to all property comprising the Collateral.  The
Servicer shall deliver to the Administrative Agent and the Collateral Custodian
file-stamped copies of, or filing receipts for, any document recorded,
registered or filed as provided above and in the possession of the Servicer, as
soon as available following such recording, registration or filing.  The
Borrowers shall cooperate fully with the Servicer in connection with the
obligations set forth above and will execute any and all documents reasonably
required to fulfill the intent of this Section 13.12(a).

 

(b)                                 The Borrowers agree that from time to time,
at its expense, they will promptly authorize, execute and deliver all
instruments and documents, and take all actions, that the Administrative Agent
may reasonably request in order to perfect, protect or more fully evidence the
Loans hereunder and the first priority perfected security interest (subject to

 

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Permitted Liens) granted in the Collateral, or to enable the Administrative
Agent or the Secured Parties to exercise and enforce their rights and remedies
hereunder or under any other Transaction Document.

 

(c)                                  If any Borrower or the Servicer fails to
perform any of its obligations hereunder with respect to the maintenance of the
Administrative Agent’s first priority perfected security interest in the
Collateral (subject to Permitted Liens), the Administrative Agent or any Secured
Party may (but shall not be required to) perform, or cause performance of, such
obligation; and the Administrative Agent’s or such Secured Party’s costs and
expenses incurred in connection therewith shall be payable by such Borrower.  If
any Borrower or the Servicer fails to perform any of its other obligations
hereunder for 10 days following receipt of notice from any Secured Party, the
Administrative Agent or any Secured Party may (but shall not be required to)
perform, or cause performance of, such obligation; and the Administrative
Agent’s or such Secured Party’s costs and expenses incurred in connection
therewith shall be payable by such Borrower or the initial Servicer, as
applicable. Each Borrower irrevocably authorizes the Administrative Agent and
appoint the Administrative Agent as its attorney-in-fact to act on behalf of
such Borrower (i) to execute on behalf of such Borrower as debtor and to file
financing statements necessary or desirable in the Administrative Agent’s sole
discretion to perfect and to maintain the perfection and priority  (subject to
Permitted Liens) of the interest of the Secured Parties in the Collateral,
including those that describe the Collateral as “all assets,” or words of
similar effect, and (ii) to file a carbon, photographic or other reproduction of
this Agreement or any financing statement with respect to the Collateral as a
financing statement in such offices as the Administrative Agent in its sole
discretion deems necessary or desirable to perfect and to maintain the
perfection and priority (subject to Permitted Liens) of the interests of the
Secured Parties in the Collateral.  This appointment is coupled with an interest
and is irrevocable.

 

(d)                                 Without limiting the generality of the
foregoing, the Borrowers will, not earlier than six (6) months and not later
than three (3) months prior to the fifth (5th) anniversary of the date of filing
of any financing statement filed pursuant to this Agreement, unless the
Collection Date shall have occurred:

 

(i)                                     authorize, execute (if necessary) and
deliver and file or cause to be filed an appropriate continuation statement with
respect to such financing statement; and

 

(ii)                                  deliver or cause to be delivered to the
Administrative Agent an opinion of the counsel for the Borrowers, in form and
substance reasonably satisfactory to the Administrative Agent, confirming and
updating the opinion delivered pursuant to Section 3.1 with respect to
perfection and otherwise to the effect that the security interest hereunder
continues to be an enforceable and perfected security interest, subject to no
other Liens of record except as expressly permitted hereunder, which opinion may
contain usual and customary assumptions, limitations and exceptions.

 

Section 13.13.                  Confidentiality.

 

(a)                                  Each of the Secured Parties, the Servicer,
the Originator, the Guarantors, the Collateral Custodian, the Backup Servicer
and the Borrowers shall maintain and shall cause each of its employees and
officers to maintain the confidentiality of the Agreement and all

 

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information with respect to the other parties, including all information
regarding the business of the other parties obtained by it or them in connection
with the structuring, negotiating and execution of the transactions contemplated
herein, except that each such party and its directors, officers and employees
may (i) disclose such information to its external accountants, attorneys,
investors, potential investors, credit enhancers and the agents and advisors of
such Persons (“Excepted Persons”); provided, however, that each Excepted Person
shall be notified of the confidentiality restrictions hereof and shall, as a
condition to any such disclosure, agree for the benefit of the parties hereto
that such information shall be used solely in connection with such Excepted
Person’s evaluation of, or relationship with, the Borrowers, the Servicer,
Sub-Servicer, the Backup Servicer, Collateral Custodian and the Originator and
their affiliates, (ii) disclose the existence of the Agreement, but not the
financial terms thereof, (iii) disclose such information as is required by
Applicable Law and (iv) disclose the Agreement and such information in any suit,
action, proceeding or investigation (whether in law or in equity or pursuant to
arbitration) involving any of the Transaction Documents for the purpose of
defending itself, reducing its liability, or protecting or exercising any of its
claims, rights, remedies, or interests under or in connection with any of the
Transaction Documents.  It is understood that the financial terms that may not
be disclosed except in compliance with this Section 13.13(a) include, without
limitation, all fees and other pricing terms, and all Events of Default,
Servicer Defaults, and the priority of payment provisions herein.  If any Person
discloses any confidential information with respect to another party pursuant to
this Section 13.13(a), it shall provide prompt notice thereof to such other
party with respect to which such confidential information related.

 

(b)                                 Anything herein to the contrary
notwithstanding, each of the parties hereto hereby consents to the disclosure of
any nonpublic information with respect to it (i) to the Collateral Custodian,
the Backup Servicer or the Secured Parties by each other, (ii) by the Collateral
Custodian, the Backup Servicer and the Secured Parties to any prospective or
actual assignee or participant of any of them, or (iii) by the Secured Parties
to any Rating Agency, any provider of a surety, guaranty or credit enhancement
to any Lender or any Person providing financing to, or holding equity interests
in, any Lender, as applicable, and to any officers, directors, employees,
outside accountants, advisors and attorneys of any of the foregoing, provided
each such Person in the case of subclauses (ii) and (iii) is informed of the
confidential nature of such information.

 

(c)                                  Notwithstanding anything herein to the
contrary, the foregoing shall not be construed to prohibit (i) disclosure of any
and all information that is or becomes publicly known (other than through the
violation of this Agreement), (ii) disclosure of any and all information (A) if
required to do so by any applicable statute, law, rule or regulation, (B) to any
government agency or regulatory body having or claiming authority to regulate or
oversee the disclosing entity or its affiliates, or (C) pursuant to any
subpoena, civil investigative demand or similar demand or request of any court,
regulatory authority, arbitrator or arbitration to which the disclosing entity
or an officer, director, employer, shareholder or affiliate of any of the
foregoing is a party (so long as the disclosing Person provides prompt notice
thereof to the applicable party with respect to which such information relates),
or (iii) any other disclosure authorized by any Borrower, the Servicer, the
Guarantors or the Originator in the case of information with respect to it.

 

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Section 13.14.                  Execution in Counterparts; Severability;
Integration.

 

This Agreement may be executed in any number of counterparts and by different
parties hereto in separate counterparts (including by facsimile), each of which
when so executed shall be deemed to be an original and all of which when taken
together shall constitute one and the same agreement.  In case any provision in
or obligation under this Agreement shall be invalid, illegal or unenforceable in
any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.  This
Agreement and any agreements or letters (including fee letters) executed in
connection herewith contain the final and complete integration of all prior
expressions by the parties hereto with respect to the subject matter hereof and
shall constitute the entire agreement among the parties hereto with respect to
the subject matter hereof, superseding all prior oral or written understandings.

 

Section 13.15.                  Waiver of Setoff.

 

Each of the Borrowers, the Servicer, the Originator and the Guarantors hereby
waives any right of setoff it may have or to which it may be entitled under this
Agreement from time to time against any Lender or its assets.

 

Section 13.16.                  Assignments by the Lenders.

 

With the prior written consent of the Borrowers (which consent will not be
unreasonably withheld), any Lender may at any time assign, or grant a security
interest or sell a participation interest in, its rights in its Loans (or
portion thereof) or Commitment (or portion thereof) to any Person; provided that
(i) no such consent of the Borrowers shall be required following the occurrence
of an Event of Default, (ii) in the case of an assignment of its Loans or
Commitments with respect to such Lender, the assignee shall execute and deliver
to the Servicer and the Administrative Agent a Joinder Supplement substantially
in the form of Exhibit I hereto, and (iii) no Lender shall need prior consent to
at any time assign, or grant a security interest or sell a participation
interest in, its Loans (or portion thereof) or Commitment (or portion thereof)
to an Affiliate or an Approved Fund.  The parties to any such assignment or sale
of a participation interest by a Lender shall execute and deliver to the
Administrative Agent, for its acceptance and recording in its books and records,
such agreement or document as may be satisfactory to such parties and the
Administrative Agent.  Neither the Borrowers, the Originator, the Servicer nor
any Guarantor shall assign or delegate, or grant any interest in, any of its
rights, obligations or duties under this Agreement without the prior written
consent of the Administrative Agent.

 

Section 13.17.                  Heading and Exhibits.

 

The headings herein are for purposes of references only and shall not otherwise
affect the meaning or interpretation of any provision hereof.  The schedules and
exhibits attached hereto and referred to herein shall constitute a part of this
Agreement and are incorporated into this Agreement for all purposes.

 

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Section 13.18.                  Right of First Refusal.

 

Each of the LLC Borrower, the Trust Borrower, as applicable, the Originator and
the initial Servicer hereby agrees, from the Closing Date until the Maturity
Date, to grant to Administrative Agent a right of first refusal with respect to
any financing facility such Person or any of its Affiliates may enter as a
borrower to finance receivables substantially similar to the Eligible
Receivables (a “Proposed Facility”).  Each of the LLC Borrower, the Trust
Borrower, as applicable, the Originator and the initial Servicer hereby agrees
to notify the Administrative Agent of its intention to enter into a Proposed
Facility and will inform the Administrative Agent of the general terms upon
which such financing is sought, based on current market conditions.  The
Administrative Agent shall then have five (5) Business Days to inform the
applicable Borrower, the Originator and the initial Servicer if it is interested
in providing such financing.  In the event that Administrative Agent indicates
an interest in providing such financing, the applicable Borrower, the Originator
and the Servicer thereafter agree to not enter into any such Proposed Facility
with any third party and to negotiate such Proposed Facility with the
Administrative Agent in good faith; provided that the Administrative Agent’s
right of first refusal as set forth in this Section 13.18 shall only apply to
the first $50,000,000 of such financing.  In the event that the Administrative
Agent declines to provide such financing or does not respond to the applicable
Borrower, the Originator or the Servicer within five (5) Business Days of its
receipt of such notice, the Borrowers, the Originator and the initial Servicer
shall be permitted to enter the Proposed Facility with a third party on
substantially similar or better terms in which such financing was proposed to
Administrative Agent.  For the avoidance of doubt, the right of first refusal
set forth in this Section 13.18 shall not apply to the Trust II Borrower.

 

Section 13.19.                  Concerning Joint and Several Liability of the
Borrowers.

 

(a)                                  Each Borrower accepts joint and several
liability hereunder in consideration of the financial accommodation to be
provided by the Lenders under this Agreement, for the mutual benefit, directly
and indirectly, of each of the other Borrowers and in consideration of the
undertaking of the other Borrowers to accept joint and several liability for
such Borrower’s obligations.

 

(b)                                 Each of the Borrowers jointly and severally
hereby irrevocably and unconditionally accepts, not merely as a surety but also
as a co-debtor, joint and several liability with each other Borrower with
respect to the payment of all of the Aggregate Unpaids and the performance of
all of the obligations of the Borrowers under this Agreement, it being the
intention of the parties hereto that all the Aggregate Unpaids and obligations
hereunder shall be the joint and several obligations of each of the Borrowers
without preferences or distinction among them.

 

(c)                                  If and to the extent that any of the
Borrowers shall fail to make any payment with respect to any of the Aggregate
Unpaids as and when due or to perform any of its obligations in accordance with
the terms hereof (including any applicable grace or cure periods), then in each
such event, the other Borrower(s) will make such payment with respect to, or
perform, such obligation.

 

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(d)                                 The obligations of each Borrower under the
provisions of this Section 13.19 constitute full recourse obligations of each
such Borrower, enforceable against it to the full extent of its Collateral,
irrespective of the validity, regularity or enforceability of this Agreement or
any other circumstances whatsoever.

 

(e)                                  Except as otherwise expressly provided
herein, each Borrower hereby waives further notice of acceptance of its joint
and several liability.  Each Borrower hereby assents to, and waives notice of,
any extension or postponement of the time for the payment of any of the
Aggregate Unpaids of the other Borrower, the acceptance of any partial payment
thereon, any waiver, consent or other action or acquiescence by the
Administrative Agent or any Lender at any time or times in respect of any
default by the other Borrower in the performance or satisfaction of any term,
covenant, condition or provision of this Agreement, any and all other
indulgences whatsoever by the Administrative Agent or any Lender in respect of
any of the Aggregate Unpaids of the other Borrower.  Without limiting the
generality of the foregoing, each Borrower assents to any other action or delay
in acting or failure to act with respect to the other Borrower on the part of
any Lender, including, without limitation, any failure strictly or diligently to
assert any right or to pursue any remedy or to comply fully with the applicable
laws or regulations hereunder which might, but for the provisions of this
Section 13.19, afford grounds for terminating, discharging or relieving such
Borrower, in whole or in part, from any of its obligations under this
Section 13.19.  The obligations of each Borrower under this Section 13.19 shall
not be diminished or rendered unenforceable by any winding up, reorganization,
arrangement, liquidation, reconstruction or similar proceeding with respect to
any Borrower or any Secured Party.  The joint and several liability of the
Borrowers hereunder shall continue in full force and effect notwithstanding any
absorption, merger, amalgamation or any other change whatsoever in the name,
membership, constitution or place of formation of any Borrower or any Secured
Party.

 

(f)                                    The provisions of this Section 13.19 are
made for the benefit of the Administrative Agent and the Secured Parties and
their respective successors and assigns, and may be enforced by any such Person
from time to time against any of the Borrowers as often as occasion therefor may
arise and without requirement on the part of any such Person first to marshal
any of its claims or to exercise any of its rights against any Borrower or to
exhaust any remedies available to it against any Borrower or to resort to any
other source or means of obtaining payment of any of the Aggregate Unpaids or to
elect any other remedy.  The provisions of this Section 13.19 shall remain in
effect until all the Aggregate Unpaids shall have been paid in full or otherwise
fully satisfied.  If at any time, any payment, or any part thereof, made in
respect of any of the Aggregate Unpaids, is rescinded or must otherwise be
restored or returned by any Secured Party upon the insolvency, bankruptcy or
reorganization of any of the Borrowers, or otherwise, the provisions of this
Section 13.19 will forthwith be reinstated in effect, as though such payment had
not been made.

 

(g)                                 Notwithstanding any provision to the
contrary contained herein or in any other of the Transaction Documents, to the
extent the joint obligations of a Borrower shall be adjudicated to be invalid or
unenforceable for any reason (including, without limitation, because of any
applicable state or federal law relating to fraudulent conveyances or transfers)
then the obligations of each Borrower hereunder shall be limited to the maximum
amount that is

 

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permissible under applicable law (whether federal or state and including,
without limitation, the Bankruptcy Code).

 

Section 13.20.                  Amendment and Restatement.

 

(a)                                  On the date hereof, the Amended Agreement
shall be amended, restated and superseded in its entirety by this Agreement but
the indebtedness evidenced thereby shall neither be cancelled nor extinguished. 
The parties hereto hereby (i) acknowledge and agree that the Liens granted under
the Transaction Documents securing the payment of such indebtedness are in all
respects continuing and in full force and effect, secure the payment of such
indebtedness and from and after the date hereof shall secure the Loans under
this Agreement in addition to such indebtedness and (ii) fully and
unconditionally, to the extent of each of their respective interests therein,
ratify and affirm all Transaction Documents.

 

(b)                                 On and after the date hereof, (i) each
reference in the Transaction Documents to the “Agreement”, “thereunder”,
“thereof” or similar words referring to the Agreement shall mean and be a
reference to this Agreement and (ii) each reference in the Transaction Documents
to a “Variable Funding Notes” or “VFNs” and the “Loans” shall mean and be a
reference to the Variable Funding Notes or VFNs and the Loans as defined in this
Agreement.

 

ARTICLE XIV

GUARANTY

 

Section 14.1.                         Guaranty of Trigger Events

 

To induce the Lenders to make Loans to the Borrowers upon the terms and subject
to the conditions set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Guarantors, jointly and severally, each hereby agree, upon the occurrence of any
Trigger Event, to be personally and unconditionally liable with the Borrowers
and any other Person in the amount of, and to indemnify, reimburse, and hold
Administrative Agent and each other Secured Party harmless from, any liability,
loss, damage, cost or expense of whatever kind or nature, known or unknown,
foreseen or unforeseen, contingent or otherwise (including but not limited to
reasonable attorneys’ fees and expenses) suffered or incurred by such Secured
Party (including any reasonable attorneys’ fees and expenses of enforcing this
Guaranty), and any material damage or material diminution in value of any of the
Collateral (collectively the “Guaranteed Amounts”) resulting from or arising in
connection with any one or more of the following “Trigger Events”:

 

(a)                                  FRAUD:  Fraud (including and without
limitation any claim of fraudulent conveyance) by the Borrowers, the Servicer,
the Originator, the Guarantors or any of their Affiliates or any Responsible
Officer of any of the Borrowers, the Servicer, or the Originator or any of their
Affiliates;

 

(b)                                 THEFT OR MISAPPROPRIATION OF FUNDS:  Theft,
or misappropriation of funds (including, without limitation, dividends,
distributions or payments being made to the Servicer, either Guarantor or any
Affiliate of the Servicer, either Guarantor or

 

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the Borrowers in contravention of the provisions of the Transaction Documents,
including, without limitation, in violation of the prepayment provisions of
Section 2.3);

 

(c)                                  CRIMES:  Any felonies or crimes of the
Servicer, either Guarantor, Borrowers or any Affiliates of the Borrowers or any
of their principals and/or equity owners thereof, or any willful violation of
any laws or legal requirements by any of the foregoing relating to the business,
property or assets of the Servicer, either Guarantor, the Borrowers or any
Affiliates of a Borrower;

 

(d)                                 HINDRANCE:  Any intentional act by the
Servicer, either Guarantor, the Borrowers or any Affiliates of the Borrowers
which prevents, delays or hinders the Secured Parties’ perfection of its
interest in the Collateral (other than in connection with an Insolvency
Proceeding at the direction of a court or Governmental Authority);

 

(e)                                  UNPERMITTED DISPOSITION:  Any voluntary
sale, encumbrance or disposition of any Collateral or Receivables or any part
thereof or interest therein not expressly permitted by the Transaction Documents
(other than in connection with an Insolvency Proceeding at the direction of a
court or Governmental Authority);

 

(f)                                    VOLUNTARY BANKRUPTCY:  If any Borrower
files, initiates or consents to the filing of a voluntary petition under any
chapter of the Bankruptcy Code, or in any manner seeks relief under the
insolvency laws of any state or jurisdiction or the appointment of a trustee,
receiver, conservator or liquidator for all or any part of the properties and
assets of such Borrower; or any Borrower, or any of its equity owners or
Affiliates, files, initiates or consents to the filing of an involuntary
petition under any chapter of the Bankruptcy Code against such Borrower;

 

(g)                                 CONSOLIDATION IN OTHER CASE:  If the
Servicer, either Guarantor, any Borrower, or any of their respective equity
owners or Affiliates consents to, initiates or institutes or makes any claim or
proceeding that seeks or is intended to result in consolidating any Borrower or
any of its properties or assets to become subject to any other Person’s case,
action or proceeding under the insolvency laws of any state or jurisdiction, or
the Collateral, or any portion thereof or interest therein, to be included in
any other Person’s bankrupt estate or otherwise subject to the claims of
creditors of any other Person as a result of the violation of the separateness
covenants of the Borrowers herein and/or the applicable Borrower’s
organizational documents the property of any bankruptcy estate or subject to any
proceeding under any insolvency laws of any state or other jurisdiction; and

 

(h)                                 VOLUNTARY DISSOLUTION:  A Borrower, or any
of its equity owners or Affiliates, voluntarily seeks, causes or takes any
action to effect a dissolution or liquidation of such Borrower.

 

Section 14.2.                         Limited Guaranty of Payment.

 

Subject to the limitations set forth below, *****, individually, as a Guarantor
hereby unconditionally guarantees to the Administrative Agent, for the benefit
of the  Secured Parties, the prompt payment of the Aggregate Unpaids up to a
cumulative amount of 10% of the Maximum Committed Amount upon written demand by
the Administrative Agent at any time

 

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after the occurrence and continuance of a Borrowing Base Deficiency.  This
limited guaranty is a guaranty of payment and not of collection and is a
continuing guaranty.  For the avoidance of doubt, in no event shall *****
liability under this Agreement, or any of the other Transaction Documents or
otherwise, exceed in the aggregate, to any and all parties from the date hereof
forward, an amount equal to 10% of the highest aggregate Outstanding Receivables
Balance of Eligible Receivables since the Closing Date.  Notwithstanding any
provision to the contrary contained herein or in any of the other Transaction
Documents, to the extent the obligations of such Guarantor shall be adjudicated
to be invalid or unenforceable for any reason, then the obligations of such
Guarantor hereunder shall be limited to the maximum amount that is permissible
under Applicable Law.

 

Section 14.3.                         Guarantor Payments.

 

If at any time payment is due pursuant to the either of the Guaranties and the
Servicer or the Administrative Agent informs in writing the Guarantors of the
same, the Guarantors, as applicable, shall within two (2) Business Days deposit
the amount due into the Collection Account for distribution in accordance with
Section 2.7 or Section 2.8, as applicable.  The Servicer shall keep records of
the amount of Guarantor Payments made by each Guarantor and such amount shall be
reflected in all Servicer Reports after the initial Guarantor Payment.

 

Section 14.4.                         Obligations Unconditional.

 

The obligations of the Guarantors hereunder, subject to the limitations of
Sections 14.1 and 14.2, are absolute and unconditional, irrespective of the
value, genuineness, validity, regularity or enforceability of any of the
Transaction Documents or any other agreement or instrument referred to herein or
therein, to the fullest extent permitted by Applicable Law, irrespective of any
other circumstance whatsoever which might otherwise constitute a legal or
equitable discharge or defense of a surety or guarantor (other than the prior
payment of the amounts due).  Each Guarantor agrees that either Guaranty may be
enforced by the Administrative Agent on behalf of the Secured Parties without
the necessity at any time of resorting to or exhausting any other security or
collateral and without the necessity at any time of having recourse to any other
of the Transaction Documents or any Collateral, if any, hereafter securing the
Aggregate Unpaids or otherwise and each Guarantor hereby waives the right to
require Administrative Agent on behalf of the Secured Parties to make demand on
or proceed against the Borrowers or any other Person or to require
Administrative Agent on behalf of the Secured Parties to pursue any other remedy
or enforce any other right.  Each Guarantor further agrees that it shall have no
right of subrogation, indemnity, reimbursement or contribution against the
Borrowers for amounts paid under the Guaranties until such time as the Aggregate
Unpaids have been paid in full in cash, all Commitments under this Agreement
have been terminated and, to the extent the Borrowers or either Guarantor is
party to any Insolvency Proceeding, no Person or Governmental Authority shall
have any right to request any return or reimbursement of funds from the
Administrative Agent or the other Secured Parties in connection with monies
received under the Transaction Documents.  Each Guarantor further agrees that
nothing contained herein shall prevent the Administrative Agent from enforcing
the Transaction Documents or foreclosing its security interest in or Lien on any
Collateral, if any, securing the Aggregate Unpaids or from exercising any other
rights available to it under any of the Transaction Documents, or any other
instrument of security, if any, and the exercise of any of

 

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the aforesaid rights and the completion of any foreclosure proceedings shall not
constitute a discharge of such Guarantor’s obligations hereunder; it being the
purpose and intent of each Guarantor that its obligations hereunder shall be
absolute, independent and unconditional under any and all circumstances. 
Neither Guarantor’s obligations hereunder nor any remedy for the enforcement
thereof shall be impaired, modified, changed or released in any manner
whatsoever by an impairment, modification, change, release, increase or
limitation of the liability of the Borrowers, the Servicer or the Originator or
by reason of the bankruptcy or insolvency of the Borrowers, the Servicer, the
Originator or the Guarantor.  The Aggregate Unpaids, and any part of them, shall
conclusively be deemed to have been created, contracted or incurred, or renewed,
extended, amended or waived, in reliance upon the Guaranties provided in
Sections 14.1 and 14.2.  All dealings between the Borrowers, the Servicer, the
Originator and the Guarantors, on the one hand, and the Administrative Agent and
the other Secured Parties, on the other hand, likewise shall be conclusively
presumed to have been had or consummated in reliance upon the Guaranties
provided in Sections 14.1 and 14.2.  Each Guarantor hereby subordinates to the
Aggregate Unpaids all debts, liabilities and other obligations, whether direct,
indirect, primary, secondary, several, joint and several or otherwise, and
irrespective of whether such debts, liabilities and obligations be evidenced by
note, contract, open account, book entry or otherwise, owing by any of the
Borrowers, the Servicer or the Originator to the Guarantor.

 

Section 14.5.                         Modifications.

 

Each Guarantor agrees that: (a) all or any part of the Collateral now or
hereafter held for the Aggregate Unpaids, if any, may be exchanged, compromised
or surrendered from time to time; (b) none of the Secured Parties or the
Administrative Agent shall have any obligation to protect, perfect, secure or
insure any such security interests, liens or encumbrances now or hereafter held,
if any, for the Aggregate Unpaids or the properties subject thereto; (c) the
time or place of payment of the Aggregate Unpaids may be changed or extended, in
whole or in part, to a time certain or otherwise, and may be renewed or
accelerated, in whole or in part; (d) the Borrowers, the Servicer, the
Originator and any other party liable for payment under the Transaction
Documents may be granted indulgences generally; (e) any of the provisions of the
Transaction Documents may be modified, amended or waived in accordance with the
terms thereof; (f) any party liable for the payment thereof may be granted
indulgences or be released; and (g) any deposit balance for the credit of the
Borrowers, the Servicer, the Originator or any other party liable for the
payment of the Aggregate Unpaids or liable upon any security therefor may be
released, in whole or in part, at, before or after the stated, extended or
accelerated maturity of the Aggregate Unpaids, all without notice to or further
assent by the Guarantors and the Guarantors shall remain bound thereon the
extent contemplated hereunder, notwithstanding any such exchange, compromise,
surrender, extension, renewal, acceleration, modification, indulgence or
release.

 

Section 14.6.                         Waiver of Rights.

 

Each Guarantor expressly waives to the fullest extent permitted by applicable
law: (a) notice of acceptance of the Guaranties provided in Sections 14.1 and
14.2 by the Secured Parties and of all extensions of credit to the Borrowers;
(b) presentment and demand for payment or performance of any of the Aggregate
Unpaids; (c) protest and notice of dishonor or of default with respect to the
Aggregate Unpaids or with respect to any security therefor; (d) notice of the

 

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Secured Parties obtaining, amending, substituting for, releasing, waiving or
modifying any security interest, lien or encumbrance, if any, hereafter securing
the Aggregate Unpaids, or the Secured Parties’ subordinating, compromising,
discharging or releasing such security interests, liens or encumbrances, if any;
and (e) all other notices to which such Guarantor might otherwise be entitled.

 

Section 14.7.                         Reinstatement.

 

Notwithstanding anything contained in this Agreement or the other Transaction
Documents, the obligations of each Guarantor under this Article XIV shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Aggregate Unpaids is rescinded or
must be otherwise restored by any holder of any of the Aggregate Unpaids,
whether as a result of any proceedings in bankruptcy or reorganization or
otherwise, and each Guarantor agrees that it will indemnify the Administrative
Agent and each other Secured Party on demand for all reasonable costs and
expenses (including, without limitation, reasonable attorney costs) incurred by
such Person in connection with such rescission or restoration, including any
such reasonable costs and expenses incurred in defending against any claim
alleging that such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law.

 

Section 14.8.                         Remedies.

 

Each Guarantor agrees that, as between such Guarantor, on the one hand, and the
Administrative Agent and the other Secured Parties, on the other hand, the
Aggregate Unpaids may be declared to be forthwith due and payable as provided in
Section 10.2 hereof (and shall be deemed to have become automatically due and
payable in the circumstances provided in Section 10.2) notwithstanding any stay,
injunction or other prohibition preventing such declaration (or preventing such
Aggregate Unpaids from becoming automatically due and payable) as against any
other Person and that, in the event of such declaration (or such Aggregate
Unpaids being deemed to have become automatically due and payable), such
Aggregate Unpaids (whether or not due and payable by any other Person) shall
forthwith become due and payable by such Guarantor, subject to the limitations
in Sections 14.1 and 14.2.

 

Section 14.9.                         Subrogation.

 

Each Guarantor agrees that, until the Collection Date, it will not exercise any
right of reimbursement, subrogation, contribution, offset or other claims
against the Borrowers, the Servicer and the Originator arising by contract or
operation of law in connection with any payment made or required to be made by
the Guarantor under the Transaction Documents.  After the payment in full in
cash of the Aggregate Unpaids (other than any part of the Aggregate Unpaids that
represents contingent contractual indemnities) and the termination of the
Commitments, the Guarantor shall be entitled to exercise against the Borrowers,
the Servicer and the Originator all such rights of reimbursement, subrogation,
contribution, and offset, and all such other claims, to the fullest extent
permitted by law.

 

[Remainder of Page Intentionally Left Blank]

 

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

 

 

*****,
as a Borrower

 

 

 

 

 

By:

/s/ *****

 

Name:       *****

 

Title:         President

 

 

Second Amended and Restated Revolving Credit Agreement

 

--------------------------------------------------------------------------------

 

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

 

 

*****,
as a Borrower

 

 

 

By:

*****,
not in its individual capacity but solely
as statutory trustee

 

 

 

 

 

By:

/s/ *****

 

Name:         *****
Title:           Vice President

 

 

 

 

 

CLST ASSET TRUST II,
as a Borrower

 

 

 

By:

*****,
not in its individual capacity but solely
as statutory trustee

 

 

 

 

 

By:

/s/ *****

 

Name:         *****
Title:           Vice President

 

 

Second Amended and Restated Revolving Credit Agreement

 

--------------------------------------------------------------------------------

 

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

 

 

*****, as the Originator and as a Guarantor

 

 

 

BY:

*****, its General Partner

 

 

 

 

By:

*****, its sole member

 

 

 

 

 

 

 

By:

/s/ *****

 

Name:        *****

 

Title:          President

 

 

Second Amended and Restated Revolving Credit Agreement

 

--------------------------------------------------------------------------------

 

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

 

 

*****, as the Servicer

 

 

 

By:

*****, its sole member

 

 

 

 

 

 

 

By: 

/s/ *****

 

Name:       *****

 

Title:         President

 

 

Second Amended and Restated Revolving Credit Agreement

 

--------------------------------------------------------------------------------

 

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

 

 

*****,
as a Guarantor

 

 

 

 

 

/s/ *****

 

     *****

 

 

Second Amended and Restated Revolving Credit Agreement

 

--------------------------------------------------------------------------------

 

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

 

 

*****,
as a Lender

 

 

 

 

 

By:

/s/ *****

 

Name:          *****

 

Title:            President

 

 

 

 

 

*****,
as the Administrative Agent

 

 

 

 

 

By:

/s/ *****

 

Name:          *****

 

Title:            President

 

 

Second Amended and Restated Revolving Credit Agreement

 

--------------------------------------------------------------------------------

 

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

 

 

For purposes of Section 3.4 of the Agreement
only:

 

 

 

*****,
as the Administrative Agent under the Term
Credit Agreement

 

 

 

 

 

By:

/s/ *****

 

Name:          *****

 

Title:            President

 

 

Second Amended and Restated Revolving Credit Agreement

 

--------------------------------------------------------------------------------

 

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

 

THE BACKUP SERVICER:

LYON FINANCIAL SERVICES, INC.,
(d/b/a U.S. Bank Portfolio Services),
not in its individual capacity but
solely as Backup Servicer

 

 

 

 

 

By:

/s/ Joseph Andries

 

Name:          Joseph Andries

 

Title:            Senior Vice President

 

 

Second Amended and Restated Revolving Credit Agreement

 

--------------------------------------------------------------------------------

 

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

 

THE COLLATERAL CUSTODIAN:

U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Collateral Custodian

 

 

 

 

 

By:

/s/ Diane Reyonlds

 

Name:          Diane L. Reynolds

 

Title:            Vice President

 

 

Second Amended and Restated Revolving Credit Agreement

 

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