exv4wxfyx99y



 





Exhibit 4(f)(99)




CONTRIBUTION AGREEMENT




     This CONTRIBUTION AGREEMENT, dated as of October 29, 2007 (the “Agreement”), is made
between CREDIT ACCEPTANCE CORPORATION, a Michigan corporation (“CAC”) and CREDIT ACCEPTANCE
FUNDING LLC 2007-2, a Delaware limited liability company (“Funding”).



     Funding desires to acquire from time to time certain Dealer Loans and related rights and
collateral, including certain of CAC’s rights in the Dealer Agreements related thereto, all of the
related Contracts, and the Collections (other than Dealer Collections) derived therefrom during the
full term of this Agreement, and CAC desires to transfer, convey and assign from time to time such
Dealer Loans and related property to Funding upon the terms and conditions hereinafter set forth.
CAC has also agreed to service the Dealer Loans and related property to be transferred, conveyed
and assigned to Funding.



     In consideration of the premises and the mutual agreements set forth herein, it is hereby
agreed by and between CAC and Funding as follows:



ARTICLE I

DEFINITIONS




     SECTION 1.1. Definitions. Capitalized terms used herein shall have the respective
meanings specified herein or, if not so specified, the respective meanings specified in, or
incorporated by reference into, the Sale and Servicing Agreement, and shall include in the singular
number the plural and in the plural number the singular:



     “Contributed Property” means the Initial Contributed Property and the Subsequent
Contributed Property.



     “Initial Contributed Property” means (i) the Dealer Loans listed on Exhibit A hereto
delivered to the Servicer, the Class A Insurer, the Backup Servicer and the Trust Collateral Agent
on the Closing Date and (ii) all Related Security with respect thereto.



     “Related Security” means, with respect to any Dealer Loans, (i) all rights under the
Dealer Agreements related thereto other than the Excluded Dealer Agreement Rights, including CAC’s
right to service the Dealer Loans and the related Contracts and to receive the related servicing
fees and reimbursement of certain recovery and repossession expenses, in accordance with the terms
of the Dealer Agreements; (ii) Collections (other than Dealer Collections) after the applicable
Cut-off Date; (iii) a security interest in each Contract securing such Dealer Loan; (iv) all
records and documents relating to such Dealer Loans and the Contracts; (v) all security interests
purporting to secure payment of such Dealer Loans; (vi) all security interests purporting to secure
payment of each Contract (including a security interest in each Financed Vehicle); (vii) all
guarantees, insurance (including insurance insuring the priority or perfection of any Contract) or
other agreements or arrangements securing the Contracts; and (viii) all Proceeds of the foregoing.
For the avoidance of doubt, the term “Related Security” with respect to any Dealer Loan includes
all rights arising under such Dealer Loan which rights are attributable to advances made under such
Dealer Loan as the result of Contracts being added to the identifiable group of



 









 







Contracts to which such Dealer Loan relates after the date such Dealer Loan was sold, and not
otherwise included in Subsequent Contributed Property, including all such rights arising after the
last day of the last full Collection Period during the Revolving Period.



     “Sale and Servicing Agreement” shall mean the Sale and Servicing Agreement dated as of
the Closing Date among CAC, Funding, Credit Acceptance Auto Dealer Loan Trust 2007-2, as the
Issuer, Wells Fargo Bank, National Association, as the Trust Collateral Agent, Indenture Trustee
and Backup Servicer.



     “Subsequent Contributed Property” means, with respect to any Distribution Date, (i)
the Dealer Loans added to Exhibit A hereto as of such Distribution Date and (ii) all Related
Security with respect thereto.



     SECTION 1.2. Other Terms. All accounting terms not specifically defined herein shall
be construed in accordance with GAAP. All terms used in Article 9 of the UCC, and 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 means “to but excluding.”



ARTICLE II

CONTRIBUTION AND SALE OF DEALER LOANS




     SECTION 2.1 Contribution and Sale of Dealer Loans. (a) In consideration of the
payments described in Section 3.1, effective as of the Closing Date, CAC does hereby convey,
assign, sell and transfer to Funding, without recourse, except as set forth herein, all of its
right, title and interest in and to the Initial Contributed Property.



     (b) CAC hereby further agrees that on each Distribution Date during the Revolving Period, in
consideration of the payment described in Section 3.1 with respect to such Distribution Date, CAC
shall, and CAC does hereby agree to, contribute, convey, assign, sell and transfer to Funding,
without recourse, except as set forth in this Agreement, all of its right, title and interest in
and to the Subsequent Contributed Property with respect to such Distribution Date.



     (c) CAC hereby further agrees that the above-described conveyances shall, without the need for
any further action on the part of CAC or Funding, include all rights arising after the end of the
Revolving Period under any Dealer Loan included in the Initial Contributed Property and Subsequent
Contributed Property which rights are attributable to advances made under such Dealer Loans as the
result of Contracts being added after the last day of the last full Collection Period during the
Revolving Period to the identifiable group of Contracts to which such Dealer Loan relates.



     (d) Each such contribution, sale, assignment, transfer and conveyance does not constitute an
assumption by Funding of any obligations of CAC or any other Person to Obligors or to any other
Person in connection with the Dealer Loans or under any Contract, Dealer Agreement or other
agreement and instrument relating to the Dealer Loans.



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     (e) In connection with any such foregoing conveyance, CAC agrees to record and file on or
prior to the Closing Date, at its own expense, a financing statement or statements with respect to
the Contributed Property conveyed by CAC hereunder meeting the requirements of applicable state law
in such manner and in such jurisdictions as are necessary to perfect the interests of Funding
created hereby, and to deliver either the originals of such financing statements or a file-stamped
copy of such financing statements or other evidence of such filings to Funding on the Closing Date.



     (f) CAC agrees that from time to time, at its expense, it will promptly execute and deliver
all instruments and documents and take all actions as may be necessary or as Funding may reasonably
request in order to perfect or protect the interest of Funding in the Dealer Loans and other
Contributed Property purchased hereunder or to enable Funding to exercise or enforce any of its
rights hereunder. CAC shall, upon request of Funding, obtain such additional search reports as
Funding shall request. To the fullest extent permitted by applicable law, Funding shall be
authorized and permitted to file continuation statements and amendments to financing statements and
assignments thereof to preserve and protect its right, title and interest in, to and under the
Contributed Property.



     (g) It is the express intent of CAC and Funding that the conveyance of the Dealer Loans and
other Contributed Property by CAC to Funding pursuant to this Agreement be construed as an absolute
sale and contribution of such Dealer Loans and other Contributed Property by CAC to Funding.
Further, it is not the intention of CAC and Funding that such conveyance be deemed a grant of a
security interest in the Dealer Loans and other Contributed Property by CAC to Funding in the
nature of a consensual lien securing an obligation. However, in the event that, notwithstanding
the express intent of the parties, the Dealer Loans and other Contributed Property are construed to
constitute property of CAC, then (i) this Agreement also shall be deemed to be, and hereby is, a
security agreement within the meaning of the UCC as enacted in the State of Michigan; and (ii) the
conveyance by CAC provided for in this Agreement shall be deemed to be, and CAC hereby grants to
Funding, a security interest in, to and under all of CAC’s right, title and interest in, to and
under the Contributed Property, to secure the rights of Funding set forth in this Agreement or as
may be determined in connection therewith by applicable law. CAC and Funding shall, to the extent
consistent with this Agreement, take such actions as may be necessary to ensure that, if this
Agreement were deemed to create such a security interest in the Dealer Loans and other Contributed
Property, such security interest would be a perfected security interest in favor of Funding under
applicable law and will be maintained as such throughout the term of this Agreement.



     (h) In connection with such conveyance, CAC agrees to deliver to Funding on the Closing Date,
one or more computer files or microfiche lists containing true and complete lists of all Dealer
Agreements and Dealer Loans conveyed to Funding on the Closing Date, and all Contracts securing all
such Dealer Loans, identified by account number, dealer number and pool number. Such file or list
shall be marked as Exhibit A to this Agreement, shall be delivered to Funding as confidential and
proprietary, and is hereby incorporated into and made a part of this Agreement. Such list and such
Exhibit A shall be supplemented and updated by lists delivered by CAC to Funding on each
Distribution Date in the Revolving Period describing all Contributed Property conveyed on each such
Distribution Date so that, on each such date, Funding will have an aggregate list and Exhibit A
that describes all Dealer Loans conveyed by CAC to Funding



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hereunder on or prior to said Distribution Date, and the related Dealer Agreements and all
Contracts securing all such Dealer Loans.



     (i) CAC will reflect the transactions described in paragraph (a) of this Section 2.1 on its
internal non-consolidated financial statements and on its non-consolidated state tax returns as a
sale or other absolute transfer of the Dealer Loans from CAC to Funding, even though CAC will
reflect this transaction on its consolidated financial statements as an “on-balance sheet” item in
accordance with generally accepted accounting principles. CAC will present the data in its
consolidated financial statements with an accompanying footnote describing Funding’s separate
existence and stating that such item is a financing secured by the Dealer Loans and is non-recourse
to CAC.



     SECTION 2.2. Servicing of Dealer Loans. The servicing, administering and collection
of the Dealer Loans shall be conducted by the Servicer then authorized to act as such under the
Sale and Servicing Agreement.



ARTICLE III

CONSIDERATION AND PAYMENT




     SECTION 3.1. Consideration. The consideration for the Dealer Loans and other
Contributed Property conveyed on the Closing Date to Funding by CAC under this Agreement shall be
an amount equal to the net cash proceeds received by Funding arising out of its conveyance on the
Closing Date of Contributed Property to the Issuer under the Sale and Servicing Agreement, plus
100% of the sole membership interest in Funding. Thereafter, on each Distribution Date in the
Revolving Period, the consideration for the Dealer Loans and other Contributed Property conveyed on
such Distribution Date will be cash in the amount of the Aggregate Outstanding Net Eligible Loan
Balance of such Dealer Loans as of such Distribution Date. The Contributed Property shall be deemed
to have a value equal to the aggregate principal amount of the Dealer Loans sold and contributed by
CAC to Funding.



     SECTION 3.2. Membership Interest. The membership interest of CAC in Funding shall
arise on the Closing Date. Such membership interest may not be sold or otherwise transferred by CAC
except as otherwise permitted in the Sale and Servicing Agreement.



ARTICLE IV

REPRESENTATIONS AND WARRANTIES




     SECTION 4.1. Representations and Warranties. CAC represents and warrants to Funding,
as of the Closing Date and each Distribution Date during the Revolving Period, that:



     (a) Organization and Good Standing. CAC is duly organized and is validly existing as
a corporation in good standing under the laws of the State of Michigan, with power and authority to
own its properties and to conduct its business as such properties are currently owned and such
business is presently conducted, and has and had at all relevant times, full power, authority, and
legal right to acquire, own, sell, and service the Dealer Loans and the related Contracts, and to
perform its obligations under the Basic Documents.



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     (b) Due Qualification. CAC is duly qualified to do business as a foreign corporation
in good standing, and has obtained all necessary licenses and approvals in all jurisdictions in
which the ownership or lease of property or the conduct of its business, including the servicing of
the Dealer Loans and the related Contracts as required by this Agreement, requires such
qualifications except where such failure will not have a material adverse effect.



     (c) Power and Authority. CAC has the power and authority to execute and deliver this
Agreement and the other Basic Documents to which it is a party and to carry out their respective
terms; and the execution, delivery, and performance of this Agreement and the other Basic Documents
to which it is a party have been duly authorized by CAC by all necessary corporate action.



     (d) Valid Sale; Binding Obligations. This Agreement evidences a valid sale, transfer,
and assignment of the Contributed Property enforceable against creditors of and purchasers from
CAC; and this Agreement and the other Basic Documents to which CAC is a party constitute legal,
valid and binding obligations of CAC enforceable in accordance with their terms, subject to the
effects of bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement
of creditors’ or secured creditors’ rights generally and to general principles of equity.



     (e) No Violation. The consummation of the transactions contemplated by this Agreement
and the other Basic Documents to which it is a party and the fulfillment of the terms hereof and
thereof do not conflict with, result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time) a default under, the Articles of Incorporation
or by-laws of CAC, or any indenture, agreement, or other instrument to which CAC is a party or by
which it is or may be bound; nor result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, agreement (other than this Agreement), or
other instrument; or violate any law or, to the best of CAC’s knowledge, any order, rule, or
regulation applicable to CAC of any court or of any federal or state regulatory body,
administrative agency, or other governmental instrumentality having jurisdiction over CAC or its
properties.



     (f) No Proceedings. There are no proceedings or investigations pending, or to CAC’s
best knowledge threatened, before any court, regulatory body, administrative agency, or other
governmental instrumentality having jurisdiction over CAC or its properties: A) asserting the
invalidity of this Agreement or any other Basic Document to which it is a party; B) seeking to
prevent the consummation of any of the transactions contemplated by this Agreement or any other
Basic Document to which it is a party; or C) seeking any determination or ruling that might
materially and adversely affect the performance by CAC of its obligations under, or the validity or
enforceability of, this Agreement, or any other Basic Document to which it is a party.



     (g) Place of Business. The principal place of business and chief executive office of
CAC is in Southfield, Michigan, and the office where CAC keeps all of its Records is at the address
listed in Section 8.3, or such other locations notified to Funding and the Trust Collateral Agent
in accordance with this Agreement in jurisdictions where all action required by the terms of this
Agreement has been taken and completed.



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     (h) Eligibility of Dealer Agreements. Each Dealer Agreement classified as an
“Eligible Dealer Agreement” (or included in any aggregation of balances of “Eligible Dealer
Agreements”) by CAC in any document or report delivered hereunder satisfied the requirements
contained in the definition of Eligible Dealer Agreement on the date so delivered.



     (i) Eligibility of Dealer Loans. Each Dealer Loan classified as an “Eligible Loan”
(or included in any aggregation of balances of “Eligible Loans”) by CAC in any document or report
delivered hereunder satisfied the requirements contained in the definition of Eligible Loan on the
date so delivered.



     (j) Eligibility of Contracts. Each Contract classified as an “Eligible Contract” (or
included in any aggregation of balances of “Eligible Contracts”) by CAC in any document or report
delivered hereunder satisfied the requirements contained in the definition of Eligible Contract on
the date so delivered.



     (k) Accuracy of Information. All information with respect to the Dealer Loans and
other Contributed Property provided to Funding hereunder by CAC was true and correct in all
material respects as of the date such information was provided to Funding and did not omit to state
any material facts necessary to make the statements contained therein not misleading.



     (l) No Liens. Each Dealer Loan and the other Contributed Property has been
transferred to Funding free and clear of any Lien of any Person, and in compliance, in all material
respects, with all Applicable Laws.



     (m) No Consents. With respect to each Dealer Loan and the other Contributed Property,
all consents, licenses, approvals or authorizations of or registrations or declarations with any
Governmental Authority required to be obtained, effected or given by CAC, in connection with the
pledge of such Contributed Property to Funding have been duly obtained, effected or given and are
in full force and effect.



     (n) Exhibit A. Exhibit A to this Agreement and each supplement or addendum thereto is
and will be an accurate and complete listing of all Dealer Loans and the related Dealer Agreements
and Contracts in all material respects on the date each such Dealer Loan was sold to Funding
hereunder, and the information contained therein is and will be true and correct in all material
respects as of such date.



     (o) Adverse Selection. No selection procedure believed by CAC to be adverse to the
interests of Funding has been or will be used in selecting the Dealer Agreements, Dealer Loans or
Contracts.



     (p) Contribution Agreement. This Contribution Agreement is the only agreement
pursuant to which Funding acquires Dealer Loans from CAC.



     (q) Security Interest. CAC has granted a security interest (as defined in the UCC as
enacted in the State of Michigan) to Funding in the Contributed Property, which is enforceable in
accordance with Applicable Law upon the Closing Date. Upon the filing of UCC-1 financing
statements naming Funding as secured party and CAC as debtor, Funding shall have a first priority
perfected security interest in the Contributed Property. All filings (including, without



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limitation, UCC filings) as are necessary in any jurisdiction to perfect the interest of
Funding have been made.



     (r) Credit Score. The weighted average (based on Contract principal balance) of the
Final Scores of each “Contract Group” is 665 or greater. A “Contract Group” is a group of Contracts
related to a group of Dealer Loans that becomes Contributed Property on the Closing Date or on a
particular Distribution Date during the Revolving Period.



     (s) Use of Proceeds. No proceeds of any sale of Contributed Property will be used (i)
for a purpose that violates, or would be inconsistent with, Regulation T, U or X promulgated by the
Board of Governors of the Federal Reserve System from time to time or (ii) to acquire any security
in any transaction which is subject to Section 12, 13 or 14 of the Securities Exchange Act of 1934,
as amended.



     (t) Taxes. CAC has filed on or before their respective due dates, all tax returns
which are required to be filed in any jurisdiction or has obtained extensions for filing such tax
returns and has paid all taxes, assessments, fees and other governmental charges against CAC or any
of its properties, income or franchises, to the extent that such taxes have become due, other than
any taxes or assessments, the validity of which are being contested in good faith by appropriate
proceedings and with respect to which adequate provision has been made on the books of the Seller
as may be required by GAAP. To the best knowledge of CAC, all such tax returns were true and
correct in all material respects and CAC knows of any proposed material additional tax assessment
against it nor any basis therefor. Any taxes, assessments, fees and other governmental charges
payable by CAC in connection with the execution and delivery of the Basic Documents and the
issuance of the Class A Notes have been paid or shall have been paid at or prior to Closing Date.



     (u) Consolidated Returns. CAC, the Seller and the Issuer are members of an affiliated
group within the meaning of Section 1504 of the Internal Revenue Code which will file a
consolidated federal income tax return at all times until the termination of the Basic Documents.



     (v) ERISA. CAC is in compliance in all material respects with the Employee Retirement
Income Security Act of 1974, as amended.



     (w) Compliance with Laws. CAC has complied in all material respects with all
applicable, laws, rules, regulations, orders, writs, judgments, injunctions, decrees or awards to
which it may be subject.



     (x) Material Adverse Change. Since December 31, 2006, no event has occurred that
would have a material adverse effect on (i) the financial condition or operations of CAC, (ii) the
ability of CAC to perform its obligations under the Basic Documents, or (ii) the collectibility of
the Dealer Loans generally or any material portion of the Dealer Loans.



     (y) Solvency; Fraudulent Conveyance. CAC is solvent, is able to pay its debts as they
become due and will not be rendered insolvent by the transactions contemplated by the Basic
Documents and, after giving effect thereto, will not be left with an unreasonably small amount of
capital with which to engage in its business. CAC does not intend to incur, or



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believes that it has incurred, debts beyond its ability to pay such debts as they mature. CAC
does not contemplate the commencement of insolvency, bankruptcy, liquidation or consolidation
proceedings or the appointment of a receiver, liquidator, conservator, trustee or similar official
to manage or control any of its assets. The amount of consideration being received by CAC upon the
sale or other absolute transfer of the Contributed Property to Funding constitutes reasonably
equivalent value and fair consideration for the Contributed Property. CAC is not transfering the
Contributed Property to Funding with any intent to hinder, deal or defraud any of its creditors.



     (z) Voidability. The transfers of Contributed Property made hereunder were not made
for or on account of an antecedent debt. No transfer by CAC of any Contributed Property hereunder
is or may be voidable under any section of the Bankruptcy Code.



     (aa) Investment Company. CAC is not an investment company which is required to
register under the Investment Company Act of 1940, as amended.



     (bb) Perfection. The perfection representations, warranties and covenants made by CAC
and set forth on Exhibit B hereto shall be a part of this Agreement for all purposes.



     SECTION 4.2. Reaffirmation of Representations and Warranties by CAC; Notice of
Breach. The representations and warranties set forth in Section 4.1 shall survive the
conveyance of the Dealer Loans to Funding, and termination of the rights and obligations of Funding
and CAC under this Agreement. Upon discovery by Funding or CAC of a breach of any of the foregoing
representations and warranties, the party discovering such breach shall give prompt written notice
to the other within three (3) Business Days of such discovery.



ARTICLE V

COVENANTS OF CAC AND THE SERVICER




     SECTION 5.1. Affirmative Covenants. So long as this Agreement is in effect, and
until all Dealer Loans which have been conveyed to Funding pursuant hereto shall have been paid in
full or written-off as uncollectible, and all amounts owed by CAC pursuant to this Agreement have
been paid in full, unless Funding otherwise consents in writing, CAC hereby covenants and agrees as
follows:



     (a) Compliance with Law. CAC will comply in all material respects with all Applicable
Laws.



     (b) Preservation of Existence. CAC will preserve and maintain its existence, rights,
franchises and privileges in the jurisdiction of its formation, and qualify and remain qualified in
good standing as a foreign corporation 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 on the Contributed Property.



     (c) Obligations and Compliance with Dealer Loans and Dealer Agreements. CAC will duly
fulfill and comply with all obligations on the part of CAC to be fulfilled or complied with under
or in connection with each Dealer Loan and each Dealer Agreement and will do nothing to impair the
rights of Funding in, to and under the Contributed Property.



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     (d) Keeping of Records and Books of Account. CAC will maintain and implement
administrative and operating procedures (including without limitation, an ability to recreate
records evidencing the Dealer Loans and the Contracts 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 Dealer Loans, or it will cause the
Servicer to do so.



     (e) Preservation of Security Interest. CAC will file such financing and continuation
statements and any other documents that may be required by any law or regulation of any
Governmental Authority to preserve and perfect the security interest of Funding in, to and under
the Contributed Property. CAC will maintain possession of the Dealer Agreements and the Contract
Files and Records, as custodian for the Trust and the Trust Collateral Agent, as set forth in
Section 3.03(a) of the Sale and Servicing Agreement. CAC, as Servicer, will comply with its
covenants under Section 4.06(a)(v) of the Sale and Servicing Agreement.



     (f) Collection Guidelines. As long as it is the Servicer, CAC will (A) comply in all
material respects with the Collection Guidelines in regard to each Dealer Loan and Contract, and
(B) furnish to Funding prompt notice of any material change in the Collection Guidelines and
deliver a copy of such changes to Funding quarterly.



     (g) Separateness. CAC will take such actions that are required on its part to be
performed to cause (i) Funding to be in compliance, at all relevant times, with Sections
6.01(xviii) and 6.04 of the Sale and Servicing Agreement, and (ii) all factual assumptions set
forth in the opinion letters delivered by Dykema Gossett PLLC with respect to certain bankruptcy
matters under the Sale and Servicing Agreement to remain true at all relevant times.



     SECTION 5.2. Negative Covenants. During the term of this Agreement, unless Funding
shall otherwise consent in writing:



     (a) Change of Name or Location of Records. CAC shall not (A) change its name or its
state of organization, move the location of its principal place of business and chief executive
office, and the offices where it keeps records concerning the Dealer Loans from the location
referred to in Section 3.03(c) of the Sale and Servicing Agreement, or (B) move the Records from
the location thereof on the Closing Date, unless CAC or the Servicer has given at least thirty (30)
days’ written notice to Funding and has taken all actions required under the UCC of each relevant
jurisdiction in order to continue the first priority perfected security interest of Funding in the
Contributed Property.



     (b) Change in Payment Instructions to Obligors. CAC will not make any change in its
instructions to Obligors regarding payments to be made directly or indirectly, unless such change
is permitted under the Sale and Servicing Agreement and Funding has consented to such change and
has received duly executed documentation related thereto.



     (c) No Instruments. CAC shall take no action to cause any Dealer Loan to be evidenced
by any instrument (as defined in the UCC as in effect in the relevant jurisdictions), except for
instruments obtained with respect to defaulted Dealer Loans that are in the possession of the
Servicer in its capacity as custodian for the Trust and the Trust Collateral Agent.



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     (d) No Liens. CAC shall not sell, pledge, assign or transfer to any other Person, or
grant, create, incur, assume or suffer to exist any Lien (other than in favor of the Trust
Collateral Agent or the Trust as specifically contemplated herein) on, the Contributed Property.
CAC shall defend the right, title and interest of Funding in, to and under the Contributed Property
against all claims of third parties claiming through or under CAC.



     (e) Credit Guidelines and Collection Guidelines. CAC will not amend, modify, restate
or replace, in whole or in part, the Credit Guidelines or Collection Guidelines, which change would
impair the collectibility of any Dealer Loan or Contract or otherwise adversely affect the
interests or the remedies of Funding under this Agreement or any other Basic Document, unless such
change is permitted under the Sale and Servicing Agreement and unless CAC obtains the prior written
consent of Funding.



     (f) Release of Contracts. Except for a release to an insurer in exchange for
insurance proceeds paid by such insurer resulting from a claim for the total insured value of a
vehicle, neither CAC or CAC as the Servicer shall release a Financed Vehicle securing a Contract
from the security interest granted by such Contract in whole or in part except (i) in the event of
payment in full by or on behalf of the Obligor thereunder, (ii) settlement consistent with the
Collection Guidelines, or (iii) repossession, nor shall CAC impair the rights of Funding in the
Contracts, except as may be required by applicable law.



     (g) Change in Structure. CAC shall not change its jurisdiction of organization or
merge or consolidate with and into any other entity or otherwise change its name, corporate
structure or its location (within the meaning of the UCC) unless (i) Funding shall have received
at least thirty (30) days advance written notice of such change and CAC has taken all action
necessary or appropriate to perfect or maintain the perfection of Funding’s interest in the
Contributed Property (including, without limitation, the filing of all financing statements and the
taking of such other action as Funding or its assigns may request in connection with such change);
(ii) in the event of a merger or consolidation, (x) if CAC is then Servicer, such merger or
consolidation satisfies all conditions in Section 7.03 of the Sale and Servicing Agreement and, (y)
if CAC is not the surviving entity, the surviving entity shall have executed an agreement of
assumption acceptable to Funding and the Class A Insurer to perform every obligation of CAC under
this Agreement and the other Basic Documents to which CAC is a party, and (iv) CAC shall have
delivered to Funding, the Indenture Trustee and the Class A Insurer, an opinion of counsel
confirming that the security interest created hereunder remains perfected and of first priority,
subject only to such limitations and qualifications as are contained in the opinions of Dykema
Gossett PLLC delivered on the Closing Date or are otherwise consented to by the addressees of such
opinion.



     SECTION 5.3 Indemnities by CAC.



     (a) Without limiting any other rights that any such Person may have hereunder or under
Applicable Law, CAC hereby agrees to indemnify Funding, or its assignee, and each of their
respective Affiliates and officers, directors, employees and agents thereof (collectively, the
“Indemnified Parties”), forthwith on demand, from and against any and all damages, losses,
claims, liabilities and related costs and expenses, including attorneys’ fees and disbursements
(all of the foregoing being collectively referred to as the “Indemnified Amounts”) awarded
against or



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incurred by such Indemnified Party arising out of or as a result of this Agreement or in
respect of any Dealer Loan or any Contract, excluding, however, (a) Indemnified
Amounts to the extent resulting from gross negligence or willful misconduct on the part of such
Indemnified Party or (b) Indemnified Amounts that arise as a result of non-payment of Dealer Loans
due to credit problems of Dealers or Obligors. If CAC has made any indemnity payment pursuant to
this Section 5.3 and such payment fully indemnified the recipient thereof and the recipient
thereafter collects any payments from others in respect of such Indemnified Amounts, then the
recipient shall repay to CAC an amount equal to the amount it has collected from others in respect
of such indemnified amounts. Without limiting the foregoing, CAC shall indemnify each Indemnified
Party for Indemnified Amounts relating to or resulting from:



          (i) any Contract or Dealer Loan treated as or represented by CAC to be an Eligible Contract
or Eligible Loan that is not at the applicable time an Eligible Contract or Eligible Loan;




          (ii) reliance on any representation or warranty made or deemed made by CAC or any of its
officers under or in connection with this Agreement, which shall have been false or incorrect in
any material respect when made or deemed made or delivered;




          (iii) the failure by CAC to comply with any term, provision or covenant contained in this
Agreement or any agreement executed in connection with this Agreement, or with any Applicable Law,
with respect to any Dealer Loan, Dealer Agreement, any Contract, or the nonconformity of any Dealer
Loan, Dealer Agreement or Contract with any such Applicable Law;




          (iv) the failure to vest and maintain vested in Funding, or its assignees, a first priority
perfected security interest in the Contributed Property, free and clear of any Lien;




          (v) the failure to file, or any delay in filing, financing statements or other similar
instruments or documents under the UCC of any applicable jurisdiction or other Applicable Laws with
respect to the Contributed Property, whether at the time of the Closing or at any subsequent time;




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




          (v) any failure of CAC to perform its duties or obligations in accordance with the provisions
of this Agreement or any failure by CAC to perform its respective duties under the Dealer Loans;




          (vi) the failure by CAC to pay when due any taxes for which CAC is liable, including without
limitation, sales, excise or personal property taxes payable in connection with the Contributed
Property;




11









 








          (vii) the commingling of Collections of the Dealer Loans and Contracts at any time with other
funds;




          (viii) any investigation, litigation or proceeding related to this Agreement or in respect of
any Dealer Loan or Contract;




          (ix) the failure of CAC, in its individual capacity, or any of its agents or representatives
to remit to the Servicer or the Trust Collateral Agent, Collections remitted to CAC, in its
individual capacity, or any such agent or representative; and




          (x) the failure of a Contract File to contain the relevant original Contract.




     Notwithstanding the foregoing, CAC shall have no indemnification obligation hereunder with
respect to any Dealer Loan or Contract in respect of which CAC shall have paid the Purchase Amount
under the Sale and Servicing Agreement.



     (b) Any amounts subject to the indemnification provisions of this Section 5.3 shall be paid by
CAC to Funding within five (5) Business Days following the Funding’s demand therefor.



     (c) The obligations of CAC under this Section 5.3 shall survive the termination of this
Agreement.



ARTICLE VI

PAYMENT OBLIGATION




     SECTION 6.1. Mandatory Payments. CAC, in its individual capacity or as Servicer, as
the case may be, shall perform its obligations under Sections 3.02 and 4.07 of the Sale and
Servicing Agreement.



     SECTION 6.2. No Recourse. Except as otherwise provided in this Article VI, the
purchase and sale of the Dealer Loans under this Agreement shall be without recourse to CAC or the
Servicer.



ARTICLE VII

CONDITIONS PRECEDENT




     SECTION 7.1. Conditions to Funding’s Obligations Regarding Dealer Loans.
Consummation of the transactions contemplated hereby on the Closing Date shall be subject to the
satisfaction of the following conditions:



     (a) All representations and warranties of CAC and the Servicer contained in this Agreement
shall be true and correct on the Closing Date with the same effect as though such representations
and warranties had been made on such date;



     (b) With respect to those Dealer Loans contributed on the Closing Date, all information
concerning such Dealer Loans provided to Funding shall be true and correct in all material respects
as of the Closing Date;



12









 





     (c) CAC and the Servicer shall have substantially performed all other obligations required to
be performed by the provisions of this Agreement;



     (d) CAC shall have filed or caused to be filed, or shall have delivered for filing, the
financing statement(s) required to be filed pursuant to Section 2.1(e); and



     (e) All corporate and legal proceedings and all instruments in connection with the
transactions contemplated by this Agreement shall be satisfactory in form and substance to Funding,
and Funding shall have received from CAC copies of all documents (including, without limitation,
records of corporate proceedings) relevant to the transactions herein contemplated as Funding may
reasonably have requested.



ARTICLE VIII

MISCELLANEOUS PROVISIONS




     SECTION 8.1. Amendment. This Agreement and the rights and obligations of the parties
hereunder may not be changed orally, but only by an instrument in writing signed by Funding and CAC
and consented to in writing by the Trust Collateral Agent.



     SECTION 8.2. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Michigan.



     SECTION 8.3. Notices. Except where telephonic instructions or notices are authorized
herein to be given, all notices, demands, instructions and other communications required or
permitted to be given to or made upon any party hereto shall be in writing and shall be sent by
facsimile transmission with a confirmation of the receipt thereof and shall be deemed to be given
for purposes of this Agreement on the day that the receipt of such facsimile transmission is
confirmed in accordance with the provisions of this Section 8.3. Unless otherwise specified in a
notice sent or delivered in accordance with the foregoing provisions of this Section, notices,
demands, instructions (including payment instructions) and other communications in writing shall be
given to or made upon the respective parties hereto at their respective addresses and accounts
indicated below, and, in the case of telephonic instructions or notices, by calling the telephone
number or numbers indicated for such party below:




	 	(a)	 	in the case of Funding:
	 
	 	 	 	Credit Acceptance Funding LLC 2007-2

Silver Triangle Building

25505 West Twelve Mile Road

Southfield, Michigan 48034-8339

Attention: Wendy A. Rummler

Telephone: (248) 353-2700 (ext. 4217)

Telecopy: (866) 249-3138
	 
	 	 	 	with a copy to:
	 
	 	 	 	Wachovia Capital Markets, LLC

Asset Backed Finance




13









 






	 	 	 	NC 0610

One Wachovia Center

301 South College Street

Charlotte, North Carolina 28288-0610

Attention: Chad Kobos

Telephone: (704) 715-1359

Telecopy: (704) 383-9106
	 
	 	 	 	And
	 
	 	 	 	XL Capital Assurance Inc.

1221 Avenue of the Americas

New York, New York 10020-1001

Attention: Surveillance
	 
	 	(b)	 	in the case of CAC and in the case of the Servicer (for so long as the Servicer is CAC):
	 
	 	 	 	Credit Acceptance Corporation

Silver Triangle Building

25505 West Twelve Mile Road

Southfield, Michigan 48034-8339

Attention: Wendy A. Rummler

Telephone: (248) 353-2700 (ext. 4217)

Telecopy: (866) 249-3138




or, as to each party, at such other address as shall be designated by such party in a written
notice to each other party.




     SECTION 8.4. Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid,
then such covenants, agreements, provisions, or terms shall be deemed severable from the remaining
covenants, agreements, provisions, or terms of this Agreement and shall in no way affect the
validity or enforceability of the other provisions of this Agreement.



     SECTION 8.5. Assignment. This Agreement may not be assigned by the parties hereto,
except that Funding may assign its rights hereunder pursuant to the Sale and Servicing Agreement to
the Trust for the benefit of the Trust, the Class A Insurer, the Swap Counterparty, the Indenture
Trustee, the Trust Collateral Agent and the Class A Noteholders. Funding hereby notifies CAC (and
CAC hereby acknowledges) that Funding, pursuant to the Sale and Servicing Agreement, has assigned
its rights hereunder to the Trust. All rights of Funding hereunder may be exercised by the Trust
or its assignees, to the extent of their respective rights pursuant to such assignments.



     SECTION 8.6. Further Assurances. Funding and CAC agree to do and perform, from time
to time, any and all acts and to execute any and all further instruments required or reasonably
requested by the other parties in order to more fully effect the purposes of this



14









 







Agreement, including, without limitation, the execution of any financing statements or
continuation statements or equivalent documents relating to the Dealer Loans for filing under the
provisions of the UCC or other laws of any applicable jurisdiction.



     SECTION 8.7. No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of Funding, CAC or the Trust Collateral Agent, any right, remedy, power or
privilege hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and
privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and
privilege provided by law.



     SECTION 8.8. Counterparts. This Agreement may be executed in two or more
counterparts including telecopy transmission thereof (and by different parties on separate
counterparts), each of which shall be an original, but all of which together shall constitute one
and the same instrument.



     SECTION 8.9. Binding Effect; Third-Party Beneficiaries. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective successors and
permitted assigns. The Trust and the Trust Collateral Agent on behalf of the Trust, the Swap
Counterparty, the Class A Noteholders and the Class A Insurer are intended by the parties hereto to
be third-party beneficiaries of this Agreement.



     SECTION 8.10. Merger and Integration. Except as specifically stated otherwise
herein, this Agreement sets forth the entire understanding of the parties relating to the subject
matter hereof, and all prior understandings, written or oral, are superseded by this Agreement.
This Agreement may not be modified, amended, waived or supplemented except as provided herein.



     SECTION 8.11. Headings. The headings herein are for purposes of reference only and
shall not otherwise affect the meaning or interpretation of any provision hereof.



     SECTION 8.12. Exhibits. The exhibits referred to herein shall constitute a part of
this Agreement and are incorporated into this Agreement for all purposes.



     SECTION 8.13 Covenant Not to File a Bankruptcy Petition. CAC agrees that until one
year and one day after such time as the Class A Notes issued under the Indenture are paid in full,
it shall not (i) institute the filing of a bankruptcy petition against Funding or the Issuer; (ii)
file a petition or consent to a petition seeking relief on behalf of Funding or the Issuer under
the Bankruptcy Law; or (iii) consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator (or similar official) of Funding or the Issuer or any portion of the property
of Funding or the Issuer.



[remainder of page intentionally left blank]





15









 








     IN WITNESS WHEREOF, Funding and CAC each have caused this Contribution Agreement to be duly
executed by their respective officers as of the day and year first above written.



	 	 	 	 	 
	FUNDING:	CREDIT ACCEPTANCE FUNDING LLC 2007-2

 	 
	 	By:  	/s/ Douglas W. Busk
 	 
	 	 	Name:  	Douglas W. Busk 	 
	 	 	Title:  	Treasurer 	 
	 



	 	 	 	 	 
	 	Credit Acceptance Funding LLC 2007-2

Silver Triangle Building

25505 West Twelve Mile Road

Southfield, Michigan 48034-8339

Attention: Wendy A. Rummler

Facsimile No.: (866) 249-3138

Confirmation No.: (248) 353-2700 (ext. 4217)

 	 
	CAC:	CREDIT ACCEPTANCE CORPORATION

	 
	 	By:  	/s/ Douglas W. Busk
 	 
	 	 	Name:  	Douglas W. Busk 	 
	 	 	Title:  	Treasurer 	 
	 



	 	 	 	 	 
	 	Credit Acceptance Corporation

Silver Triangle Building

25505 West Twelve Mile Road

Southfield, Michigan 48034-8339

Attention: Wendy A. Rummler

Facsimile No. (866) 249-3138

Confirmation No.: (248) 353-2700 (ext. 4217)

 	 
	 	 	 
	 	 	 
	 	 	 



 









 






	 	 	 	 	 



EXHIBIT A

to

Contribution Agreement




Dealer Agreements, Dealer Loans and Contracts




 









 








EXHIBIT B

to

Contribution Agreement




Perfection Representations, Warranties And Covenants





     In addition to the representations, warranties and covenants contained in the Agreement, CAC
hereby represents, warrants, and covenants to Funding as follows on the Closing Date and on each
Distribution Date on which Funding purchases Dealer Loans, in each case only with respect to the
Contributed Property conveyed to Funding on such Closing Date or the relevant Distribution Date:



General



1. This Agreement creates a valid and continuing security interest (as defined in UCC Section
9-102) in the Contributed Property in favor of Funding, which security interest is prior to all
other Liens, and is enforceable as such as against creditors of and purchasers from and assignees
of CAC.



2. Each Contract constitutes “tangible chattel paper” or a “payment intangible”, within the meaning
of UCC Section 9-102. Each Dealer Loan constitutes a “payment intangible” or a “general
intangible” within the meaning of UCC Section 9-102.



3. Each Dealer Agreement constitutes either a “general intangible” or “tangible chattel paper”
within the meaning of UCC Section 9-102.



4. CAC has taken or will take all necessary actions with respect to the Dealer Loans to perfect
Funding’s security interest in the Dealer Loans and in the property securing the Dealer Loans.




Creation



1. CAC owns and has good and marketable title to the Initial Contributed Property or Subsequent
Contributed Property, as applicable, free and clear of any Lien, claim or encumbrance of any
Person, excepting only (i) liens that will be terminated or amended on the Closing Date or each
Distribution Date during the Revolving Period, as applicable, to reflect a release of the Initial
Contributed Property or Subsequent Contributed Property, as applicable, and (ii) liens for taxes,
assessments or similar governmental charges or levies incurred in the ordinary course of business
that are not yet due and payable or as to which any applicable grace period shall not have expired,
or that are being contested in good faith by proper proceedings and for which adequate reserves
have been established, but only so long as foreclosure with respect to such a lien is not imminent
and the use and value of the property to which the Lien attaches is not impaired during the
pendency of such proceeding.




 









 








Perfection



1. CAC has caused or will have caused, within ten days after the effective date of the Indenture,
the filing of all appropriate financing statements in the proper filing office in the appropriate
jurisdictions under applicable law in order to perfect the contribution and sale of the Contributed
Property from the Originator to Funding, the transfer and sale of the Seller Property from the
Seller to the Issuer, and the security interest in the Collateral granted to the Indenture Trustee
under the Indenture.



2. With respect to Seller Property that constitutes tangible chattel paper, such tangible chattel
paper is in the possession of the Servicer, in its capacity as custodian for the Trust and the
Trust Collateral Agent, and the Trust Collateral Agent has received a written acknowledgment from
the Servicer, in its capacity as custodian, that it is holding such tangible chattel paper solely
on its behalf and for the benefit of the Trust Collateral Agent, the Seller, the Trust and the
relevant Dealer(s). All financing statements filed or to be filed against CAC in favor of Funding
in connection with this Contribution Agreement describing the Contributed Property contain a
statement to the following effect: “A purchase of or security interest in any collateral described
in this financing statement will violate the rights of the Secured Party.”




Priority



1. None of CAC, the Servicer nor Funding has authorized the filing of, or is aware of any financing
statements against either Funding, CAC or the Trust that includes a description of the Contributed
Property and proceeds related thereto other than any financing statement: (i) relating to the
transfer of Contributed Property by the Originator to the Seller under the Contribution Agreement,
(ii) relating to the transfer to the Trust under the Sale and Servicing Agreement, (iii) relating
to the security interest granted to the Indenture Trustee under the Indenture; or (iv) that will be
terminated or amended to reflect a release of the Contributed Property. Other than the security
interest granted to Funding pursuant to this Contribution Agreement, CAC has not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of the Contributed Property.



2. Neither the Seller, the Originator nor the Trust is aware of any judgment, ERISA or tax lien
filings against either the Seller, the Originator or the Trust.



3. None of the tangible chattel paper that constitutes or evidences the Contracts or the Dealer
Agreements has any marks or notations indicating that it has been pledged, assigned or otherwise
conveyed to any Person other than CAC, the Servicer, Funding, the Trust, a collection agent or the
Trust Collateral Agent.




Survival of Perfection Representations



1. Notwithstanding any other provision of this Agreement, the Sale and Servicing Agreement, the
Indenture or any other Basic Document, the perfection representations, warranties and covenants
contained in this Exhibit shall be continuing, and remain in full force and effect (notwithstanding
any replacement of the Servicer or termination of Servicer’s rights to act as such) until such time
as all obligations under the Sale and Servicing Agreement, Contribution Agreement and the Indenture
have been finally and fully paid and performed.




 









 








No Waiver



1. The parties hereto: (i) shall not, without obtaining a confirmation of the then-current rating
of the Class A Notes (without giving effect to the Class A Note Insurance Policy), waive any of the
perfection representations, warranties or covenants; (ii) shall provide the Rating Agencies with
prompt written notice of any breach of the perfection representations, warranties or covenants, and
shall not, without obtaining a confirmation of the then-current rating of the Class A Notes
(without giving effect to the Class A Note Insurance Policy) as determined after any adjustment or
withdrawal of the ratings following notice of such breach, waive a breach of any of the perfection
representations, warranties or covenants.