arloanagreementlithia-sc






Execution Copy  147032870v2  ______________________________________________________________________________  SCFC BUSINESS SERVICES LLC,   as the Borrower,  DRIVEWAY FINANCE CORPORATION,  as the Servicer and as the Collateral Custodian,   the LENDERS  from time to time parties hereto,  the AGENTS  from time to time parties hereto,  and  JPMORGAN CHASE BANK, N.A.,  as the Administrative Agent and the Account Bank  AMENDED AND RESTATED  LOAN AGREEMENT  Dated as of December 31, 2020 ______________________________________________________________________________  





 






i  147032870v2  TABLE OF CONTENTS  Page  DEFINITIONS; CONSTRUCTION Section 1.01. Definitions..................................................................................................................1 Section 1.02. Accounting Terms and Determinations ...................................................................39 Section 1.03. Computation of Time Periods ..................................................................................39 Section 1.04. Interpretation ............................................................................................................39 LOANS Section 2.01. Loans ........................................................................................................................40 Section 2.02. Funding Mechanics ..................................................................................................41 Section 2.03. Reduction of Commitments .....................................................................................42 Section 2.04. Extensions of Commitments ....................................................................................43 Section 2.05. Payments ..................................................................................................................44 Section 2.06. Settlement Procedures ..............................................................................................46 Section 2.07. Payments, Computations, Etc. .................................................................................48 Section 2.08. Collections and Allocations; Investment of Funds ..................................................49 Section 2.09. Fees ..........................................................................................................................49 Section 2.10. Increased Cost and Reduced Return ........................................................................50 Section 2.11. Taxes ........................................................................................................................52 Section 2.12. Take-outs..................................................................................................................56 Section 2.13. The Account Bank. ..................................................................................................58 Section 2.14. Cost of Funds Disclosure and Exculpatory Language .............................................61 Section 2.15. Replacement of Lender Group .................................................................................61 Section 2.16. Defaulting Committed Lenders................................................................................62 SECURITY Section 3.01. Collateral. .................................................................................................................63 Section 3.02. Release of Collateral; No Legal Title ......................................................................65 Section 3.03. Protection of Security Interest; Administrative Agent, as Attorney-in-Fact ...........65 Section 3.04. Assignment of the Purchase Agreement ..................................................................66 Section 3.05. Waiver of Certain Laws ...........................................................................................66 Section 3.06. Lockbox Account and Lockboxes ...........................................................................66 





 






Page  ii  147032870v2  CONDITIONS OF CLOSING AND LOANS Section 4.01. Conditions to Effectiveness of this Agreement .......................................................67 Section 4.02. Conditions Precedent to All Loans ..........................................................................68 REPRESENTATIONS AND WARRANTIES Section 5.01. Representations and Warranties of the Borrower ....................................................69 Section 5.02. Representations and Warranties of the Borrower Relating to the  Receivables...........................................................................................................74 Section 5.03. Representations and Warranties of the Servicer ......................................................74 Section 5.04. Retransfer of Certain Receivables ...........................................................................76 COVENANTS Section 6.01. Affirmative Covenants of the Borrower ..................................................................77 Section 6.02. Negative Covenants of the Borrower .......................................................................84 Section 6.03. Covenant of the Borrower Relating to Hedging ......................................................86 Section 6.04. Affirmative Covenants of the Servicer ....................................................................88 Section 6.05. Negative Covenants of the Servicer .........................................................................91 ADMINISTRATION AND SERVICING OF RECEIVABLES Section 7.01. Designation of Servicing..........................................................................................93 Section 7.02. Servicing Compensation ..........................................................................................93 Section 7.03. Duties of the Servicer...............................................................................................93 Section 7.04. Collection of Payments ............................................................................................97 Section 7.05. Servicer Advances ...................................................................................................97 Section 7.06. Payment of Certain Expenses by Servicer ...............................................................97 Section 7.07. Reports and Audit ....................................................................................................98 Section 7.08. Quarterly Statement as to Compliance ....................................................................99 Section 7.09. Backup Servicer; Entry into Backup Servicing Agreement ....................................99 Section 7.10. Rights After Assumption of Duties by Backup Servicer or Designation of  Successor Servicer; Liability ..............................................................................100 Section 7.11. Limitation on Liability of the Servicer and Others ................................................101 Section 7.12. The Servicer Not to Resign ....................................................................................101 Section 7.13. Servicer Termination Events..................................................................................101 Section 7.14. Appointment of Successor Servicer .......................................................................103 





 






Page  iii  147032870v2  Section 7.15. Merger or Consolidation, Assumption of Obligations or Resignation of the  Servicer...............................................................................................................105 Section 7.16. Responsibilities of the Borrower ...........................................................................106 Section 7.17. Custody of Receivable Files ..................................................................................106 Section 7.18. Duties of Collateral Custodian ...............................................................................106 TERMINATION EVENTS Section 8.01. Termination Events ................................................................................................108 Section 8.02. Actions Upon Declaration of the Occurrence of the Termination Date ................112 Section 8.03. Exercise of Remedies .............................................................................................113 Section 8.04. Waiver of Certain Laws .........................................................................................113 Section 8.05. Power of Attorney ..................................................................................................114 INDEMNIFICATION Section 9.01. Indemnities by the Borrower .................................................................................114 Section 9.02. Indemnities by the Servicer ...................................................................................116 Section 9.03. Indemnities by the Backup Servicer in its Capacity as the Successor  Servicer...............................................................................................................118 THE ADMINISTRATIVE AGENT AND THE AGENTS Section 10.01. Authorization and Action .....................................................................................118 Section 10.02. Delegation of Duties ............................................................................................119 Section 10.03. Exculpatory Provisions ........................................................................................119 Section 10.04. Reliance................................................................................................................120 Section 10.05. Non-Reliance on Agents and Other Lenders .......................................................121 Section 10.06. Indemnification ....................................................................................................121 Section 10.07. Agents in their Individual Capacity .....................................................................122 Section 10.08. Successor Administrative Agent ..........................................................................122 ASSIGNMENTS; PARTICIPATIONS Section 11.01. Assignments and Participations ...........................................................................122 





 






Page  iv  147032870v2  MUTUAL COVENANTS REGARDING CONFIDENTIALITY Section 12.01. Covenants of the Borrower, the Servicer, the Backup Servicer, the  Account Bank and the Collateral Custodian ......................................................125 Section 12.02. Covenants of the Administrative Agent, the Agents and the Lenders .................126 Section 12.03. Non-Confidentiality of Tax Treatment and Tax Structure ..................................127 MISCELLANEOUS Section 13.01. Amendments and Waivers ...................................................................................128 Section 13.02. Notices, Etc. .........................................................................................................128 Section 13.03. No Waiver, Rights and Remedies ........................................................................128 Section 13.04. Binding Effect ......................................................................................................128 Section 13.05. Term of this Agreement .......................................................................................128 Section 13.06. GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER  OF OBJECTION TO VENUE ........................................................................129 Section 13.07. WAIVER OF JURY TRIAL .............................................................................129 Section 13.08. Costs and Expenses ..............................................................................................129 Section 13.09. No Insolvency Proceedings..................................................................................129 Section 13.10. Recourse Against Certain Parties.........................................................................130 Section 13.11. Patriot Act Compliance ........................................................................................131 Section 13.12. Execution in Counterparts; Electronic Signatures; Severability; Integration ......131 Section 13.13. Not a Novation .....................................................................................................131 SCHEDULES  Schedule A – Lender Supplement (JPMorgan Lender Group)  ............................................ SA-1  Schedule B – Eligible Receivable Criteria  ........................................................................... SB-1  Schedule C – Schedule of Receivables ................................................................................. SC-1  Schedule D – Location of Receivable Files  ......................................................................... SD-1  Schedule E – Schedule of Documents  ..................................................................................SE-1  Schedule F – Financial Covenants (Lithia) ............................................................................ SF-1  Schedule G – Approved Backup Servicers ........................................................................... SG-1  





 






Page  v  147032870v2  EXHIBITS  Exhibit A – Form of Funding Request  ............................................................................... A-1  Exhibit B – Form of Assignment and Acceptance  ..............................................................B-1  Exhibit C – Credit and Collection Policy  ............................................................................C-1  Exhibit D – Form of Power of Attorney .............................................................................. D-1  Exhibit E – Form of Take-out Release  ................................................................................ E-1  Exhibit F – Form of Monthly Report  .................................................................................. F-1  Exhibit G – Forms of U.S. Tax Compliance Certificates .................................................... G-1  





 






147032870v2  AMENDED AND RESTATED LOAN AGREEMENT  This Amended and Restated Loan Agreement, dated as of December 31, 2020 (as  amended, restated, supplemented or otherwise modified from time to time, this "Agreement"), is  among SCFC BUSINESS SERVICES LLC, a Delaware limited liability company, as borrower  (the "Borrower"), DRIVEWAY FINANCE CORPORATION, an Oregon corporation formerly  known as Southern Cascades Finance Corporation ("DFC"), as servicer (in such capacity, the  "Servicer") and as collateral custodian (in such capacity, the "Collateral Custodian") for the  Secured Parties (as defined herein), the Lenders from time to time parties hereto (the "Lenders"),  the Agents for the Lender Groups (as defined herein) from time to time parties hereto (the  "Agents") and JPMORGAN CHASE BANK, N.A., as administrative agent for the Lenders and  the Agents (in such capacity, the "Administrative Agent") and as account bank (in such capacity,  the "Account Bank").  W I T N E S S E T H:  WHEREAS, the Borrower was formed for the purpose of purchasing and holding various  assets, including motor vehicle retail installment sale contracts, amounts received on or in  respect of such motor vehicle retail installment sale contracts and proceeds of the foregoing;   WHEREAS, the Borrower has requested that the Lenders make loans to the Borrower  from time to time, the proceeds of which will be used to finance the purchase price of motor  vehicle retail installment contracts as described herein;  WHEREAS, the Lenders have agreed to make such loans to the Borrower upon the terms  and subject to the conditions set forth herein;  WHEREAS, the parties hereto are parties to that certain Loan Agreement, dated as of  July 31, 2020 (as amended prior to the date hereof, the "Existing Loan Agreement") pursuant to  which, among other things, the foregoing purposes are effected; and  WHEREAS, the parties hereto wish to amend and restate the terms of the Existing Loan  Agreement (but not to enter into a novation of the Existing Loan Agreement) by entry into this  Agreement.  NOW THEREFORE, in consideration of the premises and for other good and valuable  consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto  agree as follows:  DEFINITIONS; CONSTRUCTION  Section 1.01.  Definitions.  Whenever used herein, unless the context otherwise requires,  the following words and phrases shall have the following meanings:  "Account Bank" has the meaning given to such term in the Preamble.  





 






2  147032870v2  "Account Collateral" means, the Collection Account and the Lockbox Account, together  with all cash, securities, financial assets (as defined in Section 8-102(a)(9) of the UCC) and  investments and other property from time to time deposited or credited to the Collection Account  and all proceeds thereof.  "Adjusted Eurodollar Rate" shall mean, on any day, an interest rate per annum equal to  the quotient, expressed as a percentage and rounded upwards, if necessary, to the nearest 1/100th of 1%, obtained by dividing (i) LIBOR for such day by (ii) 100% minus the Eurodollar Reserve  Percentage.  "Adjusted Principal Balance" means, as of any date for any Receivable, (i) if the amount  of Excess Spread as of such date is 3.5% or greater, the Principal Balance of such Receivable as  of such date, and (ii) if the amount of Excess Spread as of such date is less than 3.5%, then (A) if  the APR of such Receivable is less than the Required Rate, the present value (calculated using a  discount rate equal to the Required Rate) of all Scheduled Payments (including past due  Scheduled Payments) remaining on such Receivable, assuming that all such Scheduled Payments  are paid on a timely basis after such date or (B) if the APR of such Receivable is equal to or  greater than the Required Rate, the Principal Balance of such Receivable as of such date.  "Administrative Agent" has the meaning given to such term in the Preamble.  "Administrative Agent's Account" means the account or accounts identified by the  Administrative Agent to the Borrower and each Agent as the Administrative Agent's Account  hereunder.  "Advisors" means accountants, attorneys, consultants, advisors, credit enhancers,  liquidity providers and Persons similar to the foregoing and the respective directors, officers,  employees and managers of each of the foregoing.  "Affiliate" means, with respect to a Person, any other Person controlling, controlled by or  under common control with such Person.  For purposes of this definition, "control" when used  with respect to any specified Person means the power to direct the management and policies of  such Person, directly or indirectly, whether through the ownership of voting securities, by  contract or otherwise; and the terms "controlling" or "controlled" have meanings correlative to  the foregoing.  "Agent" means the agent for a particular Lender Group, as identified in the related Lender  Supplement, and as of any date, "Agents" means all agents for all Lender Groups as of such date.  "Aggregate Commitment" means, as of any day, the sum of the Commitments of each  Lender Group.  "Aggregate Mandatory Commitment" means, as of any day, the sum of the Mandatory  Commitments of each Lender Group.  "Aggregate Unpaids" means, with respect to any date, an amount equal to the sum of  (i) the Loans Outstanding, (ii) all accrued but unpaid Interest and (iii) all Program Fees,  Structuring Fees, Supplemental Structuring Fees, Unused Commitment Fees, Hedge Breakage  





 






3  147032870v2  Costs, Indemnified Amounts and other Obligations owed (whether due or accrued) by the  Borrower or the initial Servicer to the Secured Parties, the Administrative Agent, the Backup  Servicer, the Account Bank, the Indemnified Parties, and any Successor Servicer under this  Agreement and the other Basic Documents.  "Agreement" has the meaning given to such term in the Preamble.  "Alternate Base Rate" means for any day, a rate per annum equal to the greatest of (a) the  Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus  one-half of 1%, and (c) LIBOR on such day (or if such day is not a Business Day, the  immediately preceding Business Day) plus 1.00%.  Any change in the Alternate Base Rate due  to a change in the Prime Rate, the Federal Funds Effective Rate or LIBOR shall be effective  from and including the effective date of such change in the Prime Rate, the Federal Funds  Effective Rate or LIBOR, respectively.  "Amortization Period" means the period commencing on the Termination Date and  ending on the day on which the Loans Outstanding are reduced to zero and all other Aggregate  Unpaids have been paid in full.  "Amount Financed" means, with respect to a Receivable, the aggregate amount advanced  under such Receivable toward the purchase price of the related Financed Vehicle and any related  costs, including taxes, title and licensing fees, and amounts advanced in respect of accessories,  insurance premiums, service and warranty contracts, other items customarily financed as part of  a Contract, and related costs.  "Ancillary Fees" means (a) late fees, (b) extension fees, (c) prepayment charges, (d)  overdraft charges and (e) all other administrative fees or similar charges allowed by Applicable  Law received by or on behalf of the Servicer with respect to the Receivables.  "Annual Percentage Rate" or "APR" means, with respect to a Receivable, the rate per  annum of finance charges stated in such Receivable as the "annual percentage rate" (within the  meaning of the Federal Truth-in-Lending Act).  If, after the applicable Funding Date, the rate per  annum with respect to a Receivable as of such Funding Date is reduced (i) as a result of an  Insolvency Proceeding involving the related Obligor or (ii) pursuant to the Servicemembers Civil  Relief Act or similar State law, "Annual Percentage Rate" or "APR" shall refer to such reduced  rate.  "Anti-Corruption Laws" means all laws, rules, and regulations of the United States or any  State that are applicable to DFC, Lithia, the Borrower or their respective Affiliates or  Subsidiaries from time to time concerning or relating to bribery or corruption.   "Applicable Law" means, for any Person, all existing and future applicable laws, rules,  regulations (including proposed, temporary and final income tax regulations), statutes, treaties,  codes, ordinances, permits, certificates, orders and licenses of and interpretations by any  Governmental Authority (including usury laws, the Federal Truth in Lending Act, Regulation Z  and Regulation B of the Federal Reserve Board, the Securities Act (including Regulation AB  thereunder) and the Exchange Act), and applicable judgments, decrees, injunctions, writs, orders  





 






4  147032870v2  or line actions of any court, arbitrator or other administrative, judicial or quasi-judicial tribunal  or agency of competent jurisdiction.  "Applicable Margin" has the meaning given to such term in the Fee Letter.    "Assignment and Acceptance" means an assignment and acceptance agreement between a  Lender and an Eligible Assignee, in substantially the form of Exhibit B hereto.  "Available Amount" means, with respect to any day, the positive amount, if any, by  which the Facility Amount exceeds the Loans Outstanding on such day.  "Available Funds" means, for any Payment Date and the related Collection Period,  Collections on deposit in the Collection Account, to the extent received during the related  Collection Period.  "Backup Servicer" means a Person that is (i) reasonably acceptable to the Administrative  Agent and that has been (ii) appointed as the "Backup Servicer" under a Backup Servicing  Agreement that is entered into in accordance with Section 7.09.    "Backup Servicing Agreement" means an agreement entered into by the Servicer, the  Borrower and a Person that is either (i) listed on Schedule G hereto (as the same may be updated  from time to time by the Administrative Agent in its sole discretion) or (ii) otherwise reasonably  acceptable to the Administrative Agent, and who agrees thereunder to serve as the backup  servicer, pursuant to which such Person agrees (a) to perform certain servicing duties with  respect to the Receivables as set forth therein, including but not limited to providing a Monthly  Backup Servicer Certificate to the Administrative Agent and the Lenders each month, (b) to be  bound by the terms and provisions relating to the Backup Servicer as set forth in the Basic  Documents, except for any such terms and provisions that are expressly modified or waived in  the Backup Servicing Agreement (with the express consent of the Administrative Agent), and (c)  to succeed to the role of Servicer if the initial Servicer resigns or is terminated in accordance  with the terms of this Agreement.   "Backup Servicing Fee" means (i) prior to the appointment of a Backup Servicer, $0, and  (ii) thereafter, the fees payable to the Backup Servicer as set forth in the Backup Servicing  Agreement.  "Backup Servicing Fee Rate" means, (i) with respect to any Collection Period prior to the  appointment of a Backup Servicer, 0%, and (ii) with respect to the Collection Period during  which the Backup Servicer was first engaged pursuant to Section 7.09 and for each Collection  Period thereafter, (a) the percentage equivalent of a fraction, (1) the numerator of which is the  Backup Servicing Fee and (2) the denominator of which is the average daily Pool Balance during  the related Collection Period, times (b) 12.  "Bankruptcy Code" means the United States Bankruptcy Code (Title 11 of the United  States Code).  "Basel II" means the second Basel Accord issued by the Basel Committee on Banking  Supervision.   





 






5  147032870v2  "Basel III" means the third Basel Accord issued by the Basel Committee on Banking  Supervision.   "Basic Documents" means this Agreement, the Purchase Agreement, each Purchase  Agreement Supplement, the Fee Letter, all Hedging Agreements, the Blocked Account Control  Agreement, the Control Agreement, the Performance Guaranty, and any other document,  certificate, opinion, agreement or writing the execution of which is necessary or incidental to  carrying out the transactions contemplated by this Agreement or any of the other foregoing  documents.  "Beneficial Ownership Certification" means a certification regarding beneficial  ownership as required by the Beneficial Ownership Rule.  "Beneficial Ownership Rule" means 31 C.F.R. § 1010.230.  "Benefit Plan" means each (i) employee pension benefit plan (as defined in Section 3(2)  of ERISA) that are subject to Title I of ERISA, (ii) plan described in Section 4975(e)(1) of the  Code, including individual retirement accounts or Keogh Plans that are not exempt under  Section 4975(g) of the Code and (iii) any entity whose underlying assets include "plan assets" (as  defined in Section 3(42) of ERISA and Department of Labor Regulations Section 2510.3-101) by  reason of an employee benefit plan's or plans' investment in such entities.  "Blocked Account Control Agreement" means the Amended and Restated Blocked  Account Control Agreement, dated as of December 31, 2020, by and among DFC, the  Administrative Agent, and the Lockbox Bank, as such agreement may be amended or  supplemented from time to time.    "Borrower" has the meaning given to such term in the Preamble.  "Borrower Basic Documents" means all Basic Documents to which the Borrower is a  party or by which it is bound.  "Borrower's Account" means the bank account of the Borrower, as notified to the  Administrative Agent from time to time in writing by the Borrower,.  "Borrowing Base" means, as of any date of determination, an amount equal to (i) the  difference of (a) the Net Eligible Pool Balance as of such date, after giving effect to the related  additions or removals of Receivables on such date, minus (b) the Required Overcollateralization  as of such date, minus (c) the aggregate Adjusted Principal Balance of all Receivables that are  owned by the Borrower on such date, after giving effect to the related additions or removals of  Receivables on such date, for which either (1) no Certificate of Title of the type described in  clause (i) or (ii) of the definition thereof was obtained by the 180th day following the day on  which the related Receivable was originated or, without repetition, (2) a Certificate of Title of  the type described in clause (i) or (ii) of the definition thereof was obtained that named  “Southern Cascades Finance Corporation” as the secured party and a replacement Certificate of  Title of the type described in clause (i) or (ii) of the definition thereof that names DFC, the  Borrower or the Administrative Agent as secured party has not been obtained by June 30, 2021   (provided, that if any such Certificate of Title is obtained after such 180thday (in the case of  





 






6  147032870v2  subclause (1)) or June 30, 2021 (in the case of subclause (2)), the Adjusted Principal Balance of  the related Receivable will no longer be deducted pursuant to this clause (c)), plus (ii) the  amount of Collections in respect of principal payments that are on deposit in the Collection  Account on such.    "Borrowing Base Deficiency" means, as of any date of determination, the positive  amount, if any, by which (i) the Loans Outstanding exceeds (ii) the Borrowing Base.   "Breakage Costs" means (i) such amount or amounts as shall compensate any Lender for  any actual loss, cost or expense (but excluding lost profits) incurred by such Lender (as  reasonably determined by such Lender) as a result of any prepayment of a Loan (and interest  thereon) that is made on less than three Business Days' prior written notice to the Lenders and  (ii) such amount or amounts due to any Lender pursuant to Section 2.07(c).  "Business Day" means any day (other than a Saturday or a Sunday) on which commercial  banking institutions are not required or authorized to be closed in New York, New York,  Chicago, Illinois, and Medford, Oregon.  "Certificate of Title" means, with respect to a Financed Vehicle, (i) the original certificate  of title relating thereto, (ii) if the applicable Registrar of Titles issues a letter or other form of  evidence of lien in lieu of a certificate of title (including electronic titling), the original lien entry  letter, or (iii) prior to the time that a certificate of title of the type described in clause (i) or (ii) is  issued, copies of correspondence to the applicable Registrar of Titles, and all enclosures thereto,  for issuance of the original certificate of title or the original lien entry letter or form, as  applicable, and which, in all of the foregoing cases, shall name the related Obligor as the owner  of such Financed Vehicle and DFC, the Borrower or the Administrative Agent, as secured party,.   For Financed Vehicles registered in States that issue confirmation of the lienholder's interest  electronically, the "Certificate of Title" may consist of notification of an electronic recordation,  by either a third party service provider or the relevant Registrar of Titles, which indicates that the  lien of the secured party on the Financed Vehicle is recorded on the original certificate of title on  the electronic lien and title system of the applicable State.    "Change in Control" means (i) DFC owns, directly or indirectly, less than 100% of the  membership interests of the Borrower or (ii) Lithia owns, directly or indirectly, less than 51% of  the voting and equity interests in DFC.  "Closing Date" means July 31, 2020.  "Code" means the Internal Revenue Code of 1986.  "Collateral" has the meaning given to such term in Section 3.01(a).  "Collateral Custodian" has the meaning given to such term in the Preamble.  "Collection Account" means a segregated account established by the initial Servicer, on  behalf of the Borrower, with the Account Bank in the name of the Administrative Agent for the  benefit of the Secured Parties, into which all Collections shall be deposited.  





 






7  147032870v2  "Collection Period" means, with respect to any date of determination, the immediately  preceding calendar month, except for dates occurring on or prior to the first Payment Date, in  which case such term means the period from but excluding the initial Cutoff Date to and  including August 31, 2020.  "Collections" means (i) all cash collections or other cash proceeds of any Receivable  received by the Servicer (including from DFC or the Borrower) from or on behalf of any Obligor  in payment of any amounts owed in respect of such Receivable, including all Release Price  amounts deposited in the Collection Account pursuant to Section 5.04, Insurance Proceeds,  investment earnings in the Collection Account, and all Recoveries, (ii) any other funds received  by the Servicer (including from DFC or the Borrower) with respect to any Receivable (exclusive  of Ancillary Fees which may be retained by the Servicer), Financed Vehicle or any other  Collateral, (iii) all payments received by the Borrower pursuant to any Hedging Agreement or  Hedge Transaction, and (iv) any Servicer Advances.  "Commercial Paper Notes" means any short-term promissory notes issued by a Conduit  Lender with respect to financing any Loan hereunder.  "Commitment" means, with respect to any Lender or Lender Group, the commitment of  such Lender or Lender Group to fund Loans in an aggregate amount not to exceed the amount set  forth as the "Commitment" in the related Lender Supplement, as such amount may be modified  from time to time in accordance with the terms hereof.  "Commitment Termination Date" means July 31, 2022 or, with respect to any Committed  Lender, such later date to which the Commitment Termination Date may be extended for such  Committed Lender in accordance with Section 2.04(a).  "Committed Lender" means any Person that is designated as a "Committed Lender" in  any Lender Supplement or in the Assignment and Acceptance pursuant to which it became a  party to this Agreement, and any assignee of such Committed Lender to the extent of the portion  of such Commitment assumed by such assignee pursuant to its respective Assignment and  Acceptance, and as of any date, "Committed Lenders" means, collectively, all of the foregoing  Persons as of such date.  "Committed Lender Rate" means, with respect to any Loan advanced by a Committed  Lender for an Interest Period, an interest rate per annum equal to either (i) if such Committed  Lender is a member of a Lender Group that includes a Conduit Lender, the sum of (a) the  Adjusted Eurodollar Rate on such day plus (b) the Applicable Margin or (ii) if such Committed  Lender is a member of a Lender Group that does not include a Conduit Lender, the Adjusted  Eurodollar Rate on such day.  "Conduit Lender" means any Person that is designated as a "Conduit Lender" in any  Lender Supplement or in the Assignment and Acceptance pursuant to which it became a party to  this Agreement, and any assignee of such Conduit Lender to the extent of the portion of such  Commitment assumed by such assignee pursuant to its respective Assignment and Acceptance,  and as of any date, "Conduit Lenders" means, collectively, all of the foregoing Persons as of  such date.  





 






8  147032870v2  "Conduit Portfolio Deferral Ratio" means, with respect to any date of determination, the  percentage equivalent of a fraction, (i) the numerator of which is the aggregate Principal Balance  of all Receivables with respect to which a Deferral was granted during the most recently  completed Collection Period and (ii) the denominator of which is the aggregate Principal  Balance of all Receivables as of the last day of such Collection Period.  "Conduit Portfolio Delinquency Ratio" means, with respect to any date of determination,  the percentage equivalent of a fraction, (i) the numerator of which is the aggregate Principal  Balance of all Delinquent Receivables as of the last day of the most recently completed  Collection Period and (ii) the denominator of which is the Pool Balance as of the last day of such  Collection Period.  "Conduit Portfolio Net Loss Ratio (Non-Prime)" means, with respect to any date of  determination, the percentage equivalent of a fraction, (i) the numerator of which is the  difference of (a) the aggregate Principal Balance of all Non-Prime Receivables that became  Defaulted Receivables during the most recently completed Collection Period minus (b) all  Recoveries received during such Collection Period with respect to Non-Prime Receivables and  (ii) the denominator of which is the sum of (a) the aggregate Principal Balance of all Non-Prime  Receivables that became Defaulted Receivables during such Collection Period plus (b) the  amount of Collections received by the Servicer in respect of principal payments on all Non- Prime Receivables during such Collection Period.  "Conduit Portfolio Net Loss Ratio (Prime)" means, with respect to any date of  determination, the percentage equivalent of a fraction, (i) the numerator of which is the  difference of (a) the aggregate Principal Balance of all Prime Receivables that became Defaulted  Receivables during the most recently completed Collection Period minus (b) all Recoveries  received during such Collection Period with respect to Prime Receivables and (ii) the  denominator of which is the sum of (a) the aggregate Principal Balance of all Prime Receivables  that became Defaulted Receivables during such Collection Period plus (b) the amount of  Collections received by the Servicer in respect of principal payments on all Prime Receivables  during such Collection Period.  "Confidential Information" means any information, data, documents and materials in any  form and at any time (including prior to the date of this Agreement) with respect to the  Borrower, DFC, or any of their Affiliates and their respective businesses and financial  information, the Receivables and the Serviced Portfolio and includes (i) information transmitted  in written, oral, magnetic or any other medium, (ii) all copies and reproductions, in whole or in  part, of such information and (iii) all summaries, analyses, compilations, studies, notes or other  records which contain, reflect or are generated from such information; provided, that  "Confidential Information" does not include, with respect to a Person, information that (a) was  already known to such Person and such knowledge was not obtained from any other entity who  was known by such Person to be subject to an obligation of confidentiality or otherwise  prohibited from transmitting such information to such Person, (b) is or has become part of the  public domain through no act or omission of such Person, (c) is or was lawfully disclosed to such  Person without restriction on disclosure by a third party, (d) is or was developed independently  by such Person, or (e) is or was lawfully and independently provided to such Person prior to  





 






9  147032870v2  disclosure hereunder, from a third party who is not known by such Person to be subject to an  obligation of confidentiality or otherwise prohibited from transmitting such information.  "Connection Income Taxes" means Other Connection Taxes that are imposed on or  measured by net income (however denominated) or that are franchise Taxes or branch profits  Taxes.  "Consent" or "Consented" means a consent or an action of the Administrative Agent that  has been approved by the Required Lenders or the Consenting Lenders, as applicable.  "Consenting Lenders" means at a particular time, Lenders with aggregate Commitments  equal to at least 100% of the Aggregate Commitment.  "Contract" means any retail installment sale contract executed by an Obligor for a  Financed Vehicle under which an extension of credit by DFC is made in the ordinary course of  business to such Obligor and which is secured by the related Financed Vehicle.  "Contractual Obligation" means, with respect to any Person, any provision of any  securities issued by such Person or any 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 is subject.  "Control Agreement" means that certain Amended and Restated Escrow and Control  Agreement, dated as of December 31, 2020, among the Borrower, JPMorgan Chase Bank, N.A.,  as escrow agent and bank, and the Administrative Agent.  "CP Rate" means, with respect to a Conduit Lender, the rate identified as its "CP Rate" in  the Lender Supplement for the related Lender Group.  "Cram Down Loss" means, with respect to a Receivable, if a court of appropriate  jurisdiction in an Insolvency Proceeding shall have issued an order reducing the amount owed on  such Receivable or otherwise modifying or restructuring the Scheduled Payments to be made on  such Receivable, an amount equal to such reduction in the Principal Balance of such Receivable  or the reduction in the net present value (using as the discount rate the lower of the contract rate  or the rate of interest specified by the court in such order) of the Scheduled Payments as so  modified or restructured.  A "Cram Down Loss" shall be deemed to have occurred on the date  such order is entered.   "Credit and Collection Policy" means, with respect to (i) the initial Servicer, the credit  and collection policies of the Servicer as are in effect on the Closing Date, as the same may be  amended, modified, or supplemented from time to time in accordance with this Agreement, or  (ii) any Successor Servicer, the customary credit and collection policies of such Successor  Servicer, in each case as revised from time to time in accordance with this Agreement.   "Credit Provider" means any provider of a Liquidity Facility.  "Credit Support Annex" has the meaning given to such term in Section 6.03(b).  





 






10  147032870v2  "Cutoff Date" means, with respect to Receivables transferred to the Borrower on a  Funding Date, the date that is three calendar days immediately preceding such Funding Date.    "Dealer" means an automobile dealer that is wholly-owned by Lithia that facilitated the  extension of credit on a Financed Vehicle to an Obligor and through which the Contract and  related Receivable were originated by DFC pursuant to the related Dealer Agreement.  "Dealer Agreement" means an existing agreement between a Dealer and DFC regarding  the terms and conditions of the facilitation by the Dealer of the underwriting by DFC of  Contracts and the related Receivables.   "Debt-to-Equity Ratio" means, with respect to any date of determination, (i) an amount  equal to DFC's aggregate Indebtedness divided by (ii) an amount equal to DFC's Tangible Net  Worth.  "Debt-to-Income Ratio" means, with respect to any Receivable and the related Obligor,  (i) the sum of (a) all of the related obligor's and any related co-obligor's (but no related  guarantor's) monthly fixed payment obligations (including mortgage and other loan payments,  rents, credit card payments, student loan payments and child support payments) at the time such  Receivable was originated, as determined by DFC in accordance with the Credit and Collection  Policy in effect at such time, plus (b) the monthly Scheduled Payment under the related Contract,  divided by (ii) the sum of all of such related obligor's and any related co-obligor's (but no related  guarantor's) monthly gross income for the calendar month immediately preceding the date such  Receivable was originated, as determined by DFC in accordance with the Credit and Collection  Policy in effect at such time.    "Default Rate" means a per annum rate equal to the sum of (i) the Alternate Base Rate  and (ii) 3.00%  "Defaulted Receivable" means any Receivable (i) that has been, or is required to be,  treated as "defaulted" in accordance with the Credit and Collection Policy, (ii) with respect to  which the Servicer has determined in good faith that payments thereunder have ceased and are  not likely to be resumed, (iii) with respect to which the greater of (a) $50 and (b) 10% or more of  any Scheduled Payment remains unpaid for more than 120 days from the related due date, or (iv)  for which the related Financed Vehicle has been repossessed.  "Defaulting Committed Lender" means any Committed Lender that, as determined by the  Administrative Agent:  (i) has failed to fund any of its obligations to make Loans in accordance  with Section 2.01, notwithstanding that all conditions to funding under Section 4.2 and, with  respect to the Initial Loan, Section 4.1 have been satisfied or waived in accordance with the  terms thereof, within three Business Days of the date required to be funded by it hereunder, (ii)  has notified the Administrative Agent or the Borrower in writing that it does not intend to  comply with such funding obligations, or has made a public statement to that effect with respect  to such funding obligations hereunder, or (iii) has become subject to an Insolvency Event;  provided, that a Committed Lender shall not be deemed to be a Defaulting Committed Lender  hereunder solely by virtue of any control of or ownership interest in, or the acquisition of any  ownership interest in, such Committed Lender (or its direct or indirect parent company) or the  





 






11  147032870v2  exercise of control over such Committed Lender (or its direct or indirect parent company) by a  Governmental Authority thereof, if and for so long as such ownership interest does not result in  or provide such Committed Lender (or its direct or indirect parent company) with immunity from  the jurisdiction of courts within the United States or from the enforcement of judgments or writs  of attachment on its assets or permit such Committed Lender (or its direct or indirect parent  company) or such Governmental Authority to reject, repudiate, disavow or disaffirm obligations  such as those under this Agreement.  "Deferral" means, with respect to any Receivable or Serviced Portfolio Receivable, a  deferral that is granted by the Servicer to an Obligor whereby (i) all or any portion of one or  more Scheduled Payments is waived for the related due date and (ii) such waived amount is due  from such Obligor by no later than the final due date for the related Contract (which final due  date may have been extended by the Servicer in connection with such deferral).  For purposes of  this definition, the "Obligor," "Scheduled Payment" and "Contract" for each Serviced Portfolio  Receivable that is not a Receivable shall be determined as if it were a "Receivable" for purposes  of all related defined terms.   "Delinquent Receivable" means any Receivable, (i) with respect to which the greater of  (a) $50 and (b) 10% or more of any Scheduled Payment remains unpaid for 60 or more days  from the related due date and (ii) that is not a Defaulted Receivable.  "Derivatives" means any (i) exchange-traded or over-the-counter forward, future, option,  swap, cap, collar, floor or foreign exchange contract or any combination of the foregoing,  whether for physical delivery or cash settlement, relating to any interest rate, interest rate index,  currency, currency exchange rate, currency exchange rate index, debt instrument, debt price, debt  index, depository instrument, depository price, depository index, equity instrument, equity price,  equity index, commodity, commodity price or commodity index, (ii) similar transaction,  contract, instrument, undertaking or security or (iii) transaction, contract, instrument,  undertaking or security containing any of the foregoing.  "Dodd-Frank Act" means The Dodd-Frank Wall Street Reform and Consumer Protection  Act (Pub.L. 111-203, H.R. 4173).  "Dollars" or "$" means the lawful currency of the United States.  "Early Amortization Event" means, on any date of determination, that:  (i) as of any Reporting Date, the arithmetic mean of the Conduit  Portfolio Net Loss Ratio (Prime) for the three Collection Periods immediately  preceding such Reporting Date is greater than 5.00% (provided, that no Early  Amortization Event will occur under this clause (i) if a Significant Take-out Date  occurred during any of such three Collection Periods);   (ii) as of any Reporting Date, the arithmetic mean of the Conduit  Portfolio Net Loss Ratio (Non-Prime) for the three Collection Periods  immediately preceding such Reporting Date is greater than 10.50% (provided,  that no Early Amortization Event will occur under this clause (ii) if a Significant  Take-out Date occurred during any of such three Collection Periods);   





 






12  147032870v2  (iii) as of any Reporting Date, the arithmetic mean of the Conduit  Portfolio Delinquency Ratio for the three Collection Periods immediately  preceding such Reporting Date is greater than 4.00% (provided, that no Early  Amortization Event will occur under this clause (iii) if a Significant Take-out  Date occurred during any of such three Collection Periods);  (iv) as of any Reporting Date, the arithmetic mean of the Conduit  Portfolio Deferral Ratio for the three Collection Periods immediately preceding  such Reporting Date is greater than 2.50% (provided, that no Early Amortization  Event will occur under this clause (iv) if a Significant Take-out Date occurred  during any of such three Collection Periods);  (v) a Borrowing Base Deficiency exists that has not been cured for at  least three Business Days;  provided, that if such Borrowing Base Deficiency  would not have occurred but for the occurrence of a Step-up Event, then no Early  Amortization Event will occur under this clause (v) unless such Borrowing Base  Deficiency continues to exist as of the Reporting Date that occurs during the third  Collection Period after the Collection Period during which such Borrowing Base  Deficiency first existed;   (vi) a breach of any Financial Covenant (Lithia) or any Financial  Covenant (DFC) has occurred;  (vii) any Servicer Termination Event (other than a Servicer Termination  Event of the type specified in subsections (l), (m), (n) or (o) of Section 7.13)  occurs;   (viii) a Termination Event has occurred; or  (ix) a Material Adverse Change has occurred;  provided, that any Early Amortization Event may be waived in a writing by the  Consenting Lenders to the Borrower, with a copy to the Administrative Agent and the  Servicer.   "Election Period" means the period commencing on the date that a request for an  extension pursuant to Section 2.04(a) is delivered and ending on the earlier of (i) the 45th calendar day thereafter or (ii) the 15th calendar day preceding the related Commitment  Termination Date.  "Eligible Assignee" means (i) J.P. Morgan Chase Bank, N.A., (ii) any other Committed  Lender, (iii) a multi-seller commercial asset-backed paper conduit that is administered by a  Lender, an Agent or the Administrative Agent or an Affiliate of any of them and the Commercial  Paper Notes of which are rated at least "A-1" by Standard & Poor's and "Prime-1" by Moody's,  (iv) any Credit Provider previously approved by the Borrower in writing prior to such  assignment, or (iv) any other Person that is acceptable to the Agent related to the portion of the  Commitment being assigned and with respect to which the Borrower has consented to in writing  prior to such assignment (such consent of the Borrower not to be unreasonably withheld);  





 






13  147032870v2  provided, that no such consent of the Borrower shall be required during the occurrence and  continuation of a Servicer Termination Event or Termination Event.    "Eligible Pool Balance" means, as of any date of determination, the sum of the Adjusted  Principal Balances of all Eligible Receivables as of such date.  "Eligible Receivable" means, as of any date of determination, any Receivable (i) for  which the related Receivable File is in the possession of the Collateral Custodian, (ii) which is  identified on the Schedule of Receivables delivered by the Borrower to the Administrative Agent  as part of a Funding Request and (iii) which satisfies each of the eligibility requirements set forth  on Schedule B hereto, in each case as of such date of determination.  "ERISA" means the Employee Retirement Income Security Act of 1974, and the  regulations promulgated and rulings issued thereunder.  "ERISA Affiliate" means (i) any corporation which is a member of the same controlled  group of corporations (within the meaning of Section 414(b) of the Code) as the Borrower, (ii) a  trade or business (whether or not incorporated) under common control (within the meaning of  Section 414(c) of the Code) with the Borrower or (iii) a member of the same affiliated service  group (within the meaning of Section 414(m) of the Code) as the Borrower, any corporation  described in clause (i) above or any trade or business described in clause (ii) above.  "Eurodollar Reserve Percentage" means, with respect to any Interest Period, a percentage  (expressed as a decimal) equal to the weighted average of the percentages in effect during such  Interest Period, as prescribed by the Board of Governors of the Federal Reserve System (or any  successor thereto) for determining the maximum reserve requirements applicable to  "Eurocurrency liabilities" pursuant to Regulation D or any other applicable regulation of the  Federal Reserve Board (or any successor thereto) which prescribes reserve requirements  applicable to "Eurocurrency liabilities" as currently defined in Regulation D.  "Excess Concentration Amounts" means, as of any date of determination and without  duplication, the sum of:  (i) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables for which the related Obligor has a billing address in  the State with the highest concentration of Receivables by Obligor billing address  as of such date minus (b) an amount equal to the product of (1) 43.0% times (2)  the Eligible Pool Balance on such date;   (ii) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables for which the related Obligor has a billing address in  the State with the second highest concentration of Receivables by Obligor billing  address as of such date minus (b) an amount equal to the product of (1) 33.0%  times (2) the Eligible Pool Balance on such date;  (iii) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables for which the related Obligor has a billing address in  the State with the third highest concentration of Receivables by Obligor billing  





 






14  147032870v2  address as of such date minus (b) an amount equal to the product of (1) 23.0%  times (2) the Eligible Pool Balance on such date;  (iv) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables for which the related Obligor has a billing address in  any State other than those States accounted for in clauses (i), (ii), and (iii), above,  minus (b) an amount equal to the product of (1) 10.0% times (2) the Eligible Pool  Balance on such date;  (v) without duplication, the sum of (a) the positive difference, if any,  of (1) the aggregate Principal Balance of the Receivables for which the related  Obligors had FICO Scores of less than 700 minus (2) the product of (A) 88.0%  times (B) the Eligible Pool Balance as of such date plus (b) the positive  difference, if any, of (1) the aggregate Principal Balance of the Receivables for  which the related Obligors had FICO Scores of less than 620 minus (2) the  product of (A) 33.0% times (B) the Eligible Pool Balance as of such date plus (c)  the positive difference, if any, of (1) the aggregate Principal Balance of the  Receivables for which the related Obligors had FICO Scores of less than 550  minus (2) the product of (A) 15.0% times (B) the Eligible Pool Balance as of such  date, calculated in all cases with Receivables that do not have such FICO Scores  being deemed to have FICO Scores of zero;   (vi) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables for which the related Obligors did not have a FICO  Score or had a FICO Score of zero minus (b) the product of (1) 10.0% times (2)  the Eligible Pool Balance as of such date;  (vii) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables for which the related Loan-to-Value Ratios were  greater than 125% at the time of underwriting minus (b) the product of (1) 23.0%  times (2) the Eligible Pool Balance as of such date;  (viii) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables that had original Principal Balances of greater than  $40,000 minus (b) the product of (1) 25.0% times (2) the Eligible Pool Balance as  of such date;  (ix) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables which or on any prior date were (but which no longer  are as of such date of determination) Serviced Portfolio Defaulted Receivables  minus (b) the product of (1) 1.0% times (2) the Eligible Pool Balance as of such  date;  (x) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables for which the related Financed Vehicle was a Used  Vehicle at the time such Receivable was originated minus (b) the product of (1)  67.5% times (2) the Eligible Pool Balance as of such date;   





 






15  147032870v2  (xi) the positive difference, if any, of (a) the aggregate Principal  Balance of the Receivables for which the original term to maturity was more than  75 months  minus (b) the product of (1) 10.0% times (2) the Eligible Pool Balance  as of such date;  (xii)  the aggregate Principal Balance of Eligible Receivables that had  FICO Scores of less than 635 at the time of their underwriting that would need to  be subtracted from the Eligible Pool Balance on such date in order to cause the  weighted average FICO Score of all Eligible Receivables (excluding Receivables  that do not have a FICO Score or have a FICO Score of zero) to 635, with such  weighted average calculated using the FICO Score of each such Receivable at the  time of its underwriting;  (xiii) the aggregate Principal Balance of Eligible Receivables that had  Loan-to-Value Ratios at the time of their underwriting of greater than 118% that  would need to be subtracted from the Eligible Pool Balance on such date in order  to cause the weighted average Loan-to-Value Ratio of all Eligible Receivables at  the time of their underwriting to equal 118%;  (xiv) the aggregate Principal Balance of all Eligible Receivables that had  Payment-to-Income Ratios of greater than 12.0% at the time of their underwriting  that would need to be subtracted from the Eligible Pool Balance on such date in  order to cause the weighted average Payment-to-Income Ratios of all Eligible  Receivables at the time of their underwriting to equal 12.0%; and  (xv) the aggregate Principal Balance of all Eligible Receivables that had  Debt-to-Income Ratios of greater than 55.0% at the time of their underwriting that  would need to be subtracted from the Eligible Pool Balance on such date in order  to cause the weighted average Debt-to-Income Ratio of all Eligible Receivables at  the time of their underwriting to equal 55.0%.  "Excess Spread" means, as of any date of determination, the difference of (i) the  weighted average APR of all Eligible Receivables (weighted by the Principal Balance of such  Eligible Receivables) minus (ii) the Servicing Fee Rate minus (iii) the Program Fee Rate minus  (iv) the Weighted Average Hedge Rate as of such date minus (v) the Backup Servicing Fee Rate.  "Excess Spread (Adjusted)" means, as of any date of determination, the difference of (i)  the percentage equivalent of a fraction, (a) the numerator of which equals the sum of (1) for each  Eligible Receivable that has an APR that is less than the Required Rate, the product of (A) the  Adjusted Principal Balance of such Eligible Receivable as of such date times (B) the Required  Rate plus (2) for each Eligible Receivable that has an APR that is greater than or equal to the  Required Rate, the product of (A) the Adjusted Principal Balance of such Eligible Receivable as  of such date times (B) the APR of such Eligible Receivable and (b) the denominator of which is  the sum of the Adjusted Principal Balances as of such date of all Eligible Receivables minus (ii)  the Servicing Fee Rate minus (iii) the Program Fee Rate minus (iv) the Weighted Average Hedge  Rate as of such date minus (v) the Backup Servicing Fee Rate.  





 






16  147032870v2  "Exchange Act" means the Securities Exchange Act of 1934, as amended.   "Excluded Taxes" means any of the following Taxes imposed on or with respect to a  Recipient or required to be withheld or deducted from a payment to a Recipient, (i) Taxes  imposed on or measured by net income (however denominated), franchise Taxes, and branch  profits Taxes, in each case, (a) imposed as a result of such Recipient being organized under the  laws of, or having its principal office or, in the case of any Lender, its applicable lending office  located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (b) that are  Other Connection Taxes, (ii) in the case of a Lender, U.S. federal withholding Taxes imposed on  amounts payable to or for the account of such Lender with respect to an applicable interest in a  Loan or Commitment pursuant to a law in effect on the date on which (a) such Lender acquires  such interest in the Loan or Commitment or (b) such Lender changes its lending office, except in  each case to the extent that, pursuant to Section 2.11, amounts with respect to such Taxes were  payable either to such Lender's assignor immediately before such Lender became a party hereto  or to such Lender immediately before it changed its lending office, (iii) Taxes attributable to  such Recipient's failure to comply with Section 2.11(g) and (iv) any withholding Taxes imposed  under FATCA.  "Facility Amount" means, as of any date of determination, (i) prior to the Termination  Date, the Aggregate Commitment on such day and (ii) on and after the Termination Date, the  Loans Outstanding.  "Facility Termination Date" means the date following the Termination Date on which the  Aggregate Unpaids have been indefeasibly paid in full.  "FATCA" means Sections 1471 through 1474 of the Code, as of the date of this  Agreement (or any amended or successor version that is substantively comparable and not  materially more onerous to comply with), any current or future regulations or official  interpretations thereof and any applicable agreement entered into pursuant to Section 1471(b)(1)  of the Code, any applicable intergovernmental agreement with respect to the foregoing, and any  regulations and official administrative guidance thereunder.  "Federal Funds Effective Rate" means, for any day, the weighted average (rounded  upwards, if necessary, to the next 1/100th of 1%) of the rates on overnight Federal funds  transactions with members of the Federal Reserve System arranged by Federal funds brokers, as  published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if  such rate is not so published for any day that is a Business Day, the average (rounded upwards, if  necessary, to the next 1/100th of 1%) of the quotations for such day for such transactions received  by the Administrative Agent from three Federal funds brokers of recognized standing selected by  it.  "Federal Reserve Board" means the Board of Governors of the Federal Reserve System.  "Fee Letter" means the "Amended and Restated Fee Letter", dated as of the December  31, 2020, among the Borrower, the initial Servicer and the Administrative Agent, setting forth,  among other things, the Structuring Fee, the Supplemental Structuring Fee Rate, the Program Fee  Rate, the Applicable Margin, and the Unused Commitment Fee Rate.  





 






17  147032870v2  "FICO Score" means with respect to any Receivable, the decisioned credit risk score that  is generated by Equifax (or, if such credit risk score is unavailable through Equifax, the  decisioned credit risk score that is generated by TransUnion or another equivalent consumer  credit reporting agency) using their version 8 scorecard for use in the automotive lending sector,  at the time of underwriting for the related Contract, which credit risk score is generated using  statistical models established by Fair Isaac Corporation (or any successor entity thereto) for  either (i) the related obligor or (ii) if greater, the related co-obligor under the related receivable.    "Financed Vehicle" means, with respect to a Receivable, any new or used automobile,  light-duty truck, minivan, sport utility vehicle or other passenger vehicle, together with all  accessions thereto, securing the related Obligor's Indebtedness thereunder.  "Financial Covenants (Lithia)" means each of the covenants listed on Schedule F to this  Agreement.    "Financial Covenants (DFC)" means each of:  (i) DFC's Tangible Net Worth for the most recently ended fiscal  quarter shall at least equal the sum of (a) $35,000,000 plus (b) 50% DFC's  cumulative positive net income for each fiscal quarter that has ended since March  31, 2020 plus (c) 50% of any capital contributions received by DFC after March  31, 2020; and  (ii) DFC's Debt-to-Equity Ratio for the most recently ended fiscal  quarter shall not exceed 7.50 to 1.0.  "Force Majeure Event" means an act of God or the public enemy, acts of declared or  undeclared war (including acts of terrorism), public disorder, rebellion or sabotage, epidemics,  pandemics, landslides, lightening, fire, hurricanes, earthquakes, floods or similar causes.  "Foreign Lender" means a Lender that is not a U.S. Person.  "Formation Documents" means, with respect to (i) the Borrower, its limited liability  company agreement and certificate of formation, (ii) DFC, its certificate of incorporation and  bylaws, and (iii) Lithia, its certificate of incorporation and bylaws.  "Funding Date" means each Business Day on which a Loan is made and Receivables are  added to the Collateral in connection with such Loan. "Funding Request" means a written notice from the Borrower requesting a Loan and  including the items required by Section 2.01(b), substantially in the form of Exhibit A hereto.  "GAAP" means generally accepted accounting principles as in effect from time to time in  the United States.  "Governmental Authority" means, with respect to any Person, any nation or government,  any State or other political subdivision thereof, any entity exercising executive, legislative,  





 






18  147032870v2  judicial, regulatory or administrative functions of or pertaining to government and any court or  arbitrator having jurisdiction over such Person.  "Hedge Breakage Costs" means, with respect to any Hedge Transaction, any amount  payable by the Borrower to the related Hedge Counterparty upon the early termination of such  Hedge Transaction or any portion thereof.  "Hedge Collateral" means all of the rights of the Borrower, whether now existing and  hereafter acquired, in and to all Hedging Agreements, Hedge Transactions and all present and  future amounts payable by all Hedge Counterparties to the Borrower under or in connection with  such Hedging Agreements and Hedge Transactions with such Hedge Counterparties.  "Hedge Counterparty" means any entity that on the date of entering into any Hedge  Transaction is (i) JPMorgan Chase Bank, N.A. or an Affiliate thereof or (ii) (a) is an interest rate  swap dealer, (b) whose debt ratings satisfy each of the Long-Term Rating Requirement and the  Short-Term Rating Requirement and (c) agrees that in the event that Moody's or Standard &  Poor's reduces its long-term unsecured debt rating below the Long-Term Rating Requirement or  its short-term unsecured debt rating below the Short-Term Rating Requirement, it shall  (1) transfer its rights and obligations under each Hedge Transaction to another entity that meets  the requirements of this definition and has entered into a Hedging Agreement with the Borrower  on or prior to the date of such transfer, or (2) post collateral in an amount satisfactory to the  Required Lenders.  Each Hedge Counterparty must consent to the assignment of the Borrower's  rights under the Hedging Agreement to the Administrative Agent pursuant to Section 6.03(f).   "Hedge Counterparty Collateral Account" has the meaning given to such term in Section  6.03(b).  "Hedge Transaction" means each interest rate hedge transaction between the Borrower  and a Hedge Counterparty that is entered into pursuant to Section 6.03 and is governed by a  Hedging Agreement.  "Hedging Agreement" means each agreement between the Borrower and a Hedge  Counterparty which governs one or more Hedge Transactions entered into pursuant to  Section 6.03, which agreement shall be reasonably acceptable to the Administrative Agent and  shall consist of a "Master Agreement" in a form published by the International Swaps and  Derivatives Association, Inc., together with a "Schedule" thereto, any applicable Credit Support  Annex and each "Confirmation" thereunder confirming the specific terms of each such Hedge  Transaction.  "Indebtedness" means, with respect to any Person and any day, without duplication, (i) all  indebtedness of such Person for borrowed money or for the deferred purchase price of property  or services (other than current liabilities incurred in the ordinary course of business and payable  in accordance with customary trade practices) or which is evidenced by a note, bond, debenture  or similar instrument, (ii) all obligations of such Person under capital leases, (iii) all obligations  of such Person in respect of acceptances issued or created for the account of such Person, (iv) all  liabilities secured by any Lien on any property owned by such Person even though such Person  





 






19  147032870v2  has not assumed or otherwise become liable for the payment thereof and (v) all indebtedness,  obligations or liabilities of that Person in respect of Derivatives.  "Indemnified Amounts" has the meaning given to such term in Section 9.01.  "Indemnified Party" has the meaning given to such term in Section 9.01.  "Indemnified Taxes" means (a) Taxes, other than Excluded Taxes, imposed on or with  respect to any payment made by or on account of any obligation of the Borrower under any  Borrower Basic Document and (b) to the extent not otherwise described in (a), Other Taxes.  "Independent Director" means a natural Person who either (i) (a) shall not have been at  the time of such Person's appointment or at any time during the preceding five years, and shall  not be as long as such Person is a director of the Borrower, (1) a director, officer, employee,  partner, shareholder, equity owner, member, manager or Affiliate of DFC or Lithia, or any  Affiliate of DFC, Lithia, or the Borrower (other than as an independent director or manager of  such Person), (2) a customer or supplier of DFC, Lithia, the Borrower or any of their respective  Affiliates, (3) a Person controlling or under common control with any partner, shareholder,  member, manager, Affiliate, customer or supplier of DFC, Lithia, the Borrower or any of their  respective Affiliates or (4) a member of the immediate family of any Person described in clauses  (1) through (3) above; provided, that such Independent Director may be an independent director  of another special purpose entity affiliated with DFC or Lithia or any of their respective  Affiliates, (b) is an employee of a company that (1) is in the business of providing independent  director services for special purpose entities and (2) is recognized in the securitization market as  a provider of such services, (c) has prior experience as an independent director or manager for a  corporation or limited liability company whose charter documents required the unanimous  consent of all independent directors or managers thereof before such corporation or limited  liability company could consent to the institution of insolvency proceedings against it or could  file a petition seeking relief under any applicable insolvency laws and (d) has at least three years  of employment experience with one or more entities that provide, in the ordinary course of their  respective businesses, advisory, management or placement services to issuers of securitization or  structured finance instruments, agreements or securities or (ii) has otherwise been approved in  writing by the Administrative Agent.  "Ineligible Receivable" means, as of any date of determination, a Receivable that is not  an Eligible Receivable.  "Initial Loan" means the first Loan made on or after the Closing Date.  "Insolvency Event" means, with respect to a specified Person, (i) the filing of a decree or  order for relief by a court having jurisdiction in the premises in respect of such Person or any  substantial part of its property in an involuntary case under any applicable Insolvency Law now  or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee,  sequestrator or similar official for such Person or for any substantial part of its property, or  ordering the winding-up or liquidation of such Person's affairs, and such decree or order shall  remain unstayed and in effect for a period of 60 consecutive days or (ii) the commencement by  such Person of a voluntary case under any Insolvency Law now or hereafter in effect, or the  





 






20  147032870v2  consent by such Person to the entry of an order for relief in an involuntary case under any such  law, or 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, or the failure by such Person generally to pay its debts as such debts become  due, or the taking of action by such Person in furtherance of any of the foregoing.  "Insolvency Laws" means the Bankruptcy Code and all other applicable liquidation,  conservatorship, bankruptcy, moratorium, arrangement, rearrangement, receivership, insolvency,  reorganization, suspension of payments, marshaling of assets and liabilities or similar debtor  relief laws from time to time in effect affecting the rights of creditors generally.  "Insolvency Proceeding" means, with respect to any Person, any bankruptcy, insolvency,  arrangement, rearrangement, conservatorship, moratorium, suspension of payments,  readjustment of debt, reorganization, receivership, liquidation, marshaling of assets and liabilities  or similar proceeding of or relating to such Person under any Insolvency Laws.  "Instrument" means any "instrument" (as defined in Article 9 of the UCC), other than an  instrument that constitutes part of chattel paper.  "Insurance Policy" means, with respect to any Receivable, (i) an insurance policy  covering physical damage to or loss of the related Financed Vehicle or (ii) any lender's single  interest, credit life, disability, hospitalization and similar insurance policies with respect to the  related Obligor.  "Insurance Proceeds" means any amounts payable or any payments made under any  Insurance Policy.  "Interest" means, for any Interest Period and each Loan outstanding during such Interest  Period, interest on the Principal Amount of such Loan computed pursuant to Section 2.05(b);  provided, that (i) no provision of this Agreement shall require or permit the collection of Interest  in excess of the Maximum Lawful Rate 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 Period" means, with respect to each Payment Date, the immediately preceding  Collection Period (or, in the case of the first Payment Date, the period from and including the  Closing Date through and including August 31, 2020); provided, that any Interest Period that  commences before the Facility Termination Date that would otherwise end after the Facility  Termination Date shall end on the Facility Termination Date.   "Invested Percentage" means, for a Lender as of any date of determination, the  percentage equivalent of (i) the sum of (a) the portion of the Loans Outstanding (if any) funded  by such Lender on or prior to such day, plus (b) with duplication of any amount in clause (a), any  portion of the Loans Outstanding acquired by such Lender on or prior to such day as an assignee  from another Lender pursuant to an Assignment and Acceptance, minus (c) any portion of the  Loans Outstanding assigned by such Lender to an assignee on or prior to such day pursuant to an  Assignment and Acceptance, divided by (ii) the Loans Outstanding on such day.  





 






21  147032870v2  "Investment" means, 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, and excluding commission, travel and similar advances to  officers, employees and directors made in the ordinary course of business.  "Investment Company Act" means the Investment Company Act of 1940, as amended.  "IRS" means the U.S. Internal Revenue Service.  "JPMorgan Agent" means JPMorgan Chase Bank, in its capacity as Agent for the  JPMorgan Lender Group, and its successors in such capacity.  "JPMorgan Chase Bank" means JPMorgan Chase Bank, N.A.  "JPMorgan Lender Group" means the group of Lenders consisting of (a) the Conduit  Lender identified on the Lender Supplement attached hereto as Schedule A, (b) the Committed  Lender identified on the Lender Supplement attached hereto as Schedule A, and (c) the  JPMorgan Agent.  "Lender Advance" means a Lender's Lender Percentage of the Principal Amount of a  particular Loan to be made to the Borrower on a Funding Date.  "Lender Group" means each group of Lenders consisting of (i) one or more Lenders and  (ii) an Agent, in each case as indicated on the related Lender Supplement.  As of the Closing  Date, the sole Lender Group is the JPMorgan Lender Group.  "Lender Percentage" means a Lender's Commitment as a percentage of the Aggregate  Commitment.  "Lender Register" has the meaning given to such term in Section 11.01(c).  "Lenders" means, collectively, the Conduit Lenders and the Committed Lenders.  "Lender Supplement" means (i) with respect to the JPMorgan Lender Group, the  information set forth in Schedule A to this Agreement and (ii) with respect to any other Lender  Group, the information set forth in the related Lender Supplement, in each case as the same may  be amended or otherwise modified from time to time, with, in the case of changes to the Facility  Amount, any Commitment and any definition of CP Rate, the consent of the Borrower.  With  respect to the Lender Supplement for any Lender Group other than the JPMorgan Lender Group,  such Lender Supplement shall contain substantially similar information to that set forth in  Schedule A with respect to the JPMorgan Lender Group.  "Liability" means any duty, responsibility, obligation or liability.  "LIBOR" means, for any day, a rate per annum equal to the three month London- Interbank Offered Rate administered by ICE Benchmark Administration (or any other Person  that takes over administration of such rate) appearing on Reuters Screen LIBOR01 Page (or on  any successor or substitute page of such service, providing rate quotations comparable to those  





 






22  147032870v2  currently provided on such page of such service, as determined by the Administrative Agent  from time to time in accordance with its customary practices for purposes of providing  quotations of interest rates applicable to U.S. Dollar deposits in the London interbank market) at  approximately 11:00 a.m. (London time) on such day or, if such day is not a Business Day in  London, the immediately preceding Business Day in London.  In the event that such rate does  not appear on such page (or on any successor or substitute page on such screen or otherwise on  such screen), LIBOR for such day shall be the average rate at which three month U.S. dollar  deposits of $5,000,000 are offered by the principal London office of the Administrative Agent  and two other major banks, at approximately 11:00 a.m., London time, on such day.  If the  Administrative Agent is unable to determine LIBOR in the foregoing manner, LIBOR shall be  the rate from the prior day or, if such day is not a Business Day in London, the immediately  preceding Business Day in London.  If "LIBOR" calculated pursuant to this definition shall be  less than zero, such rate shall be deemed zero for purposes of this Agreement and the other Basic  Documents.  "Lien" means any mortgage, lien, pledge, charge, claim, security interest or encumbrance  of any kind.  "Liquidity Facility" means, with respect to each Conduit Lender, any of the committed  loan facilities, lines of credit and other financial accommodations available to such Conduit  Lender to support the liquidity of such Conduit Lender's Commercial Paper Notes.  "Lithia" means Lithia Motors, Inc., an Oregon corporation.  "Loan" has the meaning given to such term in Section 2.01(a).  "Loan-to-Value Ratio" means, with respect to any Receivable, the percentage equivalent  of a fraction, (i) the numerator of which is the original Principal Balance of such Receivable and  (ii) the denominator of which is the book value of the related Financed Vehicle at the date of  underwriting, where such book value is the selling price of the Financed Vehicle as determined  in accordance with the Credit and Collection Policy.  "Loans Outstanding" means, on any day, the aggregate Principal Amount of all Loans  made on or prior to such day, reduced from time to time by payments and distributions in respect  of principal of the Loans in accordance with the terms hereof.  "Lockbox Account" means one or more deposit accounts established and maintained at  the Lockbox Bank pursuant to the Blocked Account Control Agreement for the benefit of the  Secured Parties (as defined in the Blocked Account Control Agreement) where all Obligors are  instructed to make payments in respect of the Receivables.  "Lockbox Bank" means, initially, JPMorgan Chase Bank, N.A. or any other bank as  agreed to by the Borrower, the Administrative Agent and the Required Lenders.  "Lockboxes" means one or more post office boxes or operating accounts established by  DFC and maintained at the Lockbox Bank for the benefit of the Secured Parties (as defined in  the Blocked Account Control Agreement).  





 






23  147032870v2  "Long-Term Rating Requirement" means, with respect to any Person, that such Person  has a long-term unsecured debt rating of not less than "A" by Standard & Poor's and not less than  "A2" by Moody's.  "Mandatory Commitment" means, with respect to any Lender or Lender Group, the  amount set forth as the "Mandatory Commitment" in the related Lender Supplement, as such  amount may be modified from time to time in accordance with the terms hereof.  "Material Adverse Change" means any event or condition which would have a material  adverse effect on (i) the collectability of all or a material portion of the Receivables, (ii) the  condition (financial or otherwise), business or properties of the Borrower, (iii) the ability of the  Servicer to collect on the Receivables, (iv) the condition (financial or otherwise), business or  properties of DFC, or (v) the condition (financial or otherwise), businesses or investments of the  Performance Guarantor.  For the avoidance of doubt, the following is a non-exclusive list of  changes to the Credit and Collection Policy which, if reasonably likely to negatively impact the  creditworthiness or collectability of any Receivables, will be deemed to constitute a “Material  Adverse Change” unless such changes are made with the consent of the Administrative Agent in  the manner set forth in this Agreement:  changes that would modify any of (a) the threshold that  determines whether an origination can be made upon the authority of a “level 2 underwriter” or a  "level 3 underwriter"; (b) the maximum allowable threshold limitations for substantial  underwriting criteria, including but not limited to those related to loan term, Debt-to-Income  Ratio, Payment-to-Income Ratio, and Loan-to-Value Ratio; (c) the categorization of receivables  as delinquent, non-performing, defaulted or charged-off; (d) material collection processes  relating, without limitation, to delinquent, non-performing, defaulted or charged-off receivables,  loan loss recognition, loan modification (including extensions and deferrals), end-of-term  recovery and processing, and collateral recovery; and (e) any provisions for credit exceptions;  and (f) stated creditworthiness thresholds required for obligors.   "Material Adverse Effect" means, with respect to any Person and to any event or  circumstance, a material adverse effect on (i) the business, condition (financial or otherwise),  operations, performance, properties or prospects of such Person (including any such change or  effect resulting from the introduction of or change in any Applicable Laws or any ruling, order or  other action by any Governmental Authority), taken as a whole, (ii) the validity or enforceability  of this Agreement or any other Basic Document or the validity, enforceability or collectability of  a material portion of (a) the Contracts (taken as a whole), (b) the Receivables (taken as a whole)  or (c) any other Collateral (taken as a whole), (iii) the rights and remedies of the Administrative  Agent and Secured Parties under the Basic Documents, (iv) the ability of such Person to perform  its obligations under this Agreement or any other Basic Document to which it is a party, or (v)  the status, existence, perfection, priority or enforceability of the interest of the Administrative  Agent or the Lenders in the Collateral.  "Maximum Lawful Rate" means the highest rate of interest permissible under Applicable  Law.  "Member" has the meaning set forth in the Borrower's Formation Documents.  





 






24  147032870v2  "Monthly Backup Servicer Certificate" means a monthly report of the Backup Servicer in  the form prescribed by the Backup Servicing Agreement which shall set forth, among other  items, the Backup Servicer's recalculation of the Eligible Pool Balance, the Borrowing Base, the  Conduit Portfolio Delinquency Ratio, the Conduit Portfolio Net Loss Ratio (Non-Prime), the  Conduit Portfolio Net Loss Ratio (Prime),  the Serviced Portfolio Delinquency Ratio, the  Serviced Portfolio Net Loss Ratio (Non-Prime), and the Serviced Portfolio Net Loss Ratio  (Prime), in each case as of the end of the Collection Period immediately preceding the date on  which such certificate is delivered.  "Monthly Principal Payment Amount" means either (i) with respect to any Payment Date  occurring prior to the Termination Date, the lesser of (a) the excess (if any) of the Loans  Outstanding on such date (excluding any additional amounts to be borrowed on such Payment  Date) over the Borrowing Base on such Payment Date and (b) the amount of Available Funds  that is available to be applied pursuant to Section 2.06(v)(B) on such Payment Date (after giving  effect to all payments pursuant to sub-clauses (i) through (v) of Section 2.06 on such Payment  Date) or (ii) with respect to any Payment Date occurring on or after the Termination Date, the  lesser of (a) the Loans Outstanding on such date and (b) the amount of Available Funds that is  available to be applied pursuant to Section 2.06(v)(B) on such Payment Date (after giving effect  to all payments pursuant to subclauses (i) through (v) of Section 2.06 on such Payment Date) .  "Monthly Report" means a monthly statement of the Servicer delivered pursuant to  Section 7.07(a) on each Reporting Date with respect to the related Collection Period,  substantially in the form of Exhibit F.  "Moody's" means Moody's Investors Service, Inc.  "Multiemployer Plan" means a "multiemployer plan" as defined in Section 4001(a)(3) of  ERISA which is or was at any time during the current year or the immediately preceding five  years contributed to by the Borrower, DFC, Lithia or any ERISA Affiliate on behalf of their  employees.  "Near Prime Receivable" means a Receivable for which, at the time of underwriting, the  related FICO Score was (i) less than 700 but also (ii) greater than or equal to 620.  "Net Eligible Pool Balance" means, as of any date of determination, the difference of (i)  the Eligible Pool Balance as of such date minus (ii) the Excess Concentration Amount as of such  date.  "Non-Extending Lender" means, after its respective Commitment Termination Date, each  Lender that has declined to extend its Commitment Termination Date in accordance with  Section 2.04, to the extent not replaced pursuant to Section 2.04(b).  "Non-Prime Receivable" means a Receivable that is either a Near Prime Receivable or a  Subprime Receivable.    "Non-Prime Serviced Portfolio Receivable" means a Serviced Portfolio Receivable for  which, at the time of underwriting, (i) the related FICO Score was less than 700 (including a  FICO Score of zero) or (ii) there was no FICO Score.  





 






25  147032870v2  "Obligations" means all loans, advances, debts, liabilities, indemnities and obligations for  monetary amounts owing by the Borrower to the Secured Parties, the Collateral Custodian, the  Backup Servicer, any Successor Servicer, the Administrative Agent, the Agents or any of their  respective assigns, as the case may be, whether due or to become due, matured or unmatured,  liquidated or unliquidated, contingent or non-contingent and all covenants and duties regarding  such amounts, of any kind or nature, present or future, arising under or in respect of any of the  Loans or any Hedging Agreement, whether or not evidenced by any separate note, agreement or  other instrument, including all principal, interest (including interest that accrues after the  commencement against the Borrower of any action under the Bankruptcy Code), amounts  payable pursuant to Section 2.12, Breakage Costs, Hedge Breakage Costs, fees, including any  and all arrangement fees, loan fees, Program Fees, Structuring Fees, Supplemental Structuring  Fees, and Unused Commitment Fees and any and all other fees, expenses, costs or other sums  (including attorney fees and disbursements) chargeable to the Borrower under the Basic  Documents.  "Obligor" means each Person obligated to make payments pursuant to a Receivable,  including any guarantor thereof.  "Officer's Certificate" means a certificate signed by any Responsible Officer of the  Borrower, the Servicer, DFC, Lithia, the Backup Servicer or the Collateral Custodian, as the case  may be, and delivered to the Administrative Agent.  "Opinion of Counsel" means, with respect to any Person, a written opinion of counsel,  who is reasonably acceptable to the Administrative Agent.  "Other Connection Taxes" means, with respect to any Recipient, Taxes imposed as a  result of a present or former connection between such Recipient and the jurisdiction imposing  such Tax (other than connections arising from such Recipient having executed, delivered,  become a party to, performed its obligations under, received payments under, received or  perfected a security interest under, engaged in any other transaction pursuant to or enforced any  Borrower Basic Document, or sold or assigned an interest in any Loan or Borrower Basic  Document).  "Other Taxes" means all present or future stamp, court or documentary, intangible,  recording, filing or similar Taxes that arise from any payment made under, from the execution,  delivery, performance, enforcement or registration of, from the receipt or perfection of a security  interest under, or otherwise with respect to, any Borrower Basic Document, except any such  Taxes that are Other Connection Taxes imposed with respect to an assignment.  "Owners" means the Lenders that are owners of record of the Loans or, with respect to  any Loan owned by an Agent hereunder as nominee on behalf of Lenders in the related Lender  Group, the Lenders that are beneficial owners of such Loan as reflected on the books of such  Agent in accordance with this Agreement and the other Basic Documents.  "Partial Expiration Event" means the occurrence of the election of one or more  Non-Extending Lenders after its respective Commitment Termination Date to not extend its  





 






26  147032870v2  Commitment, unless such Non-Extending Lender is replaced pursuant to Section 2.04(b) or  unless the Termination Date shall have occurred.  "Partial Expiration Event Amount" means the portion of Loans Outstanding payable  pursuant to Section 2.06(vii) in connection with a Partial Expiration Event.  "Participant Register" has the meaning given to such term in Section 11.01(e).  "Patriot Act" means the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law  October 26, 2001)).   "Payment Date" means the 15th day of each calendar month or, if any such day is not a  Business Day, the next succeeding Business Day, commencing September 15, 2020.  "Payment-to-Income Ratio" means, with respect to any Receivable as of the date of  underwriting, the ratio (expressed as a percentage) of (i) the monthly payment owed by the  related Obligor pursuant to the related Contract to (ii) the sum of all of the related obligor's and  any related co-obligor's (but no related guarantor's) monthly gross income for the calendar month  immediately preceding the date such Receivable was originated, as determined by DFC in  accordance with the Credit and Collection Policy in effect at such time.  "Pension Plan" means an "employee pension benefit plan," as such term is defined in  Section 3(2) of ERISA, maintained by the Borrower, DFC, Lithia, or any ERISA Affiliate, or in  which employees of the Borrower are entitled to participate, as from time to time in effect.  "Performance Guarantor" means Lithia.  "Performance Guaranty" means the Amended and Restated Performance Guaranty, dated  as of December 31, 2020, by the Performance Guarantor in favor of the Secured Parties.  "Permitted Investments" means any of the following types of investments:  (i) marketable obligations of the United States, the full and timely  payment of which are backed by the full faith and credit of the United States and  which have a maturity of not more than 30 days from the date of acquisition;  (ii) bankers' acceptances and certificates of deposit and other  interest-bearing obligations (in each case having a maturity of not more than  30 days from the date of acquisition) denominated in Dollars and issued by any  bank with capital, surplus and undivided profits aggregating at least  $100,000,000, the short-term obligations of which meet or exceed the Short-Term  Rating Requirement;  (iii) commercial paper rated at least A-1 by Standard & Poor's and  Prime-1 by Moody's;  





 






27  147032870v2  (iv) money market funds registered under the Investment Company Act  having a rating, at the time of such investment, of not less than Aaa by Moody's  and AAAm by Standard & Poor's;  (v) interest-bearing demand deposits, time deposits or certificates of  deposit (having original maturities of no more than 365 days) of depository  institutions or trust companies incorporated under the laws of the United States or  any State (or domestic branches of any foreign bank) and subject to supervision  and examination by federal or State banking or depository institution authorities;  provided, that at the time such investment, or the commitment to make such  investment, is entered into, the short-term debt rating of such depository  institution or trust company shall meet or exceed the Short-Term Rating  Requirement; and  (vi) any other investments approved in writing by the Administrative  Agent;  provided, that each of the Permitted Investments may be purchased from the Administrative  Agent, the Account Bank or any of their respective Affiliates.  "Permitted Liens" means (i) Liens in favor of the Borrower created pursuant to the  Purchase Agreement, (ii) Liens in favor of any Agent or the Administrative Agent, as agent for  the Secured Parties created pursuant to this Agreement or any other Basic Document, (iii) Liens  for taxes and assessments not yet due or for taxes which the Borrower is contesting in good faith  and by appropriate legal proceedings the validity, applicability or amount thereof and such  contest does not materially endanger any right or interest of the Secured Parties under the Basic  Documents, (iv) Liens arising in the ordinary course of business by virtue of any contractual,  statutory or common law provision relating to banker's Liens, rights of set-off or similar rights  and remedies covering deposit or securities accounts (including funds or other assets credited  thereto) or other funds maintained with a depository institution or securities intermediary, (v)  Liens created pursuant to the Blocked Account Control Agreement and the Control Agreement,  and (vi) mechanics' liens and other liens arising by operation of law.  "Person" means an individual, partnership, corporation, trust (including a business or  statutory trust), limited liability company, joint stock company, unincorporated association, sole  proprietorship, joint venture, government (or any agency or political subdivision thereof) or other  entity.   "Plan Event" means the occurrence of any of the following:  (i) a notice of intent to  terminate a Pension Plan has been filed; (ii) a Pension Plan termination under Section 4041(f) of  ERISA; (iii) the Pension Benefit Guaranty Corporation institutes proceedings to terminate, or  appoint a trustee to administer any Pension Plan; or (iv) the occurrence of an event or existence  of any condition that might constitute grounds under Section 4042 of ERISA for the termination  of, or the appointment of a trustee to administer, a Pension Plan.  "Pool Balance" means, as of any date of determination, the sum of the Adjusted Principal  Balances of all Receivables as of such date.  





 






28  147032870v2  "Posted Collateral" has the meaning given to such term in Section 6.03(b).  "Prime Rate" means, for any date of determination, the rate of interest most recently  announced by JPMorgan Chase as its prime commercial rate for Dollar-denominated loans made  in the United States.  "Prime Receivable" means a Receivable for which, at the time of underwriting, the  related FICO Score was 700 or greater.  "Prime Serviced Portfolio Receivable" means a Serviced Portfolio Receivable for which,  at the time of underwriting, the related FICO Score was 700 or greater.  "Principal Amount" means, with respect to any Loan, the aggregate amount advanced by  the Lenders on the Funding Date in respect of such Loan.  "Principal Balance" means, for any Receivable as of any date of determination, (i) the  related Amount Financed minus the sum, without duplication, of (a) that portion of all Scheduled  Payments actually received on or prior to such day allocable to principal using the Simple  Interest Method plus (b) any payment of the Release Price with respect to such Receivable  allocable to principal plus (c) any Cram Down Loss in respect of such Receivable plus (d) any  prepayment in full or any partial prepayment applied in reduction of principal of such  Receivable.  "Program Fee" means, for any Collection Period, the fee payable by the Borrower on the  related Payment Date in an amount equal to the product of (i) the Program Fee Rate times (ii) the  average daily Loans Outstanding during such Collection Period funded by Commercial Paper  Notes times (iii) a fraction, (a) the numerator of which is the actual number of days during such  Collection Period and (b) the denominator of which is 360.  "Program Fee Rate" has the meaning given to such term in the Fee Letter.  "Purchase Agreement" means the Amended and Restated Purchase Agreement, dated as  of December 31, 2020, between DFC and the Borrower, together with each Purchase Agreement  Supplement.  "Purchase Agreement Supplement" means a Purchase Agreement Supplement in  substantially the form attached to the Purchase Agreement as Exhibit A, executed by the  Borrower and DFC in connection with a transfer of Receivables and the related Collateral on any  Funding Date.  "Qualified Institution" means any depository institution or trust company organized under  the laws of the United States or any State (or any domestic branch of a foreign bank), (i) (a) that  meets (or the parent of which meets) either (1) the Long-Term Rating Requirement or (2) the  Short-Term Rating Requirement or (b) is otherwise acceptable to the Administrative Agent and  (ii) whose deposits are insured by the Federal Deposit Insurance Corporation.  "Quarterly Report" means a data tape, which shall include as to each Receivable such  information as shall be agreed upon by the Administrative Agent and the initial Servicer or the  





 






29  147032870v2  Successor Servicer, as applicable, including such information as the Administrative Agent may  reasonably request from time to time to satisfy or fulfill regulatory requirements applicable to the  Secured Parties, including capital treatment under Basel II or Basel III.    "Receivable" means Indebtedness owed to DFC or the Borrower by an Obligor (without  giving effect to any pledge hereunder) under a Contract included as part of the Collateral,  whether constituting an account, chattel paper, instrument or general intangible, arising out of or  in connection with the sale of the Financed Vehicle related thereto, and including the right of  payment of any finance charges and other obligations of the Obligor with respect thereto.   Notwithstanding the foregoing, once the Administrative Agent has released its security interest  in a Receivable and the related Contract in accordance with the terms of this Agreement, such  Receivable shall no longer be a Receivable hereunder.  "Receivable File" means a file pertaining to each Receivable containing, among other  things, each of the following documents:    (i) a fully executed original of the related Contract;   (ii) (a) a certificate of insurance, (b) an application form for insurance  signed by the related Obligor, or (c) a signed representation letter from the  Obligor pursuant to which the Obligor has agreed to obtain physical damage  insurance for the related Financed Vehicle;   (iii)  a copy of the application filed to amend the Certificate of Title to  indicate the security interest of DFC in the related Financed Vehicle and, from  and after the time that such Certificate of Title has been so amended, if the  applicable jurisdiction (a) issues original certificates of title, the original  Certificate of Title or, until such original Certificate of Title is available, an  application therefor, or (b) does not issue original certificates of title, a copy of  such Certificate of Title or other equivalent issued by such jurisdiction;  (iv) an electronic copy of the original credit application signed by the  related Obligor;  (v) electronic copies of all original assumption, consolidation,  extension, modification or waiver agreements, if any, relating to such Receivable;  (vi) any other documents that the Servicer shall keep on file, in  accordance with its customary procedures or the Credit and Collection Policy  relating to such Receivable, the related Obligor or the related Financed Vehicle;  and   (vii) electronic copies of any additional original loan documents  evidencing any assumption, consolidation, extension, modification or waiver of  such Receivable.  "Recipient" means the Administrative Agent or any Lender.  





 






30  147032870v2  "Records" means, with respect to any Contract, all documents, books, records and other  information (including computer programs, tapes, disks, punch cards, data processing software  and related property and rights) maintained with respect to any related item of Collateral and the  related Obligor.  "Recoveries" means, with respect to any Defaulted Receivable and Collection Period, all  monies collected from whatever source during such Collection Period in respect of such  Defaulted Receivable, including Insurance Proceeds but excluding payment of the related  Release Price, net of any amounts required by Applicable Law to be remitted to the related  Obligor and net of the Servicer's expenses (other than overhead) incurred in connection with the  liquidation of such Defaulted Receivable and the related Financed Vehicle.  "Registrar of Titles" means, with respect to any State, the governmental agency or body  responsible for the registration of, and the issuance of certificates of title relating to, motor  vehicles and liens thereon.  "Regulatory Requirement" has the meaning set forth in Section 2.10(a).  "Release Price" means an amount equal to the sum of (i) the Principal Balance of each  Receivable retransferred pursuant to Section 5.04(a) or 5.04(b), as applicable plus (ii) accrued  interest on each such Receivable (at the related APR) through the date of repurchase plus (iii) all  related Breakage Costs plus (iv) all Hedge Breakage Costs due to the relevant Hedge  Counterparties for any termination, in whole or in part, of one or more Hedge Transactions  related to the relevant Hedging Agreement, as required by the terms of any Hedging Agreement.  "Reportable Event" means any of the events set forth in Section 4043(c) of ERISA for  which the 30-day notice provision has not been waived.  "Reporting Date" means, with respect to any Payment Date and the related Collection  Period, the second Business Day prior to such Payment Date.  "Required Lenders" means at a particular time, Lenders with aggregate Commitments  equal to 100% of the Aggregate Commitment.  "Required Overcollateralization" means, as of any date, an amount equal to the product of  (i) Weighted Average Overcollateralization Percentage as of such date times (ii) the highest Net  Eligible Pool Balance since the most recent Funding Date or, if more recent, the most recent  Take-out Date, in each case after giving effect to the related additions or removals of  Receivables on such date.  "Required Overcollateralization Percentage" means, as of any date, (i) with respect to  Prime Receivables, either (a) on any date of determination as of which no Step-up Event (Prime)  has occurred and is continuing, 13.00% or (b) on any date of determination as of which a Step-up  Event (Prime) has occurred and is continuing, 18.00%, (ii) with respect to Near Prime  Receivables, either (a) on any date of determination as of which no Step-up Event (Non-Prime)  has occurred and is continuing, 25.50% or (b) on any date of determination as of which as Step- up Event (Non-Prime) has occurred and is continuing, 30.50%, and (iii) with respect to Subprime  Receivables, either (a) on any date of determination as of which no Step-up Event (Non-Prime)  





 






31  147032870v2  has occurred and is continuing, 39.50% or (b) on any date of determination as of which as Step- up Event (Non-Prime) has occurred and is continuing, 44.50%.  "Required Rate" means, as of any date, the sum of (i) the Weighted Average Hedge Rate  as of such date plus (ii) the Program Fee Rate as of such date plus (iii) the Servicing Fee Rate  plus (iv) the Backup Servicing Fee Rate plus (v) the greater of (a) zero percent (0.00%) and (b)  the percentage which will result in Excess Spread (Adjusted) that is at least equal to 3.50%.  "Requirements of Law" means, with respect to any Person, the certificate of  incorporation or articles of association and by-laws or other organizational or governing  documents of such Person, and any law, treaty, rule or regulation, or order or determination of an  arbitrator or Governmental Authority, in each case applicable to or binding upon such Person or  to which such Person is subject, whether federal, State or local (including usury laws, the Federal  Truth in Lending Act, the Equal Credit Opportunity Act, the Fair Credit Billing Act, the Fair  Credit Reporting Act, the Fair Debt Collection Practices Act, the Federal Trade Commission Act,  the Magnuson-Moss Warranty Act, the Servicemembers Civil Relief Act, Regulations B, U, T, X  and Z of the Federal Reserve Board, the Dodd-Frank Act, the Gramm-Leach-Bliley Act, each  applicable state Motor Vehicle Retail Installment Sales Act, and state adaptations of the National  Consumer Act and of the Uniform Consumer Credit Code and all other consumer protection and  usury laws). "Responsible Officer" means, when used with respect to any Person, any officer of such  Person, including any president, vice president, assistant vice president, secretary, assistant  secretary or any other officer thereof customarily performing functions similar to those  performed by the individuals who at the time shall be such officers, respectively, or to whom any  matter is referred because of such officer's knowledge of or familiarity with the particular  subject.  "Revolving Period" means the period commencing on the Closing Date and ending on the  day immediately preceding the Termination Date.  "Sanctioned Country" means, at any time, a country or territory which is the subject or  target of any Sanctions.  "Sanctioned Person" means, at any time, (i) any Person listed in any Sanctions-related list  of designated Persons maintained by the Office of Foreign Assets Control of the U.S.  Department of the Treasury or the U.S. Department of State, (ii) any Person operating, organized  or resident in a Sanctioned Country or (iii) any Person controlled by any such Person.  "Sanctions" means economic or financial sanctions or trade embargoes imposed,  administered or enforced from time to time by the U.S. government, including those  administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or  the U.S. Department of State.  "DFC" has the meaning given to such term in the Preamble.  "Schedule of Documents" means the schedule of documents attached hereto as  Schedule E.  





 






32  147032870v2  "Schedule of Receivables" means the schedule of Receivables attached hereto as  Schedule C, as updated from time to time in connection with each Funding Request and any  Take-out Release.  "Scheduled Payments" means, with respect to each Receivable, the regularly scheduled  payments to be made by the related Obligor pursuant to the terms of the related Contract.  "Secured Party" means (i) the Administrative Agent, (ii) each Lender and (iii) each  Hedge Counterparty.  "Securities Act" means the Securities Act of 1933, as amended.  "Seller" means DFC in its capacity as Seller under the Purchase Agreement.  "Senior Monthly Interest and Fees" means, for any Payment Date, the sum of (i) the  amount of any accrued and unpaid Interest for such Payment Date, calculated at a per annum rate  equal to the related CP Rate, plus (ii) the Program Fee for such Payment Date plus (iii) the  Unused Commitment Fee for such Payment Date.  "Serviced Portfolio" means the Servicer's entire portfolio of motor vehicle retail  installment sale contracts and installment loans that (i) are originated, directly or indirectly, by  DFC in accordance with the Credit and Collection Policy, (ii) are serviced by DFC, (iii) are  owned by DFC or an Affiliate or a Subsidiary of DFC and (iv) satisfy each of the eligibility  requirements set forth on Schedule B hereto; provided, that no motor vehicle retail installment  sale contract or installment loan that was originated upon the direction of a "level 3 underwriter"  in accordance with the Credit and Collection Policy shall be included in the Serviced Portfolio.   For the avoidance of doubt, no motor vehicle retail installment sale contracts or installment loans  that were originated, directly or indirectly, by DFC in accordance with any predecessor set of  credit policies and underwriting guidelines to the Credit and Collection Policy shall not be  included in the Serviced Portfolio.  "Serviced Portfolio Defaulted Receivable" means, as of any date of determination, any  Serviced Portfolio Receivable (i) that has been, or is required to be, treated as "defaulted" in  accordance with the Credit and Collection Policy, (ii) with respect to which the Servicer has  determined in good faith that payments thereunder have ceased and are not likely to be resumed,  (iii) with respect to which the greater of (a) $50 and (b) 10% or more of any Scheduled Payment  remains unpaid for more than 120 days from the related due date, or (iv) for which the related  Financed Vehicle has been repossessed   For purposes of this definition, the "Scheduled  Payment" and "Financed Vehicle" for each Serviced Portfolio Receivable that is not a  Receivable shall be determined as if it were a "Receivable" for purposes of all related defined  terms.   "Serviced Portfolio Deferral Ratio" means, as of any date of determination, the  percentage equivalent of a fraction, (i) the numerator of which is the aggregate Principal Balance  of all Serviced Portfolio Receivables with respect to which a Deferral was granted during the  most recently completed Collection Period and (ii) the denominator of which is the aggregate  Principal Balance of all Serviced Portfolio Receivables as of the last day of such Collection  Period.  For purposes of this definition, the "Principal Balance" for each Serviced Portfolio  





 






33  147032870v2  Receivable that is not a Receivable shall be determined as if it were a "Receivable" for purposes  of all related defined terms.  "Serviced Portfolio Delinquency Ratio" means, as of any date of determination, the  percentage equivalent of a fraction, (i) the numerator of which is the aggregate Principal Balance  of all Serviced Portfolio Delinquent Receivables as of the last day of the most recently  completed Collection Period and (ii) the denominator of which is the aggregate Principal  Balance of all Serviced Portfolio Receivables as of the last day of such Collection Period.  For  purposes of this definition, the "Principal Balance" for each Serviced Portfolio Receivable that is  not a Receivable shall be determined as if it were a "Receivable" for purposes of all related  defined terms.   "Serviced Portfolio Delinquent Receivable" means, as of any date of determination, any  Serviced Portfolio Receivable, (i) with respect to which the greater of (a) $50 and (b) 10% or  more of any Scheduled Payment remains unpaid for 60 or more days from the related due date  and (ii) that is not a Defaulted Receivable.  For purposes of this definition, the "Scheduled  Payment" for each Serviced Portfolio Receivable that is not a Receivable shall be determined as  if it were a "Receivable" for purposes of all related defined terms.   "Serviced Portfolio Net Loss Ratio (Non-Prime)" means, as of any date of determination,  the percentage equivalent of a fraction, (i) the numerator of which is the difference of (a) the  aggregate Principal Balance of all Non-Prime Serviced Portfolio Receivables that became  Serviced Portfolio Defaulted Receivables during the most recently completed Collection Period  minus (b) all Recoveries received with respect to Non-Prime Serviced Portfolio Receivables  during such Collection Period and (ii) the denominator of which is the sum of (a) the aggregate  Principal Balance of all Non-Prime Serviced Portfolio Receivables that became Serviced  Portfolio Defaulted Receivables during such Collection Period plus (b) the amount of Collections  received by the Servicer in respect of principal payments on all Non-Prime Serviced Portfolio  Receivables during such Collection Period.  For purposes of this definition, the "Principal  Balance," "Recoveries" and "Collections" for each Non-Prime Serviced Portfolio Receivable that  is not a Receivable shall be determined as if it were a "Receivable" for purposes of all related  defined terms.  "Serviced Portfolio Net Loss Ratio (Prime)" means, as of any date of determination, the  percentage equivalent of a fraction, (i) the numerator of which is the difference of (a) the  aggregate Principal Balance of all Prime Serviced Portfolio Receivables that became Serviced  Portfolio Defaulted Receivables during the most recently completed Collection Period minus (b)  all Recoveries received with respect to Prime Serviced Portfolio Receivables during such  Collection Period and (ii) the denominator of which is the sum of (a) the aggregate Principal  Balance of all Prime Serviced Portfolio Receivables that became Serviced Portfolio Defaulted  Receivables during such Collection Period plus (b) the amount of Collections received by the  Servicer in respect of principal payments on all Prime Serviced Portfolio Receivables during  such Collection Period.  For purposes of this definition, the "Principal Balance," "Recoveries"  and "Collections" for each Prime Serviced Portfolio Receivable that is not a Receivable shall be  determined as if it were a "Receivable" for purposes of all related defined terms.  





 






34  147032870v2  "Serviced Portfolio Receivable" means any motor vehicle receivable that is included in  the Serviced Portfolio.  "Servicer" has the meaning given to such term in the Preamble.  "Servicer Advance" means an advance made by the initial Servicer pursuant to  Section 7.05.   "Servicer Basic Documents" means all Basic Documents to which the initial Servicer is a  party or by which it is bound.  "Servicer Termination Event" has the meaning given to such term in Section 7.13.  "Servicer Termination Notice" has the meaning given to such term in Section 7.13.  "Servicing Fee" means the fee payable to the Servicer on each Payment Date in  accordance with Section 2.09(b) in an amount equal to either (i) in the case of the initial  Servicer, the product of (a) one-twelfth times (b) the applicable Servicing Fee Rate times (c) the  average daily Principal Balance of the Receivables during the related Collection Period or (ii) in  the case of the Backup Servicer in its capacity as Successor Servicer, the related fees set forth in  the Backup Servicing Agreement; provided, that the Servicing Fee for a Successor Servicer may  be subject to a minimum monthly fee to be mutually agreed upon by the Required Lenders and  such Successor Servicer.   "Servicing Fee Rate" means in the case of the initial Servicer, a rate per annum equal to  2.00%.  "Short-Term Rating Requirement" means, with respect to any Person, that such Person  has a short-term unsecured debt rating of not less than A-1 by Standard & Poor's and not less  than Prime-1 by Moody's.  "Significant Take-out Date" means any Take-out Date on which the Receivables that are  released from the Collateral in accordance with Section 2.12 have an aggregate Adjusted  Principal Balance (i) of at least $40,000,000 and (ii) that represents 80% or more of the Eligible  Pool Balance on such Take-out Date (before giving effect to such Take-out); provided, that if  any Receivables that are so released on a Take-out Date are included in the Collateral again  during the Collection Period in which the related Take-out Date occurred or during either of the  two succeeding Collection Periods, then such Receivables shall be deemed not to have been  released from the Collateral on the initial Take-out Date for purposes of this definition, but only  as of the date on which they are again included in the Collateral.  "Simple Interest Method" means the method of allocating a fixed level payment to  principal and interest, pursuant to which the portion of such payment that is allocated to interest  is equal to the product of the fixed rate of interest multiplied by the unpaid principal balance  multiplied by the period of time elapsed since the preceding payment of interest was made.  "Solvent" means, as to any Person at any time, having a state of affairs such that (i) the  fair value of the property owned by such Person is greater than the amount of such Person's  





 






35  147032870v2  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; (ii) the present  fair salable value of the property owned by 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 as they become absolute and matured; (iii) 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; (iv) 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 (v) such Person is not engaged in business or a transaction, and is not  about to engage in a business or a transaction, for which such Person's property would constitute  unreasonably small capital.  "Standard & Poor's" means S&P Global Ratings, a Standard & Poor's Financial Services  LLC business.  "State" means any state of the United States or the District of Columbia.   "Step-up Event" means the occurrence as of any Reporting Date of any of the following  events::  (i) the arithmetic mean of the Serviced Portfolio Net Loss Ratio  (Prime) for the three previous Collection Periods is greater than 5.00%;   (ii) the arithmetic mean of the Conduit Portfolio Net Loss Ratio  (Prime) for the three previous Collection Periods is greater than 4.00% (provided,  that no Step-up Event will occur under this clause (ii) if a Significant Take-out  Date occurred during any of such three Collection Periods);   (iii) the arithmetic mean of the Serviced Portfolio Net Loss Ratio (Non- Prime) for the three previous Collection Periods is greater than 10.50%;   (iv) the arithmetic mean of the Conduit Portfolio Net Loss Ratio (Non- Prime) for the three previous Collection Periods is greater than 9.50% (provided,  that no Step-up Event will occur under this clause (iv) if a Significant Take-out  Date occurred during any of such three Collection Periods);   (v) the arithmetic mean of the Serviced Portfolio Delinquency Ratio  for the three previous Collection Periods is greater than 3.50%; or  (vi) the arithmetic mean of the Conduit Portfolio Delinquency Ratio for  the three previous Collection Periods is greater than 3.00% (provided, that no  Step-up Event will occur under this clause (vi) if a Significant Take-out Date  occurred during any of such three Collection Periods);  Any Step-up Event that occurs will be deemed to be continuing until the earlier of (a) the  first Reporting Date on which none of the events described above exists or (b) the  effective date of any waiver that is provided by the Consenting Lenders with respect to  the related Step-up Event.  





 






36  147032870v2  "Step-up Event (Non-Prime)" means any Step-up Event described in clause (iii), (iv), (v)  or (vi) of the definition thereof.  "Step-up Event (Prime)" means any Step-up Event described in clause (i), (ii), (v) or (vi)  of the definition thereof.  "Stop-Funding Event" means the occurrence of any of the following:  (i) as of any Reporting Date, the arithmetic mean of the Serviced  Portfolio Delinquency Ratio for the three previous Collection Periods is greater  than 4.50%;  (ii) as of any Reporting Date, the arithmetic mean of the Serviced  Portfolio Net Loss Ratio (Prime) for the three previous Collection Periods is  greater than 6.00%;   (iii) as of any Reporting Date, the arithmetic mean of the Serviced  Portfolio Net Loss Ratio (Non-Prime) for the three previous Collection Periods is  greater than 11.50%; or  (iv) either (a) no Backup Servicing Agreement has been executed and  become effective by the date required by Section 7.09(a) or (b) after the date on  which the Borrower initially enters into a Backup Servicing Agreement, such  Backup Servicing Agreement is thereafter terminated without the consent of the  Required Lenders;   Any Stop-Funding Event that occurs will be deemed to be continuing until the earlier of  (a) either (1) with respect to the Stop-Funding Events set forth in clauses (i), (ii) and (iii),  the first Reporting Date on which none of the events described in such clauses exists or  (2) with respect to the Stop-Funding Event set forth in clause (iv), the first date thereafter  on which a Backup Servicing Agreement becomes effective in accordance with the terms  of this Agreement or (b) the effective date of any waiver that is provided by the Required  Lenders with respect to the related Step-up Event.  "Structuring Fee" has the meaning given to such term in the Fee Letter.  "Subordinated Hedge Breakage Costs" means Hedge Breakage Costs payable by the  Borrower to a Hedge Counterparty in connection with the termination of a Hedge Transaction  where either (i) such Hedge Counterparty is a "Defaulting Party" (as such term is defined in the  related Hedging Agreement) or (ii) such Hedge Counterparty is the sole "Affected Party" with  respect to a "Termination Event" (as such terms are defined in the related Hedging Agreement),  other than a Termination Event relating to illegality, force majeure and taxes, which by its terms  applies to such Hedge Counterparty, in all cases other than to the extent of a return of equivalent  collateral (and income thereon).  "Subordinated Monthly Interest Payment Amount" means, for any Payment Date, the  difference of (i) the sum of (a) the amount of any accrued and unpaid Interest for such Payment  





 






37  147032870v2  Date, calculated pursuant to Section 2.07 plus (b) the Program Fee, if applicable, plus (c) the  Unused Commitment Fee, if applicable, minus (ii) the Senior Monthly Interest and Fees.  "Subprime Receivable" means a Receivable for which, at the time of underwriting, the  related FICO Score was (i) less than 620 (including a FICO Score of zero) or (ii) there was no  FICO Score.  "Subsequent Loan" means each Loan made following the Initial Loan.  "Subsequent Receivable" means each Receivable that becomes a part of the Collateral on  a Funding Date other than the Funding Date relating to the Initial Loan.  "Subsidiary" means, with respect to a Person, any entity with respect to which more than  50% of the outstanding voting securities shall at any time be owned or controlled, directly or  indirectly, by such Person and/or one or more of its Subsidiaries, or any similar business  organization which is so owned or controlled.  "Successor Servicer" has the meaning given to such term in Section 7.14(b).  "Supplemental Loan Amount" means, as of any Funding Date, the amount by which the  portion of the Loans Outstanding funded by a Lender Group, after giving effect to the requested  Loan on such Funding Date, exceeds the greater of (i) its Mandatory Commitment and (ii) the  highest amount of the Loans Outstanding funded by such Lender Group on any prior date.  "Supplemental Structuring Fee" means the fee payable by the Borrower on the related  Funding Date in an amount equal to the product of (i) the Supplemental Structuring Fee Rate and  (ii) the Supplemental Loan Amount.  "Supplemental Structuring Fee Rate" has the meaning given to such term in the Fee  Letter.  "Take-out" means any transaction pursuant to which all or a portion of the Receivables  are released from the Lien granted to the Administrative Agent hereunder, a corresponding  portion of the Loans Outstanding are repaid, and such Receivables are transferred by the  Borrower to the Seller or another Person.  "Take-out Date" means the date upon which a Take-out is consummated.  "Take-out Date Certificate" means a certificate delivered by a Responsible Officer of the  Servicer on the Take-out Date indicating that the requirements set forth in this Agreement for a  Take-out has been satisfied.  "Take-out Release" means a release executed pursuant to Section 2.12, substantially in  the form of Exhibit E.   "Tangible Net Worth" means at any time with respect to DFC, the difference of DFC's (i)  assets minus (ii) liabilities minus (iii) without duplication, intangible assets, including goodwill,  





 






38  147032870v2  franchises, licenses, deferred tax assets, patents, trademarks, trade names, copyrights and service  marks, in all cases calculated on a consolidated basis and in accordance with GAAP. "Tax" or "Taxes" means all present or future taxes, levies, imposts, duties, deductions,  withholdings (including backup withholding), assessments, fees or other charges imposed by any  Governmental Authority, including any interest, additions to tax, additional amounts or penalties  applicable thereto.  "Termination Date" means the earliest to occur of (i) the occurrence of the latest  Commitment Termination Date, (ii) the Business Day designated by the Borrower to the Lenders  as the Termination Date at any time following 30 days' prior written notice, (iii) the date on  which a Servicer Termination Event occurs, (iv) the date on which the Termination Date either  automatically occurs or is declared, as applicable, following the occurrence of a Termination  Event and pursuant to Section 8.01(b) or (v) the date on which an Early Amortization Event  occurs.    "Termination Event" has the meaning given to such term in Section 8.01(a).  "Transition Expenses" has the meaning given to such term in Section 7.14(f).  "U.S. Person" means any Person that is a "United States person" as defined in Section  7701(a)(30) of the Code.  "U.S. Tax Compliance Certificate" has the meaning specified in Section 2.11(g)(ii)(B)(3).  "UCC" means the Uniform Commercial Code as from time to time in effect in the  applicable jurisdiction.  "United States" or "U.S." means the United States of America.  "Unmatured Servicer Termination Event" means any event that, with the giving of notice  or the lapse of time, or both, would become a Servicer Termination Event.  "Unmatured Termination Event" means any event that, with the giving of notice or the  lapse of time, or both, would become a Termination Event.  "Unreimbursed Servicer Advances" means, at any time, the amount of all previous  Servicer Advances (or portions thereof) as to which the Servicer has not been reimbursed as of  such time pursuant to Section 2.06.  "Unused Commitment Fee" means, for any Interest Period prior to the commencement of  the Amortization Period, the fee payable by the Borrower on the related Payment Date in an  amount equal to product of (i) the Unused Commitment Fee Rate times (ii) an amount equal to  the positive difference, if any, of (a) the average daily Aggregate Mandatory Commitment during  such Interest Period minus (b) the average daily Loans Outstanding during such Interest Period  times (iii) a fraction, (A) the numerator of which is the actual number of days during such  Interest Period and (B) the denominator of which is 360.   





 






39  147032870v2  "Unused Commitment Fee Rate" has the meaning given to such term in the Fee Letter.   "Used Vehicle" means a Financed Vehicle that (i) has an odometer reading of 500 miles  or greater, (ii) is a vehicle model that is more than two years old or (iii) was owned by and titled  in the name of any Person (other than Lithia or DFC).  "Weighted Average Hedge Rate" means, as of any date of determination, either (i) if the  Borrower is party to one or more Hedge Transactions on such date (after giving effect to any  Hedge Transactions that the Borrower enters into or terminates on such date), the weighted  average for all such Hedge Transactions (weighted by the notional amounts of such Hedge  Transactions) of (a) with respect to any Hedge Transaction that is in the form of an interest rate  cap transaction, the threshold rate above which payments are made by the related Hedge  Counterparty to the Borrower, and (b) with respect to any Hedge Transaction that is in the form  of an interest rate swap transaction, the fixed rate payable by the Borrower thereunder or (ii) if  the Borrower is not party to any Hedge Transactions on such date (after giving effect to any  Hedge Transactions that the Borrower enters into or terminates on such date), the Adjusted  Eurodollar Rate for such date.  "Weighted Average Overcollateralization Percentage" means, as of any date of  determination, the percentage equivalent of a fraction, (i) the numerator of which equals the sum  of (a) the product of (1) the applicable Required Overcollateralization Percentage with respect to  Prime Receivables as of such date times (2) the aggregate Adjusted Principal Balance of all  Prime Receivables that are Eligible Receivables as of such date plus (b) the product of (1) the  applicable Required Overcollateralization Percentage with respect to Near Prime Receivables as  of such date times (2) the aggregate Adjusted Principal Balance of all Near Prime Receivables as  that are Eligible Receivables of such date plus (c) the product of (1) the applicable Required  Overcollateralization Percentage with respect to Subprime Receivables as of such date times (2)  the aggregate Adjusted Principal Balance of all Subprime Receivables that are Eligible  Receivables as of such date, and (ii) the denominator of which is equal to the Eligible Pool  Balance as of such date.  "Withholding Agent" means the Borrower and the Administrative Agent.   Section 1.02.  Accounting Terms and Determinations.  Unless otherwise defined or  specified herein, all accounting terms shall be construed herein, all accounting determinations  hereunder shall be made, all financial statements required to be delivered hereunder shall be  prepared and all financial records shall be maintained in accordance with GAAP.  Section 1.03.  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 1.04.  Interpretation.  When used in this Agreement, unless a contrary intention  appears:  (i) a term has the meaning assigned to it; (ii) "or" is not exclusive; (iii) "including"  means including without limitation; (iv) words in the singular include the plural and words in the  plural include the singular; (v) any agreement, instrument or statute defined or referred to herein  or in any instrument or certificate delivered in connection herewith means such agreement,  





 






40  147032870v2  instrument or statute as from time to time amended, modified or supplemented and includes (in  the case of agreements or instruments) references to all attachments thereto and instruments  incorporated therein; (vi) references to a Person are also to its successors and permitted assigns;  (vii) the words "hereof", "herein" and "hereunder" and words of similar import when used in this  Agreement shall refer to this Agreement as a whole and not to any particular provision hereof;  (viii) references contained herein to Section, Schedule and Exhibit, as applicable, are references  to Sections, Schedules and Exhibits in this Agreement unless otherwise specified; (ix) references  to "writing" include printing, typing, lithography and other means of reproducing words in a  visible form; and (x) the term "proceeds" has the meaning set forth in the applicable UCC.  LOANS  Section 2.01.  Loans.  (a) On the terms and conditions set forth herein, including this Section and  Article Four, the Borrower may from time to time on any Business Day during the Revolving  Period on which no Stop-Funding Event exists, request that each Lender make an advance (the  aggregate amount of such advances on a Funding Date, a "Loan") in the amount of each such  Lender's Lender Advance, to the Borrower on a Funding Date.  Any such Loan may be made by  a Conduit Lender in its sole discretion, and if not made by such Conduit Lender, either (i) shall  be made by the related Committed Lender, to the extent that such Loan would not cause the  portion of the Loans Outstanding funded by such Lender Group, determined after giving effect to  such funding, to exceed its Mandatory Commitment, or (ii) may be made by the related  Committed Lender in its sole discretion, to the extent that such Loan would cause the portion of  the Loans Outstanding funded by such Lender Group, determined after giving effect to such  funding, to exceed its Mandatory Commitment but be less than or equal to its Commitment.  For  the avoidance of doubt, neither any Conduit Lender nor any related Committed Lender shall  have any obligation on any date to fund an amount that would cause its Lender Percentage of the  Loans Outstanding, determined after giving effect to such funding, to exceed its Mandatory  Commitment.  (b) No later than 3:00 p.m., New York City time, two Business Days prior to a  proposed Funding Date, the Borrower shall notify the Administrative Agent and the Agents of  such proposed Funding Date and Loan by delivering to the Administrative Agent and the Agents  (with a copy to the Account Bank):  (i) a Funding Request, which will include, among other things,  the proposed Funding Date, a calculation of the Borrowing Base as of the date the  Loan is requested (including all components of such calculation, including any Excess  Concentration Amounts) and the Principal Amount of the Loan requested, which shall  be in an amount at least equal to $1,000,000 or integral multiples of $100,000 in  excess thereof (or, if less, an amount equal to the Aggregate Commitment after giving  effect to any payments on the related Payment Date if the Funding Date occurs on a  Payment Date); and   





 






41  147032870v2  (ii) an updated Schedule of Receivables that includes each  Receivable that is the subject of the proposed Loan.  (c) Following receipt by the Administrative Agent and the Agents of a Funding  Request, and prior to the Termination Date, each Lender Group severally agrees to make its  Lender Advance of any Loan requested by the Borrower pursuant to Section 2.01(b), subject to  the conditions contained herein, in an aggregate amount equal to the Loan so requested.  (d) In no event shall:  (i) a Lender be required to fund a Principal Amount that would  cause its Lender Percentage of the Loans Outstanding, determined after giving effect  to such funding, to exceed its Mandatory Commitment; provided, that any Lender may  elect, in its sole discretion, to fund any such Principal Amount;  (ii)  a Lender be required on any date to fund a Principal  Amount that would cause its Lender Percentage of the Loans Outstanding, determined  after giving effect to such funding, to exceed its Commitment;  (iii) any Loan be requested hereunder, nor shall any Lender be  obligated to fund its Lender Advance of any Loan, to the extent that after giving effect  to such Loan, the Loans Outstanding would exceed the Borrowing Base;  (iv) the Principal Amount of any Loan exceed the Available  Amount on such day; and  (v) more than one Loan be funded on any Business Day.  Section 2.02.  Funding Mechanics.  (a) If any Funding Request is delivered to the Administrative Agent and the Agents  after 3:00 p.m., New York City time, two Business Days prior to the proposed Funding Date,  such Funding Request shall be deemed to be received prior to 3:00 p.m., New York City time, on  the next succeeding Business Day and the proposed Funding Date of such proposed Loan shall  be deemed to be the second Business Day following the date of such deemed receipt.  Each  Funding Request shall include a representation by the Borrower that (i) the requested Loan will  not, on the related Funding Date, exceed the Available Amount and (ii) all conditions precedent  to the making of such Loan have been satisfied or will be satisfied as of the proposed Funding  Date.  Any Funding Request shall be irrevocable.  (b) Each Lender's Lender Advance of a Loan shall be made available to the Agent for  its Lender Group, subject to the fulfillment of the applicable conditions set forth in Article Four,  at or prior to 1:00 p.m., New York City time, on the applicable Funding Date, by deposit of  immediately available funds to the Administrative Agent's Account.  The Administrative Agent  shall promptly notify the Borrower and the related Agent in the event that any Lender Group  either fails to make such funds available before such time or notifies the Administrative Agent  that it will not make such funds available before such time.  Subject to the fulfillment of the  applicable conditions set forth in Article Four, as determined by the Administrative Agent, the  





 






42  147032870v2  Administrative Agent will not later than 3:00 p.m., New York City time, on such Funding Date  make all such funds deposited to the Administrative Agent's Account by the Agents available, in  the same type of funds received, by wire transfer thereof to the Borrower's Account.  If any  Lender Group makes available to the Administrative Agent funds for any Loan to be made by  such Lender Group as provided in the foregoing provisions of this Article, and such funds are not  made available to the Borrower by the Administrative Agent because the conditions to the  applicable Loan set forth in Article Four are not satisfied or waived in accordance with the terms  hereof, the Administrative Agent shall return such funds (in like funds as received from such  Lender) to the related Agent for such Lender Group, without interest.   (c) The failure of any Lender to make any Loan required to be made by it shall not  relieve any other Lender of its obligations hereunder; provided, that the Commitments of the  Lender Groups are several and no Lender Group shall be responsible for any other Lender  Group's failure to make Loans as required.  Section 2.03.  Reduction of Commitments.  (a) At any time the Borrower may, upon at least five Business Days' prior written  notice to the Administrative Agent, each Agent, the Account Bank and each Hedge  Counterparty, reduce the Facility Amount to an amount not less than the Loans Outstanding,  which reduction shall be applied, unless otherwise Consented to by the Administrative Agent and  the Agents, to the Commitments of each Lender pro rata based on the Lender Percentage  represented by such Commitment.  Any such reduction of the Commitment of any Lender shall  also reduce the related Mandatory Commitment of such Lender by the same amount.  If any such  written notice is delivered after 3:00 p.m., New York City time, five Business Days prior, such  notice shall be deemed to be received prior to 3:00 p.m., New York City time, on the next  succeeding Business Day.  Each partial reduction shall be in a minimum aggregate amount of  $5,000,000 or integral multiples of $1,000,000 in excess thereof.  Any request for a reduction in  the Facility Amount shall be irrevocable and the Borrower shall deliver no more than four such  requests in any 12-month period.  (b) In connection with any reduction of the Facility Amount, the Borrower shall remit  to the Administrative Agent and the Agents, for payment to each Lender, (i) instructions  regarding such reduction and (ii) cash in an amount sufficient to pay any Aggregate Unpaids  with respect to such reduction, including any associated Breakage Costs; provided, that no such  reduction shall be given effect unless the Borrower has complied with the terms of any Hedging  Agreement requiring that one or more Hedge Transactions be terminated in whole or in part as a  result of any such reduction in the Loans Outstanding and the Borrower has paid all Hedge  Breakage Costs due to the relevant Hedge Counterparty for any such termination.  Upon receipt  of any such amounts, the Administrative Agent and Agents shall apply such amounts first to the  pro rata reduction of the Loans Outstanding, second to the payment of the remaining Aggregate  Unpaids with respect thereto, including any Breakage Costs, by paying such amounts to the  Lenders pro rata, based on their respective Lender Percentages.  (c) On the Commitment Termination Date for a Committed Lender, the Mandatory  Commitment and the Commitment of such Committed Lender shall be automatically reduced to  zero.  On the Termination Date, the Mandatory Commitments and the Commitments of all  





 






43  147032870v2  Committed Lenders shall be automatically reduced to zero; provided, that if the Termination  Date occurs solely due to the occurrence of an Early Amortization Event and all Lenders have  consented to the waiver of such Early Amortization Event, then the Mandatory Commitments  and the Commitments of all Committed Lenders shall remain at their levels immediately prior to  the occurrence of such Early Amortization Event.   Section 2.04.  Extensions of Commitments.  (a) Neither more than 120 days nor fewer than 60 days prior to any Commitment  Termination Date, the Borrower may request in writing to the related Agent on behalf of its  related Lender Group (with a copy to the Administrative Agent), that the related Committed  Lender extend its Commitment Termination Date for an additional 364-day period as herein  provided, which request will be granted or denied by each Lender Group in its sole discretion.   Upon receipt of any such request, the related Agent shall notify each Committed Lender in its  Lender Group.  On or before the last day of the Election Period, the related Committed Lender  shall notify the Agent for its Lender Group of its willingness or refusal to so extend its  Commitment Termination Date; provided, that the failure of any Committed Lender to respond  prior to the last day of the Election Period shall be deemed to be its refusal to so extend the  Commitment Termination Date.  The Agent for such Lender Group shall notify the Borrower  and the Administrative Agent of such willingness or refusal by the Committed Lender not later  than the Business Day following the last day of the Election Period.  If (i) the Committed Lender  in a Lender Group has agreed to extend the related Commitment Termination Date and (ii) as of  the Commitment Termination Date then in effect, no Termination Event shall have occurred and  be continuing, the Commitment Termination Date then in effect for each such Committed Lender  that has agreed to extend the Commitment Termination Date shall be extended to the date which  is 364 days following the Commitment Termination Date then in effect or, if such day is not a  Business Day, the next preceding Business Day (or to any other date as agreed upon by the  Borrower and each Committed Lender).   (b) Within two Business Days following the end of an Election Period, the Agent for  each Lender Group shall notify each other Lender in such Lender Group, the Administrative  Agent and the Borrower of the identity of any Non-Extending Lender and the amount of its  Commitment.  The Administrative Agent and the Borrower may (but shall not be required to)  request one or more other Committed Lenders to acquire all or a portion of the Commitment of  the Non-Extending Lender and all amounts payable to it hereunder in accordance with  Article Eleven on or prior to the related Commitment Termination Date of such Non-Extending  Lender.  Each Non-Extending Lender hereby agrees to assign all or a portion of its Commitment  and the amounts payable to it hereunder to a replacement Committed Lender identified in  accordance with the preceding sentence, subject to ratable payment of such Non-Extending  Lender's Invested Percentage of the Loans Outstanding, together with all accrued and unpaid  interest thereon, and a ratable portion of all fees and other amounts due to it hereunder.  (c) Prior to the occurrence of the Termination Date, if a Partial Expiration Event has  occurred, the Administrative Agent shall give notice to the Borrower and the Servicer to apply  any Collections in accordance with Section 2.06(vii)(B), except as otherwise provided in  Section 2.06, pro rata to the repayment of such amounts owing to any Non-Extending Lender as  of the date of the related Partial Expiration Event, commencing no later than the first Payment  





 






44  147032870v2  Date which is at least two Business Days following the Commitment Termination Date for the  Non-Extending Lender, specifying the amounts thereof.  Section 2.05.  Payments.  (a) The Borrower shall pay Interest on the unpaid Principal Amount of each Loan for  the period from the related Funding Date until the date that such Loan shall be paid in full.   Interest shall accrue during each Interest Period and be payable on the Loans Outstanding on  each Payment Date in accordance with Section 2.06.    (b) Prior to the declaration of the occurrence of the Termination Date pursuant to  Section 8.01(b), (i) the portion of the Loans Outstanding that is funded or maintained by a  Conduit Lender by issuing Commercial Paper Notes shall accrue interest on each day during the  related Interest Period at a rate per annum equal to such Conduit Lender's CP Rate for such  Interest Period and (ii) the portion of the Loans Outstanding that is funded or maintained either  (A) by a Conduit Lender other than by issuing Commercial Paper Notes or (B) by a Committed  Lender, shall accrue interest on each day during the related Interest Period at a rate per annum  equal to the Committed Lender Rate for such Committed Lender for such day.  After the  declaration of the occurrence of the Termination Date pursuant to Section 8.01(b), each Lender's  Invested Percentage of the Loans Outstanding shall accrue Interest on each day during the related  Interest Period at a per annum rate equal to the Default Rate for such day.    (c) If prior to the commencement of any Interest Period (i) the Administrative Agent  determines (which determination shall be conclusive absent manifest error) that adequate and  reasonable means do not exist for ascertaining LIBOR (including, without limitation, because  LIBOR is not available or published on a current basis) for such Interest Period, or (ii) any  Lender notifies the Agent for its Lender Group and the Administrative Agent that LIBOR for  such Interest Period will not adequately and fairly reflect the cost to such Lender of making or  maintaining all or any portion of its Invested Percentage, then the Administrative Agent shall  give notice thereof to the Borrower and all Lenders by telephone or telecopy as promptly as  practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders  that the circumstances giving rise to such notice no longer exist, then the Administrative Agent  shall suspend the availability of LIBOR and any portion of the Loans Outstanding that would  otherwise accrue Interest for the related Interest Period at the Adjusted Eurodollar Rate or the  Committed Lender Rate will instead accrue Interest for the related Interest Period at the  Alternate Base Rate and (B) the Alternate Base Rate for such Interest Period shall be calculated  for all purposes without giving effect to clause (c) of the definition thereof.     If at any time the Administrative Agent determines (which determination shall be conclusive  absent manifest error) that (1) the circumstances set forth in clause (i) of the immediately  preceding paragraph have arisen and such circumstances are unlikely to be temporary or (2) the  circumstances set forth in clause (i) of the immediately preceding paragraph have not arisen but  either (A) the supervisor for the administrator of LIBOR has made a public statement that the  administrator of LIBOR is insolvent (and there is no successor administrator that will continue  publication of LIBOR), (B) the administrator of LIBOR has made a public statement identifying  a specific date after which LIBOR will permanently or indefinitely cease to be published by it  (and there is no successor administrator that will continue publication of LIBOR), (C) the  





 






45  147032870v2  supervisor for the administrator of LIBOR has made a public statement identifying a specific  date after which LIBOR will permanently or indefinitely cease to be published or (D) the  supervisor for the administrator of LIBOR or a Governmental Authority having jurisdiction over  the Administrative Agent has made a public statement identifying a specific date after which  LIBOR may no longer be used for determining interest rates for loans, then the Administrative  Agent and the Borrower shall endeavor to establish an alternate rate of interest to LIBOR that  gives due consideration to the then prevailing market convention for determining a rate of  interest for syndicated loans in the United States at such time, and shall enter into an amendment  to this Agreement to reflect such alternate rate of interest and such other related changes to this  Agreement as may be applicable; provided, that if such alternate rate of interest as so determined  would be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement.   Until an alternate rate of interest shall be determined in accordance with this paragraph (but, in  the case of the circumstances described in clause (A), (B) or (C) of the first sentence of this  paragraph), only to the extent LIBOR is not available or published at such time on a current  basis), any portion of the Loans Outstanding that would otherwise accrue Interest for the related  Interest Period at the Adjusted Eurodollar Rate or the Committed Lender Rate will instead accrue  Interest for the related Interest Period at the Alternate Base Rate and (B) the Alternate Base Rate  for such Interest Period shall be calculated for all purposes without giving effect to clause (c) of  the definition thereof.  The Interest on certain portions of the Loans Outstanding hereunder is determined by reference  to LIBOR, which is derived from the London interbank offered rate.  The London interbank  offered rate is intended to represent the rate at which contributing banks may obtain short-term  borrowings from each other in the London interbank market.  In July 2017, the U.K. Financial  Conduct Authority announced that, after the end of 2021, it would no longer persuade or compel  contributing banks to make rate submissions to the ICE Benchmark Administration (together  with any successor to the ICE Benchmark Administrator, the "IBA") for purposes of the IBA  setting the London interbank offered rate. As a result, it is possible that commencing in 2022, the  London interbank offered rate may no longer be available or may no longer be deemed an  appropriate reference rate upon which to determine the interest rate on loans. In light of this  eventuality, public and private sector industry initiatives are currently underway to identify new  or alternative reference rates to be used in place of the London interbank offered rate. In the  event that the London interbank offered rate is no longer available or in certain other  circumstances as set forth in this Section 2.05(c), this Section provides a mechanism for  determining an alternative rate of interest.  However, the Administrative Agent does not warrant  or accept any responsibility for, and shall not have any liability with respect to, the  administration, submission or any other matter related to the London interbank offered rate or  other rates in the definition of “LIBOR” or with respect to any alternative or successor rate  thereto, or replacement rate thereof, including without limitation, whether the composition or  characteristics of any such alternative, successor or replacement reference rate, will be similar to,  or produce the same value or economic equivalence of, LIBOR or have the same volume or  liquidity as did the London interbank offered rate prior to its discontinuance or unavailability.  (d) The principal of and Interest on the Loans shall be paid as provided herein.  In the  case of Loans owned by an Agent as agent for its Lender Group, such Agent shall allocate to the  members of its Lender Group each payment in respect of the Loans received by such Agent as  provided herein.  All payments made hereunder in respect of principal and Interest shall be  





 






46  147032870v2  allocated and applied to Owners of each Loan based on their respective Invested Percentages, or  in any such case in such other proportions as each affected Lender may agree upon in writing  from time to time with the related Agent and the Borrower; provided, that from and after the  Commitment Termination Date for each Non-Extending Lender until the earlier to occur of (i)  the Termination Date and (ii) the date on which the aggregate amount of payments in reduction  of Loans Outstanding made after the date of the occurrence of the related Partial Expiration  Event equals the Partial Expiration Event Amount, except as otherwise provided in Section 2.06,  payments pursuant to Section 2.06(vii)(B) in reduction of the Partial Expiration Event Amount  shall be allocated and applied to Non-Extending Lenders pro rata based on their respective  Lender Percentages as of the date of the related Partial Expiration Event.  (e) At or before 3:00 p.m., New York City time, on the fifth Business Day of each  calendar month, (i) each Conduit Lender shall notify the Agent for its Lender Group of (A) its  CP Rate for the related Interest Period, and (B) if applicable, the date on which the Alternate  Base Rate or the Committed Lender Rate became applicable to its Invested Percentage of the  Loans Outstanding or a portion thereof and (ii) each Committed Lender shall notify the Agent  for its Lender Group of (A) its Committed Lender Rate for the related Interest Period and (B) if  applicable, the date on which the Alternate Base Rate became applicable to its Invested  Percentage of the Loans Outstanding or a portion thereof.  At or before 5:00 p.m., New York  City time, on the fifth Business Day of each calendar month, the Agents shall then notify the  Borrower and the Administrative Agent of all such rates.  For such purposes, the Agents may  rely conclusively on notices from Lenders as to the interest rate or rates from time to time  applicable to their respective Invested Percentage of the Loans Outstanding.  Each determination  by a Conduit Lender of its applicable CP Rate and each determination by a Committed Lender of  its Committed Lender Rate pursuant to this Agreement shall be conclusive and binding on the  Lenders, each Agent, the Borrower, the Servicer, the Backup Servicer and the Collateral  Custodian, in the absence of manifest error.  (f) Notwithstanding any other provision of this Agreement or the other Basic  Documents, if at any time the rate of interest payable by any Person under the Basic Documents  exceeds the Maximum Lawful Rate, then, so long as the Maximum Lawful Rate would be  exceeded, such rate of interest shall be equal to the Maximum Lawful Rate.  If at any time  thereafter the rate of interest so payable is less than the Maximum Lawful Rate, such Person  shall continue to pay Interest 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 so payable.  In no event shall the total Interest  received by a Lender under this Agreement and the other Basic Documents exceed the amount  which such Lender could lawfully have received, had the Interest due been calculated from the  Closing Date at the Maximum Lawful Rate.  Section 2.06.  Settlement Procedures.  On each Payment Date, the Servicer shall instruct  the Account Bank to pay, to the following Persons, from the Collection Account to the extent of  Available Funds the following amounts in the following order of priority, as set forth in the  related Monthly Report: (i) First, to the Servicer, an amount equal to any Unreimbursed  Servicer Advances, to the extent not previously retained by the Servicer;  





 






47  147032870v2  (ii) Second, to the Backup Servicer, the Backup Servicing Fee,  any out-of-pocket expenses that are reimbursable to the Backup Servicer pursuant to  the Backup Servicing Agreement (including any Transition Expenses, but only if the  Backup Servicer is not the Successor Servicer), and any indemnifiable amounts due to  the Backup Servicer; provided, that Transition Expenses payable to the Backup  Servicer pursuant to this clause may not exceed $100,000 in any calendar year;  (iii) Third, pro rata (A) to the Servicer (including any  Successor Servicer), the accrued and unpaid Servicing Fee and all Ancillary Fees to  the extent not previously retained by the Servicer and (B) to any Successor Servicer,  any out-of-pocket expenses and indemnities due to the Successor Servicer; provided,  that aggregate amounts payable to any Successor Servicer pursuant to this clause may  not exceed $100,000 in any calendar year;  (iv) Fourth, pro rata (A) to each Hedge Counterparty (based on  amounts due to each Hedge Counterparty pursuant to this subclause), any net  payments due and payable under the related Hedging Agreement (other than Hedge  Breakage Costs), and (B) to each Agent (based on amounts due to the members of  each Lender Group pursuant to this subclause), for further payment to each related  Lender, an amount equal to the sum of (1) the portion of Senior Monthly Interest and  Fees due to members of the related Lender Group plus (2) any Breakage Costs of any  related Lender; (v) Fifth, pro rata (A) to each Hedge Counterparty that has any  due and payable Hedge Breakage Costs (other than Subordinated Hedge Breakage  Costs), such Hedge Breakage Costs, and (B) to each Agent (based on Lender  Percentage) for further payment to each related Lender, the Monthly Principal  Payment Amount;  (vi) Sixth, if the Termination Date has not occurred but a Partial  Expiration Event has occurred, pro rata to each Agent for a Lender Group that  includes a Non-Extending Lender (based on the Loans Outstanding to each such Non- Extending Lender) for further payment to each related Non-Extending Lender, an  amount equal to the product of (A) such Non-Extending Lender's Invested Percentage  as of its Commitment Termination Date times (B) all remaining Available Funds until  the portion of the Loan Outstanding owned by such Non-Extending Lender is reduced  to zero;  (vii) Seventh, pro rata to each Agent (based on the amount of  the Subordinated Monthly Interest Payment Amount due to members of the related  Lender Group), for further payment to each related Lender, the Subordinated Monthly  Interest Payment Amount;  (viii) Eighth, pro rata to each Hedge Counterparty that has any  due and payable Subordinated Hedge Breakage Costs (based on such amounts due),  such Subordinated Hedge Breakage Costs;  





 






48  147032870v2  (ix) Ninth, pro rata to each Agent (based on such amounts due)  for further payment to the related Lender or the related Indemnified Parties, all other  Aggregate Unpaids (other than the principal amount of the Loans Outstanding) then  due to the Lenders and Indemnified Parties under this Agreement;   (x) Tenth, pro rata (based on such amounts due) to the Backup  Servicer and the Successor Servicer, any fees, expenses (including Transition  Expenses) and indemnities not paid pursuant to clauses (ii) or (iii), above, as  applicable; and   (xi) Eleventh, any remaining amount shall be distributed to, or  as otherwise directed by, the Borrower.    Section 2.07.  Payments, Computations, Etc.  (a) Unless otherwise expressly provided herein, all amounts to be paid or deposited  by the Borrower hereunder shall be paid or deposited in accordance with the terms hereof no  later than 3:00 p.m., New York City time, on the day when due in Dollars in immediately  available funds to the Administrative Agent's account, for further payment by the Administrative  Agent to the Persons to who such amounts are due and payable.  (b) Whenever any payment hereunder (i) 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, except in the  case where the next succeeding Business Day would occur in the succeeding calendar month, in  which case such payment shall be due on the preceding Business Day or (ii) is received after  3:00 p.m., New York City time, such payment shall be deemed to have been received on the next  succeeding Business Day, and any such extension of time shall in such case be included in the  computation of payment of Interest, other interest or any fee payable hereunder, as the case may  be.  (c) If any Loan requested by the Borrower and approved by a Lender and the  Administrative Agent pursuant to Section 2.01 is not, for any reason other than due to the fault of  an Agent, a Lender or the Administrative Agent, made or effectuated, as the case may be, on the  date specified therefor, the Borrower shall indemnify such Lender against any reasonable loss,  cost or expense incurred by such Lender, including any loss (including loss of anticipated profits,  net of anticipated profits in the reemployment of such funds in the manner determined by such  Lender), cost or expense incurred by reason of the liquidation or reemployment of deposits or  other funds acquired by such Lender to fund or maintain such Loan.  (d) All payments hereunder shall be made without set-off or counterclaim and in such  amounts as may be necessary in order that all such payments shall not be less than the amounts  otherwise specified to be paid under this Agreement.  (e) To the extent that (i) any Person makes a payment to the Borrower, the  Administrative Agent, the Servicer, the Backup Servicer, the Collateral Custodian or any Lender  or Agent or (ii) the Borrower, the Administrative Agent, the Servicer, the Backup Servicer, the  Collateral Custodian or any Lender or Agent receives or is deemed to have received any payment  or proceeds for application to an obligation, which payment or proceeds or any part thereof are  





 






49  147032870v2  subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be  repaid to a trustee, receiver or any other party under any Insolvency Law, State or federal law,  common law or for equitable cause, then, to the extent such payment or proceeds are set aside,  the obligation or part thereof intended to be satisfied shall be revived and continue in full force  and effect, as if such payment or proceeds had not been received or deemed received by the  Borrower, the Administrative Agent, the Servicer, the Backup Servicer, the Collateral Custodian  or any Lender or Agent, as the case may be.  Section 2.08.  Collections and Allocations; Investment of Funds.  (a) On or before the applicable Funding Date, the Borrower or the Servicer shall  direct and instruct all related Obligors to make payments in respect of the related Receivables  that are made (i) by mail to be made directly to the Lockboxes and (ii) by electronic payments to  be made to the Lockbox Account.   (b) The Servicer shall instruct the Lockbox Bank to remove all Collections from the  Lockbox Account and deposit such amounts into the Collection Account within two Business  Days.  The Servicer and the Borrower shall deposit all other Collections to the Collection  Account as soon as practicable, but in no event later than two Business Days after receipt  thereof, all other Collections, and at all times prior to such remittance, the Servicer shall hold the  same in trust for the benefit of the Administrative Agent.  Notwithstanding the foregoing, the  Servicer shall be permitted to make all deposits in accordance with Section 7.03(c)(v) whenever  the conditions set forth in that Section are satisfied.  (c) The initial Servicer shall have access to the Lockbox Account at all times until the  occurrence of a Termination Event and the delivery by the Administrative Agent of a shifting  control or similar notice under the Blocked Account Control Agreement, following which time  the Administrative Agent shall have the exclusive right to give instructions to the Lockbox  Account Bank directing the disposition of funds on deposit in the Lockbox Account, without  further consent by the Borrower.  The Servicer shall be entitled to retain and to reimbursement of  all amounts remitted by or on behalf of the Obligors to the Servicer under the terms of, or with  respect to, the related Receivables, that represent Ancillary Fees.  (d) To the extent there are uninvested amounts on deposit in the Collection Account,  such amounts shall be invested in Permitted Investments that mature no later than the Business  Day before the next Payment Date, which Permitted Investments shall be selected (i) prior to the  occurrence of any Termination Event, by the Borrower or (ii) from and after the occurrence of  any Termination Event, by the Administrative Agent.  Absent the written instruction of the  Borrower or the Administrative Agent, the Account Bank shall invest funds on deposit in the  Collection Account in Permitted Investments described in clause (v) of the definition thereof.   No Permitted Investment may be purchased at a premium.  Any earnings (and losses) on the  foregoing investments shall be for the account of the Borrower.   Section 2.09.  Fees.  (a) The Borrower hereby agrees to pay to each Agent, to the extent of Available  Funds, for the account of the related Lenders, monthly in arrears, the Unused Commitment Fee  





 






50  147032870v2  and the Program Fee from the Collection Account in accordance with Section 2.06.  Payments of  the Program Fee and the Unused Commitment Fee shall be allocated and paid to Owners based  upon their respective Invested Percentages for the applicable Interest Period.    (b) The Servicer and the Backup Servicer shall be entitled to receive any accrued and  unpaid fees due to them, respectively, in accordance with Section 2.06.  (c) The Borrower shall pay to the Administrative Agent on the Closing Date the  Structuring Fee and from time to time any reasonable out-of-pocket expenses (including fees  charged by any nationally recognized statistical rating organization in connection with reviewing  the transactions contemplated by this Agreement) in immediately available funds.  (d) The Borrower shall pay to the Administrative Agent on each applicable Funding  Date the Supplemental Structuring Fee, if any, in immediately available funds  (e) The Borrower shall pay to Katten Muchin Rosenman LLP, counsel to the  Administrative Agent and the Lenders, in immediately available funds and in all cases within 30  days after receiving an invoice for the related amounts, (i) its reasonable fees accrued through  and including the Closing Date (not to exceed $250,000) and out-of-pocket expenses for services  rendered through and including the Closing Date, and (ii) any additional reasonable fees and out- of-pocket expenses incurred by such counsel for services rendered to the Administrative Agent  and the Lenders after the Closing Date.  (f) The Borrower shall pay to the Administrative Agent from time to time the  reasonable out-of-pocket expenses of any on-going surveillance fees charged by any nationally  recognized statistical rating organization in connection with reviewing the transactions  contemplated by this Agreement.    Section 2.10.  Increased Cost and Reduced Return.  (a) If any Regulatory Requirement (i) subjects any Lender or Credit Provider to any  charge or withholding on or with respect to any Liquidity Facility or this Agreement or a Lender  or Credit Provider's obligations under a Liquidity Facility or this Agreement or on or with  respect to the Receivables, or changes the basis of taxation of payments to any Lender or any  Credit Provider of any amounts payable under any Liquidity Facility or this Agreement (except  for changes in the rate of Tax on the overall net income of a Lender or Credit Provider,  Indemnified Taxes or Excluded Taxes), (ii) imposes, modifies or deems applicable any reserve,  assessment, fee, tax (other than (A) Indemnified Taxes, (B) Taxes described in clauses (ii)  through (iv) of the definition of Excluded Taxes and (C) Connection Income Taxes), insurance  charge, special deposit or similar requirement against assets of, deposits with or for the account  of, or liabilities of a Credit Provider or a Lender, or credit extended by a Credit Provider or a  Lender pursuant to a Liquidity Facility or this Agreement or, (iii) imposes any other condition  the result of which is to increase the cost to a Credit Provider or a Lender of performing its  obligations under a Liquidity Facility or this Agreement, or to reduce the rate of return on a  Credit Provider's or Lender's capital or assets as a consequence of its obligations under a  Liquidity Facility or this Agreement, or to reduce the amount of any sum received or receivable  by a Credit Provider or a Lender under a Liquidity Facility or this Agreement, or to require any  





 






51  147032870v2  payment calculated by reference to the amount of interests or loans held or interest received by  it, then, upon demand by the Administrative Agent, the Borrower shall pay to the Administrative  Agent, for the benefit of the relevant Credit Provider or Lender, such amounts charged to such  Credit Provider or Lender or such amounts to otherwise compensate such Credit Provider or such  Lender for such increased cost or such reduction.  The term "Regulatory Requirement" shall mean (i) the adoption after the date hereof of  any applicable law, rule or regulation (including any applicable law, rule or regulation regarding  capital adequacy or liquidity coverage) or any change therein after the date hereof, or (ii) any  change after the date hereof in the interpretation or administration thereof by any governmental  authority, central bank or comparable agency charged with the interpretation or administration  thereof, or compliance with any request or directive (whether or not having the force of law) of  any such authority, central bank or comparable agency; provided, that for purposes of this  definition, (A) the Dodd-Frank Act and all requests, rules, guidelines or directives thereunder,  issued in connection therewith or in implementation thereof, and (B) all requests, rules,  guidelines and directives promulgated by the Bank for International Settlements, the Basel  Committee on Banking Supervision (or any successor or similar authority) or the United States  or foreign regulatory authorities, in each case pursuant to Basel II or Basel III, shall in each case  be deemed to be a "Regulatory Requirement", regardless of the date enacted, adopted, issued or  implemented.  The Borrower acknowledges that any Lender or Credit Provider may institute  measures in anticipation of a Regulatory Requirement (including, without limitation, the  imposition of internal charges on such Person's interests or obligations under this Agreement or  any Liquidity Facility), and may commence allocating charges to or seeking compensation from  the Borrower under this Section in connection with such measures, in advance of the effective  date of such Regulatory Requirement (such charges or compensation, "Early Adoption Increased  Costs").  The Borrower agrees to pay Early Adoption Increased Costs to the Administrative  Agent, for the benefit of such Lender or Credit Provider, which are incurred by such Lender or  Credit Provider, beginning sixty (60) days after delivery by such Lender or Credit Provider (or  the Agent on its behalf) to the Borrower of a written representation and warranty (an "Early  Adoption Increased Costs Representation") to the effect that such Lender or Credit Provider is ()  recognizing Early Adoption Increased Costs, (y) setting forth the amount or amounts necessary  to compensate such Lender or Credit Provider and (z) that such Lender or Credit Provider  actually incurred such costs.  The Borrower further acknowledges that any charge or  compensation demanded hereunder may take the form of a monthly charge to be assessed by  such Lender or Credit Provider.  For the avoidance of doubt, the Borrower shall not be required  to pay any Early Adoption Increased Costs incurred by any Lender or Credit Provider prior to the  expiration of sixty (60) days after receipt by the Borrower of the Early Adoption Increased Costs  Representation from or on behalf of such Lender or Credit Provider.  The Early Adoption  Increased Costs Representation shall be conclusive absent manifest error.    (b) Failure or delay on the part of any Lender or Credit Provider to demand  compensation pursuant to this Section shall not constitute a waiver of such Lender's or Credit  Provider's right to demand such compensation; provided, that the Borrower shall not be required  to compensate a Lender or Credit Provider pursuant to this Section for any increased costs  incurred or reductions suffered more than six months prior to the date that such Lender or Credit  Provider, as the case may be, notifies the Borrower of the Regulatory Requirement giving rise to  such increased costs or reductions, and of such Lender's or Credit Provider's intention to claim  





 






52  147032870v2  compensation therefor (except that, if the Regulatory Requirement giving rise to such increased  costs or reductions is retroactive, then the nine-month period referred to above shall be extended  to include the period of retroactive effect thereof).  Section 2.11.  Taxes.  (a) Defined Term.  For purposes of this Section, the term "applicable law" includes  FATCA.  (b) Payments Free of Taxes.  Any and all payments by or on account of any  obligation of the Borrower under any Borrower Basic Document shall be made without  deduction or withholding for any Taxes, except as required by applicable law.  If any applicable  law (as determined in the good faith discretion of an applicable Withholding Agent) requires the  deduction or withholding of any Tax from any such payment by a Withholding Agent, then the  applicable Withholding Agent shall be entitled to make such deduction or withholding and shall  timely pay the full amount deducted or withheld to the relevant Governmental Authority in  accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable by  the Borrower shall be increased as necessary so that after such deduction or withholding has  been made (including such deductions and withholdings applicable to additional sums payable  under this Section) the applicable Recipient receives an amount equal to the sum it would have  received had no such deduction or withholding been made.  (c) Payment of Other Taxes by the Borrower.  The Borrower shall timely pay to the  relevant Governmental Authority in accordance with applicable law, or at the option of the  Administrative Agent timely reimburse it for the payment of, any Other Taxes.  (d) Indemnification by the Borrower.  The Borrower shall indemnify each Recipient,  within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including  Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section)  payable or paid by such Recipient or required to be withheld or deducted from a payment to such  Recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not  such Indemnified Taxes were correctly or legally imposed or asserted by the relevant  Governmental Authority.  A certificate as to the amount of such payment or liability delivered to  the Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative  Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.  (e) Indemnification by the Lenders.  Each Lender shall severally indemnify the  Administrative Agent, within 10 days after demand therefor, for (i) any Indemnified Taxes  attributable to such Lender (but only to the extent that the Borrower has not already indemnified  the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the  Borrower to do so), (ii) any Taxes attributable to such Lender's failure to comply with the  provisions of Section 11.01(e) relating to the maintenance of a Participant Register and (iii) any  Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the  Administrative Agent in connection with any Borrower Basic Document, and any reasonable  expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or  legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the  amount of such payment or liability delivered to any Lender by the Administrative Agent shall  





 






53  147032870v2  be conclusive absent manifest error.  Each Lender hereby authorizes the Administrative Agent to  set off and apply any and all amounts at any time owing to such Lender under any Borrower  Basic Document or otherwise payable by the Administrative Agent to the Lender from any other  source against any amount due to the Administrative Agent under this paragraph (e).  (f) Evidence of Payments.  As soon as practicable after any payment of Taxes by the  Borrower to a Governmental Authority pursuant to this Section, the Borrower shall deliver to the  Administrative Agent the original or a certified copy of a receipt issued by such Governmental  Authority evidencing such payment, a copy of the return reporting such payment or other  evidence of such payment reasonably satisfactory to the Administrative Agent.  (g) Status of Lenders.  (i) Any Lender that is entitled to an exemption from or  reduction of withholding Tax with respect to payments made under any Borrower  Basic Document shall deliver to the Borrower and the Administrative Agent, at the  time or times reasonably requested by the Borrower or the Administrative Agent, such  properly completed and executed documentation reasonably requested by the  Borrower or the Administrative Agent as will permit such payments to be made  without withholding or at a reduced rate of withholding.  In addition, any Lender, if  reasonably requested by the Borrower or the Administrative Agent, shall deliver such  other documentation prescribed by applicable law or reasonably requested by the  Borrower or the Administrative Agent as will enable the Borrower or the  Administrative Agent to determine whether or not such Lender is subject to backup  withholding or information reporting requirements.  Notwithstanding anything to the  contrary in the preceding two sentences, the completion, execution and submission of  such documentation (other than such documentation set forth in Section 2.11(g)(ii)(A),  (ii)(B) and (ii)(D) below) shall not be required if in the Lender's reasonable judgment  such completion, execution or submission would subject such Lender to any material  unreimbursed cost or expense or would materially prejudice the legal or commercial  position of such Lender.  (ii) Without limiting the generality of the foregoing:   (A)  any Lender that is a U.S. Person shall deliver to the  Borrower and the Administrative Agent on or prior to the date on which  such Lender becomes a Lender under this Agreement (and from time to  time thereafter upon the reasonable request of the Borrower or the  Administrative Agent), executed copies of IRS Form W-9 certifying that  such Lender is not subject to U.S. federal backup withholding tax;   (B)  any Foreign Lender shall, to the extent it is legally entitled  to do so, deliver to the Borrower and the Administrative Agent (in such  number of copies as shall be requested by the recipient) on or prior to the  date on which such Foreign Lender becomes a Lender under this  Agreement (and from time to time thereafter upon the reasonable request  





 






54  147032870v2  of the Borrower or the Administrative Agent), whichever of the following  is applicable:  (1)   in the case of a Foreign Lender claiming the  benefits of an income tax treaty to which the United States is a  party (x) with respect to payments of interest under any Borrower  Basic Document, executed copies of IRS Form  W-8BEN orW- 8BEN-E establishing an exemption from, or reduction of, U.S.  federal withholding Tax pursuant to the "interest" article of such  tax treaty and (y) with respect to any other applicable payments  under any Borrower Basic Document, IRS Form W-8BEN or W- 8BEN-E establishing an exemption from, or reduction of, U.S.  federal withholding Tax pursuant to the "business profits" or "other  income" article of such tax treaty;  (2)   executed copies of IRS Form W-8ECI;  (3)  in the case of a Foreign Lender claiming the  benefits of the exemption for portfolio interest under Section  881(c) of the Code, (x) a certificate substantially in the form of  Exhibit G-1 to the effect that such Foreign Lender is not a "bank"  within the meaning of Section 881(c)(3)(A) of the Code, a "10  percent shareholder" of the Borrower within the meaning of  Section 881(c)(3)(B) of the Code, or a "controlled foreign  corporation" described in Section 881(c)(3)(C) of the Code (a  "U.S. Tax Compliance Certificate") and (y) executed copies of IRS  Form W-8BEN or W-8BEN-E; or  (4)  to the extent a Foreign Lender is not the beneficial  owner, executed copies of IRS Form W-8IMY, accompanied by  IRS Form W-8ECI, IRS Form W-8BEN or IRS Form W-8BEN-E,  a U.S. Tax Compliance Certificate substantially in the form of  Exhibit G-2 or Exhibit G-3, IRS Form W-9, and/or other  certification documents from each beneficial owner, as applicable;  provided, that if the Foreign Lender is a partnership and one or  more direct or indirect partners of such Foreign Lender are  claiming the portfolio interest exemption, such Foreign Lender  may provide a U.S. Tax Compliance Certificate substantially in the  form of Exhibit G-4 on behalf of each such direct and indirect  partner;  (C)   any Foreign Lender shall, to the extent it is legally entitled  to do so, deliver to the Borrower and the Administrative Agent (in such  number of copies as shall be requested by the recipient) on or prior to the  date on which such Foreign Lender becomes a Lender under this  Agreement (and from time to time thereafter upon the reasonable request  of the Borrower or the Administrative Agent), executed copies of any  





 






55  147032870v2  other form prescribed by applicable law as a basis for claiming exemption  from or a reduction in U.S. federal withholding Tax, duly completed,  together with such supplementary documentation as may be prescribed by  applicable law to permit the Borrower or the Administrative Agent to  determine the withholding or deduction required to be made; and  (D)  if a payment made to a Lender under any Borrower Basic  Document would be subject to U.S. federal withholding Tax imposed by  FATCA if such Lender were to fail to comply with the applicable  reporting requirements of FATCA (including those contained in Section  1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver  to the Borrower and the Administrative Agent at the time or times  prescribed by law and at such time or times reasonably requested by the  Borrower or the Administrative Agent such documentation prescribed by  applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the  Code) and such additional documentation reasonably requested by the  Borrower or the Administrative Agent as may be necessary for the  Borrower and the Administrative Agent to comply with their obligations  under FATCA and to determine that such Lender has complied with such  Lender's obligations under FATCA or to determine the amount to deduct  and withhold from such payment, if any.  Solely for purposes of this  clause, "FATCA" shall include any amendments made to FATCA after the  date of this Agreement.  Each Lender agrees that if any form or certification it previously delivered expires or  becomes obsolete or inaccurate in any respect, it shall update such form or certification or within  five Business Days of its knowledge thereof notify the Borrower and the Administrative Agent in  writing of its legal inability to do so.  (h) Treatment of Certain Refunds.  If any party determines, in its sole discretion  exercised in good faith, that it has received a refund of any Taxes as to which it has been  indemnified pursuant to this Section (including by the payment of additional amounts pursuant to  this Section), it shall pay to the indemnifying party an amount equal to such refund (but only to  the extent of indemnity payments made under this Section with respect to the Taxes giving rise  to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party  and without interest (other than any interest paid by the relevant Governmental Authority with  respect to such refund).  Such indemnifying party, upon the request of such indemnified party,  shall repay to such indemnified party the amount paid over pursuant to this paragraph (h) (plus  any penalties, interest or other charges imposed by the relevant Governmental Authority) in the  event that such indemnified party is required to repay such refund to such Governmental  Authority.  Notwithstanding anything to the contrary in this paragraph (h), in no event will the  indemnified party be required to pay any amount to an indemnifying party pursuant to this  paragraph (h) the payment of which would place the indemnified party in a less favorable net  after-Tax position than the indemnified party would have been in if the Tax subject to  indemnification and giving rise to such refund had not been deducted, withheld or otherwise  imposed and the indemnification payments or additional amounts with respect to such Tax had  never been paid.  This paragraph shall not be construed to require any indemnified party to make  





 






56  147032870v2  available its Tax returns (or any other information relating to its Taxes that it deems confidential)  to the indemnifying party or any other Person  (i) Survival.  Each party's obligations under this Section shall survive the resignation  or replacement of the Administrative Agent or any assignment of rights by, or the replacement  of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of  all obligations under any Borrower Basic Document.  (j) If the Borrower is required to pay additional amounts to or for the benefit of any  Lender or Credit Provider pursuant to this Section as a result of a change of law or treaty  occurring after such Lender or Credit Provider first became a party to this Agreement, such  Lender or Credit Provider will, at the Borrower's request, change the jurisdiction of its applicable  lending office if, in the sole judgment of such Lender or Credit Provider, such change (i) will  eliminate or reduce any such additional payment which may thereafter accrue and (ii) will not, in  the judgment of such Lender or Credit Provider, be otherwise disadvantageous to it or  inconsistent with its internal policies.  Section 2.12.  Take-outs.  (a) On any Business Day, the Borrower shall have the right to prepay all or a portion  of the Loans Outstanding and require the Administrative Agent to release its security interest and  Lien on the related Receivables, subject to the following terms and conditions:  (i) the Borrower shall have given the Administrative Agent, each Agent, the  Servicer and the Backup Servicer at least ten Business Days' prior written notice  of its intent to effect the related Take-out;  (ii) unless a Take-out is to be effected on a Payment Date (in which case the  relevant calculations with respect to such Take-out shall be reflected on the  applicable Monthly Report), the initial Servicer shall deliver to the Administrative  Agent (A) a Take-out Date Certificate (which shall include a calculation of the  Borrowing Base after giving effect to such Take-out), together with evidence to  the reasonable satisfaction of the Administrative Agent that the Borrower shall  have sufficient funds on the related Take-out Date to effect such Take-out in  accordance with this Agreement, which funds may come from the proceeds of  sales of the Receivables in connection with such Take-out and (B) a computer  tape of the Receivables, both before and after giving effect to such Take-out;  (iii) on the related Take-out Date, the following shall be true and correct and  the Borrower shall be deemed to have certified that after giving effect to the Take- out and the release to the Borrower of the related Receivables on the related Take- out Date, (A) no Borrowing Base Deficiency exists, (B) neither an Unmatured  Termination Event nor a Termination Event has occurred, nor will either result  from such Take-out, (C) the fractional portion of the Eligible Pool Balance that  represents the aggregate Adjusted Principal Balance of all Delinquent Receivables  constituting Collateral will be no greater than 150% of the fractional portion of  the Eligible Pool Balance that was represented by the aggregate Adjusted  





 






57  147032870v2  Principal Balance of all Delinquent Receivables that constituted Collateral  immediately prior to the release of the related Receivables and (D) the fractional  portion of the Eligible Pool Balance that represents the aggregate Adjusted  Principal Balance of all Defaulted Receivables constituting Collateral will be no  greater than 150% of the fractional portion of the Eligible Pool Balance that was  represented by the aggregate Adjusted Principal Balance of all Defaulted  Receivables that constituted Collateral immediately prior to the release of the  related Receivables;  (iv) on the related Take-out Date, the Servicer shall have received an amount  equal to all Unreimbursed Servicer Advances associated with the Receivables to  be released and the Administrative Agent shall have received, for the benefit of  the Lenders and the Hedge Counterparties, as applicable, in immediately available  funds, and shall then distribute to the applicable entities, an amount equal to the  sum of (A) the portion of the Loans Outstanding to be prepaid, (B) an amount  equal to all unpaid Interest (including Interest not yet accrued) to the extent  reasonably determined by the Administrative Agent to be attributable to that  portion of the Loans Outstanding to be paid in connection with the Take-out,  (C) an aggregate amount equal to the sum of all other amounts due and owing to  the Administrative Agent, the Lenders and the Hedge Counterparties, as  applicable, under this Agreement and the other Basic Documents, to the extent  accrued to such date (including Breakage Costs and Hedge Breakage Costs) and  (D) all other Aggregate Unpaids with respect thereto; and   (v) on or prior to the related Take-out Date, the Borrower shall have delivered  to the Administrative Agent an updated Schedule of Receivables listing all  Receivables that will continue to be owned by the Borrower immediately  following the related Take-out.  (b) The Borrower hereby agrees to pay the reasonable legal fees and expenses of the  Administrative Agent, the Lenders and the Account Bank in connection with any Take-out  (including expenses incurred in connection with the release of the Lien of the Administrative  Agent, the Lenders and any other party having such an interest in the Receivables in connection  with such Take-out).  (c) In connection with any Take-out, on the related Take-out Date, subject to  satisfaction of the conditions referred to in this Section, the Administrative Agent shall, at the  expense of the Borrower (i) execute such instruments of release with respect to the portion of the  Receivables (and the other related Collateral) to be released to the Borrower, including a Take- out Release, in favor of the Borrower as the Borrower may reasonably request, (ii) deliver, or  cause to be delivered, any portion of the Receivables (and the other related Collateral) to be  released to the Borrower in its possession to the 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 on the portion of the Receivables  (and the other related Collateral) to be released to the Borrower and deliver to the Borrower such  Receivables and related Collateral.  





 






58  147032870v2  Section 2.13.  The Account Bank.  (a) The Borrower hereby appoints JPMorgan Chase Bank, N.A. as the initial Account  Bank.  All payments of amounts due and payable in respect of the Obligations that are to be  made from amounts withdrawn from the Collection Account shall be made on behalf of the  Borrower by the Account Bank.  (b) The Account Bank shall not be charged with knowledge of any Early  Amortization Event, Termination Event or Unmatured Termination Event unless a Responsible  Officer of the Account Bank obtains actual knowledge of such event or the Account Bank  receives written notice of such event from the Borrower, the Servicer or any Secured Party.  (c) Without limiting the generality of this Section, the Account Bank shall have no  duty (i) to see to any recording, filing or depositing of this Agreement or any agreement referred  to herein or any financing statement or continuation statement evidencing a security interest in  the Collateral, or to see to the maintenance of any such recording or filing or depositing or to any  recording, refiling or redepositing of any thereof, (ii) to see to any insurance of the Financed  Vehicles or Obligors or to effect or maintain any such insurance, (iii) to see to the payment or  discharge of any Tax, assessment or other governmental charge or any Lien or encumbrance of  any kind owing with respect to, assessed or levied against, any part of the Contracts, (iv) to  confirm or verify the contents of any reports or certificates of the Servicer or the Borrower  delivered to the Account Bank pursuant to this Agreement believed by the Account Bank to be  genuine and to have been signed or presented by the proper party or parties or (v) to inspect the  Financed Vehicles at any time or ascertain or inquire as to the performance or observance of any  of the Borrower's or the Servicer's representations, warranties or covenants or the initial  Servicer's duties and obligations as Servicer and as custodian of books, records, files and  computer records relating to the Contracts under this Agreement.  (d) The Account Bank shall not be required to expend or risk its own funds or  otherwise incur financial liability in the performance of any of its duties hereunder, or in the  exercise of any of its rights or powers, if there shall be reasonable ground for believing that the  repayment of such funds or adequate indemnity against such risk or liability shall not be  reasonably assured to it, and none of the provisions contained in this Agreement shall in any  event require the Account Bank to perform, or be responsible for the manner of performance of,  any of the obligations of the Servicer under this Agreement.  (e) The Account Bank may rely and shall be protected in acting or refraining from  acting upon any resolution, Officer's Certificate, any Monthly Report, certificate of auditors or  any other certificate, statement, instrument, opinion, report, notice, request, consent, order,  appraisal, bond or other paper or document reasonably believed by it to be genuine and to have  been signed or presented by the proper party or parties.  (f) The Account Bank may consult with counsel of its choice with regard to legal  questions arising out of or in connection with this Agreement and the advice or opinion of such  counsel shall be full and complete authorization and protection in respect of any action taken,  omitted or suffered by the Account Bank in good faith in accordance therewith.  





 






59  147032870v2  (g) The Account Bank shall be under no obligation to exercise any of the rights,  powers or remedies vested in it by this Agreement (except to comply with its obligations under  this Agreement and any other Basic Document to which it is a party) or to institute, conduct or  defend any litigation under this Agreement or in relation to this Agreement, at the request, order  or direction of the Administrative Agent pursuant to the provisions of this Agreement, unless the  Administrative Agent, on behalf of the Secured Parties, shall have offered to the Account Bank  reasonable security or indemnity against the costs, expenses and liabilities that may be incurred  therein or thereby.  (h) The Account Bank shall not be bound to make any investigation into the facts of  matters stated in any resolution, certificate, statement, instrument, opinion, report, notice,  request, consent, order, approval, bond or other paper or document, unless requested in writing  so to do by a Secured Party; provided, that if the payment within a reasonable time to the  Account Bank of the costs, expenses or liabilities likely to be incurred by it in the making of  such investigation shall be, in the opinion of the Account Bank, not reasonably assured by the  Borrower, the Account Bank may require reasonable indemnity against such cost, expense or  liability as a condition to so proceeding.  The reasonable expense of every such examination  shall be paid by the Borrower or, if paid by the Account Bank, shall be reimbursed by the  Borrower upon demand.  (i) The Account Bank may execute any of the trusts or powers hereunder or perform  any duties under this Agreement either directly or by or through agents or attorneys or a  custodian.  The Account Bank shall not be responsible for any misconduct or negligence of any  such agent or custodian appointed with due care by it hereunder.  (j) (i) The Account Bank shall have no duties or responsibilities except those  that are specifically set forth herein, and no implied covenants or obligations shall be read into  this Agreement against the Account Bank.  If the Account Bank shall request instructions from  the Administrative Agent or the Servicer with respect to any act, action or failure to act in  connection with and as set forth in this Agreement, the Account Bank shall be entitled to refrain  from taking such action and continue to refrain from acting unless and until the Account Bank  shall have received written instructions from the Administrative Agent or the Servicer, as  applicable without incurring any liability therefor to the Administrative Agent, the Borrower, the  Servicer or any other person.  (ii) The Account Bank may act in reliance upon any written  communication of the Administrative Agent concerning the delivery of Collateral  pursuant to this Agreement.  The Account Bank does not assume and shall have no  responsibility for, and makes no representation as to, monitoring the value of the  Contracts and other Collateral.  The Account Bank shall not be liable for any action or  omission to act hereunder, except for its own gross negligence, bad faith or willful  misconduct.  THE FOREGOING PROVISIONS SHALL APPLY WHETHER OR NOT SUCH  LIABILITIES ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN  PART, UNDER ANY CLAIM OR THEORY OF STRICT LIABILITY, OR ARE  





 






60  147032870v2  CAUSED, IN WHOLE OR IN PART, BY ANY NEGLIGENT ACT OR OMISSION OF  ANY KIND BY THE ACCOUNT BANK.  (k) Control Provisions  (i) The parties acknowledge and agree that the Collection  Account is intended to be a "securities account" (as defined in Section 8-501 of the  UCC), and the Account Bank shall be the "securities intermediary" with respect to the  Collection Account.  Notwithstanding such intention, (x) if the Collection Account  constitutes a "deposit account" (as defined in Section 9-102(a)(29) of the UCC), the  provisions of this Agreement governing a "deposit account" shall apply to such  Collection Account.  (ii) All securities or other property, including Permitted  Investments, constituting financial assets credited to the Collection Account (other  than cash) shall be registered in the name of the Account Bank, indorsed to the  Account Bank or in blank or credited to another securities account maintained in the  name of the Account Bank, and in no case will any financial asset credited to the  Collection Account be registered in the name of the Borrower or any other person,  payable to the order of the Borrower or any other person or specially indorsed to the  Borrower or any other person except to the extent the foregoing have been specially  indorsed to the Account Bank or in blank.  (iii) All property delivered to the Account Bank pursuant to this  Agreement that is granted to the Administrative Agent, as agent for the Secured  Parties shall be promptly credited to the Collection Account in accordance with the  terms of this Agreement.  (iv) The Collection Account is an account to which financial  assets or other property are or may be credited, and the Account Bank shall, subject to  the terms of this Agreement, treat the Borrower as entitled to exercise the rights that  comprise any financial asset or other property credited to such account.  (v) The Account Bank hereby agrees that each item of property  (whether investment property, financial asset, security, instrument, general intangible  or cash) credited to the Collection Account to the extent that it constitutes a securities  account shall be treated as a "financial asset" within the meaning of Section 8- 102(a)(9) of the UCC.  (vi) If at any time the Account Bank shall receive any order  from the Administrative Agent as agent for the Secured Parties directing transfer or  redemption of any financial asset relating to the Collection Account or any instruction  originated by the Secured Party directing the disposition of funds in the Collection  Account, the Account Bank shall comply with such entitlement order or instruction  without further consent by the Borrower or any other person.  If the Borrower is  otherwise entitled to issue entitlement orders or instructions and such entitlement  orders or instructions conflict with any entitlement order or instruction issued by the  





 






61  147032870v2  Secured Party, the Account Bank shall follow the entitlement orders or instructions  issued by the Secured Party.  (vii) Regardless of any provision in any other agreement, for  purposes of the UCC, New York shall be deemed to be the "bank's jurisdiction"  (within the meaning of Section 9-304 of the UCC) and the "securities intermediary's  jurisdiction" (within the meaning of Section 8-110 of the UCC).  Section 2.14.  Cost of Funds Disclosure and Exculpatory Language.  JPMorgan Chase  Bank hereby notifies the Borrower and the initial Servicer that: (i) JPMorgan Chase Bank and/or  its affiliates may from time to time purchase, hold or sell, as principal and/or agent, Commercial  Paper Notes issued by any Conduit Lender that is a member of the JPMorgan Lender Group; (ii)  JPMorgan Chase Bank and/or its affiliates act as administrative agent for such Conduit Lenders,  and as administrative agent JPMorgan Chase Bank manages such Conduit Lenders' issuance of  Commercial Paper Notes, including the selection of amount and tenor of Commercial Paper  Notes issuance, and the discount or interest rate applicable thereto; (iii) JPMorgan Chase Bank  and/or its affiliates act as a Commercial Paper Notes dealer for such Conduit Lenders; and (iv)  JPMorgan Chase Bank's activities as administrative agent and Commercial Paper Notes dealer  for such Conduit Lenders, and as a purchaser or seller of Commercial Paper Notes, impact the  interest or discount rate applicable to the Commercial Paper Notes issued by each such Conduit  Lender, which impact the CP Rate paid by the Borrower hereunder.  By execution hereof, each  of the Borrower and the initial Servicer hereby (x) acknowledges the foregoing and agrees that  JPMorgan Chase Bank does not warrant or accept any responsibility for, and shall not have any  liability with respect to, the interest or discount rate paid by any Conduit Lender in the JPMorgan  Lender Group in connection with its Commercial Paper Notes issuance; (y) acknowledges that  the discount or interest rate at which JPMorgan Chase Bank and/or its affiliates purchase or sell  Commercial Paper Notes will be determined by JPMorgan Chase Bank and/or its affiliates in  their sole discretion and may differ from the discount or interest rate applicable to comparable  transactions entered into by JPMorgan Chase Bank and/or its affiliates on the relevant date; and  (z) waives any conflict of interest arising by reason of JPMorgan Chase Bank and/or its affiliates  acting as administrative agent and Commercial Paper Notes dealer for any such Conduit Lender  while acting as purchaser or seller of Commercial Paper Notes.  Section 2.15.  Replacement of Lender Group.  If (a) any Lender or Credit Provider  requests compensation under Section 2.10 or (b) any Committed Lender becomes a Defaulting  Committed Lender, then the Borrower may, at its sole expense and effort, upon notice to the  related Agent and the Administrative Agent, require each Lender in such Agent's Lender Group  to assign and delegate, without recourse (in accordance with and subject to the restrictions  contained in Section 11.01), all of its respective interests, rights and obligations under this  Agreement to an assignee that shall assume such obligations (which assignee may be another  Lender if a Lender accepts such assignment); provided, that (i) the Borrower shall have received  the prior written consent of the Administrative Agent with respect to any assignee that is not  already a member of a Lender Group hereunder, which consent shall not unreasonably be  withheld, conditioned or delayed, (ii) each member of such assigning Lender Group shall have  received payment of an amount equal to all outstanding Loans funded or maintained by such  Lender Group, together with all accrued Interest thereon and all accrued Unused Commitment  Fees and Program Fees, as applicable, and any other Obligations payable to them hereunder and  





 






62  147032870v2  under the Basic Documents, from the assignee (to the extent of such outstanding Loans) or Seller  (in the case of all other amounts), and (iii) in the case of any such assignment resulting from a  claim for compensation under Section 2.10, such assignment will result in a reduction in such  compensation or payments.  A Lender shall not be required to make any such assignment and  delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the  circumstances entitling the Borrower to require such assignment and delegation cease to exist.  Section 2.16.  Defaulting Committed Lenders.    (a) Notwithstanding any provision of this Agreement to the contrary, if any  Committed Lender becomes a Defaulting Committed Lender, then the following provisions shall  apply for so long as such Committed Lender is a Defaulting Committed Lender:  (i) Unused Commitment Fees shall cease to accrue on the  unfunded portion of the Commitment of such Defaulting Committed Lender pursuant  to Section 2.09(a);  (ii) notwithstanding anything to the contrary contained in  Section 2.03 hereof, the unused portion of the Commitment of such Defaulting  Committed Lender may be reduced to zero without any contemporaneous ratable  reduction of the Commitments of the other Committed Lenders;  (iii) neither the Commitment nor the Loans of such Defaulting  Committed Lender shall be included in determining whether all Lenders, a majority of  the Lenders, the Consenting Lenders or the Required Lenders have taken or may take  any action hereunder and the Agent of the Lender Group which includes such  Defaulting Committed Lender shall not be included in determining whether all Agents  have taken or may take any action hereunder (including, in each case, any consent to  any amendment or waiver pursuant to Section 13.01); provided, that any waiver,  amendment or modification requiring the consent of all Lenders or Agents or each  affected Lender or Agent, as applicable, which affects such Defaulting Committed  Lender or the related Agent differently than other affected Lenders or Agents shall  require the consent of such Defaulting Committed Lender or the related Agent, as  applicable; and  (iv) the Borrower may replace such Defaulting Committed  Lender in accordance with Section 2.15 of this Agreement.  (b) In the event that the Administrative Agent determines that a Defaulting  Committed Lender has adequately remedied all matters that caused such Committed Lender to  be a Defaulting Committed Lender, then (i) the Lender Percentages shall be readjusted to reflect  the inclusion of such Committed Lender's Commitment and on such date such Committed  Lender shall purchase at par such of the Loans of the other Lenders as the Administrative Agent  and the Agents shall determine may be necessary in order for such Committed Lender to hold  such Loans in accordance with its Lender Percentage and (ii) the provisions of clause (a), above,  shall, from and after such determination, cease to be of further force or effect with respect to  such Committed Lender.  





 






63  147032870v2  SECURITY  Section 3.01.  Collateral.  (a) The parties hereto intend that this Agreement constitute a security agreement and  the transactions effected hereby constitute secured loans by the Lenders to the Borrower under  Applicable Law.  As collateral security for the prompt, complete and indefeasible payment and  performance in full when due, whether by lapse of time, acceleration or otherwise, of the  Obligations, the Borrower hereby grants to the Administrative Agent, as agent for the Secured  Parties, a lien on and security interest in all of the Borrower's right, title and interest in, to and  under the following, whether now existing or owned or hereafter arising or acquired by the  Borrower (collectively, the "Collateral"):  (i) the Receivables and the related Contracts (including the  right to service the Receivables in connection therewith) and any accounts or  obligations evidenced thereby, any guarantee thereof, all Collections and all monies  due (including any payments made under any guarantee or similar credit enhancement  with respect to any such Receivables) or to become due or received by any Person in  payment of any of the foregoing on or after the related Cutoff Date;  (ii) the Financed Vehicles related to such Receivables  (including Financed Vehicles that have been repossessed) or in any document or  writing evidencing any security interest in any Financed Vehicle and each security  interest in each Financed Vehicle securing each such Receivable, including all  proceeds from any sale or other disposition of such Financed Vehicles;  (iii) the Account Collateral;  (iv) subject to the Blocked Account Control Agreement, the  Borrower's rights to the Lockbox Account;  (v) subject to the Control Agreement, the Borrower's rights to  the Collection Account;   (vi) all Hedge Collateral;  (vii) all Receivable Files, the Schedule of Receivables, and all  documents, agreements and instruments included in the Receivable Files, including  rights of recourse of the Borrower against DFC and/or any Dealer with respect to the  Receivables;  (viii) all Records, documents and writings evidencing or related  to the Receivables or the Contracts;  (ix) all rights to payment under all Insurance Policies with  respect to a Financed Vehicle, including any monies collected from whatever source in  





 






64  147032870v2  connection with any default of an Obligor with respect to a Financed Vehicle and any  proceeds from claims or refunds of premiums on any Insurance Policy;  (x) all guaranties, indemnities, warranties, insurance (and  proceeds and premium refunds thereof) and other agreements or arrangements of  whatever character from time to time supporting or securing payment of the  Receivables, whether pursuant to the related Contracts or otherwise;  (xi) all rights to payment under all service contracts and other  contracts and agreements associated with the Receivables;  (xii) all security interests, Liens, guaranties and other  encumbrances in favor of or assigned or transferred to the Borrower in and to the  Receivables and Financed Vehicles;  (xiii) all deposit accounts, monies, deposits, funds, accounts and  instruments relating to the foregoing (subject to the Blocked Account Control  Agreement and the Control Agreement);  (xiv) the Purchase Agreement (including each Purchase  Agreement Supplement) and remedies thereunder and the assignment to the  Administrative Agent of all UCC financing statements filed by the Borrower against  DFC under or in connection with the Purchase Agreement; and  (xv) all income and proceeds of the foregoing.  (b) The grant under this Section does not constitute and is not intended to result in a  creation or an assumption by the Administrative Agent, any Agent, or any other Secured Party of  any obligation of the Borrower 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, (i) the Borrower shall remain liable under the Contracts 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, (ii) the exercise by the Administrative Agent of any of its  rights in the Collateral shall not release the Borrower from any of its duties or obligations under  the Collateral and (iii) none of the Administrative Agent, any Agent, or any other Secured Party  shall have any obligations or liability under the Collateral by reason of this Agreement, nor shall  any of the Administrative Agent, any Agent, or any other Secured Party be obligated to perform  any of the obligations or duties of the Borrower thereunder or to take any action to collect or  enforce any claim for payment assigned hereunder.  Each of DFC and the Borrower represents  and warrants as to itself that each remittance of Collections by DFC or the Borrower to the  Administrative Agent or any Lender hereunder will have been (A) in payment of a debt incurred  by the Borrower in the ordinary course of business or financial affairs of the Lenders and the  Borrower and (B) made in the ordinary course of business or financial affairs of the Lenders and  the Borrower.  (c) Notwithstanding the foregoing grant of security interest, no account, instrument,  chattel paper or other obligation or property of any kind due from, owned by or belonging to a  Sanctioned Person shall be Collateral.  





 






65  147032870v2  Section 3.02.  Release of Collateral; No Legal Title.  (a) At the same time as any Contract (i) expires by its terms or (ii) has been prepaid  in full, and in each case all amounts in respect thereof have been paid by the related Obligor and  subsequently deposited into a Lockbox Account or the Collection Account, the Administrative  Agent will, to the extent requested by the Servicer, promptly release its interest and lien in such  Contract and the related Collateral.  In connection with any sale of a Financed Vehicle, after the  deposit by the Servicer of the proceeds of such sale into the Lockbox Account and subsequent  deposit within two Business Days thereafter into the Collection Account, the Administrative  Agent will, at the sole expense of the Servicer (which, in the case of any Successor Servicer,  shall be reimbursable in accordance with the provisions of Section 2.06), promptly execute and  deliver to the Servicer any assignments, bills of sale, termination statements and any other  releases and instruments as the Servicer may reasonably request in order to effect the release and  transfer of such Financed Vehicle; provided, that the Administrative Agent will not make any  representation or warranty, express or implied, with respect to any such Financed Vehicle in  connection with such sale or transfer and assignment.  Nothing in this Section shall diminish the  Servicer's obligations pursuant to Section 7.03 with respect to the proceeds of any such sale.  (b) Upon (i) the transfer of any Receivables and the related Collateral in connection  with a Take-out or (ii) the Facility Termination Date, the Administrative Agent, at the  Borrower's expense, upon payment in full of the related Aggregate Unpaids, shall execute and  file such partial or full releases or partial or full assignments of financing statements and other  documents and instruments as may be reasonably requested by the Borrower to effectuate the  release of the relevant portion of the Collateral.  Section 3.03.  Protection of Security Interest; Administrative Agent, as Attorney-in-Fact.  (a) The Borrower agrees that from time to time, at its expense, it will promptly  execute and deliver all instruments and documents, and take all actions, that may reasonably be  necessary or desirable, or that the Administrative Agent may deem necessary, to perfect, protect,  or more fully evidence the security interest granted to the Administrative Agent in the  Receivables and the other Collateral, or to enable the Secured Parties to exercise and enforce  their rights and remedies hereunder and thereunder; provided, that prior to the declaration of a  Termination Event, the Borrower shall in no case be required to relien a security interest on any  Financed Vehicle in favor of the Administrative Agent or other Secured Party.  (b) If the Borrower fails to perform any of its obligations hereunder after five  Business Days' notice from any Secured Party, such Secured Party may (but shall not be required  to) perform, or cause performance of, such obligation; and the reasonable costs and expenses of  such Secured Party incurred in connection therewith shall be payable by the Borrower as  provided in Article Nine.  The Borrower irrevocably authorizes the Administrative Agent and  appoints the Administrative Agent, as its attorney-in-fact to act on behalf of the Borrower, (i) to  execute or cause to be executed on behalf of the 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 of the interest of the Secured Parties in the Receivables and  the other Collateral and (ii) to file a carbon, photographic or other reproduction of this  Agreement or any financing statement with respect to the Receivables and the other Collateral,  





 






66  147032870v2  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 of the interests of the  Secured Parties in the Receivables and the other Collateral.  Such financing statements may  describe the Collateral in the same manner as described herein 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 reasonable discretion, is necessary, advisable or prudent to ensure  the perfection of the security interest in the Collateral granted to the Administrative Agent  herein. The Borrower hereby authorizes the filing of financing statements describing the  collateral as "all assets of the debtor, whether now owned or existing or hereafter acquired or  arising and wherever located, and all proceeds and products thereof" or words to that effect.   This appointment is coupled with an interest and is irrevocable.  Section 3.04.  Assignment of the Purchase Agreement.  The Borrower hereby represents,  warrants and confirms to the Administrative Agent that the Borrower has assigned to the  Administrative Agent, for the ratable benefit of the Secured Parties hereunder, all of the  Borrower's right and title to and interest in the Purchase Agreement (including each Purchase  Agreement Supplement).  The Borrower confirms that, during the continuation of a Termination  Event, the Administrative Agent shall have the sole right to enforce the Borrower's rights and  remedies under the Purchase Agreement or any Purchase Agreement Supplement for the benefit  of the Secured Parties, but without any obligation on the part of the Secured Parties or any of  their respective Affiliates, to perform any of the obligations of the Borrower under the Purchase  Agreement or any Purchase Agreement Supplement.  The Borrower further confirms and agrees  that such assignment to the Administrative Agent shall terminate upon the Facility Termination  Date; provided, that the rights of the Secured Parties pursuant to such assignment with respect to  rights and remedies in connection with any indemnities and any breach of any representation,  warranty or covenants made by DFC pursuant to the Purchase Agreement, which rights and  remedies survive the termination of the Purchase Agreement, shall be continuing and shall  survive any termination of such assignment.  Section 3.05.  Waiver of Certain Laws.  Each of the Borrower, the Servicer, the Backup  Servicer and Collateral Custodian agrees, 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 appraisement, valuation, stay, extension or redemption law now or hereafter in force in any  locality where any part of the Collateral may be situated in order to prevent, hinder or delay the  enforcement or foreclosure of this Agreement, 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 Borrower, the Servicer, the Backup Servicer and  the Collateral Custodian, 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 3.06.  Lockbox Account and Lockboxes.  DFC hereby grants a security interest in  the Lockbox Account and the Lockboxes to the Administrative Agent on behalf of the Secured  Parties, as security for the payment and performance of its obligations to the Administrative  





 






67  147032870v2  Agent, the Secured Parties and the Borrower set forth herein, and DFC hereby agrees that the  security interest granted pursuant to this Section shall be for the benefit of, and the remedies  provided for herein and in the Blocked Account Control Agreement with respect thereto shall be  exercisable by, the Administrative Agent on behalf of the Secured Parties.  CONDITIONS OF CLOSING AND LOANS  Section 4.01.  Conditions to Effectiveness of this Agreement.  The Closing Date shall not  occur and no party hereto will be obligated to take, fulfill or perform any action hereunder, until  each of the following conditions have been satisfied, in the sole discretion of the Administrative  Agent:   (a) Each Basic Document (other than the Backup Servicing Agreement and  any Hedging Agreements) shall have been duly executed by, and delivered to, the parties  hereto and thereto and the Administrative Agent shall have received complete and, where  applicable, executed versions of all other documents, instruments, agreements and legal  opinions specified in the Schedule of Documents, each in form and substance satisfactory  to the Administrative Agent.  (b) The Administrative Agent shall have received (i) satisfactory evidence  that the Borrower, the Servicer, DFC, Lithia, the Collateral Custodian and the Account  Bank have 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 Basic Documents to which each is a party and the  consummation of the transactions contemplated hereby or thereby or (ii) an Officer's  Certificate from each of the Borrower, the Servicer, DFC, Lithia, the Collateral  Custodian, and the Account Bank, in form and substance satisfactory to the  Administrative Agent, affirming that no such consents or approvals are required; it being  understood that the acceptance of such evidence or Officer's Certificate shall in no way  limit the recourse of the Administrative Agent or any Secured Party against DFC or the  Borrower for a breach of DFC's or the Borrower's representation or warranty that all such  consents and approvals have, in fact, been obtained.  (c) The Borrower, the initial Servicer, DFC and Lithia shall each be in  compliance in all material respects with all Applicable Laws and shall have delivered an  Officer's Certificate to the Administrative Agent as to this and other closing matters.   (d) The Borrower shall have paid all fees required to be paid by it on the  Closing Date.  (e) No Termination Event or Unmatured Termination Event shall have  occurred.  (f) No Servicer Termination Event or Unmatured Servicer Termination Event  shall have occurred.  





 






68  147032870v2  Section 4.02.  Conditions Precedent to All Loans.  Each request for a Loan (including the  Initial Loan) by the Borrower to a Lender shall be subject to the conditions set forth in  Section 4.01 and the further conditions precedent that:  (a) The initial Servicer shall have delivered to the Administrative Agent, on or  prior to the date of such Loan, (i) a Funding Request and (ii) a Purchase Agreement  Supplement (Exhibit A to the Purchase Agreement including the Schedule of Receivables  attached thereto), dated within two Business Days prior to the date of such Loan, in each  case containing such additional information as may be reasonably requested by the  Administrative Agent.  (b) On the date of such Loan, the following shall be true and correct and the  Borrower shall be deemed to have certified that, after giving effect to the proposed Loan  and pledge of the Collateral:  (i) the representations and warranties contained in  Sections 5.01 and 5.02 are true and correct on and as of such day as though made on  and as of such day and shall be deemed to have been made on such day (except to the  extent such representation or warranty expressly relates to a prior date);  (ii) no Stop-Funding Event has occurred and is continuing;  (iii) no event has occurred and is continuing, or would result  from such transaction that constitutes (A) a Termination Event or Unmatured  Termination Event or (B) a Servicer Termination Event or Unmatured Servicer  Termination Event;  (iv) on and as of such day, after giving effect to such  transaction, the aggregate Loan Outstanding does not exceed the Borrowing Base;  (v) on and as of each such day, the Borrower and the Servicer  each has performed all of the agreements contained in this Agreement and the other  Basic Documents to be performed by it at or prior to such day; and  (vi) no law or regulation shall prohibit, and no order, judgment  or decree of any federal, State or local court or governmental body, agency or  instrumentality shall prohibit or enjoin, the making of such Loan by the Lenders in  accordance with the provisions hereof.  (c) After giving effect to the proposed Loan and the related pledge of  Collateral:  (i) the weighted average FICO Score of all Eligible Receivables  (excluding Eligible Receivables that do not have a FICO Score or have a FICO  Score of zero) shall be at least 635, with such weighted average calculated using  the FICO Score of each such Receivable at the time of its underwriting and the  Principal Balance as of such date of determination;  





 






69  147032870v2  (ii) the weighted average Loan-to-Value Ratio of all  Eligible  Receivables at the time of underwriting of such Eligible Receivables shall be no  greater than 118.0%, with such weighted average calculated using the Principal  Balances as of such date of determination;  (iii) the weighted average Payment-to-Income Ratio of all Eligible  Receivables at the time of underwriting of such Eligible Receivables shall be no  greater than 12.0%, with such weighted average calculated using the Principal  Balances as of such date of determination; and  (iv) the weighted average Debt-to-Income Ratio of all Eligible  Receivables at the time of underwriting of such Eligible Receivables shall be no  greater than 55.0%, with such weighted average calculated using the Principal  Balances as of such date of determination;  (d) For each Loan other than the Initial Loan, the Borrower shall be in  compliance with Section 6.03 and with all requirements of any Hedging Agreement  required thereby.   (e) On the date of such transaction, the Administrative Agent shall have  received such other approvals, opinions, information or documents as the Administrative  Agent may reasonably require.  (f) If applicable, the Administrative Agent shall have received the related  Supplemental Structuring Fee.  REPRESENTATIONS AND WARRANTIES  Section 5.01.  Representations and Warranties of the Borrower.  The Borrower represents  and warrants, as of the Closing Date, the date of this Agreement, and each Funding Date, as  follows:  (a) Organization and Good Standing.  The Borrower has been duly organized,  and is validly existing as a limited liability company 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 the Borrower had at  all relevant times, and now has all necessary power, authority and legal right to acquire,  own, sell and pledge the Receivables and the other Collateral.  (b) Due Qualification.  The Borrower is duly qualified to do business and is in  good standing as a limited liability company, 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, as applicable, the purchase, sale and pledge of the Receivables)  requires such qualifications, licenses or approvals, except those jurisdictions in which  failure to be so qualified would not have a Material Adverse Effect.  





 






70  147032870v2  (c) Power and Authority; Due Authorization.  The Borrower (i) has all  necessary power, authority and legal right to (A) execute and deliver the Borrower Basic  Documents, (B) carry out the terms of the Borrower Basic Documents and (C) grant the  security interest in the Collateral on the terms and conditions herein provided and (ii) has  duly authorized by all necessary limited liability company action the execution, delivery  and performance of the Borrower Basic Documents and the grant of the security interest  in the Collateral on the terms and conditions herein and therein provided.  (d) Binding Obligation.  Each Borrower Basic Document constitutes a legal,  valid and binding obligation of the Borrower, enforceable against the Borrower in  accordance with its respective terms, except as such enforceability may be limited by  Insolvency Laws and except as such enforceability may be limited by general principles  of equity (whether considered in a suit at law or in equity).  (e) No Violation.  The execution and delivery of the Borrower Basic  Documents, the consummation of the transactions contemplated by the Borrower Basic  Documents and the fulfillment of the terms hereof and thereof will not (i) conflict in any  material respect with, result in any material 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  Borrower's Formation Documents or a default in any material respect under any  Contractual Obligation of the Borrower, (ii) result in the creation or imposition of any  Lien upon any of the Borrower's properties (other than Permitted Liens) or (iii) violate  any Applicable Law, the violation of which could 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 Borrower, threatened against the Borrower,  before any Governmental Authority (i) asserting the invalidity of any Borrower Basic  Document, (ii) seeking to prevent the consummation of any of the transactions  contemplated by any Borrower Basic Document or (iii) seeking any determination or  ruling that could reasonably be expected to have a Material Adverse Effect.  (g) All Consents Required.  All approvals, authorizations, consents, orders,  licenses or other actions of any Person or of any Governmental Authority required for the  due execution, delivery and performance by the Borrower of the Borrower Basic  Documents have been obtained.  (h) Bulk Sales.  The execution, delivery and performance of the Borrower  Basic Documents do not require compliance with any "bulk sales" act or similar law by  the Borrower.  (i) Solvency.  The transactions contemplated by the Borrower Basic  Documents do not and will not cause the Borrower not to be Solvent.  (j) Taxes.  The Borrower has filed or caused to be filed all federal, state and  other tax returns that are required to be filed by it.  The Borrower has paid or made  adequate provisions for the payment of all Taxes made against it or any of its property  





 






71  147032870v2  (other than 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 Borrower), and no Tax lien has been filed  and, to the Borrower's knowledge, no claim is being asserted, with respect to any such  Tax.  (k) Quality of Title.  Each Receivable, together with the Contract related  thereto, shall, at all times, be owned by the Borrower free and clear of any Lien except  for Permitted Liens, and upon the Initial Loan or each Subsequent Loan, the  Administrative Agent, as agent for the Secured Parties, shall acquire a valid and perfected  first priority security interest in each Receivable and in the related Collateral then  existing or thereafter arising, free and clear of any Lien, other than Permitted Liens.  No  effective financing statement or other instrument similar in effect covering any portion of  the Collateral shall at any time be on file in any recording office except such as may be  filed in favor of (i) the Borrower in accordance with the Purchase Agreement or (ii) the  Administrative Agent in accordance with this Agreement.  (l) Security Interest.  The Borrower has granted a security interest (as defined  in the UCC) to the Administrative Agent, as agent for the Secured Parties, in the  Collateral, which is enforceable in accordance with Applicable Law upon execution and  delivery of this Agreement.  Upon the filing of UCC-1 financing statements describing  the Collateral, naming the Administrative Agent as secured party, and naming the  Borrower as debtor, the Administrative Agent, as agent for the Secured Parties, shall have  a first priority (except for any Permitted Liens) perfected security interest in the  Collateral.  All filings (including UCC filings) as are necessary in any jurisdiction to  perfect the interest of the Administrative Agent, as agent for the Secured Parties, in the  Collateral have been made.   (m) Reports Accurate.  All Monthly Reports (if prepared by the Borrower, or  to the extent that information contained therein is supplied by the Borrower, such portion  supplied by the Borrower), information, exhibits, financial statements, documents, books,  records or reports furnished or to be furnished by the Borrower to each Agent, any  Secured Party, the Backup Servicer and the Account Bank in connection with this  Agreement are true, complete and correct in all material respects.  (n) Location of Offices.  The principal place of business and chief executive  office of the Borrower and the office where the Borrower keeps all the Records are  located at the address of the Borrower referred to in Section 13.02 (or at such other  locations as to which the notice and other requirements specified in Section 6.02(f) shall  have been satisfied) and has been so for the last four months.  (o) Lockboxes; Lockbox Account; Collection Account.  None of the  Lockboxes, the Lockbox Account nor any interest therein has been pledged or assigned to  any party other than the parties to, and pursuant to, the Blocked Account Control  Agreement.  The Collection Account or any interest therein has not been pledged or  assigned to any party other than the Administrative Agent.  





 






72  147032870v2  (p) Tradenames.  The Borrower 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.  (q) Purchase Agreement.  The Purchase Agreement is the only agreement  pursuant to which the Borrower purchases Receivables and the related Contracts.  (r) Value Given.  The Borrower shall have given reasonably equivalent value  to DFC in consideration for the transfer to the Borrower of the Receivables and the  related Collateral under the Purchase Agreement, no such transfer shall have been made  for or on account of an antecedent debt owed by DFC to the Borrower and no such  transfer is or may be voidable or subject to avoidance under any section of the  Bankruptcy Code.  (s) Accounting.  The Borrower accounts for the transfers to it from DFC of  the Receivables and related Collateral under the Purchase Agreement as true sales/true  contributions of such Receivables and related Collateral in its books, records and  financial statements, in each case consistent with GAAP and with the requirements set  forth herein.  (t) Special Purpose Entity.  The Borrower is in compliance with  Section 6.01(o).  (u) Confirmation from DFC.  The Borrower has received confirmation from  DFC that, so long as the Borrower is not "insolvent" within the meaning of the  Bankruptcy Code or otherwise unable to pay its debts as they become due, DFC will not  cause the Borrower to file a voluntary petition under the Bankruptcy Code or any other  Insolvency Laws.  Each of the Borrower and DFC is aware that in light of the  circumstances described in the preceding sentence and other relevant facts, the filing of a  voluntary petition under the Bankruptcy Code for the purpose of making any Receivable  or any other assets of the Borrower available to satisfy claims of the creditors of DFC  would not result in making such assets available to satisfy such creditors under the  Bankruptcy Code.  (v) ERISA Matters.  The Borrower is not a "benefit plan investor" (as defined  under Section 3(42) of ERISA).  The Borrower does not sponsor, maintain or contribute  to any Pension Plan or Multiemployer Plan.  Neither the Borrower nor any ERISA  Affiliate does not have any liability (contingent or otherwise) with respect to any Pension  Plan or Multiemployer Plan except to the extent such liability could reasonably be  expected to have a Material Adverse Effect.  Each Pension Plan sponsored, maintained or  contributed to by DFC or any ERISA Affiliate of the Borrower, under which employees  of the Borrower participate in or participated in, complies in all respects with ERISA and  all other applicable laws except to the extent the failure to comply could not reasonably  be expected to have a Material Adverse Effect. No Plan Event has occurred or is  reasonably expected to occur that might result, directly or indirectly, in any material lien  being imposed on the property or assets of the Borrower. The Borrower is not a "benefit  plan investor" (as defined under Section 3(42) of ERISA).  The Borrower does not  





 






73  147032870v2  sponsor, maintain or contribute to any Pension Plan or Multiemployer Plan.  Neither the  Borrower nor any ERISA Affiliate does not have any liability (contingent or otherwise)  with respect to any Pension Plan or Multiemployer Plan except to the extent such liability  could reasonably be expected to have a Material Adverse Effect.  Each Pension Plan  sponsored, maintained or contributed to by DFC or any ERISA Affiliate of the Borrower,  under which employees of the Borrower participate in or participated in, complies in all  respects with ERISA and all other applicable laws except to the extent the failure to  comply could not reasonably be expected to have a Material Adverse Effect. No Plan  Event has occurred or is reasonably expected to occur that might result, directly or  indirectly, in any material lien being imposed on the property or assets of the Borrower.  (w) Investment Company Act.  The Borrower (i) is not a "covered fund" under  regulations adopted to implement section 619 of the Dodd-Frank Wall Street Reform and  Consumer Protection Act, commonly known as the "Volcker Rule" and (ii) is not, and  after giving effect to the transactions contemplated hereby, will not be required to register  as an "investment company" within the meaning of the Investment Company Act.  In  determining that the Borrower is not an "investment company" within the meaning of the  Investment Company Act, the Borrower is entitled to either the benefit of the exemption  provided under Section 3(c)(5) of the Investment Company Act or the exclusion for loan  securitizations in the Volcker Rule under 17 C.F.R. 75.10(c)(8).   (x) Accuracy of Representations and Warranties.  Each representation or  warranty by the Borrower contained herein, in any other Basic Document or in any  certificate or other document furnished by the Borrower pursuant hereto or thereto or in  connection herewith or therewith is true and correct in all material respects.  (y) Representations and Warranties in Purchase Agreement.  The  representations and warranties made by DFC to the Borrower in Section 3.03 of the  Purchase Agreement are hereby remade by the Borrower on each date to which they  speak in the Purchase Agreement, as if such representations and warranties were set forth  herein.  For purposes of this Section, such representations and warranties are incorporated  herein by reference as if made by the Borrower to the Administrative Agent and to each  of the Secured Parties under the terms hereof mutatis mutandis.  (z) Anti-Corruption Laws and Sanctions.  The Borrower is subject to policies  and procedures of Lithia that are designed to ensure compliance by Lithia and its  Subsidiaries, directors, officers, employees and agents with Anti-Corruption Laws and  applicable Sanctions. The Borrower, its officers, directors and employees are in  compliance with Anti-Corruption Laws and applicable Sanctions in all material respects.   None of (a) the Borrower or any of its directors, officers or employees, or (b)  to the  knowledge of the Borrower, any agent of the Borrower that will act in any capacity in  connection with or benefit from the facility established hereby, is a Sanctioned Person.   No Loan, use of proceeds or other transaction contemplated by this Agreement will  violate Anti-Corruption Laws or applicable Sanctions.   (aa) Beneficial Ownership Rule.  At least 51% of the equity interests in the  Borrower is owned, directly or indirectly, by a listed entity, and the Borrower is excluded  





 






74  147032870v2  on that basis from the definition of "Legal Entity Customer" as defined in the Beneficial  Ownership Rule.  Section 5.02.  Representations and Warranties of the Borrower Relating to the  Receivables.  The Borrower hereby represents and warrants as of each Funding Date, as follows:  (a) Schedule C and the information contained in the related Funding Request  is an accurate and complete listing in all material respects of the Receivables (including  the Receivables being transferred on such Funding Date) constituting a portion of the  Collateral as of the date of the related Loan and the information contained therein with  respect to the identity of such Receivables and the amounts owing thereunder is true and  correct in all material respects as of the related Cutoff Date; and  (b) each Receivable referenced on the related Funding Request is an Eligible  Receivable.  Section 5.03.  Representations and Warranties of the Servicer.  The initial Servicer  represents and warrants, as of the Closing Date, the date of this Agreement, and each Funding  Date, as follows:  (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  the State of Oregon, with all requisite power and authority to own or lease its properties  and 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 and is in  good standing as a limited liability company, and has obtained all necessary licenses and  approvals in all jurisdictions in which the ownership or lease of its property and or the  conduct of its business, including the underwriting and servicing of the Receivables,  requires such qualification, licenses or approvals, except to the extent the failure to obtain  such consents or approvals could not reasonably be expected to have a Material Adverse  Effect.  (c) Power and Authority; Due Authorization.  The Servicer (i) has all  necessary power, authority and legal right to (A) execute and deliver the Servicer Basic  Documents and (B) carry out the terms of the Servicer Basic Documents and (ii) has duly  authorized by all necessary corporate action the execution, delivery and performance of  the Servicer Basic Documents.  (d) Binding Obligation.  Each Servicer Basic Document 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 except as such enforceability may be limited by general principles  of equity (whether considered in a suit at law or in equity).  (e) No Violation.  The execution and delivery of the Servicer Basic  Documents, the consummation of the transactions contemplated by the Servicer Basic  





 






75  147032870v2  Documents and the fulfillment of the terms hereof and thereof will not (i) conflict in any  material respect with, result in any material 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  Servicer's Formation Documents or, in any material respect, any Contractual Obligation  of the Servicer, (ii) result in the creation or imposition of any Lien upon any of the  Servicer's properties (other than Permitted Liens) or (iii) violate any Applicable Law, the  violation of which could 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 any Servicer Basic Document,  (ii) seeking to prevent the consummation of any of the transactions contemplated by any  Servicer Basic Document, (iii) challenging the enforceability of a material portion of the  Receivables or (iv) seeking any determination or ruling that could reasonably be expected  to have Material Adverse Effect.  (g) All Consents Required.  All approvals, authorizations, consents, orders or  other actions of any Person or of any Governmental Authority (if any) required for the  due execution, delivery and performance by the Servicer of the Servicer Basic  Documents have been obtained.  (h) Reports Accurate.  All Monthly Reports, information, exhibits, financial  statements, documents, books, records or reports furnished or to be furnished by the  Servicer to any Agent, any Secured Party, the Backup Servicer and the Account Bank in  connection with this Agreement are accurate, true and correct in all material respects.  (i) Servicer's Performance.  The Servicer has the knowledge, the experience  and the systems, financial and operational capacity available to timely perform each of its  obligations hereunder.  (j) Lockbox Account; Collection Account.  The Servicer has neither pledged  nor entered into a control agreement (other than the Blocked Account Control  Agreement) with respect to the Lockbox Account or amounts on deposit therein.  The  Servicer has neither pledged nor entered into a control agreement (other than the Control  Agreement) with respect to the Collection Account or amounts on deposit therein.  (k) Tradenames and Place of Business.  (i) Except as otherwise indicated in  this Agreement or as the same may be changed in accordance with Section 6.05(b), the  Servicer 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 and (ii) the principal  place of business and chief executive office of the Servicer are located at the address of  the Servicer set forth on the signature pages hereto and has been so for the last four  months.  (l) Compliance with the Credit and Collection Policy.  The Servicer has, with  respect to the Receivables, complied in all material respects with the Credit and  Collection Policy.  





 






76  147032870v2  (m) ERISA Matters.  No Plan Event has occurred or is reasonably expected to  occur that might result, directly or indirectly, in any lien being imposed on the property  of the Servicer which could result in a Material Adverse Effect.  (n) Investment Company Act.  The Servicer is not an "investment company"  within the meaning of the Investment Company Act.  (o) Anti-Corruption Laws and Sanctions.  The Servicer is subject to policies  and procedures of Lithia that are designed to ensure compliance by Lithia and its  Subsidiaries, directors, officers, employees and agents with Anti-Corruption Laws and  applicable Sanctions. The Servicer, its officers, directors and employees are in  compliance with Anti-Corruption Laws and applicable Sanctions in all material respects.   None of (a) the Servicer or any of its directors, officers or employees, or (b) to the  knowledge of the Borrower, any agent of the Servicer that will act in any capacity in  connection with or benefit from the facility established hereby, is a Sanctioned Person.   No Loan, use of proceeds or other transaction contemplated by this Agreement will  violate Anti-Corruption Laws or applicable Sanctions.  Section 5.04.  Retransfer of Certain Receivables.  (a) Retransfer of an Ineligible Receivable.  If a Receivable is an Ineligible Receivable  at the time it was initially pledged hereunder, no later than the earlier of (i) knowledge by the  Borrower of such Receivable having been an Ineligible Receivable when it was so pledged and  (ii) receipt by the Borrower from the Administrative Agent or the initial Servicer of written  notice thereof (which notice the initial Servicer shall be required to give within two Business  Days of any of its Responsible Officers having actual knowledge thereof), the Borrower shall  (A) disclose the identity of such Ineligible Receivable on the next Monthly Report and (B) on or  before the next Payment Date, to the extent such breach has not been cured or waived, make a  deposit of the Release Price for each such Ineligible Receivable to the Collection Account in  immediately available funds and accept the release of each such Ineligible Receivable.  The  Administrative Agent shall be deemed, upon deposit of the Release Price into the Collection  Account, to convey to the Borrower, without recourse, representation or warranty, all of its right,  title and interest in such Ineligible Receivable and the Borrower shall accept the release of each  such Ineligible Receivable from the Administrative Agent, and the aggregate Pool Balance shall  be reduced by the Principal Balance (as of the end of the most recent Collection Period) of each  such Ineligible Receivable.  Upon each release to the Borrower of such Ineligible Receivable, the  Administrative Agent shall automatically and without further action be deemed to transfer,  assign and set-over to the Borrower, without recourse, representation or warranty, all the right,  title and interest of the Administrative Agent in, to and under such Ineligible Receivable and all  future monies due or to become due with respect thereto, all proceeds of such Ineligible  Receivable and Recoveries and Insurance Proceeds relating thereto, all rights to security for any  such Ineligible Receivable, and all proceeds and products of the foregoing.  The Administrative  Agent shall, at the sole expense of the Servicer (which, in the case of any Successor Servicer,  shall be reimbursable in accordance with the provisions of Section 2.06), execute such  documents and instruments of release as may be prepared by the Servicer on behalf of the  Borrower and take such other actions as shall reasonably be requested by the Borrower to effect  the release of such Ineligible Receivable pursuant to this subsection.  





 






77  147032870v2  (b) Retransfer of Receivables for Breach of Servicing Covenant.  In the event that the  initial Servicer breaches a servicing covenant pursuant to Section 7.03(c)(i) with respect to any  Receivable, which breach adversely affects the Receivable or the interests of the Lenders, no  later than the earlier of (i) knowledge by the initial Servicer of such event or (ii) receipt by the  initial Servicer from the Administrative Agent or the Borrower of written notice thereof, the  initial Servicer shall (A) disclose the identity of such Receivable on the next Monthly Report and  (B) on or before the next Payment Date, to the extent such breach has not been cured or waived,  make a deposit of the Release Price for each such Receivable into the Collection Account in  immediately available funds, and the initial Servicer shall accept the release of such  Receivable(s), in each case as described in Section 5.04(a).    (c) Notice of Retransfer.  The Borrower or the Servicer, as applicable, shall provide  written notice to the Administrative Agent and each Hedge Counterparty on the Monthly Report  of any release of Receivables pursuant to Sections 5.04(a) and (b).  With respect to any such  release, the Borrower shall provide written notice to the Administrative Agent and each Hedge  Counterparty of any release of Receivables prior to 3:00 p.m., New York City time, three  Business Days prior to the related repurchase date, and such notice shall include a calculation of  the Borrowing Base after giving effect to such release, as well as representations and warranties  by the Borrower that no Termination Event or Servicer Termination Event has occurred, that the  Borrowing Base calculation included with such notice is accurate and that any required Hedging  Agreements are in full effect.  COVENANTS  Section 6.01.  Affirmative Covenants of the Borrower.  From the Closing Date until the  Facility Termination Date:  (a) Compliance with Laws.  The Borrower will comply in all material respects  with all Applicable Laws, including those with respect to the Receivables and related  Financed Vehicles.  (b) Preservation of Existence.  The Borrower will preserve and maintain its  existence, rights, franchises and privileges in the State of Delaware, and qualify and  remain qualified in good standing as a foreign limited liability company 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 Agreements.  The Borrower will, at its  expense, timely and fully perform and comply (or cause the Seller to perform and comply  pursuant to this Agreement, the Purchase Agreement and all Purchase Agreement  Supplements), in all material respects, all provisions, covenants and other promises  required to be observed by it under the Basic Documents and the Contracts.  





 






78  147032870v2  (d) Keeping of Records and Books of Account.  To the extent not maintained  and implemented by the Servicer, the Borrower will maintain and implement  administrative and operating procedures (including an ability to recreate records  evidencing Receivables in the event of the destruction of the originals thereof), and keep  and maintain all documents, books, records, financial statements and other information  reasonably necessary or advisable for the collection of all Receivables.  Such books and  records shall include reports adequate to permit the daily identification of each new  Receivable and all Collections of and adjustments to each existing Receivable.  (e) Borrower Assets.  With respect to each Receivable, the Borrower will:  (i) acquire such Receivable pursuant to and in accordance with the terms of the Purchase  Agreement, (ii) take all action necessary to perfect, protect and more fully evidence the  Borrower's ownership of such Receivable, including (A) filing and maintaining, effective  financing statements (Form UCC-1) listing DFC, respectively, as debtor in all necessary  filing offices (and will cause DFC to obtain similar financing statements from each entity  from which it acquired the Receivables), and filing continuation statements, amendments  or assignments with respect thereto in such filing offices and (B) executing or causing to  be executed such other instruments or notices as may be necessary and (iii) take all  additional action that the Administrative Agent may reasonably request, including the  filing of financing statements listing the Administrative Agent as secured party to perfect,  protect and more fully evidence the respective interests of the parties to this Agreement in  the Collateral.  (f) Delivery of Collections.  The Borrower will deliver to the Servicer, for  further remittance to the Collection Account, all Collections received by Borrower in  respect of the Receivables no later than two Business Days after the Borrower's receipt  thereof.  (g) Separate Corporate Existence.  The Borrower shall be in compliance with  the special purpose entity requirements set forth in Section 6.01(o).  (h) Credit and Collection Policy.  The Borrower will, or will cause DFC or the  Servicer to, as the case may be, (i) with respect to each Receivable, comply with the  Credit and Collection Policy (which may include originating or servicing Receivables in  accordance with those discretionary exceptions that are set forth therein) and (ii) furnish  to the Administrative Agent written notice of any material changes to the Credit and  Collection Policy and revised versions of the Credit and Collection Policy containing  such changes.   (i) Notice of Certain Events.  The Borrower will provide the Administrative  Agent with written notice within one Business Day of the date on which the Borrower  receives notice of, or obtains knowledge of, the occurrence of any Termination Event,  Unmatured Termination Event, Step-up Event, Early Amortization Event, Servicer  Termination and Unmatured Servicer Termination Event.  (j) Taxes.  The Borrower will file and pay any and all Taxes, including those  required to meet the obligations of the Basic Documents, except Taxes that the Borrower  





 






79  147032870v2  is contesting in good faith and by appropriate legal proceedings the validity, applicability  or amount thereof and such contest does not materially endanger any right or interest of  the Secured Parties under the Basic Documents.  (k) Liens.  The Borrower will not create, or participate in the creation of, or  permit to exist, any Liens (other than Permitted Liens) with respect to the Lockbox  Account or the Collection Account.  (l) Reporting.  The Borrower will furnish or cause to be furnished to the  Administrative Agent, each Agent and, to the extent requested by a Hedge Counterparty,  such Hedge Counterparty:  (i) Monthly Report.  Not later than each Reporting Date, a  Monthly Report.   (ii) Quarterly Report.  By the 15th of each February, May,  August and November, a Quarterly Report, including information as of the previous  month-end, as to the Receivables such as collections, delinquencies, losses, recoveries,  cash flows and such other information as reasonably requested by the Administrative  Agent.  (iii) Financial Statements.    (A)Within 60 days after the end of the first three quarterly fiscal  periods of each fiscal year of DFC, the unaudited unconsolidated balance  sheets of DFC as at the end of such period and the related unaudited  unconsolidated statements of income and retained earnings for DFC for  such period, setting forth in comparative figures for the previous fiscal  quarter (to the extent such prior quarterly financial statements were  delivered pursuant to this Section or are otherwise available),  accompanied by a certificate of a Responsible Officer of DFC, which  certificate shall state that each such unconsolidated financial statement  fairly presents the financial condition of DFC in accordance with GAAP,  consistently applied, as at the end of, and for, such period (subject to  normal year end audit adjustments).  (B) Within 60 days after the end of the first three quarterly fiscal  periods of each fiscal year of the Performance Guarantor, the unaudited  consolidated balance sheets of the Performance Guarantor as at the end of  such period and the related unaudited consolidated statements of income  and retained earnings for the Performance Guarantor for such period,  setting forth in comparative figures for the previous quarter (to the extent  such prior quarter financial statements were delivered pursuant to this  Section or are otherwise available), accompanied by a certificate of a  Responsible Officer of the Performance Guarantor, which certificate shall  state that each such consolidated financial statement fairly presents the  financial condition of the Performance Guarantor in accordance with  





 






80  147032870v2  GAAP, consistently applied, as at the end of, and for, such period (subject  to normal year end audit adjustments).  Notwithstanding the foregoing, if  any such report is timely filed with the Securities and Exchange  Commission and is publicly available on its the Electronic Data Gathering,  Analysis and Retrieval (EDGAR) system on the date that the related report  would otherwise be due hereunder, such report shall be deemed to have  been timely delivered in accordance with this subclause.  (C) Within 120 days after each fiscal year of (i) DFC, the  unaudited consolidated balance sheets of DFC as of the end of such fiscal  year and the related unaudited consolidated statements of income and  retained earnings and of cash flows for DFC for such year and (ii) the  Performance Guarantor, the audited consolidated balance sheets of the  Performance Guarantor as at the end of such fiscal year and the related  audited consolidated statements of income and retained earnings and of  cash flows for the Performance Guarantor for such year, setting forth in  comparative form the figures for the previous year, accompanied by an  opinion thereon of independent certified public accountants of recognized  national standing, which opinion shall not be qualified as to scope of audit  or going concern (other than a qualification as to going concern based  solely on the tenor of the Commitments hereunder) and shall state that  each consolidated financial statement fairly presents the financial  condition and results of operations of the Performance Guarantor at the  end of, and for, such fiscal year in accordance with GAAP.   Notwithstanding the foregoing, if any such report is timely filed with the  Securities and Exchange Commission and is publicly available on its the  Electronic Data Gathering, Analysis and Retrieval (EDGAR) system on  the date that the related report would otherwise be due hereunder, such  report shall be deemed to have been timely delivered in accordance with  this subclause.    (D)Within 120 days of the end of each fiscal year of DFC, a  certificate of a Responsible Officer of DFC, which certificate shall state  that the unaudited consolidated balance sheets of DFC delivered pursuant  to subclause (C) fairly present the financial condition of DFC in  accordance with GAAP, consistently applied, at the end of, and for, such  fiscal year.  Within 120 days of the end of each fiscal year of the  Performance Guarantor, a certificate of a Responsible Officer of the  Performance Guarantor, which certificate shall state that the audited  consolidated balance sheets of the Performance Guarantor delivered, or  deemed to have been delivered, pursuant to subclause (C) fairly present  the financial condition of the Performance Guarantor in accordance with  GAAP, consistently applied, as at the end of, and for, such fiscal year.    (iv) Representations.  Promptly following the Borrower's  obtaining knowledge of the same, the Borrower shall notify the Administrative Agent  that any representation or warranty set forth in Section 5.01 or 5.02 was incorrect in  





 






81  147032870v2  any material respect at the time it was given or deemed to have been given, and at the  same time shall deliver to the Administrative Agent a written notice setting forth in  reasonable detail the nature of such facts and circumstances.  In particular, but without  limiting the foregoing, the Borrower shall notify the Administrative Agent in the  manner set forth in the preceding sentence before any Funding Date of any facts or  circumstances within the knowledge of the Borrower which would render any of such  representations and warranties untrue in any material respect at the date when they  were made or deemed to have been made.  (v) Proceedings.  As soon as possible and in any event within  two Business Days of the date on which the Borrower receives notice of, or obtains  knowledge of, the same, the Borrower shall provide notice of any settlement of,  material judgment (including a material judgment with respect to the liability phase of  a bifurcated trial) in or commencement of any labor controversy (of a material nature),  litigation, action, suit or proceeding before any court or Governmental Authority,  domestic or foreign, affecting the Borrower or any of its Affiliates that would  reasonably be expected to have a Material Adverse Effect.  (vi) Notice of Material Events.  Promptly following any  Responsible Officer of the Borrower obtaining knowledge the same, the Borrower  shall provide notice of any other event or circumstances that, in the reasonable  judgment of the Borrower, would reasonably be expected to have a Material Adverse  Effect.  (m) Anti-Corruption Laws and Sanctions.  The Borrower will remain subsect  to, and enforce, Lithia's policies and procedures designed to ensure compliance by Lithia  and its Subsidiaries and each of their respective Subsidiaries and their respective  directors, officers, employees and agents with Anti-Corruption Laws and applicable  Sanctions.    (n) Beneficial Ownership Certification.  From time to time any Lender that  has a reasonable basis for requesting such a certification may request that the Borrower  deliver, and within five Business Days of each such request the Borrower shall execute  and deliver to such Lender, a Beneficial Ownership Certification, in form and substance  reasonably acceptable to such Lender.  Furthermore, promptly following any change that  would result in a change to the status of the Borrower as an excluded "Legal Entity  Customer" under the Beneficial Ownership Rule, the Borrower shall execute and deliver  to each Lender a Beneficial Ownership Certification, in form and substance reasonably  acceptable to each such Lender.  (o) Special Purpose Entity.  The Borrower shall take or perform each of the  following actions (and the Borrower has not heretofore failed to take or perform any such  actions in the past):   (i) maintain its own separate deposit and other bank accounts  and funds to which no other Person has any access (except to the extent permitted  





 






82  147032870v2  under the Basic Documents) which accounts shall be maintained in the name of the  Borrower;  (ii) maintain full books of accounts and records (financial or  other) and financial statements separate from those of any other Person (including, all  resolutions, records, agreements or instruments underlying or regarding the  transactions contemplated by the Basic Documents or otherwise);  (iii) at all times hold itself out to the public and all other  Persons as a legal entity separate from the and any other Person;  (iv) have its own board of directors;  (v) file its own tax returns separate from those of any other  Person, if any, as may be required under applicable law, to the extent (A) not part of a  consolidated group filing a consolidated return or returns or (B) not treated as a  division for tax purposes of another taxpayer, and pay any taxes so required to be paid  under applicable law;  (vi) ensure that any consolidated financial statements of any  Affiliate or any other Person that are filed with the Securities Exchange Commission  or any other governmental authority or are furnished to any creditors of any Affiliate  or any other Person include notes clearly stating that the Borrower is a separate  corporate entity and that its assets are available first and foremost to satisfy the claims  of the creditors of the Borrower; and  (vii) except as contemplated by the Basic Documents, not  commingle its assets with assets of any other Person and maintain the assets of the  Borrower in such a manner that it is not costly or difficult to segregate, identify or  ascertain its individual assets from those of any other Person, including any Affiliate;  (viii) conduct its business in its own name and strictly comply  with all organizational formalities to maintain its separate existence;  (ix) disclose, and cause each Member to disclose, in its  financial statements the effects of all transactions between such Member and the  Borrower in a manner which makes it clear that (A) the Borrower is a separate legal  entity, (B) the assets of the Borrower are not assets of any Affiliate and are not  available to pay creditors of any Affiliate and (C) neither such Member nor any  Affiliate thereof is liable or responsible for the debts of the Borrower;  (x) pay its own liabilities and expenses only out of its own  funds;  (xi) except for capital contributions or capital distributions  permitted under the terms and conditions of the Borrower's Formation Documents, not  enter into any transaction with an Affiliate of the Borrower except on arm's length  terms;  





 






83  147032870v2  (xii) compensate (either directly or through reimbursement of  the Borrower's allocable share of any shared expenses) all employees, consultants and  agents and Affiliates, to the extent applicable, for services provided to the Borrower by  such employees, consultants and agents or Affiliates, in each case, from the Borrower's  own funds and either maintain a sufficient number of employees, and/or employ  sufficient consultants or agents, in light of its contemplated operations; provided, the  foregoing shall not require the Members to make any additional capital contributions  to the Borrower;  (xiii) except as expressly permitted under any of the Basic  Documents, pay from its own bank accounts for accounting and payroll services, rent,  lease and other expenses (or the Borrower's allocable share of any such amounts  provided by one or more other Affiliates) and not have such operating expenses (or the  Borrower's allocable share thereof) paid by any Affiliates; provided, the foregoing  shall not require the Members to make any additional capital contributions to the  Borrower;  (xiv) not hold out its credit or assets as being available to satisfy  the obligations of any other Person;  (xv) maintain office space separate and clearly delineated from  the office space of any Affiliate;  (xvi) allocate fairly and reasonably any overhead expenses that  are shared with an Affiliate, including for shared office space and for services  performed by an employee of an Affiliate;  (xvii) cause (A) all written communications, including letters,  invoices, purchase orders, and contracts, of the Borrower to be made solely in the  name of the Borrower, (B) the Borrower to have its own tax identification number,  stationery, checks and business forms, separate from those of any other Person, (C) all  Affiliates not to use the stationery or business forms of the Borrower, and cause the  Borrower not to use the stationery or business forms of any Affiliate, and (D) all  Affiliates not to conduct business in the name of the Borrower, and cause the  Borrower not to conduct business in the name of any Affiliate;  (xviii) except as expressly permitted by any of the Basic  Documents, direct creditors of the Borrower to send invoices and other statements of  account of the Borrower directly to the Borrower and not to any Affiliate and cause the  Affiliates to direct their creditors not to send invoices and other statements of accounts  of such Affiliates to the Borrower;  (xix) except as expressly permitted by any of the Basic  Documents, not acquire obligations or securities of or make loans or advances to or  grant a security interest in or pledge its assets for the benefit of the Member, any  Affiliate or any other Person;  





 






84  147032870v2  (xx) correct any known misunderstanding regarding its separate  identity and not identify itself as a department or division of any other Person except  as may be required for income tax purposes;  (xxi) maintain adequate capital in light of its contemplated  business purpose, transactions and liabilities, and refrain from engaging in a business  for which its remaining property represents an unreasonably small capital; provided,  however, the foregoing shall not require the Members to make any additional capital  contributions to the Borrower;  (xxii) practice and adhere to all limited liability company  procedures and formalities to the extent required by the Borrower's Formation  Documents or all other appropriate constituent documents and applicable law;  (xxiii) except for the other Basic Documents, not acquire any  obligations or securities of the Member or of any Affiliate of the Borrower;   (xxiv) cause the directors, officers, agents and other  representatives of the Borrower to act at all times with respect to the Borrower  consistently and in furtherance of the foregoing and in the best interests of the  Borrower; and  (xxv) at all times will have at least one director that qualifies as  an "Independent Director" (as such term is defined in the Borrower's Formation  Documents).  Section 6.02.  Negative Covenants of the Borrower.  From the date hereof until the  Facility Termination Date:  (a) Other Business.  The Borrower will not (i) engage in any business other  than the transactions contemplated by the Basic Documents, (ii) incur any Indebtedness,  obligation, liability or contingent obligation of any kind (including guaranteeing any  obligation) other than pursuant to this Agreement, any other Basic Document or under  any Hedging Agreement required by Section 6.03 or (iii) form any Subsidiary or make  any Investments in any other Person.  (b) Receivables Not to be Evidenced by Instruments.  The Borrower will take  no action to cause any Receivable that is not, as of the related Funding Date, evidenced  by an Instrument, to be so evidenced except in connection with the enforcement or  collection of such Receivable.  (c) Security Interests.  The Borrower will not sell, pledge, assign or transfer to  any other Person, or grant, create, incur, assume or suffer to exist any Lien (other than  Permitted Liens) on any portion of the Collateral, whether now existing or hereafter  transferred hereunder, or any interest therein, and the Borrower will not sell, pledge,  assign or suffer to exist any Lien on its interest, if any, hereunder.  The Borrower will  promptly notify the Administrative Agent of the existence of any Lien (other than a  Permitted Lien) on any portion of the Collateral and the Borrower shall defend the right,  





 






85  147032870v2  title and interest of the Administrative Agent in, to and under such Collateral, against all  claims of third parties; provided, that nothing in this subsection shall prevent or be  deemed to prohibit the Borrower from suffering to exist Permitted Liens upon any  portion of the Collateral.  (d) Mergers, Acquisitions, Sales, Etc.  The Borrower will not be a party to any  merger or consolidation, or purchase or otherwise acquire all or substantially all of the  assets or any stock or membership interests of any class of, or any partnership or joint  venture interest in, any other Person, or, sell, transfer, convey or lease all or any  substantial part of its assets, or sell or assign with or without recourse any portion of the  Collateral or any interest therein (other than pursuant hereto).  (e) Distributions.  The Borrower shall not declare or pay, directly or  indirectly, any dividend or make any other distribution (whether in cash or other  property) with respect to the profits, assets or capital of the Borrower or any Person's  interest therein, or purchase, redeem or otherwise acquire for value any of its capital  stock now or hereafter outstanding, except that so long as no Termination Event or  Unmatured Termination Event has occurred and is continuing or would result therefrom,  the Borrower may distribute to holders of its membership interest funds distributed to the  Borrower pursuant to Section 2.06(xi), subject to Applicable Law.  (f) Change of Name or Location of Receivable Files.  The Borrower shall not  (i) change its name or state of organization, move the location of its principal place of  business and chief executive office, and the offices where it keeps the Records from the  location referred to in Section 13.02 or (ii) move, or consent to the Collateral Custodian  or the Servicer moving, the Receivable Files from the location thereof on the Closing  Date, unless the Borrower has given at least 30 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 of the Administrative Agent  in the Collateral.  (g) True Sale.  Except for purposes of GAAP, the Borrower will not account  for or treat the transactions contemplated by the Purchase Agreement in any manner other  than as the sale, or absolute assignment, of the Receivables and other Collateral by DFC  to the Borrower.  (h) ERISA Matters.  The Borrower will not establish, maintain or contribute  to or have any liability (contingent or otherwise) with respect to any Pension Plan or  Multiemployer Plan or otherwise be a "benefit plan investor" under Section 3(42) of  ERISA. The Borrower will not engage or permit any ERISA Affiliate to engage in any  prohibited transaction under Section 406 of ERISA or Section 4975 of the Code for  which an exemption is not available or has not previously been obtained from the United  States Department of Labor and which would result in a Material Adverse Effect.  (i) Formation Documents; Purchase Agreement.  The Borrower will not  amend, modify, waive or terminate any provision of its Formation Documents or of the  Purchase Agreement (including any Purchase Agreement Supplement) without the prior,  





 






86  147032870v2  written consent of the Administrative Agent; provided, that if the Borrower has provided  the Administrative Agent with written notice of its intention to make any such  amendment, modification, waiver or termination and the Administrative Agent has not  provided a response either granting or withholding its consent thereto within ten Business  Days, then the Borrower may proceed with the related amendment, modification, wavier  or termination as if the Administrative Agent had provided its consent thereto.  (j) Changes in Payment Instructions.  The Borrower will not add or make any  change, or permit the Servicer to make any change, in its instructions to Obligors  regarding payments to be made to the Borrower or the Servicer or payments to be made  to the Lockboxes or the Lockbox Account, unless the Administrative Agent has  Consented to such change in writing and has received duly executed copies of all  documentation related thereto, which documentation shall be satisfactory in form and  substance to the Administrative Agent.  (k) Extension or Amendment.  The Borrower will not, except as otherwise  permitted in Section 7.03(c)(i), extend, amend or otherwise modify, or permit the  Servicer to extend, amend or otherwise modify, the terms of any Contract.  (l) No Assignments.  The Borrower will not assign or delegate, grant any  interest in or permit any Lien (other than Permitted Liens) to exist upon any of its rights,  obligations or duties under this Agreement without the prior written Consent of the  Administrative Agent.  (m) Anti-Corruption Laws and Sanctions.  The Borrower will not request any  Loan, and the Borrower shall not use any Loan, and shall procure that its directors,  officers, employees and agents (if any) shall not use, the proceeds of any Loan (A) in  furtherance of an offer, payment, promise to pay, or authorization of the payment or  giving of money, or anything else of value, to any Person in violation of any Anti- Corruption Laws, (B) for the purpose of funding, financing or facilitating any activities,  business or transaction of or with any Sanctioned Person, or in any Sanctioned Country,  or (C) in any manner that would result in the violation of any Sanctions applicable to any  party hereto.  Section 6.03.  Covenant of the Borrower Relating to Hedging.  (a)   Beginning on the date that is thirty days after the date of the Initial Loan, the  Borrower shall at all times that the Loans Outstanding are greater than zero, maintain one or  more Hedge Transactions in form and substance satisfactory to the Administrative Agent, which  may be in the form of an interest rate swap or an interest rate cap transaction; provided, that on  each Funding Date the aggregate notional amount under all Hedge Transactions must equal at  least 100% of the Loans Outstanding as of such date (after giving effect to any changes to the  Loans Outstanding on such date).  Furthermore, (i) each such Hedge Transaction shall provide  for the payment on each Payment Date to the Hedge Counterparty of interest on the notional  amount thereof at a fixed rate per annum and for the payment on each Payment Date to the  Borrower of a floating rate per annum equal to three-month LIBOR for each Interest Period, (ii)  the notional amount of each such Hedge Transaction shall amortize monthly based on an  





 






87  147032870v2  assumed "ABS Rate" agreed upon by the Borrower and the Administrative Agent, (iii) the  "Termination Events" and "Events of Default" that are applicable under each such Hedge  Transaction shall have been approved by the Required Lenders to the Administrative Agent prior  to the effectiveness of such Hedge Transaction and (iv) each such Hedge Transaction shall have  a final maturity date reflecting the expected repayment of the Receivables, taking into account  anticipated losses and prepayments.  Each Hedge Transaction shall be entered into with a Hedge  Counterparty and governed by a Hedging Agreement.  If a Hedge Counterparty, other than a  Hedge Counterparty as defined in clause (i) of the definition thereof, met the Short-Term Ratings  Requirement and/or the Long-Term Ratings Requirement at the time the related Hedge  Transaction was entered into and is downgraded or has any ratings withdrawn such that it no  longer meets the Short-Term Ratings Requirement and/or the Long-Term Ratings Requirement,  as applicable, then within thirty (30) days of the related downgrade or withdrawal either (A) the  Borrower must enter into a new Hedging Agreement or (B) the Hedge Counterparty must post  collateral pursuant to a credit support annex in an amount satisfactory to the Required Lenders.  If on any date any Hedge Transactions are in the form of interest rate swaps and the  aggregate notional amount under all Hedge Transactions as of such date that are outstanding is  (x) less than 95% of the Loans Outstanding as of such date (after giving effect to any changes to  the Loans Outstanding on such date) or (y) more than 105% of the Loans Outstanding as of such  date (after giving effect to any changes to the Loans Outstanding on such date), then on the  related 'Adjustment Date' (which shall be either such date (if such date is a Payment Date) or  otherwise the next Business Day after such date that is a Payment Date), the Borrower shall, if  directed by the Administrative Agent, enter into one or more Hedge Transactions, increase the  notional amount of one or more Hedge Transactions, or decrease the notional amount of one or  more Hedge Transactions, as necessary such that immediately thereafter the aggregate notional  amount under all Hedge Transactions is neither (I) less than 95% of the Loans Outstanding as of  the Adjustment Date (after giving effect to any changes to the Loans Outstanding on such date)  nor (II) more than one 105% of the Loans Outstanding as of the Adjustment Date (after giving  effect to any changes to the Loans Outstanding on such date).  (b) The Borrower shall establish and thereafter maintain a segregated trust account in  the name of the Borrower with respect to each Hedge Counterparty (each, a "Hedge  Counterparty Collateral Account") with a Qualified Institution in trust and for the benefit of the  Lenders and the related Hedge Counterparty.  In the event that pursuant to the terms of the  applicable Hedging Agreement, the related Hedge Counterparty is required to deposit cash or  securities as collateral to secure its obligations ("Posted Collateral"), the Borrower shall deposit  all Posted Collateral received from the Hedge Counterparty into the Hedge Counterparty  Collateral Account. All sums on deposit and securities held in any Hedge Counterparty  Collateral Account shall be used only for the purposes set forth in the related credit support  annex ("Credit Support Annex") to the Hedging Agreement. The only permitted withdrawal from  or application of funds on deposit in, or otherwise to the credit of, a Hedge Counterparty  Collateral Account shall be (i) for application to the obligations of the applicable Hedge  Counterparty under the related Hedging Agreement in accordance with the terms of the related  Credit Support Annex and (ii) to return collateral to the Hedge Counterparty when and as  required by the Credit Support Annex. Amounts on deposit in each Hedge Counterparty  Collateral Account shall be invested at the written direction of the related Hedge Counterparty,  and all investment earnings actually received on amounts on deposit in a Hedge Counterparty  





 






88  147032870v2  Collateral Account or distributions on securities held as Posted Collateral shall be distributed to  the related Hedge Counterparty in accordance with the terms of the related Credit Support  Annex. Any amounts applied by the Borrower to the obligations of the Hedge Counterparty  under the Hedging Agreement in accordance with the terms of the Credit Support Annex shall be  deposited in the Collection Account and applied in accordance with Section 2.06 of this  Agreement. The Borrower agrees to give the Hedge Counterparty prompt notice if it obtains  knowledge that the Hedge Counterparty Collateral Account or any funds on deposit therein or  otherwise to the credit of the Hedge Counterparty Collateral Account, shall or have become  subject to any writ, order, judgment, warrant of attachment, execution or similar process.  (c) Within 30 days after the occurrence of any event defined as an "Event of Default"  or "Termination Event" in a Hedging Agreement, the Borrower shall cause such Hedge  Counterparty to assign its obligations under the Hedging Agreement to a new Hedge  Counterparty which satisfies the requirements set forth in the definition of "Hedge  Counterparty."  (d) The Borrower shall deliver to the Administrative Agent a copy of all documents  related to any Hedging Agreement, including confirmations, schedules and an aggregate notional  amortization schedule.  (e) All reasonably documented out-of-pocket costs and expenses (including  reasonable legal fees and disbursements) incurred by the Administrative Agent and the Lenders  incurred with each Hedge Transaction shall be paid by the Borrower.  (f) As additional security hereunder, the Borrower has granted a security interest to  the Administrative Agent all right, title and interest of the Borrower in the Hedge Collateral.  The  Borrower acknowledges that, as a result of that pledge, the Borrower may not, without the prior  written Consent of the Administrative Agent, exercise any rights under any Hedging Agreement  or Hedge Transaction, except for the Borrower's right under any Hedging Agreement to enter  into Hedge Transactions in order to meet the Borrower's obligations hereunder.  Nothing herein  shall have the effect of releasing the Borrower from any of its obligations under any Hedging  Agreement or any Hedge Transaction, nor be construed as requiring the consent of any Secured  Party for the performance by the Borrower of any such obligations.  Section 6.04.  Affirmative Covenants of the Servicer.  From the date hereof until the  Facility Termination Date:  (a) Compliance with Law.  The Servicer will comply in all material respects  with all Applicable Laws, including those with respect to the Contracts, the Receivables,  the related Financed Vehicles, the Receivable Files or any part thereof and any collection  efforts on behalf of the Receivables or related Financed Vehicles, except to the extent  that the Servicer's failure to so comply would not have a Material Adverse Effect.  (b) Preservation of Corporate Existence.  The Servicer will preserve and  maintain its existence, rights, franchises and privileges in its State of formation, and shall  qualify and remain qualified in good standing as a foreign limited liability company in  each jurisdiction where the failure to preserve and maintain such existence, rights,  





 






89  147032870v2  franchises, privileges and qualification has had, or could reasonably be expected to have,  a Material Adverse Effect.  (c) Obligations and Compliance with Receivables.  The Servicer will fulfill  and comply with all obligations on the part of the Borrower to be fulfilled or complied  with under or in connection with each Receivable and will do nothing to impair the rights  of the Administrative Agent in, to and under the Collateral.  The Servicer will comply  with the terms and conditions of this Agreement relating to the obligation of the  Borrower to remove Receivables from the Collateral pursuant to this Agreement and the  obligation of the Seller, under the Purchase Agreement, to reacquire Receivables from the  Borrower pursuant to the Purchase Agreement.  (d) Performance and Compliance with Servicer Basic Documents.  The initial  Servicer will timely and fully perform and comply with all provisions, covenants and  other promises required to be observed by it under the Servicer Basic Documents.  (e) Keeping of Records and Books of Account.  The Servicer will maintain  and implement administrative and operating procedures (including an ability to recreate  records evidencing Receivables, including the Receivable Files, 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  Receivables, including the Receivable Files.  (f) Preservation of Security Interest.  The Servicer will execute and 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 protect fully the  security interest of the Administrative Agent in, to and under the Collateral; provided,  that in the case of any Successor Servicer, the Successor Servicer shall execute and file  such documents (as prepared by the Borrower or the Administrative Agent) only upon the  written direction of the Borrower or the Administrative Agent and any action taken by the  Successor Servicer pursuant to this clause shall be a reimbursable expense paid in  accordance with the provisions of Section 2.06.  The Servicer will defend the right, title  and interest of the Borrower, the Secured Parties, the Administrative Agent and the  Collateral Custodian in, to and under the Collateral against all claims of third parties  claiming through or under the Servicer; provided, that in the case of any Successor  Servicer, such action or defense shall only be taken at the written direction of the  Borrower or the Administrative Agent and, so long as the need for such defense or action  was not caused by the Successor Servicer's gross negligence, bad faith or willful  misconduct, any action taken by the Successor Servicer pursuant to this clause shall be a  reimbursable expense paid in accordance with the provisions of Section 2.06.  (g) Credit and Collection Policy.  The Servicer will comply in all material  respects with the Credit and Collection Policy in regard to each Receivable.    (h) Monthly Reports. Not later than each Reporting Date, the Servicer will  provide to the Administrative Agent and, to the extent requested or required by a Hedge  Counterparty, such Hedge Counterparty, a Monthly Report.  





 






90  147032870v2  (i) Termination Events and Servicer Termination Events.  The Servicer will  furnish to the Administrative Agent, the Backup Servicer and each Hedge Counterparty,  within one Business Day after a Responsible Officer of the Servicer has actual  knowledge thereof, notice of the occurrence of an Unmatured Termination Event, a  Termination Event, an Unmatured Servicer Termination Event or a Servicer Termination  Event.  (j) Other.  The Servicer will furnish to the Administrative Agent, from time to  time, such other information, documents, records or reports respecting the Collateral or  the condition or operations, financial or otherwise, of the Servicer as the Administrative  Agent may from time to time reasonably request in order to protect the interests of the  Administrative Agent or Lenders under or as contemplated by this Agreement.  (k) Notice Regarding Collateral.  The Servicer shall advise the Collateral  Custodian (if other than DFC) and the Administrative Agent in writing in reasonable  detail promptly following its actual knowledge or receipt of written notice of (i) any Lien  (other than a Permitted Lien) asserted or claim made against any portion of the Collateral,  (ii) the occurrence of any breach in any material respect by the Servicer of any of its  representations, warranties and covenants contained herein relating to the Receivables  and (iii) the occurrence of any other event which would reasonably be expected to have a  material adverse effect on the security interest of the Administrative Agent on behalf of  the Secured Parties in the Collateral or the collectability of all or a material portion of the  Receivables.  (l) Additional Information.  The Servicer shall, within five Business Days of  its receipt thereof, respond to reasonable written directions or written requests for  information that the Borrower, the Administrative Agent, any Lender or the Collateral  Custodian might have with respect to the administration of the Receivables.  (m) Financial Statements.  The initial Servicer shall provide to the  Administrative Agent, each Agent and each Lender, the financial statements described in  Section 6.01(l)(iii).  (n) Accounting Policy.  The initial Servicer will notify the Administrative  Agent within five Business Days of its implementation of any material change in the its   accounting policies.  (o) Additional Covenants.  The Servicer shall (i) promptly notify the  Borrower, the Administrative Agent or the Collateral Custodian (if other than DFC) of  the occurrence of any event which would require that the Borrower make or cause to be  made any filings, reports, notices or applications or seek any consents or authorizations  from any and all Governmental Authorities in accordance with the relevant UCC and any  State vehicle license or registration authority as may be necessary or advisable to create,  maintain and protect a first priority security interest of the Administrative Agent in, to  and on the Financed Vehicles and a first priority security interest of the Administrative  Agent in, to and on the Collateral, and (ii) take all reasonable action necessary to  maximize the returns pursuant to the Insurance Policies.    





 






91  147032870v2  (p) Anti-Corruption Laws and Sanctions.  The initial  Servicer will remain  subject to and enforce Lithia's policies and procedures designed to ensure compliance by  Lithia and its Subsidiaries and each of their respective Subsidiaries and their respective  directors, officers, employees and agents with Anti-Corruption Laws and applicable  Sanctions.    Section 6.05.  Negative Covenants of the Servicer.  From the date hereof until the Facility  Termination Date:  (a) Lockboxes; Lockbox Account; Collection Account.  The Servicer shall not  create or participate in the creation of, or solely in the case of the initial Servicer, permit  to exist, any Liens (other than Permitted Liens) with respect to the Lockboxes, the  Lockbox Account or the Collection Account.  The Servicer shall not enter into any  "control agreement" (as defined in the relevant UCC) with respect to the Lockboxes, the  Lockbox Account (other than the Blocked Account Control Agreement) or the Collection  Account (other than the Control Agreement).  Without the prior written Consent of the  Administrative Agent, the Servicer shall not move the Lockboxes, the Lockbox Account  or the Collection Account to an institution other than the one at which it is held as of the  Closing Date.  (b) Change of Name or Location of Receivable Files.  The initial Servicer  shall not 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 Receivables (including the Receivable Files) from the location referred to  in Section 13.02, unless the initial Servicer has given at least 30 days' prior 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 of the  Administrative Agent, as agent for the Secured Parties, in the Collateral.  (c) Credit and Collection Policy.  The Servicer will not amend, modify,  restate or replace, in whole or in part, in any material respect, the Credit and Collection  Policy, without the prior written Consent of the Administrative Agent, which consent  shall not be unreasonably withheld.  If the Administrative Agent does not provide its  written consent to, or rejection of, a proposed material amendment, modification,  restatement or replacement of the Credit and Collection Policy within 10 Business Days  of its receipt of notice thereof from the Servicer, then the Administrative Agent will be  deemed to have consented to such amendment, modification, restatement or replacement.  (d) Change in Payment Instructions to Obligors.  The initial Servicer will not  make any change in its instructions to the Obligors regarding payments to be made to the  Borrower or the Servicer, except as otherwise permitted by the Credit and Collection  Policy, or payments to be made to the Lockboxes or the Lockbox Account, unless the  Administrative Agent has Consented to such change and has received duly executed  documentation related thereto.  





 






92  147032870v2  (e) Extension or Amendment of Contracts.  The Servicer will not, except as  otherwise permitted in Section 7.03(c)(i), extend, amend or otherwise modify the terms  of any Contract.  (f) No Instruments.  The Servicer shall take no action to cause any Receivable  to be evidenced by any Instrument or "electronic chattel paper" (as defined in the UCC).  (g) No Liens.  Other than as permitted by this Agreement, the Servicer shall  not sell, pledge, assign or transfer to any other Person, or grant, create, incur, assume or  suffer to exist any Lien (other than the Lien created by this Agreement) on all or any  portion of the Collateral or any interest therein; and the Servicer shall defend the right,  title and interest of the Administrative Agent on behalf of the Secured Parties in, to and  under the Collateral against all claims of third parties claiming through or under the  Servicer.  (h) Release; Additional Covenants.  The Servicer shall not (i) release any  Financed Vehicle securing any Receivable from the security interest granted therein by  such Receivable in whole or in part except (A) in the event of payment in full by the  Obligor thereunder or upon transfer of such Financed Vehicle to a purchaser following  repossession by the Servicer or (B) to an insurer in exchange for Insurance Proceeds paid  by such insurer resulting from a claim for the total insured value of a Financed Vehicle,  or (ii)  take any action that would reasonably be expected to impair the rights of the  Borrower, the Secured Parties or the Collateral Custodian in the Collateral.   Notwithstanding any other provision of this Agreement, the Servicer may release any  Financed Vehicle from the security interest created by the related Receivable when the  Servicer deposits into the Collection Account an amount equal to the related Release  Price or the entire amount of Insurance Proceeds, Recoveries and other Collections it has  received or expects to receive with respect to such Receivable and such Financed  Vehicle.  (i) ERISA.  The Servicer will not (A) engage or permit any ERISA Affiliate  to engage in any prohibited transaction for which an exemption is not available or has not  previously been obtained from the United States Department of Labor and which would  result in a Material Adverse Effect, or (B) to the extent it would result in a Material  Adverse Effect (i) permit to exist any accumulated funding deficiency, as defined in  Section 302(a) of ERISA and Section 412(a) of the Code, or funding deficiency with  respect to any Benefit Plan other than a Multiemployer Plan, (ii) fail to make any  payments to a Multiemployer Plan that the Servicer or any such ERISA Affiliate may be  required to make under the agreement relating to such Multiemployer Plan or any law  pertaining thereto, (iii) terminate any Pension Plan so as to result in any liability or (iv)  permit to exist any occurrence of any Reportable Event.  (j) Anti-Corruption Laws and Sanctions.  The initial Servicer will not request  any Loan, and none of the initial Servicer, any Subsidiary or Affiliate or the Servicer  shall use, and shall procure that its Subsidiaries and its or their respective directors,  officers, employees and agents shall not use, the proceeds of any Loan (A) in furtherance  of an offer, payment, promise to pay, or authorization of the payment or giving of money,  





 






93  147032870v2  or anything else of value, to any Person in violation of any Anti-Corruption Laws, (B) for  the purpose of funding, financing or facilitating any activities, business or transaction of  or with any Sanctioned Person, or in any Sanctioned Country, or (C) in any manner that  would result in the violation of any Sanctions applicable to any party hereto.  ADMINISTRATION AND SERVICING OF RECEIVABLES  Section 7.01.  Designation of Servicing.  The Administrative Agent and the Borrower, at  the direction of and on behalf of the Administrative Agent, hereby appoint DFC, as Servicer to  manage, collect and administer each of the Receivables and the other Collateral, and to enforce  its respective rights and interests in and under the Collateral and DFC hereby accepts such  appointment and agrees to perform the duties and responsibilities of the Servicer pursuant to the  terms hereof.  Section 7.02.  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 Section 2.06(ii).  The Servicer  shall further be entitled to retain as additional servicing compensation any and all Ancillary Fees  from Obligors.  Section 7.03.  Duties of the Servicer.  (a) Standard of Care.  The Servicer agrees that its servicing and collection of the  Receivables shall be carried out in accordance with the Credit and Collection Policy and  Applicable Law and, to the extent more exacting, the degree of skill and attention that the  Servicer exercises with respect to all comparable motor vehicle receivables that it services for  itself or others.   (b) Records Held in Trust.  The Servicer shall hold in trust for the Secured Parties all  records which evidence or relate to all or any part of the Collateral.  The outgoing Servicer shall  promptly deliver to any Successor Servicer, and the Successor Servicer shall hold in trust for the  Borrower and the Secured Parties ,all records which evidence or relate to all or any part of the  Collateral.  (c) Collection Practices.  (i) The Servicer shall be responsible for collection of  payments called for under the terms and provisions of the Contracts related to the  Receivables, as and when the same shall become due.  The Servicer, in making  collection of Receivable payments pursuant to this Agreement, shall be acting as agent  for the Borrower, and shall be deemed to be holding such funds in trust on behalf of  and as agent for the Borrower.  The Servicer, consistent with the Credit and Collection  Policy in effect at the time of acting, shall service, manage, administer and make  collections on the Receivables on behalf of the Borrower and shall have full power and  authority to do any and all things which it may deem necessary or desirable in  connection therewith which are consistent with this Agreement.  The Servicer may in  





 






94  147032870v2  its discretion grant extensions, rebates or adjustments on a Contract or amend or  modify any Contract (including modifying the APR or the amount of the Scheduled  Payments) as permitted by the Credit and Collection Policy then in effect.  If any such  modification occurs after the Termination Date, such Receivable must be repurchased  by the initial Servicer pursuant to Section 5.04(b).  The Servicer may in its discretion  waive any late payment charge or any other fees, not including interest on the  Principal Balance, that may be collected in the ordinary course of servicing a  Receivable.  The Servicer shall also enforce all rights of the Borrower under the  Purchase Agreement (including each Purchase Agreement Supplement) including the  right to require DFC to repurchase Receivables for breaches of representations and  warranties made by DFC.  (ii) Consistent with the Credit and Collection Policy, if any  Receivable is past due or delinquent, in whole or in part, the Servicer will make  reasonable and customary efforts to contact the Obligor.  The Servicer shall continue  its efforts to obtain payment from an Obligor who is past due or delinquent on a  Receivable until the related Financed Vehicle has been repossessed and sold or the  Servicer has determined that all amounts collectable on the Receivable have been  collected.  The Servicer shall use commercially reasonable efforts, consistent with the  Credit and Collection Policy and the standard of care set forth in Section 7.03(a), to  collect funds on a Defaulted Receivable and by the close of business on the second  Business Day following receipt of such Collections and deposit thereof into the  Lockbox Account, such Collections shall be deposited into the Collection Account.  (iii) In the event a Receivable becomes a Defaulted Receivable,  the Servicer, itself or through the use of independent contractors or agents shall,  consistent with the Credit and Collection Policy, repossess or otherwise convert the  ownership of the Financed Vehicle securing any such Receivable.  All costs and  expenses incurred by the Servicer in connection with the repossession of the Financed  Vehicles securing such Receivables shall be reimbursed to the Servicer (other than  overhead), to the extent not previously recouped by the Servicer from Recoveries on  the Payment Date immediately succeeding the Collection Period in which the Servicer  delivered to the Administrative Agent an itemized statement of such costs and  expenses.  Notwithstanding the foregoing and consistent with the terms of this  Agreement, the Servicer shall not be obligated to repossess or take any action with  respect to a Defaulted Receivable if, in its reasonable judgment consistent with the  Credit and Collection Policy, the Recoveries would not be increased.  (iv) The Servicer shall deposit or cause to be deposited by  electronic funds transfer all Collections to the Collection Account no later than two  Business Days after deposit into the Lockbox Account or otherwise.  Notwithstanding  the foregoing, in no event shall any Successor Servicer be obligated to transfer funds  in excess of the available funds in the Lockbox Account.  (v) Notwithstanding the provisions of subclause (iv), at any  time that (A) DFC is the Servicer, (B) Lithia has long-term unsecured debt ratings of  not less than "A" by Standard & Poor's and not less than "A2" by Moody's, and (C) no  





 






95  147032870v2  Early Amortization Event, Termination Event, or Servicer Termination Event has  occurred and is continuing, the Servicer may make a single monthly deposit of  Collections to the Collection Account in immediately available funds, provided that  such deposit is made not later than 3:00 p.m., New York City time, on the second  Business Day preceding the Payment Date following the Collection Period with  respect to which such Collections relate.  (d) Collection; Recourse; Sales of Financed Vehicles.  The Servicer, itself or through  the use of independent contractors or agents, is authorized to follow practices consistent with the  Credit and Collection Policy in its servicing of automotive receivables, which may include  reasonable efforts to realize rights of recourse against any Dealer and selling a Financed Vehicle  at public or private sale; provided, that the Servicer, itself or through the use of independent  contractor or agents shall, in accordance with the Credit and Collection Policy, attempt to  maximize the sales proceeds for each repossessed Financed Vehicle.  The foregoing shall be  subject to the provision that, in any case in which a Financed Vehicle shall have suffered  damage, the Servicer shall not expend funds for the repair or the repossession of such Financed  Vehicle unless the Servicer shall determine in its discretion that such repair or repossession  would increase the Recoveries in an amount greater than the cost of repairs.  Notwithstanding the  foregoing and consistent with the terms of this Agreement, the Servicer shall not be obligated to  repossess or take any action with respect to a repossessed Financed Vehicle if, in its reasonable  judgment and consistent with the Credit and Collection Policy, the Recoveries would not be  increased.  (e) Insurance.  The Servicer shall:  (i) on behalf of the Borrower, administer and enforce all rights  and responsibilities of the Borrower, as owner of the Receivables, provided for in the  Insurance Policies relating to the Receivables;  (ii) administer the filings of claims under the Insurance Policies  by filing the appropriate notices related to claims, including initial notices of loss, as  well as claims with the respective carriers or their authorized agents all in accordance  with the terms of the Insurance Policies; and use reasonable efforts to file such claims  on a timely basis after obtaining knowledge of the events giving rise to such claims.  (iii) utilize such notices, claim forms and claim procedures as  are required by the respective insurance carriers;  (iv) upon receipt of notice that an Obligor's physical damage  insurance covering a Financed Vehicle related to a Receivable has lapsed or is  otherwise not in force, notify such Obligor that each Obligor is required to maintain  physical damage insurance covering a Financed Vehicle throughout the term of the  related Receivable;  (v) not be required to pay any premiums or, other than  administering the filing of claims and performing reporting requirements specified in  





 






96  147032870v2  the Insurance Policies in connection with filing such claims, perform any obligations  of the named insured under such Insurance Policies; and  (vi) not be responsible to the Borrower, the Secured Parties or  the Collateral Custodian for any (A) act or omission to act done in order to comply  with the requirements or satisfy any provisions of the Insurance Policies or (B) act,  absent willful misconduct or negligence, or omission to act done in compliance with  this Agreement.  In the case of any inconsistency between this Agreement and the terms of any Insurance  Policy, the Servicer shall comply with the latter.  (f) Obligation to Restore.  In the event of any physical loss or damage to a Financed  Vehicle related to a Receivable from any cause, whether through accidental means or otherwise,  the Servicer shall have no obligation to cause the affected Financed Vehicle to be restored or  repaired.  However, the Servicer shall comply with the provisions of any insurance policy or  policies directly or indirectly related to any physical loss or damage to a Financed Vehicle.  (g) Security Interests.  The Borrower hereby directs the Servicer to take or cause to  be taken such steps as are necessary, to maintain perfection of the security interest created by  each such Receivable in the related Financed Vehicle.  The Servicer shall, at the direction of the  Borrower, the Administrative Agent or the Collateral Custodian (if other than DFC), take any  action necessary to preserve and protect the security interests of the Borrower, the Secured  Parties and the Collateral Custodian in the Receivables, including any action specified in any  Opinion of Counsel delivered to the Servicer.  For the avoidance of doubt, any action taken by  the Successor Servicer pursuant to this clause shall be a reimbursable expense paid in accordance  with the provisions of Section 2.06.  (h) Realization on Financed Vehicles.  The Servicer represents, warrants and  covenants that in the event that the Servicer realizes upon any Financed Vehicle, the methods  utilized by the Servicer to realize upon such Receivable or otherwise enforce any provisions of  such Receivable, will be conducted in accordance with the provisions of this Agreement, the  Credit and Collection Policy and Applicable Law.  (i) Recordkeeping.  The Servicer shall:  (i) maintain legible copies (in electronic or hard-copy form, in  the discretion of the Servicer) or originals of all documents in its Receivable File with  respect to each Receivable and the Financed Vehicle related thereto; and  (ii) keep books and records, reasonably satisfactory to the  Administrative Agent, pertaining to each Receivable and shall make periodic reports  in accordance with this Agreement; such records may not be destroyed or otherwise  disposed of except as provided herein and as allowed by Applicable Law, all  documents, whether developed or originated by the Servicer or not, reasonably  required to document or to properly administer any Receivable shall remain at all  times the property of the Borrower and shall be held in trust by the Servicer; the  Servicer shall not acquire any property rights with respect to such records, and shall  





 






97  147032870v2  not have the right to possession of them except as subject to the conditions stated in  this Agreement; and the Servicer shall bear the entire cost of restoration in the event  any Receivable File shall become damaged, lost or destroyed while in the Servicer's  possession or control.  Section 7.04.  Collection of Payments.  (a) Payments to the Lockboxes or the Lockbox Account.  On or before the relevant  Funding Date, the initial Servicer shall have instructed all related Obligors to make all payments  in respect of the related Receivables directly to the Lockboxes or the Lockbox Account.  (b) Establishment of the Collection Account.  On or before the Closing Date, the  Servicer shall cause the Collection Account to be established with the Account Bank in the name  of the Borrower.  The Collection Account shall at all times be subject to the Control Agreement.  (c) Adjustments.  If the Servicer (i) 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, (ii) 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 or (iii) is entitled to reimbursement of any Ancillary Fees in accordance with  Section 7.02, the Servicer shall appropriately adjust the amount subsequently deposited into the  Collection Account to reflect such dishonored check, mistake or reimbursement (as applicable).   Any Scheduled Payment in respect of which a dishonored check is received shall be deemed not  to have been paid.  Section 7.05.  Servicer Advances.  For each Collection Period, if the Servicer determines  that any Scheduled Payment (or portion thereof) that was due and payable pursuant to a  Receivable during such Collection Period was not received prior to the last day of such  Collection Period, the Servicer may, but is not obligated to, make an advance in an amount up to  the amount of such delinquent Scheduled Payment (or portion thereof); in addition, if on any day  there are not sufficient funds on deposit in the Collection Account to pay accrued Interest, the  Servicer may, but is not obligated to, make an advance in the amount necessary to pay such  Interest (each, a "Servicer Advance"), in each case if the Servicer reasonably believes that the  Servicer Advance will be recovered from subsequent payments with respect to such Receivable.   The Servicer will deposit any Servicer Advances into the Collection Account on or prior to 2:00  p.m., New York City time, on the related Payment Date, in immediately available funds.  The  Servicer shall be entitled to reimbursement of Servicer Advances from subsequent payments on  or in respect of the Receivable with respect to which a Servicer Advance was made, including  collections of any prepayments, amounts deposited in the Collection Account for the repurchase  of the Receivable for a breach of a representation or warranty and, if the Servicer determines that  a Servicer Advance will not be recovered from the Receivable to which it relates, from  collections related to other Receivables.  Notwithstanding anything to the contrary set forth  herein, no Successor Servicer will be required to make any Servicer Advance.  Section 7.06.  Payment of Certain Expenses by Servicer.  Except for such amounts and  expenses for which the Servicer is entitled to reimbursement as provided herein, the Servicer will  be required to pay all expenses incurred by it in connection with its activities under this  





 






98  147032870v2  Agreement, including the fees and disbursements of independent certified public accountants,  Taxes imposed on the Servicer, expenses incurred in connection with payments and reports  pursuant to this Agreement, fees and expenses of subservicers and agents of the Servicer, and all  other fees and expenses not expressly stated under this Agreement for the account of the  Borrower.  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 Collection 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.  Section 7.07.  Reports and Audit.  (a) Monthly Reports.  On each Reporting Date, the Servicer will provide to the  Borrower, the Administrative Agent, the Backup Servicer and, to the extent requested or required  by a Hedge Counterparty, such Hedge Counterparty, a Monthly Report.  (b) Quarterly Report.  By the 15th of each February, May, August and November,  commencing in August 2020, the Servicer will provide a Quarterly Report to the Administrative  Agent and, to the extent requested or required by a Hedge Counterparty, such Hedge  Counterparty.  The Administrative Agent or a Hedge Counterparty may request such report more  frequently if required by regulators or to comply with Applicable Law (including Basel II and  Basel III).    (c) Serviced Portfolio Information. Upon the reasonable request of the Administrative  Agent, the initial Servicer shall provide, at its own expense, the Administrative Agent with  information on the Serviced Portfolio regarding delinquencies, loss-to-liquidations, annualized  losses and such other information as the Administrative Agent may request, but solely to the  extent that such data is available to the Servicer without undue administrative burden or cost.    (d) Audit.  Once during each calendar year (commencing in 2020), at such times  during normal business hours as are reasonably convenient to the Borrower or the Servicer, as  the case may be, at the sole cost and expense of the Servicer (provided, that such costs and  expenses are reasonable and customary for similar types of inspections in the industry and do not  exceed $75,000 per annum) and upon reasonable request of the Administrative Agent and prior  written notice to the Borrower or the Servicer, as the case may be, the Borrower or the Servicer,  as the case may be, shall permit such Person or Persons as the Administrative Agent may  designate (including the Backup Servicer or an independent accounting firm), with the approval  of the Required Lenders, to conduct, on behalf of all of them, audits or to visit and inspect any of  the properties of the Borrower or the Servicer where the Receivable Files are located, as the case  may be, to examine the Receivable Files, internal controls and procedures maintained by the  Borrower or Servicer, as the case may be, and take copies and extracts therefrom, and to discuss  the affairs of the Borrower and the Servicer with their respective officers and employees (which  employees, except after the occurrence and during the continuation of a Termination Event or  Servicer Termination Event, shall be designated by the Borrower or the Servicer, as the case may  be) and, upon written notice to the Borrower or the Servicer, as the case may be, independent  accountants.  The scope of any audit or inspection will be a scope agreed upon between the  Servicer and the Administrative Agent.  The Administrative Agent may request to take the  foregoing actions more than once per calendar year if it has a commercially reasonable basis for  





 






99  147032870v2  requesting such actions, but any additional inspections and audits shall be at the expense of the  Administrative Agent.  After the occurrence and during the continuation of a Termination Event,  Unmatured Termination Event, Unmatured Servicer Termination Event or Servicer Termination  Event, the Administrative Agent, the Backup Servicer and their respective representatives shall  be permitted to take the foregoing actions without being subject to any limitation on the number  of audits, visits or inspections that may be conducted during a calendar year and such audits,  visits or inspections shall be at the sole cost and expense of the Servicer and such costs and  expenses shall not be subject to a cap; provided, that the Administrative Agent and its  representatives shall make reasonable efforts to coordinate, and provide a prior written notice of,  such audits, visits and inspections.  The Borrower or the Servicer, as the case may be, hereby  authorizes such officers, employees and independent accountants to discuss with the  Administrative Agent and its representatives, the affairs of the Borrower or the Servicer, as the  case may be.  The Servicer shall reimburse the Administrative Agent for all reasonable fees,  costs and expenses incurred by or on behalf of the Secured Parties in connection with the  foregoing actions promptly upon receipt of a written invoice therefor.  Nothing in this subsection  shall affect the obligation of the Servicer to observe any Applicable Law prohibiting the  disclosure of information regarding the Obligors, and the failure of the Servicer to provide access  to information as a result of such obligation shall not constitute a breach of this subsection. In the  case of any Successor Servicer, any fees or expenses of the Servicer referenced in this Section  shall be reimbursable in accordance with the provisions of Section 2.06.    Section 7.08.  Quarterly Statement as to Compliance.  The initial Servicer shall deliver to  the Administrative Agent, (a) within 45 days after the end of the calendar quarter ending on  September 30, 2020 and (b) within 30 days after the end of each calendar quarter thereafter, an  Officer's Certificate, stating that (i) a review of the activities of the Servicer during the preceding  quarterly period (or since the Closing Date in the case of the first such Officer's Certificate) and  of its performance under this Agreement has been made under such officer's supervision and  (ii) to the best of such officer's knowledge, based on such review, the Servicer has fulfilled all its  obligations under this Agreement throughout such quarter (or such shorter period in the case of  the first such Officer's Certificate), or, if there has been a default in the fulfillment of any such  obligation, specifying each such default known to such officer and the nature and status thereof.    Section 7.09.  Backup Servicer; Entry into Backup Servicing Agreement.  (a) The parties hereto acknowledge and agree that, as of the date of this  Agreement, (i) Vervent Inc., a Delaware corporation, is the "Backup Servicer" and (ii) the  Backup Servicing Agreement, dated as of December 17, 2020, by and among the  Borrower, the Servicer, and Vervent Inc. is the "Backup Servicing Agreement."    (b) At all times that a Backup Servicing Agreement is in effect, (i) the  Servicer shall perform all of its duties thereunder and (ii) the Borrower shall both perform  all of its duties thereunder and shall cause the Servicer to consult with the Backup  Servicer as may be necessary from time to time to perform or carry out the Backup  Servicer's obligations thereunder, including the obligation, if requested in writing by the  Administrative Agent, to succeed to the duties and obligations of the Servicer pursuant  hereto.  





 






100  147032870v2  (c) The Backup Servicer shall be entitled to recover its fees and reimbursable  costs as set forth in the Backup Servicing Agreement in accordance with Section 2.06  (but only to the extent that the same have not been paid by the Servicer).  Section 7.10.  Rights After Assumption of Duties by Backup Servicer or Designation of  Successor Servicer; Liability.  At any time following the assumption of the duties of the Servicer  by the Backup Servicer, in its capacity as Successor Servicer, or the designation of a Successor  Servicer (other than the Backup Servicer) pursuant to Section 7.14 as a result of the occurrence  of a Servicer Termination Event:  (a) The Servicer, on behalf of the Borrower, shall, at the Administrative  Agent's request, (i) assemble all of the records relating to the Collateral, including all  Receivable Files, and shall make the same available to the Administrative Agent, the  Backup Servicer or any Successor Servicer at a place selected by the Administrative  Agent, and (ii) segregate all cash, checks and other instruments received by it from time  to time constituting Collections of Collateral in a manner acceptable to the  Administrative Agent, the Backup Servicer or such other Successor Servicer and shall, no  later than two Business Days after receipt, remit all such cash, checks and instruments,  duly endorsed or with duly executed instruments of transfer, to, or at the direction of, the  Administrative Agent.  (b) The Borrower hereby authorizes the Administrative Agent to take or cause  to be taken any and all steps in the Borrower's name and on behalf of the Borrower  necessary or desirable, in the determination of the Administrative Agent, to collect all  amounts due under the Collateral, including endorsing the Borrower's name on checks  and other instruments representing Collections and enforcing the Receivables.  (c) The Successor Servicer shall be liable in accordance herewith only to the  extent of the obligations specifically undertaken by the Successor Servicer in such  capacity herein.  Such liability is limited to only those actions taken or omitted to be  taken by the Successor Servicer and caused through its gross negligence, bad faith or  willful misconduct.  No implied covenants or obligations shall be read into this  Agreement against the Successor Servicer and, in the absence of bad faith on its part, the  Successor Servicer may conclusively rely on the truth of the statements and the  correctness of the opinions expressed in any certificates or opinions furnished to the  Successor Servicer and conforming to the requirements of this Agreement.  (d) The Successor Servicer shall not be charged with actual or constructive  knowledge of any Termination Event or Unmatured Termination Event unless a  Responsible Officer of the Successor Servicer obtains actual knowledge of such event or  the Successor Servicer receives written notice of such event from the Borrower, the  Servicer or the Administrative Agent.    (e) The Successor Servicer shall not be required to expend or risk its own  funds or otherwise incur financial liability in the performance of its duties hereunder, or  in the exercise of any of its rights or powers, if the repayment of such funds or adequate  





 






101  147032870v2  indemnity against such risks or liability is not reasonably assured to it in writing prior to  the expenditure of such funds or the incurrence of financial liability.    Section 7.11.  Limitation on Liability of the Servicer and Others.  Except as expressly   provided herein, neither the Servicer nor any of its directors or officers or employees or agents  shall be under any liability to the Secured Parties or any other Person for any action taken or for  refraining from the taking of any action pursuant to this Agreement; provided, that this provision  shall not protect the Servicer or any such Person against any liability that would otherwise be  imposed by reason of its willful misconduct, bad faith or negligence in the performance of duties  or by reason of its willful misconduct hereunder.  Section 7.12.  The Servicer Not to Resign.  The Servicer shall resign only with the prior  written consent of the Administrative Agent (acting at the direction of the Required Lenders) or  if the Servicer provides an Opinion of Counsel to the Administrative Agent to the effect that such  Servicer is no longer permitted by law to act as Servicer hereunder.  No termination or  resignation of the Servicer hereunder shall be effective until a Successor Servicer, acceptable to  the Administrative Agent has accepted its appointment as Successor Servicer hereunder and has  agreed to be bound by the terms of this Agreement.  Section 7.13.  Servicer Termination Events.  The occurrence and continuance of any of  the following events shall constitute a "Servicer Termination Event" hereunder:  (a) any failure by the Servicer to make any payment, transfer or deposit as  required by it as required by any Basic Document, to which it is a party, which failure is  not remedied within one Business Day;  (b) any failure by the Servicer to deliver the Monthly Report by the Reporting  Date, which failure is not remedied within one Business Day;  (c) an Insolvency Event shall occur with respect to the Servicer;  (d) any failure by the Servicer duly to observe or perform in any other  covenant or agreement of the Servicer set forth in this Agreement or the other Basic  Documents to which the Servicer is a party, which such failure materially and adversely  affects the rights or interests of the Secured Parties and remains unremedied for 30 days  after the earlier of knowledge thereof by the Servicer or after the date on which written  notice of such failure shall have been given to the Servicer;  (e) any representation, warranty or certification made by the Servicer in any  Basic Document to which it is a party or in any certificate delivered pursuant to any Basic  Document to which it is a party shall prove to have been false or otherwise incorrect in  any respect when made, deemed made, or delivered, which such incorrect representation,  warranty or certification materially and adversely affects the rights or interests of the  Secured Parties and, if able to be cured, shall not have been cured for 30 days after the  earlier of the date on which the Servicer first has knowledge thereof or the date on which  written notice of such failure shall have been given to the Servicer;   





 






102  147032870v2  (f) DFC shall fail to pay any principal of or premium or interest on any  Indebtedness having a principal amount of $5,000,000 or greater, when the same  becomes due and payable (whether by scheduled maturity, required prepayment,  acceleration, demand or otherwise) and such failure shall continue after the applicable  grace period, if any, specified in the agreement or instrument relating to such  Indebtedness; or any other default under any agreement or instrument relating to any such  Indebtedness of DFC, or any other event, shall occur and shall continue after the  applicable grace period, if any, specified in such agreement or instrument if the effect of  such default or event is to accelerate, or to permit the acceleration of, the maturity of such  Indebtedness; or any such Indebtedness shall be declared to be due and payable or  required to be prepaid (other than by a regularly scheduled required prepayment),  redeemed, purchased or defeased, or an offer to prepay, redeem, purchase or defease such  Indebtedness shall be required to be made, in each case, prior to the stated maturity  thereof;  (g) any material provision of any Basic Document to which the Servicer is a  party shall in whole or in part, cease to be in full force and effect or cease to be the  legally valid, binding and enforceable obligation of the Servicer;  (h) (i) one or more final nonappealable judgments shall be entered against the  Servicer by one or more courts of competent jurisdiction assessing monetary damages,  individually or in the aggregate over any calendar year, in excess of $1,000,000; (ii) one  or more monetary settlements shall be entered into by the Servicer with any Person,  individually or in the aggregate over any calendar year, in excess of $1,000,000; (iii) the  IRS shall file notice of a Lien pursuant to Section 6323 of the Code with regard to any  assets of the Servicer and such Lien shall not have been released within 30 days; or (iv)  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 the Servicer and such Lien shall not  have been released within 30 days;   (i) any Change in Control shall occur with respect to DFC;  (j) a Termination Event shall have occurred and is continuing and shall not  have been waived;  (k) the Performance Guaranty shall cease to be in full force and effect (other  than in accordance with its terms) or the Performance Guarantor shall assert that it is not  bound by, or otherwise seek to terminate or disaffirm its obligations under, the  Performance Guaranty, or shall otherwise claim that the Performance Guaranty is in any  way invalid or unenforceable;  (l) as of any Reporting Date, the arithmetic mean of the Serviced Portfolio  Delinquency Ratio for the three previous Collection Periods is greater than 6.00%;   (m) as of any Reporting Date, the arithmetic mean of the Serviced Portfolio  Net Loss Ratio (Prime) for the three previous Collection Periods is greater than 8.00%;   





 






103  147032870v2  (n) as of any Reporting Date, the arithmetic mean of the Serviced Portfolio  Net Loss Ratio (Non-Prime) for the three previous Collection Periods is greater than  13.50%; or  (o) as of any Reporting Date, the arithmetic mean of the Serviced Portfolio  Deferral Ratio for the three previous Collection Periods is greater than 3.00%.  Notwithstanding the foregoing, if any delay or failure of performance referred to above  shall have been caused by a Force Majeure Event, the applicable grace period referred to  above shall be extended for 10 Business Days (and if no grace period is stated above, the  applicable grace period shall be 10 Business Days).  Upon the occurrence of any of the foregoing, notwithstanding anything herein to the  contrary, the Termination Date shall occur and, so long as any such Servicer Termination Event  shall not have been remedied within any applicable cure period or waived in writing by the  Required Lenders, the following shall immediately occur without further action:  (i) the  Revolving Period shall terminate and no further Loans will be made; (ii) the Administrative  Agent (acting at the direction of or with the consent of the Required Lenders) by written notice  to the Servicer (with a copy to each Agent, Lender, Hedge Counterparty, the Backup Servicer  and Collateral Custodian) (each, a "Servicer Termination Notice"), may terminate all of the  rights and obligations of the Servicer as Servicer under this Agreement; (iii) the Administrative  Agent may direct the Servicer to direct Collections to an account other than the Lockbox  Account or the Collection Account; and (iv) the Administrative Agent may cause the Collateral  Custodian to deliver, or cause to be delivered, the Receivable Files and the related accounts and  records maintained by the Collateral Custodian to the Administrative Agent, or its agent or  designee, at such place as the Administrative Agent may reasonably designate.  Section 7.14.  Appointment of Successor Servicer.  (a) On and after the receipt by the Servicer of a Servicer Termination Notice, the  Servicer shall continue to perform all servicing functions under this Agreement until the date  specified in the Servicer Termination Notice or 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, the  Administrative Agent and the Backup Servicer.  The Administrative Agent may, in its discretion,  at the time described in the immediately preceding sentence, appoint the Backup Servicer as the  Successor Servicer hereunder in accordance with this Agreement and the Backup Servicing  Agreement., in which case the Backup Servicer shall assume all obligations of the Servicer  hereunder, and all authority and power of the Servicer under this Agreement shall pass to and be  vested in the Backup Servicer as Successor Servicer.  All actions taken by the Administrative  Agent pursuant to this Section shall be taken upon the request or approval of the Required  Lenders.  (b) In the event that there is no Backup Servicer at the time that the Servicer is  terminated hereunder, or the Administrative Agent does not so appoint the Backup Servicer to  succeed the Servicer as Successor Servicer hereunder, or the Backup Servicer is unable to  assume such obligations on such date, the Administrative Agent shall as promptly as possible  





 






104  147032870v2  appoint a successor servicer (each such party so appointed or, as applicable, the Backup Servicer  as successor to the Servicer, collectively, the "Successor Servicer"), and such Successor Servicer  shall accept its appointment by a written assumption in a form acceptable to the Administrative  Agent.    (c) Upon the termination and removal of the Servicer, the predecessor Servicer shall  cooperate with the Successor Servicer in effecting the termination of the rights and  responsibilities of the predecessor Servicer under this Agreement, including the transfer to the  Successor Servicer for administration by it of all cash amounts that shall at the time be held by  the predecessor Servicer for deposit, or shall thereafter be received, with respect to a Receivable,  and the related accounts and records maintained by the Servicer.  In the case that the Successor  Servicer shall not agree to perform any duties or obligations of the Servicer hereunder, such  duties or obligations may be performed or delegated by the Administrative Agent.    (d) The Administrative Agent shall have the same rights of removal and termination  for cause with respect to the Successor Servicer as with respect to DFC as the Servicer.  (e) The Successor Servicer shall act as Servicer hereunder and shall, subject to the  availability of sufficient funds in the Collection Account pursuant to Section 2.06 (up to the  Servicing Fee), receive as compensation therefor the Servicing Fee pursuant to Section 2.06.  (f) All reasonable out-of-pocket costs and expenses (including attorneys' fees and  disbursements) incurred in connection with the transferring of Receivables to the Successor  Servicer, converting the Servicer's data to the computer system of the Successor Servicer, and  amending this Agreement to reflect such succession as Servicer pursuant to this Section shall be  paid by the predecessor Servicer upon presentation of reasonable transition expenses (the  "Transition Expenses").  In no event shall the Successor Servicer be responsible for any  Transition Expenses.  If the predecessor Servicer fails to pay the Transition Expenses, the  Transition Expenses shall be payable pursuant to Section 2.06.   (g) Upon its appointment, the Successor Servicer 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 Successor Servicer; provided, that any Successor Servicer shall have (i) no liability  with respect to any obligation which was required to be performed by the predecessor Servicer  prior to the date that the successor becomes the Successor Servicer or any claim of a third party  based on any alleged action or inaction of the predecessor Servicer; (ii) no obligation to perform  any repurchase or advancing obligations, if any, of the Servicer; (iii) no obligation to pay any  Taxes required to be paid by the Servicer; (iv) no obligation to pay any of the fees and expenses  of any other party to this Agreement; (v) no liability or obligation with respect to any Servicer  indemnification obligations of any prior Servicer, including DFC; and (vi) no obligation to  service the Receivables in accordance with the Credit and Collection Policy, but shall use its  customary credit and collection policies for similar assets or those policies to be agreed to with  the Administrative Agent.  The indemnification obligations of the Successor Servicer are  expressly limited to those instances of gross negligence, bad faith or willful misconduct of the  Successor Servicer.  Furthermore, to the extent that the Backup Servicing Agreement provides  





 






105  147032870v2  that any representations, warranties, covenants, or other agreements made hereunder by the  Servicer, or obligations undertaken hereunder by the Servicer, shall not be made or performed, or  shall be made or performed in an alternative manner, by the Backup Servicer in the event that the  Backup Servicer becomes the Successor Servicer hereunder, the Borrower, the Administrative  Agent, the Agents, the Collateral Custodian and the Lenders agree that the representations,  warranties, covenants, other agreement and other obligations of the Servicer hereunder shall not  be applicable with respect to, or shall be modified with respect to, the Backup Servicer in its  capacity as Successor Servicer and in the manner set forth in the Backup Servicing Agreement.  (h) All authority and power granted to the Servicer under this Agreement shall  automatically cease and terminate upon termination of this Agreement and shall pass to and be  vested in the Borrower and the Borrower is hereby authorized and empowered to execute and  deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, all documents and other  instruments, and to do and accomplish all other acts or things necessary or appropriate to effect  the purposes of such transfer of servicing rights.  The Servicer agrees to cooperate with the  Borrower in effecting the termination of the responsibilities and rights of the Servicer to conduct  servicing of the Receivables.  Section 7.15.  Merger or Consolidation, Assumption of Obligations or Resignation of the  Servicer.  Any Person (a) into which the Servicer may be merged or consolidated, (b) which may  result from any merger or consolidation to which the Servicer may be a party, (c) which may  succeed to the properties and assets of the Servicer substantially as a whole or (d) which may  succeed to the duties and obligations of the Servicer under this Agreement following the  resignation of the Servicer, which Person executes an agreement of assumption acceptable to the  Administrative Agent to perform every obligation of the Servicer hereunder, shall, with the prior  written Consent of the Administrative Agent (which Consent shall not be unreasonably  withheld), be the successor to the Servicer under this Agreement without further act on the part  of any of the parties to this Agreement; provided, that:  (i) prior written notice of such consolidation, merger,  succession or resignation shall be delivered by the Servicer to the Administrative  Agent and the Collateral Custodian (if other than DFC);  (ii) immediately after giving effect to such consolidation,  merger, succession or resignation, no Servicer Termination Event and no Unmatured  Servicer Termination Event shall have occurred and is continuing;  (iii) no Termination Event or Unmatured Termination Event  would occur as result of such consolidation, merger, succession or resignation;  (iv) the Servicer shall have delivered to the Borrower, the  Administrative Agent, and the Collateral Custodian (if other than DFC) an Officer's  Certificate and an Opinion of Counsel, each stating that such consolidation, merger,  succession or resignation and such agreement of assumption comply with this Section  and that all conditions precedent provided for in this Agreement and the other Basic  Documents to which it is a party relating to such transaction have been complied with  and, in the case of the Opinion of Counsel, that such agreement of assumption is legal,  





 






106  147032870v2  valid and binding with respect to the Servicer and such other matters as the  Administrative Agent may reasonably request; and  (v) the Servicer shall have delivered to the Borrower, the  Administrative Agent, and the Collateral Custodian an Opinion of Counsel to the  effect that either:  (A) in the opinion of such counsel, all financing statements,  continuation statements and amendments and notations on Certificates of Title thereto  have been executed and filed that are necessary to preserve and protect the interest of  the Borrower, the Secured Parties, the Administrative Agent and the Collateral  Custodian in the Receivables and reciting the details of such filings or (B) no such  action shall be necessary to preserve and protect such interest.  Section 7.16.  Responsibilities of the Borrower.  Anything herein to the contrary  notwithstanding, the Borrower shall (i) perform, or cause the Servicer to perform, all of its  obligations under the Receivables to the same extent as if a security interest in such Receivables  had not been granted hereunder, and the exercise by the Administrative Agent of its rights  hereunder shall not relieve the Borrower from such obligations and (ii) pay when due, from  funds available to the Borrower under Section 2.06(xii), any Taxes, including any sales taxes  payable in connection with the Receivables and their creation and satisfaction.  No Secured Party  shall have any obligation or liability with respect to any Receivable, nor shall any of them be  obligated to perform any of the obligations of the Borrower thereunder.  Section 7.17.  Custody of Receivable Files.  To assure uniform quality in servicing the  Receivables and to reduce administrative costs, the Administrative Agent, on behalf of the  Secured Parties, hereby revocably appoints the Collateral Custodian as its agent, and the  Collateral Custodian hereby accepts such appointment, to act as custodian, on behalf of the  Secured Parties, of the Receivables and the Receivable Files.  Section 7.18.  Duties of Collateral Custodian.  (a) Safekeeping.  With respect to the documents constituting each Receivable File,  the Collateral Custodian shall (i) act exclusively as the custodian for, and the agent and bailee (as  such term is used in Section 9-313 of the UCC) of, the Secured Parties, (ii) hold all documents  constituting such Receivable Files received by it for the exclusive use and benefit of the Secured  Parties and (iii) make disposition thereof only in accordance with the terms of this Agreement or  with written instructions furnished by the Administrative Agent.  The Collateral Custodian shall  maintain such accurate and complete accounts, records and computer systems pertaining to each  Receivable File as shall enable the Servicer and the Borrower to comply with this Agreement.  In  performing its duties as custodian, the Collateral Custodian shall act with reasonable care, using  that degree of skill and attention that it exercises with respect to the files of comparable motor  vehicle installment sale contracts and installment loans that the Collateral Custodian holds for  itself or others.  The Collateral Custodian shall maintain continuous custody of the Receivable  Files and such other documents received by it in secure, fire resistant facilities.  Each Receivable  shall be identified on the books and records of the Collateral Custodian in a manner that  (i) indicates that the Receivable is held by the Collateral Custodian on behalf of the Secured  Parties, and (ii) is otherwise necessary, as reasonably determined by the Collateral Custodian to  comply with the terms of this Agreement.  The Collateral Custodian shall report to the  





 






107  147032870v2  Administrative Agent any failure on its part to hold the Receivable Files and to maintain its  accounts, records and computer systems as herein provided and take appropriate action to  remedy any such failure.  Nothing herein shall be deemed to require an initial review or any  periodic review of the Receivable Files by the Secured Parties, and none of the Secured Parties  shall be liable or responsible for any action or failure to act by the Servicer in its capacity as  custodian hereunder.  (b) Maintenance of and Access to Records.  The Collateral Custodian shall maintain  each Receivable File at one of the locations specified in Schedule D or at such other location as  shall be specified to the Administrative Agent, each Agent and each Lender, by 30 days' prior  written notice.  The Collateral Custodian may temporarily move individual Receivable Files or  any portion thereof without notice as necessary to conduct collection and other servicing  activities in accordance with its customary practices and procedures.  The Collateral Custodian  shall make available to the Secured Parties or their duly authorized representatives, attorneys or  auditors a list of locations of the Receivable Files, the Receivable Files and the related accounts,  records and computer systems maintained by the Servicer at such times during normal business  hours as any Secured Party shall reasonably request.   (c) Title to Receivables.  The Receivable Files and the other documents delivered to  the Collateral Custodian will be delivered from time to time to the Collateral Custodian for the  sole purpose of holding for safekeeping.  The Collateral Custodian shall not at any time have, or  in any way attempt to assert, any interest in any Receivable held by it as custodian hereunder or  in the related Receivable File, other than for collecting or enforcing such Receivable for the  benefit of the Administrative Agent on behalf of the Secured Parties.   (d) Instructions; Authority to Act.  The Collateral Custodian shall be deemed to have  received proper instructions with respect to the Receivable Files upon its receipt of written  instructions signed by a Responsible Officer of the Administrative Agent (acting at the direction  of the Required Lenders).  (e) Indemnification by Collateral Custodian.  The Collateral Custodian, in its capacity  as custodian of the Receivable Files, shall indemnify and hold harmless the Secured Parties and  each of their respective officers, directors, employees and agents from and against any and all  loss, liability or expense that may be imposed on, incurred or asserted against the Secured Parties  and each of their respective officers, directors, employees and agents as the result of any  improper act or omission in any way relating to the maintenance and custody of the Receivable  Files by the Collateral Custodian; provided, that the Collateral Custodian shall not be liable for  any portion of any such loss, liability or expense resulting from the willful misfeasance, bad faith  or gross negligence of any Secured Party.  (f) Effective Period and Termination.  The Collateral Custodian's appointment as  custodian shall become effective as of the Closing Date and shall continue in full force and effect  until terminated pursuant to this Section.  If the initial Servicer is terminated following a Servicer  Termination Event, the appointment of the Collateral Custodian as custodian hereunder may be  terminated by the Administrative Agent.  As soon as practicable after any such resignation or  termination of such appointment, the Administrative Agent shall appoint a successor Collateral  Custodian to be custodian of the Receivable Files and the accounts and records relating thereto  





 






108  147032870v2  and the Collateral Custodian shall, at its sole cost and expense, (i) deliver, or cause to be  delivered, the Receivable Files and the related accounts and records maintained by the Collateral  Custodian to such successor Collateral Custodian, or its agent or designee, as the case may be, at  such place as such successor Collateral Custodian may reasonably designate and (ii) otherwise  cooperate with the successor Collateral Custodian in affecting the termination of the rights and  responsibilities of the predecessor Collateral Custodian under this Agreement.  From and after  the appointment of a successor Collateral Custodian, the predecessor Collateral Custodian shall  continue to perform all custodial functions under this Agreement until the date specified by the  Administrative Agent in writing or, if no such date is specified, until a date mutually agreed upon  by the predecessor Collateral Custodian and the Administrative Agent.  The Administrative  Agent may, in its discretion, at the time described in immediately preceding sentence, appoint  the Backup Servicer as the successor Collateral Custodian hereunder, and the Backup Servicer  shall on such date assume all obligations of the Collateral Custodian hereunder, and all authority  and power of the predecessor Collateral Custodian under this Agreement shall pass to and be  vested in the Backup Servicer.  The Administrative Agent shall have the same rights of removal  and termination for cause with respect to the Backup Servicer or any other successor Collateral  Custodian as with respect to DFC as the Collateral Custodian.  (g) Inspection.  The Collateral Custodian shall permit the Administrative Agent, the  Servicer, the Backup Servicer and each Lender or their designee, upon reasonable prior notice  and during the Servicer's regular business hours and at the reasonable expense of the Borrower,  to periodically, at the discretion of the Administrative Agent (acting at the direction of the  Required Lenders), the Servicer, the Backup Servicer and each Lender, conduct an audit of the  Receivables and Receivable Files.  Notwithstanding the foregoing, for so long as DFC is the  Collateral Custodian, the right to conduct inspections of the Collateral Custodian shall be  governed by the provisions of Section 7.07(d).  TERMINATION EVENTS  Section 8.01.  Termination Events.  (a) Each of the following events shall constitute a "Termination Event":  (i) failure by the Borrower to (A) make any payment, transfer  or deposit required by the terms of any Basic Document on the day such payment,  transfer or deposit is required to be made (including any payment of Interest, Program  Fees or Unused Commitment Fees on any Payment Date but excluding payments of  any Loans Outstanding), or (B) deliver the Monthly Report on the Reporting Date, and  in each case, such failure continues unremedied for two Business Days;  (ii) failure of the Borrower to pay in full the Loans Outstanding  by the Payment Date occurring in the 90th month following the expiration of the latest  Commitment Termination Date or to pay any Monthly Principal Payment Amount  when the same becomes due and payable pursuant to the terms of the Basic  Documents and such failure continues unremedied for one Business Day;   





 






109  147032870v2  (iii) any failure by the Borrower, the Seller or the Performance  Guarantor duly to observe or perform any other covenant or agreement of the  Borrower, the Seller or the Performance Guarantor, respectively, set forth in this  Agreement or the other Basic Documents to which the Borrower, the Seller or the  Performance Guarantor, respectively, is a party  , which failure materially and  adversely affects the rights or interests of the Secured Parties and such failure remains  unremedied for 30 days after the earlier of knowledge thereof by the Borrower, the  Seller or the Performance Guarantor, as applicable, or after the date on which written  notice of such failure shall have been given by the other parties or by the  Administrative Agent to the Borrower, the Seller or the Performance Guarantor, as  applicable;  (iv) any representation or warranty made by the Borrower, the  Seller or the Performance Guarantor in any Basic Document to which it is a party or in  any Funding Request, Monthly Report, Quarterly Report or other report, certificate or  notice delivered pursuant to any Basic Document to which it is a party, shall prove to  have been false or otherwise incorrect in any respect when made, deemed made or  delivered, which such false or incorrect representation, warranty or information  materially and adversely affects the rights or interests of the Secured Parties and, if  able to be cured, shall not have been cured for 30 days after the earlier of the date on  which the Borrower, the Seller, or the Performance Guarantor, as applicable, first has  knowledge thereof or the date on which written notice of such failure shall have been  given to the Borrower, the Seller, or the Performance Guarantor, as applicable;  provided, that no Termination Event shall have occurred under this clause for breaches  of representations or warranties that are cured by the repurchase of the related  Receivable pursuant to Section 5.04 hereof;  (v) an Insolvency Event shall occur with respect to the  Borrower, the Seller or the Performance Guarantor;  (vi) the Administrative Agent shall fail for any reason to have a  valid, first priority perfected security interest in all, or any material portion of, the  Collateral, which failure shall not have been cured for ten days after the earlier of the  date on which the Borrower or DFC first has knowledge thereof or the date on which  written notice of such failure shall have been given to the Borrower or DFC;   (vii) (A) one or more final nonappealable judgments shall be  entered against the Borrower, the Seller or the Performance Guarantor by one or more  courts of competent jurisdiction assessing monetary damages, individually or in the  aggregate over any calendar year, in excess of $25,000, $1,000,000 or $1,000,000,  respectively; or (B) one or more monetary settlements shall be entered into by the  Borrower, the Seller or the Performance Guarantor with any Person, individually or in  the aggregate over any calendar year, in excess of $25,000, $1,000,000 or $1,000,000  respectively; (C) the IRS shall file notice of a Lien pursuant to Section 6323 of the  Code with regard to any assets of the Borrower, the Seller or the Performance  Guarantor and such Lien shall not have been released within 30 days; or (iv) the  Pension Benefit Guaranty Corporation shall file notice of a Lien pursuant to Section  





 






110  147032870v2  4068 of ERISA with regard to any of the assets of the Borrower, the Seller or the  Performance Guarantor and such Lien shall not have been released within 30 days;   (viii) the Borrower, the Seller or the Performance Guarantor shall  fail to pay any principal of or premium or interest on any Indebtedness having a  principal amount of $0 or greater (with respect to the Borrower) or  $10,000,000 or  greater (with respect to the Seller or the Performance Guarantor), when the same  becomes due and payable (whether by scheduled maturity, required prepayment,  acceleration, demand or otherwise) and such failure shall continue after the applicable  grace period, if any, specified in the agreement or instrument relating to such  Indebtedness; or any other default under any agreement or instrument relating to any  such Indebtedness of the Borrower, the Seller, or the Performance Guarantor, as  applicable, or any other event, shall occur and shall continue after the applicable grace  period, if any, specified in such agreement or instrument if the effect of such default or  event is to accelerate, or to permit the acceleration of, the maturity of such  Indebtedness; or any such Indebtedness shall be declared to be due and payable or  required to be prepaid (other than by a regularly scheduled required prepayment),  redeemed, purchased or defeased, or an offer to prepay, redeem, purchase or defease  such Indebtedness shall be required to be made, in each case, prior to the stated  maturity thereof;  (ix) any Change in Control shall occur;  (x) at any time, the Loans Outstanding exceed the Net Eligible  Pool Balance;  (xi) the Performance Guaranty shall cease to be in full force and  effect (other than in accordance with its terms) or the Borrower, the Servicer or the  Performance Guarantor shall assert that it is not bound by, or otherwise seek to  terminate or disaffirm its obligations under, the Performance Guaranty, or shall  otherwise claim that the Performance Guaranty is in any way invalid or unenforceable;  (xii) either (A) any Basic Document shall, in whole or in part,  terminate, cease to be effective or cease to be the legally valid, binding and  enforceable obligation of the Borrower, the Seller, DFC (in its capacity as Servicer or  Collateral Custodian) or the Performance Guarantor or (B) any of the Borrower, the  Seller, DFC (in its capacity as Servicer or Collateral Custodian) or the Performance  Guarantor shall, directly or indirectly, contest in any manner such effectiveness,  validity, binding nature or enforceability of any Basic Document;  (xiii) any Servicer Termination Event (other than a Servicer  Termination Event of the type specified in subsections (l), (m), (n) or (o) of Section  7.13) occurs;  (xiv) failure on the part of the Borrower (A) to establish one or  more Hedge Transactions in fulfillment of the requirements set forth in Section 6.03  within thirty days of the date on which the Initial Loan is made hereunder and (B)  





 






111  147032870v2  thereafter to maintain one or more Hedge Transactions in fulfillment of the  requirements set forth in Section 6.03, which failure remains unremedied for 30 days  after the Borrower or the initial Servicer has knowledge of such failure or receives  notice of such failure;  (xv) the Borrower shall fail to have an Independent Director as  required by Section 6.01(o) at any time;   (xvi) the representation of the Borrower set forth in Section  5.01(w) fails to be true and correct at any time;   (xvii) as of any Reporting Date, if no Significant Take-out Date  occurred during any of the three previous Collection Periods, the arithmetic mean of  the Conduit Portfolio Net Loss Ratio (Prime) for such three previous Collection  Periods is greater than 7.00%;   (xviii) as of any Reporting Date, if no Take-out Date occurred  during any of the three previous Collection Periods, the arithmetic mean of the  Conduit Portfolio Net Loss Ratio (Non-Prime) for such three previous Collection  Periods is greater than 12.50%; and  (xix) as of any Reporting Date, if no Take-out Date occurred  during any of the three previous Collection Periods, the arithmetic mean of the  Conduit Portfolio Delinquency Ratio for such three previous Collection Periods is  greater than 5.50%;   provided, that any Termination Event may be waived in a writing by the Consenting  Lenders to the Borrower, with a copy to the Administrative Agent and the Servicer.   Notwithstanding the foregoing, if any delay or failure referred to above shall have been  caused by a Force Majeure Event, the applicable grace period referred to above shall be extended  for 10 Business Days (and if no grace period is stated above, the applicable grace period shall be  10 Business Days).  (b) Upon the occurrence of any Termination Event, the Administrative Agent shall, at  the request, or may with the consent, of the Required Lenders, by notice to the Borrower, declare  the Termination Date to have occurred, without demand, protest or future notice of any kind, all  of which are hereby expressly waived by the Borrower, and, upon such declaration, all Loans  and all other amounts owing by the Borrower under this Agreement shall be accelerated and  become immediately due and payable; provided, that in the event that a Termination Event  described in Section 8.01(a)(v) has occurred, the Termination Date shall automatically occur,  without demand, protest or any notice of any kind, all of which are hereby expressly waived by  the Borrower.  (c) Upon the automatic occurrence or declaration of the occurrence of the  Termination Date in accordance with Section 8.01(b), the following shall immediately occur  without further action:  (i) the Revolving Period shall terminate and no further Loans will be  





 






112  147032870v2  made, (ii) Interest on all Loans Outstanding will be calculated using the Default Rate and (iii) no  further Program Fees will accrue.   Section 8.02.  Actions Upon Declaration of the Occurrence of the Termination Date.   Upon the automatic occurrence or declaration of the occurrence of the Termination Date  following the occurrence of a Termination Event in accordance with Section 8.01(b), the  Administrative Agent may, or at the direction of the Required Lenders, shall, exercise in respect  of the Collateral the following remedial actions, in addition to any and all other rights and  remedies otherwise available to it, including rights available hereunder and all of the rights and  remedies of a secured party upon default under the UCC (such rights and remedies to be  cumulative and nonexclusive):  (a) The Administrative Agent may, without notice to the Borrower except as  required by law and at any time or from time to time, charge, set-off and otherwise apply  all or any part of the Loans Outstanding, any Interest accrued thereon and/or any other  amount due and owing to any Secured Party against amounts payable to the Borrower  from the Collection Account or any part of such account in accordance with the priorities  required by Section 2.06.  (b) The Administrative Agent may take any action permitted under the Basic  Documents, including, without limitation, delivering any shifting control or similar notice  under the Blocked Account Control Agreement or the Control Agreement.  (c) Consistent with the rights and remedies of a secured party under the UCC  (and except as otherwise required by the UCC), the Administrative Agent may, on behalf  of itself and the Lenders and without notice except as specified below, solicit and accept  bids for and sell the Collateral or any part of the Collateral in one or more parcels at  public or private sale, at any exchange, broker's board or at 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.  The Borrower agrees  that, to the extent notice of sale shall be required by law, at least ten Business Days'  notice to the Borrower 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 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 for such sale,  and such sale may, without further notice, be made at the time and place to which it was  so adjourned.  Every such sale shall operate to divest all right, title, interest, claim and  demand whatsoever of the Borrower in and to the Collateral so sold, and shall be a  perpetual bar, both at law and in equity, against the Borrower or any Person claiming the  Collateral sold through the Borrower and its successors or assigns.  (d) Upon the completion of any sale under Section 8.02(c), the Borrower will  deliver or cause to be delivered all of the Collateral sold to the purchaser or purchasers at  such sale on the date of sale, or within a reasonable time thereafter if it shall be  impractical to make immediate delivery, but in any event full title and right of possession  to such property shall pass to such purchaser or purchasers forthwith upon the completion  





 






113  147032870v2  of such sale.  Nevertheless, if so requested by the Administrative Agent or by any  purchaser, the Borrower shall confirm any such sale or transfer by executing and  delivering to such purchaser all proper instruments of conveyance and transfer and  release as may be designated in any such request.  (e) At any sale under Section 8.02(c), DFC, the Performance Guarantor, the  Administrative Agent or any Secured Party may bid for and purchase the property offered  for sale and, upon compliance with the terms of sale, may hold, retain and dispose of  such property without further accountability therefor.  Any Secured Party purchasing  property at a sale under Section 8.02(c) may set off the purchase price of such property  against amounts owing to such Secured Party in full payment of such purchase price.  (f) The Administrative Agent may direct the Servicer to direct Collections to  an account other than the Lockbox Account or the Collection Account.  (g) The Administrative Agent may exercise at the Borrower's sole expense  any and all rights and remedies of the Borrower under or in connection with the  Collateral.  Section 8.03.  Exercise of Remedies.  No failure or delay on the part of the  Administrative Agent to exercise any right, power or privilege under this Agreement and no  course of dealing between the Borrower, on the one hand, and the Administrative Agent, any  Agent or the Secured Parties, on the other hand, shall operate as a waiver of such right, power or  privilege, nor shall any single or partial exercise of any right, power or privilege under this  Agreement preclude any other or further exercise of such right, power or privilege or the exercise  of any other right, power or privilege.  The rights and remedies expressly provided in this  Agreement are cumulative and not exclusive of any rights or remedies which the Secured Parties  would otherwise have pursuant to law or equity.  No notice to or demand on any party in any  case shall entitle such party to any other or further notice or demand in similar or other  circumstances, or constitute a waiver of the right of the other party to any other or further action  in any circumstances without notice or demand.  Section 8.04.  Waiver of Certain Laws.  The Borrower agrees, 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 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 the Borrower, 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 such parcels as the Administrative Agent or  such court may determine.  





 






114  147032870v2  Section 8.05.  Power of Attorney.  The Borrower hereby irrevocably appoints the  Administrative Agent 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 Article, including:  (i) to give any necessary receipts or acquittance for  amounts collected or received hereunder, (ii) to make all necessary transfers of the Collateral in  connection with any sale or other disposition made pursuant hereto, (iii) to execute and deliver  for value all necessary or appropriate bills of sale, assignments and other instruments in  connection with any such sale or other disposition, the Borrower thereby ratifying and  confirming all that such attorney (or any substitute) shall lawfully do hereunder and pursuant  hereto and (iv) to sign any agreements, orders or other documents in connection with or pursuant  to any Basic Document.  In furtherance of the foregoing, the Borrower shall deliver to the  Administrative Agent an executed power of attorney in the form of Exhibit D on the Closing  Date.  If so requested by the Administrative Agent, directly or through a purchaser of any of the  Collateral, the Borrower 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.  INDEMNIFICATION  Section 9.01.  Indemnities by the Borrower.  Without limiting any other rights which the  Administrative Agent, each Agent, each Lender or its assignee, the Backup Servicer (including  in its capacity as Successor Servicer), the Account Bank, the Collateral Custodian (if not DFC),  the Servicer (if not DFC) or any of their respective Affiliates may have hereunder or under  Applicable Law, the Borrower hereby agrees to indemnify the Administrative Agent, each  Agent, each Secured Party, the Backup Servicer, including if it is then acting as Successor  Servicer, the Account Bank, the Collateral Custodian (if not DFC) and each of their respective  Affiliates and officers, directors, employees and agents thereof (collectively, the "Indemnified  Parties") from and against any and all reasonable and documented fees, damages, losses, claims,  liabilities and related costs and expenses, including reasonable attorneys' fees, court costs, and  expenses (collectively, the "Indemnified Amounts") awarded against or incurred by, any such  Indemnified Party arising out of or as a result of this Agreement, excluding, however,  Indemnified Amounts to the extent resulting from the gross negligence, bad faith, or willful  misconduct on the part of any Indemnified Party.  Without limiting the foregoing, the Borrower  shall indemnify the Indemnified Parties for Indemnified Amounts relating to or resulting from:  (i) any Receivable represented by the Borrower to be an  Eligible Receivable which is not at the applicable time an Eligible Receivable;  (ii) reliance on any representation or warranty made or deemed  made by the Borrower or any of its respective officers under or in connection with this  Agreement or any other Basic Document, which shall have been false or incorrect in  any material respect when made or deemed made or delivered;  (iii) the failure by the Borrower to comply with any term,  provision or covenant contained in this Agreement or any other Basic Document, or a  





 






115  147032870v2  failure by the Borrower to comply with any Applicable Law with respect to any  Contract or Receivable, the related Financed Vehicle or the non-conformity of any  Contract with any such Applicable Law;  (iv) the failure to vest and maintain vested in the Administrative  Agent a valid and enforceable security interest in any or all of the Collateral or a valid  and enforceable first priority perfected security interest in any or all of the Collateral;  (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 Collateral, whether at the  time of a Loan or at any subsequent time and as required by the Basic Documents;  (vi) any dispute, claim, offset or defense (other than the  discharge in bankruptcy of the related Obligor) of an Obligor to the payment of any  Receivable comprising a portion of the Collateral which is, or is purported to be, an  Eligible Receivable (including a defense based on the Contract not being a legal, valid  and binding obligation of such Obligor enforceable against it in accordance with its  terms) or any other claim resulting from the sale or financing of the Financed Vehicle  related to such Receivable (other than as a result of the bankruptcy or insolvency of  the related Obligor);  (vii) any products liability claim or personal injury or property  damage suit or other similar or related claim or action of whatever sort arising out of  or in connection with any Contract or the related Financed Vehicle;  (viii) the failure by the Borrower to pay when due any Taxes for  which the Borrower is liable, including sales, excise or personal property taxes  payable in connection with the Collateral;  (ix) any repayment or disgorgement by any Agent or a Secured  Party of any amount previously distributed in reduction of the Loans Outstanding or  payment of Interest, any other Obligation or any other amount due hereunder or under  any Hedging Agreement, in each case which amount such entity believes in good faith  is required to be repaid or disgorged;  (x) any litigation, proceeding or investigation relating to  arising from the Basic Documents, the transactions contemplated hereby and thereby,  the use of proceeds of the Loans or any other investigation, litigation or proceeding  relating to the Borrower in which any Indemnified Party becomes involved as a result  of any of the transactions contemplated by the Basic Documents;  (xi) the use of the proceeds of any Loan;  (xii) any failure by the Borrower to give reasonably equivalent  value to the Seller in consideration for the transfer by the Seller to the Borrower of any  of the Receivables and the related Collateral or any attempt by any Person to void or  





 






116  147032870v2  otherwise avoid any such transfer under any statutory provision or common law or  equitable action, including any provision of the Bankruptcy Code;  (xiii) the commingling by the Borrower of any Collections with  other funds;  (xiv) any claim brought by any Person arising from any activity  by the Borrower in servicing, administering or collecting any Receivable;  (xv) if JPMorgan Chase Bank, N.A. is not the Lockbox Bank,  the failure of the Lockbox Bank to remit any amounts or items of payment held in the  Collection Account or the Lockbox Account pursuant to the instructions of the  Administrative Agent given in accordance with this Agreement or the other Basic  Documents, whether by reason or the exercise of setoff rights or otherwise;  (xvi) all reasonable and documented fees, costs and expenses  (including reasonable legal fees and expenses) incurred by any Lender, their respective  Credit Providers or the Administrative Agent in connection with any amendments or  supplements or waivers or consents (including review and analysis thereof) with  respect to the Basic Documents or any other document or instrument delivered  pursuant hereto or thereto (whether or not the same is finally agreed to) if the same is  requested by the Borrower, or is required or necessary under the Basic Documents; or  (xvii) any and all Sanctions against, and all reasonable costs and  expenses (including attorneys' fees and disbursements) incurred in connection with the  defense thereof by the Administrative Agent or any Lender or Agent as a result of  funding all or any portion of the Loans or the acceptance of payments or of Collateral  due under the Basic Documents.  Notwithstanding the foregoing, in no event shall any Indemnified Party be indemnified  against any Indemnified Amounts to the extent such Indemnified Amounts are or result from (A)  Excluded Taxes, (B) non-payment by any Obligor of any amount that is due and payable under  the related Receivable, or (C) any loss in value of any Financed Vehicle or Permitted  Investments for reasons that are not caused by the Borrower.  For the avoidance of doubt, the  terms of this Section 9.01 shall not apply to any indemnification relating to Taxes, which will be  governed by the terms of Section 2.11.  Any amounts subject to the indemnification provisions of this Section shall be paid by the  Borrower solely pursuant to the provisions of Section 2.06 in the order and priority set forth  therein not later than the first Payment Date following written demand therefor.  Section 9.02.  Indemnities by the Servicer.  Without limiting any other rights which the  Administrative Agent, each Agent, each Lender or its assignee, the Backup Servicer, the  Account Bank, the Collateral Custodian (if not DFC) or any of their respective Affiliates may  have hereunder or under Applicable Law, the initial Servicer hereby agrees to indemnify the  Indemnified Parties from and against any and all Indemnified Amounts awarded against or  incurred by, any such Indemnified Party arising out of or as a result of the failure of the initial  Servicer to perform its obligations under this Agreement, excluding, however, Indemnified  





 






117  147032870v2  Amounts to the extent resulting from the gross negligence, bad faith or willful misconduct on the  part of any Indemnified Party.  Without limiting the foregoing, the initial Servicer shall  indemnify the Indemnified Parties for Indemnified Amounts relating to or resulting from:  (i) reliance on any representation or warranty made or deemed  made by the Servicer or any of its respective officers under or in connection with this  Agreement or any other Basic Document, which shall have been false or incorrect in  any material respect when made or deemed made or delivered;  (ii) the failure by the Servicer to comply with any term,  provision or covenant contained in this Agreement or any other Basic Document to  which it is a party or a failure by the Servicer to comply with any term, provision or  covenant contained in any agreement executed in connection with this Agreement or  any other Basic Document, or with any Applicable Law with respect to any Contract  or Receivable, the related Financed Vehicle or the non-conformity of any Contract  with any such Applicable Law and any failure by DFC to perform its respective duties  under the Contracts and Receivables included as a part of the Collateral;  (iii) for so long as DFC is the Servicer, the failure to vest and  maintain vested in the Administrative Agent a valid and enforceable security interest  in any or all of the Collateral or a valid and enforceable first priority perfected security  interest in any or all of the Collateral;  (iv) for so long as DFC is the Servicer, 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  Collateral, whether at the time of a Loan or at any subsequent time and as required by  the Basic Documents;  (v) any dispute, claim, offset or defense (other than the  discharge in bankruptcy of the related Obligor) of an Obligor to the payment of any  Receivable comprising a portion of the Collateral which is, or is purported to be, an  Eligible Receivable (including a defense based on the Contract not being a legal, valid  and binding obligation of such Obligor enforceable against it in accordance with its  terms) or any other claim resulting from the sale or financing of the Financed Vehicle  related to such Receivable (other than as a result of the bankruptcy or insolvency of  the related Obligor);  (vi) any failure by the Servicer to perform its duties or  obligations in accordance with the provisions of this Agreement;  (vii)  the failure by the Servicer to pay when due any Taxes for  which the Servicer is liable, including sales, excise or personal property taxes payable  in connection with the Collateral;  (viii) any litigation, proceeding or investigation relating to  arising from the obligation of the Servicer under the Basic Documents to which it is a  party, the transactions contemplated hereby and thereby, or any other investigation,  





 






118  147032870v2  litigation or proceeding relating to the Servicer in which any Indemnified Party  becomes involved as a result of any of the transactions contemplated by such Basic  Documents;  (ix) any claim brought by any Person arising from any activity  by the Servicer in servicing, administering or collecting any Receivable;  (x) to the extent caused by actions or inactions of the Servicer,  the failure of the Lockbox Bank to remit any amounts or items of payment held in the  Lockbox Account pursuant to the instructions of the Administrative Agent given in  accordance with this Agreement or the other Basic Documents, whether by reason or  the exercise of setoff rights or otherwise; and  (xi) all reasonable and documented fees, costs and expenses  (including reasonable legal fees and expenses) incurred by any Lender, their respective  Credit Providers or the Administrative Agent in connection with any amendments or  supplements or waivers or consents (including review and analysis thereof) with  respect to the Basic Documents or any other document or instrument delivered  pursuant hereto or thereto (whether or not the same is finally agreed to) if the same is  requested by the Servicer.  Notwithstanding the foregoing, in no event shall any Indemnified Party be indemnified  against any Indemnified Amounts to the extent such Indemnified Amounts are or result from (A)  Excluded Taxes, (B) non-payment by any Obligor of any amount that is due and payable under  the related Receivable, or (C) any loss in value of any Financed Vehicle or Permitted  Investments for reasons that are not caused by the Servicer.    Any amounts subject to the indemnification provisions of this Section shall be paid by the  Servicer to the related Indemnified Party within 20 Business Days following written demand  therefor.    Section 9.03.  Indemnities by the Backup Servicer in its Capacity as the Successor  Servicer. Notwithstanding any indemnification obligations that the Backup Servicer may assume  in a Backup Servicing Agreement, in no event shall the Backup Servicer, in its capacity as  Successor Servicer, have (a) any liability with respect to any obligation which was required to be  performed by the predecessor Servicer prior to the date that the Backup Servicer becomes the  Successor Servicer or any claim of a third party based on any alleged action or inaction of the  predecessor Servicer or (b) any liability or obligation with respect to any Servicer  indemnification obligations of any prior Servicer, including DFC.  THE ADMINISTRATIVE AGENT AND THE AGENTS  Section 10.01.  Authorization and Action.  





 






119  147032870v2  (a) Each Lender and each Secured Party (other than the Administrative Agent)  hereby designates and appoints JPMorgan Chase Bank (and JPMorgan Chase Bank accepts such  designation and appointment) as Administrative Agent hereunder, and authorizes the  Administrative Agent to take such actions as agent on its behalf and to exercise such powers as  are delegated to the Administrative Agent by the terms of this Agreement together with such  powers as are reasonably incidental thereto.  In performing its functions and duties hereunder,  the Administrative Agent shall act solely as agent for the Secured Parties and does not assume  nor shall be deemed to have assumed any obligation or relationship of trust or agency with or for  the Borrower or any of its successors or assigns.  The Administrative Agent shall not be required  to take any action which exposes it to personal liability or which is contrary to this Agreement or  Applicable Law.  The appointment and authority of the Administrative Agent hereunder shall  terminate at the indefeasible payment in full of the Aggregate Unpaids.  (b) Each Lender hereby irrevocably designates and appoints the related Agent as the  agent of such Lender under this Agreement, and each such Lender irrevocably authorizes such  Agent, as the agent for such Lender, to take such action on its behalf under the provisions of the  Basic Documents and to exercise such powers and perform such duties thereunder as are  expressly delegated to such Agent by the terms of this Agreement, together with such other  powers as are reasonably incidental thereto.    (c) Notwithstanding any provision to the contrary elsewhere in this Agreement,  neither the Administrative Agent nor any Agent (the Administrative Agent and each Agent being  referred to in this Article as an "Agent") shall have any duties or responsibilities, except those  expressly set forth herein, or any fiduciary relationship with any Lender, and no implied  covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this  Agreement or otherwise exist against the Administrative Agent or any Agent.  (d) The Administrative Agent shall promptly distribute to each Agent (if such Agent  is not otherwise required to receive such notice), who shall promptly distribute to each related  Lender all notices, requests for consent and other information received by the Administrative  Agent under this Agreement.  Section 10.02.  Delegation of Duties.  Each Agent may execute any of its duties under  any of the Basic Documents by or through agents or attorneys-in-fact and shall be entitled to  advice of counsel concerning all matters pertaining to such duties.  No Agent shall be responsible  for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable  care.  Section 10.03.  Exculpatory Provisions.  Neither any Agent nor any of its directors,  officers, agents or employees shall be (i) liable for any action lawfully taken or omitted to be  taken by it or them under or in connection with this Agreement (except for its, their or such  Person's own gross negligence or willful misconduct or, in the case of any Agent, the breach of  its obligations expressly set forth in this Agreement) or (ii) responsible in any manner to any of  the Secured Parties for any recitals, statements, representations or warranties made by the  Borrower, the Servicer, DFC, the Backup Servicer or the Collateral Custodian contained in this  Agreement or in any certificate, report, statement or other document referred to or provided for  in, or received under or in connection with, this Agreement or any other Basic Document to  





 






120  147032870v2  which it is a party for the value, validity, effectiveness, genuineness, enforceability or sufficiency  of this Agreement or any other document furnished in connection herewith, or for any failure of  the Borrower to perform its obligations hereunder, or for the satisfaction of any condition  specified in Article Four.  No Agent shall be under any obligation to any Secured Party to  ascertain or to inquire as to the observance or performance of any of the agreements or covenants  contained in, or conditions of, this Agreement, or to inspect the properties, books or records of  the Borrower.  No Agent shall be deemed to have knowledge of any Termination Event, Servicer  Termination Event, Step-up Event , Stop-Funding Event, or Early Amortization Event unless it  has received written notice thereof from the Borrower, the Servicer or a Secured Party.  Section 10.04.  Reliance.  (a) Each Agent shall be entitled to rely, and shall be fully protected in relying, upon  any writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram,  telecopy, telex or teletype message, written statement, order or other document or conversation  believed by it to be genuine and correct and to have been signed, sent or made by the proper  Person or Persons and upon advice and statements of legal counsel (including counsel to the  Agent), independent accountants and other experts selected by such Agent.  (b) Each Agent shall be fully justified in failing or refusing to take any action under  any of the Basic Documents unless it shall first receive such advice or concurrence of the  Required Lenders as it deems appropriate or it shall first be indemnified to its satisfaction by, in  the case of (i) the Administrative Agent, the Lenders or (ii) an Agent, the Lenders or by the  Lenders in its Lender Group, against any and all liability and expense which may be incurred by  it by reason of taking or continuing to take any such action.  (c) The Administrative Agent shall in all cases be fully protected in acting, or in  refraining from acting, under any of the Basic Documents in accordance with a request of the  Required Lenders (or their Agents), and such request and any action taken or failure to act  pursuant thereto shall be binding upon all present and future Lenders.  (d) Each Agent shall in all cases be fully protected in acting, or in refraining from  acting, under any of the Basic Documents in accordance with a request of (i) Owners in its  Lender Group having Invested Percentages aggregating greater than 50% of the aggregate  Invested Percentages of all Owners in such Lender Group and (ii)  Lenders in its Lender Group  having Commitments aggregating greater than 50% of the aggregate Commitments of all  Lenders in such Lender Group, and such request and any action taken or failure to act pursuant  thereto shall be binding upon all present and future Lenders in such Lender Group.  (e) No Agent shall be deemed to have knowledge or notice of the occurrence of any  breach of this Agreement or the occurrence of any Servicer Termination Event, Early  Amortization Event, Step-up Event, Stop-Funding Event, or Termination Event unless it has  received notice from the Borrower, the Servicer, the Backup Servicer or any Lender, referring to  this Agreement and describing such event.  In the event that the Administrative Agent receives  such a notice, it shall promptly give notice thereof to each Agent, and in the event any Agent  receives such a notice, it shall promptly give notice thereof to the Lenders in its Lender Group.   The Administrative Agent shall take such action with respect to such event as shall be reasonably  





 






121  147032870v2  directed by the Required Lenders, and each Agent shall take such action with respect to such  event as shall be reasonably directed by (i) all Owners in its Lender Group and (ii)  all Lenders in  its Lender Group; provided, that unless and until such Agent shall have received such directions,  such Agent may (but shall not be obligated to) take such action, or refrain from taking such  action, with respect to such event as it shall deem advisable in the best interests of the Lenders or  of the Lenders in its Lender Group, as applicable.  Section 10.05.  Non-Reliance on Agents and Other Lenders.  Each Lender expressly  acknowledges that no Agent nor any of its officers, directors, employees, agents, attorneys-in- fact or Affiliates has made any representations or warranties to it and that no act by any Agent  hereafter taken, including any review of the affairs of the Borrower, the Servicer, DFC, the  Backup Servicer or the Collateral Custodian shall be deemed to constitute any representation or  warranty by any Agent to any Lender.  Each Lender represents to each Agent that it has,  independently and without reliance upon any Agent or any other Lender, and based on such  documents and information as it has deemed appropriate, made its own appraisal of, and  investigation into, the business, operations, property, financial and other condition and  creditworthiness of the Borrower, the Servicer, DFC, the Backup Servicer or the Collateral  Custodian and the Receivables and made its own decision to purchase its interest in the Loans  hereunder and enter into this Agreement.  Each Lender also represents that it will, independently  and without reliance upon any Agent or any other Lender, and based on such documents and  information as it shall deem appropriate at the time, continue to make its own analysis, appraisals  and decisions in taking or not taking action under any of the Basic Documents, and to make such  investigation as it deems necessary to inform itself as to the business, operations, property,  financial and other condition and creditworthiness of the Borrower, the Servicer, DFC, the  Backup Servicer or the Collateral Custodian and the Receivables.  Except for notices, reports and  other documents received by an Agent hereunder, no Agent shall have any duty or responsibility  to provide any Lender with any credit or other information concerning the business, operations,  property, condition (financial or otherwise), prospects or creditworthiness of the Borrower, the  Servicer, DFC, the Backup Servicer or the Collateral Custodian or the Receivables which may  come into the possession of such Agent or any of its officers, directors, employees, agents,  attorneys-in-fact or affiliates.  Section 10.06.  Indemnification.  The Lenders (i) agree to indemnify the Administrative  Agent in its capacity as such (without limiting the obligation (if any) of the Borrower or the  Servicer to reimburse the Administrative Agent for any such amounts), ratably according to their  respective Commitments (or, if the Commitments have terminated, Invested Percentages) and  (ii) in each Lender Group agree to indemnify the Agent for such Lender Group in its capacity as  such (without limiting the obligation (if any) of the Borrower and the Servicer to reimburse such  Agent for any such amounts), ratably according to their respective Commitments (or, if the  Commitments have terminated, Invested Percentages), in each case from and against any and all  liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or  disbursements of any kind whatsoever which may at any time (including at any time following  the payment of the obligations under this Agreement, including the Loans Outstanding) be  imposed on, incurred by or asserted against such Agent in any way relating to or arising out of  this Agreement, or any documents contemplated by or referred to herein or the transactions  contemplated hereby or any action taken or omitted by the Agent under or in connection with  any of the foregoing; provided, that no Lender shall be liable for the payment of any portion of  





 






122  147032870v2  such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses  or disbursements of an Agent resulting from its own gross negligence or willful misconduct.  The  provisions of this Section shall survive the payment of the obligations under this Agreement,  including the Loans Outstanding, the termination of this Agreement, and any resignation or  removal of the applicable Agent.  Section 10.07.  Agents in their Individual Capacity.  Each Agent and its Affiliates may  make loans to, accept deposits from and generally engage in any kind of business with the  Borrower and any other party to a Basic Document as though it were not an Agent hereunder.  In  addition, the Lenders acknowledge that one or more Persons which are Agents may act (i) as  administrator, sponsor or agent for one or more Lenders and in such capacity act and may  continue to act on behalf of each such Lender in connection with its business, and (ii) as the  agent for certain financial institutions under the liquidity and credit enhancement agreements  relating to this Agreement to which any one or more Lenders is party and in various other  capacities relating to the business of any such Lender under various agreements.  Any such  Person, in its capacity as Agent, shall not, by virtue of its acting in any such other capacities, be  deemed to have duties or responsibilities hereunder or be held to a standard of care in connection  with the performance of its duties as an Agent other than as expressly provided in this  Agreement.  Any Person which is an Agent may act as an Agent without regard to and without  additional duties or liabilities arising from its role as such administrator or agent or arising from  its acting in any such other capacity.  None of the provisions to this Agreement shall require the  Administrative Agent to expend or risk its own funds or otherwise to incur any liability, financial  or otherwise, in the performance of any of its duties hereunder, or in the exercise of any of its  rights or powers if it shall have reasonable grounds for believing that repayment of such funds or  indemnity satisfactory to it against such risk or liability is not assured to it.  Section 10.08.  Successor Administrative Agent.  The Administrative Agent may assign  its rights and obligations hereunder with the consent of the Required Lenders and upon ten days'  notice to the Lenders and the Borrower.  The Administrative Agent may resign as Administrative  Agent upon ten days' notice to the Lenders, each Agent and the Borrower with such resignation  becoming effective upon a successor agent succeeding to the rights, powers and duties of the  Administrative Agent pursuant to this Section.  If the Administrative Agent shall resign as  Administrative Agent under this Agreement, then the Required Lenders shall appoint a successor  administrative agent.  Any successor administrative agent shall succeed to the rights, powers and  duties of resigning Administrative Agent, and the term "Administrative Agent" shall mean such  successor administrative agent effective upon its appointment, and the former Administrative  Agent's rights, powers and duties as Administrative Agent shall be terminated, without any other  or further act or deed on the part of such former Administrative Agent or any of the parties to  this Agreement.  After the retiring Administrative Agent's resignation as Administrative Agent,  the provisions of this Article shall inure to its benefit as to any actions taken or omitted to be  taken by it while it was Administrative Agent under this Agreement.  ASSIGNMENTS; PARTICIPATIONS  Section 11.01.  Assignments and Participations.  





 






123  147032870v2  (a) Each Lender may upon at least 30 days' notice to the Administrative Agent and  the Agents assign to one or more banks or other entities all or a portion of its rights and  obligations under this Agreement; provided, that (i) each such assignment shall be of a constant,  and not a varying percentage of all of the assigning Lender's rights and obligations under this  Agreement, (ii) the amount of the Commitment of the assigning Lender being assigned pursuant  to each such assignment (determined as of the date of the Assignment and Acceptance with  respect to such assignment), except if being assigned to an Affiliate of the Lender, shall in no  event be less than the lesser of (A) $5,000,000 or an integral multiple of $1,000,000 in excess of  that amount and (B) the full amount of the assigning Lender's Commitment, (iii) each such  assignment shall be to an Eligible Assignee, (iv) the parties to each such assignment shall  execute and deliver to the Administrative Agent (with a copy to the Borrower), for its recording  in the Lender Register, an Assignment and Acceptance, together with a processing and  recordation fee of $3,500 or such lesser amount as shall be approved by the Administrative  Agent, (v) the parties to each such assignment shall have agreed to reimburse the Administrative  Agent for all reasonable fees, costs and expenses (including the reasonable fees and  disbursements of counsel for the Administrative Agent) incurred by the Administrative Agent in  connection with such assignment, (vi) each Person that becomes a Lender under an Assignment  and Acceptance shall agree to be bound by the confidentiality provisions of Article Twelve and  (vii) there shall be no increased costs, expenses or Taxes incurred by the Administrative Agent or  any Lender Group upon assignment or participation.  Upon such execution, delivery and  recording by the Administrative Agent, from and after the effective date specified in each  Assignment and Acceptance, (i) the assignee thereunder shall be a party hereto and, to the extent  that rights and obligations hereunder have been assigned to it pursuant to such Assignment and  Acceptance, have the rights and obligations of a Lender hereunder and (ii) the Lender assignor  thereunder shall, to the extent that rights and obligations hereunder have been assigned by it  pursuant to such Assignment and Acceptance, relinquish its rights and be released from its  obligations under this Agreement (and, in the case of an Assignment and Acceptance covering  all or the remaining portion of an assigning Lender's rights and obligations under this  Agreement, such Lender shall cease to be a party hereto).  (b) By executing and delivering an Assignment and Acceptance, the Lender assignor  thereunder and the assignee thereunder confirm to and agree with each other and the other parties  hereto as follows:  (i) other than as provided in such Assignment and Acceptance, such assigning  Lender makes no representation or warranty and assumes no responsibility with respect to any  statements, warranties or representations made in or in connection with this Agreement or the  execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement  or any other instrument or document furnished pursuant hereto; (ii) such assignee confirms that it  has received a copy of this Agreement, together with copies of such financial statements and  other documents and information as it has deemed appropriate to make its own credit analysis  and decision to enter into such Assignment and Acceptance; (iii) such assignee will,  independently and without reliance upon the Administrative Agent, such assigning Lender or any  other Lender and based on such documents and information as it shall deem appropriate at the  time, continue to make its own credit decisions in taking or not taking action under this  Agreement; (iv) such assigning Lender and such assignee confirm that such assignee is an  Eligible Assignee; (v) such assignee appoints and authorizes the Administrative Agent to take  such action as agent on its behalf and to exercise such powers under this Agreement as are  delegated to such agent by the terms hereof, together with such powers as are reasonably  





 






124  147032870v2  incidental thereto; and (vi) such assignee agrees that it will perform in accordance with their  terms all of the obligations which by the terms of this Agreement are required to be performed  by it as a Lender.  (c) The Administrative Agent shall maintain at its address referred to herein a copy of  each Assignment and Acceptance delivered to it and a register for the recordation of the names,  addresses and Commitment of each Lender and the Principal Amount (and stated interest) of  each Loan made by each Lender from time to time (the "Lender Register").  The entries in the  Lender Register shall be conclusive and binding for all purposes, absent manifest error, and the  Borrower and the Lenders shall treat each Person whose name is recorded in the Lender Register  as a Lender hereunder for all purposes of this Agreement.  The Lender Register shall be available  for inspection by any Agent or Lender at any reasonable time and from time to time upon  reasonable prior notice.  (d) Subject to the provisions of Section 11.01(a), upon its receipt of an Assignment  and Acceptance executed by an assigning Lender and an assignee, the Administrative Agent  shall, if such Assignment and Acceptance has been completed, accept such Assignment and  Acceptance, and the Administrative Agent shall then record the information contained therein in  the Lender Register.  (e) Each Lender may sell participations to one or more banks or other entities in or to  all or a portion of its rights and obligations under this Agreement (including all or a portion of its  Commitment and each Loan owned by it); provided, that (i) such Lender's obligations under this  Agreement (including its Commitment hereunder) shall remain unchanged, (ii) such Lender shall  remain solely responsible to the other parties hereto for the performance of such obligations,  (iii) the Administrative Agent and the other Lenders shall continue to deal solely and directly  with such Lender in connection with such Lender's rights and obligations under this Agreement  and (iv) the Borrower provides its prior written consent to the sale of such participation (such  consent of the Borrower not to be unreasonably withheld).  Notwithstanding anything herein to  the contrary, each participant shall have the rights of a Lender (including any right to receive  payment) under Sections 2.10 and 2.11; provided, that no participant shall be entitled to receive  payment under either such Section in excess of the amount that would have been payable under  such Section by the Borrower to the Lender granting its participation had such participation not  been granted, and no Lender granting a participation shall be entitled to receive payment under  either such Section in an amount which exceeds the sum of (i) the amount to which such Lender  is entitled under such Section with respect to any portion of any Loan owned by such Lender  which is not subject to any participation plus (ii) the aggregate amount to which its participants  are entitled under such Sections with respect to the amounts of their respective participations.   With respect to any participation described in this Section, the participant's rights as set forth in  the agreement between such participant and the applicable Lender to agree to or to restrict such  Lender's ability to agree to any modification, waiver or release of any of the terms of this  Agreement or to exercise or refrain from exercising any powers or rights which such Lender may  have under or in respect of this Agreement shall be limited to the right to consent to any of the  matters set forth in Section 11.01.  Each Lender that sells a participation shall, acting solely for this purpose as an agent of  the Borrower, maintain a register on which it enters the name and address of each participant and  





 






125  147032870v2  the principal amounts (and stated interest) of each participant's interest in the obligations under  this Agreement (the "Participant Register"); provided, that no Lender shall have any obligation to  disclose all or any portion of the Participant Register (including the identity of any participant or  any information relating to a participant's interest in any Commitment or Loan or its other  obligations under the Agreement) to any person except to (A) the Administrative Agent and (B)  the extent that such disclosure is necessary to establish that such Commitment, Loan or other  obligation is in registered form under Section 5f.103-1(c) of the United States Treasury  Regulations.  The entries in the Participant Register shall be conclusive absent manifest error,  and such Lender shall treat each person whose name is recorded in the Participant Register as the  owner of such participation for all purposes of this Agreement notwithstanding any notice to the  contrary.  (f) Each Lender may, in connection with any assignment or participation or proposed  assignment or participation pursuant to this Section, disclose to the assignee or participant or  proposed assignee or participant any information, including Confidential Information, relating to  the Borrower furnished to such Lender by or on behalf of the Borrower.  (g) Nothing herein shall prohibit any Lender from (i) pledging or assigning as  Collateral any of its rights under this Agreement to any Federal Reserve Bank or any other  Governmental Authority in accordance with Applicable Law or (ii) pledging or granting a  security interest in all or any portion of its rights (including payments to it under this Agreement  and the other Basic Documents) under this Agreement to a collateral trustee in order to comply  with Rule 3a-7 under the Investment Company Act; provided, that in each case, (A) any such  pledge or Collateral assignment may be made without compliance with Section 11.01(a) or  11.01(b) and (B) no such pledge or grant of a security interest shall release a Lender from any of  its obligations hereunder or substitute any such pledgee or grantee for such Lender as a party  hereto.  MUTUAL COVENANTS REGARDING CONFIDENTIALITY  Section 12.01.  Covenants of the Borrower, the Servicer, the Backup Servicer, the  Account Bank and the Collateral Custodian.  Each of the Borrower, the Servicer, the Backup  Servicer, the Account Bank and the Collateral Custodian severally and with respect to itself only,  covenants and agrees to hold in confidence, and not disclose to any Person, the terms of this  Agreement (including any fees payable in connection with this Agreement or the identity of a  Lender under this Agreement), except as the Administrative Agent and the Required Lenders  may have consented to in writing prior to any proposed disclosure, except it may disclose such  information (a) to its officers, directors, employees, agents, counsel, accountants, auditors,  subservicers, advisors or representatives, (b) to the extent such information has become available  to the public other than as a result of a disclosure by or through the Borrower, the Servicer, the  Backup Servicer, the Account Bank or the Collateral Custodian, (c) to JPMorgan Chase Bank or  its Affiliates or (d) to the extent it should be (i) required by Applicable Law (including filing a  copy of this Agreement and the other Basic Documents (other than the Fee Letter and excluding  from any such copy the identity of each Lender)) as exhibits to filings required to be made with  the Securities and Exchange Commission, or in connection with any legal or regulatory  





 






126  147032870v2  proceeding or (ii) requested by any Governmental Authority to disclose such information;  provided, that in the case of clause (d)(i), the Borrower, the Servicer, the Backup Servicer, the  Account Bank or the Collateral Custodian, as applicable, will use all reasonable efforts to  maintain confidentiality and will (unless otherwise prohibited by law) notify the Agent or Lender  of its intention to make any such disclosure prior to making such disclosure.  Section 12.02.  Covenants of the Administrative Agent, the Agents and the Lenders.  (a) Each of the Administrative Agent, each Agent and each Lender covenants and  agrees that it will not disclose any of the Confidential Information at any time received or  obtained by it without the Borrower's prior written consent; provided, that it may disclose any  such Confidential Information (i) in connection with participations and assignments pursuant to  Section 11.01, (ii) to its officers, directors or employees, to JPMorgan Chase Bank or its  Affiliates, to any Credit Provider or to any nationally recognized statistical ratings organization  that rates the Commercial Paper Notes issued by a Conduit Lender, each of which shall be  informed by it of the confidential nature of the Confidential Information and shall have agreed to  keep such information confidential, and (iii) to its or its Affiliates' Advisors (provided that such  Advisors are advised of the confidential nature of such information and such Advisors are  obligated to keep such information confidential pursuant to the terms of their engagement or  applicable professional rules).  Each of the Administrative Agent, each Agent and each Lender  agrees to be responsible for any breach of this Agreement by its Affiliates and Advisors, and it  agrees that its Affiliates and Advisors will be advised by it of the confidential nature of such  information and that it shall cause its Affiliates to be bound by this Agreement.  Notwithstanding  the foregoing, with respect to participations and assignments pursuant to Section 11.01 involving  an Eligible Assignee other than an entity satisfying clause (i) of the definition of "Eligible  Assignee", Confidential Information may not be provided to prospective participants or  assignees before the execution of an Assignment and Acceptance, unless such Confidential  Information is covered under a separate confidentiality agreement between the assigning Lender  and such prospective participant or assignee pursuant to which such prospective participant or  assignee shall agree to the provisions set forth in this Article.  (b) Each of the Administrative Agent, each Agent and each Lender acknowledges and  agrees that any Confidential Information provided to it, in whatever form, is the sole property of  the Borrower or DFC, as applicable.  Neither such Person nor its Affiliates or Advisors shall use  any of the Confidential Information now or hereafter received or obtained from or through the  Borrower, DFC or any of their respective Affiliates for any purpose other than for purposes of  engaging in, or as otherwise contemplated by, the transactions contemplated by the Basic  Documents.    (c) If the Administrative Agent, any Agent, a Lender or any of their respective  Affiliates or Advisors are legally compelled (whether by deposition, interrogatory, request for  documents, subpoena, civil investigation, demand or similar process) to disclose any  Confidential Information, the related entity shall, to the extent permitted by law, promptly notify  the Borrower and DFC in writing of such requirement so that the Borrower and/or DFC, at their  sole cost and expense, may seek a protective order or other appropriate remedy and/or waive  compliance with the provisions hereof.  The Administrative Agent, each Agent and each Lender  or any of their respective Affiliates or Advisors agree to use its reasonable efforts, upon the  





 






127  147032870v2  written request of the Borrower or DFC, as applicable, to obtain or assist the Borrower or DFC,  as applicable, in obtaining any such protective order.  Failing the reasonably timely entry of a  protective order or the reasonably timely receipt of a waiver hereunder, it may disclose, without  liability hereunder, that portion (and only that portion) of the Confidential Information that in the  opinion of such party's counsel, it is legally compelled to disclose.  (d) Notwithstanding the foregoing, it is understood that the Administrative Agent,  each Agent and each Lender or its Affiliates may be required to disclose (and may so disclose,  without liability hereunder, provided that it complies with the following sentence) the  Confidential Information or portions thereof (i) at the request of a bank examiner or other  regulatory authority or in connection with an examination of it or its Affiliates by a bank  examiner or other regulatory authority, including in connection with the regulator compliance  policy of Administrative Agent, any Agent or any Lender, (ii) to any nationally recognized  statistical rating organization (within the meaning of the Exchange Act) (an "NRSRO") either  (A) in compliance with Rule 17g-5 under the Exchange Act (or any similar rule or regulation in  any relevant jurisdiction) or (B) in connection with the rating or reaffirmation of the rating of the  Commercial Paper Notes, each of which shall be informed by Administrative Agent, such Agent,  such Lender or such Affiliate, as applicable, of the confidential nature of the Confidential  Information and shall have agreed to keep such information confidential, or (iii) to any collateral  trustee appointed by such Lender to comply with Rule 3a-7 under the Investment Company Act;  provided, that such collateral trustee is informed of the confidential nature of such information  and such collateral trustee agrees in writing to keep such Confidential Information subject to an  agreement with substantially similar terms as provided herein.    (e) It is understood and agreed that no failure or delay by the Borrower, the Servicer,  the Backup Servicer, the Collateral Custodian, the Administrative Agent, the Account Bank,  each Agent or any Lender in exercising any right, power or privilege hereunder shall operate as a  waiver thereof, nor shall any single or partial exercise thereof preclude any other or further  exercise thereof or the exercise of any right, power or privilege hereunder.  Section 12.03.  Non-Confidentiality of Tax Treatment and Tax Structure.   Notwithstanding anything to the contrary contained herein or in any document related to the  transactions contemplated hereby, in connection with Treasury Regulations Section 1.6011-4,  Section 301.6111-1T and Section 301.6112-1, the parties hereby agree that, from the  commencement of discussions with respect to the transactions described herein, each party  hereto (and each of its employees, representatives, Advisors, Affiliates or agents) is permitted to  disclose to any and all persons of any kind (other than limitations imposed by State or federal  securities laws), the structure and tax aspects of the transactions, and all materials of any kind  (including opinions or other tax analyses) that are provided to each such party related to such  structure and tax aspects.  In this regard, each party hereto acknowledges and agrees that this  disclosure of the structure or tax aspects of the transactions is not limited in any way by an  express or implied understanding or agreement, oral or written (whether or not such  understanding or agreement is legally binding) except as is reasonably necessary to comply with  state and federal securities laws.  Furthermore, each party hereto acknowledges and agrees that it  does not know or have reason to know that its use or disclosure of information relating to the  structure or tax aspects of the transactions is limited in any other manner (such as where the  





 






128  147032870v2  transactions are claimed to be proprietary or exclusive) for the benefit of any other Person (other  than as it may be limited by State or federal securities laws).  MISCELLANEOUS  Section 13.01.  Amendments and Waivers.  This Agreement may be amended, waived or  modified by the written agreement of the Borrower and the Required Lenders.  The  Administrative Agent shall provide a copy of each such proposed amendment, waiver or other  modification to the Account Bank, the Backup Servicer and each Hedge Counterparty.    No amendment, waiver or other modification which could have a material adverse effect  on the rights or obligations of the Account Bank, the Backup Servicer (including, in its capacity  as Successor Servicer) or any Hedge Counterparty shall be effective against the Account Bank,  the Backup Servicer or such Hedge Counterparty, as applicable, without the prior written  agreement of the Account Bank, the Backup Servicer or such Hedge Counterparty, as applicable.    Section 13.02.  Notices, Etc.  All notices and other communications provided for  hereunder shall, unless otherwise stated herein, be in writing (including communication by e- mail or facsimile copy) and e-mailed, mailed, transmitted or delivered, as to each party hereto, at  its address set forth under its name on the signature pages hereof or specified in such party's  Assignment and Acceptance 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 notice by (a) mail, five days after being deposited in the  United States mail, first class postage prepaid, (b) facsimile copy, when receipt is confirmed by  telephone, except that notices and communications pursuant to Article Two shall not be effective  until received with respect to any notice sent by mail or (c) notice by an e-mail, when receipt is  confirmed by telephone or by reply e-mail from the recipient.  Section 13.03.  No Waiver, Rights and Remedies.  No failure on the part of any Agent or  any Secured Party or any assignee of any 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 13.04.  Binding Effect.  This Agreement shall be binding upon and inure to the  benefit of the Borrower, the Servicer, the Backup Servicer, the Collateral Custodian, the Account  Bank, the Administrative Agent, each Agent, the Secured Parties and their respective successors  and permitted assigns and, in addition, each Hedge Counterparty shall be an express third-party  beneficiary of this Agreement.  Section 13.05.  Term of this Agreement.  This Agreement shall remain in full force and  effect until the Facility Termination Date; provided, that (a) the rights and remedies with respect  to any breach of any representation and warranty made or deemed made by the Borrower  pursuant to Article Five and the indemnification and payment provisions of Article Ten and  





 






129  147032870v2  Section 2.11, (b) the confidentiality provisions of Article Twelve, (c) the provisions of  Section 13.10 and (d) any other provision of this Agreement expressly stated to survive, shall be  continuing and shall survive any termination of this Agreement.  Section 13.06.  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 REFERENCE TO ITS CONFLICTS OF LAW PROVISIONS  (OTHER THAN § 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW).   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 13.07.  WAIVER OF JURY TRIAL.  TO THE EXTENT PERMITTED BY  APPLICABLE LAW, EACH OF THE PARTIES HERETO 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 13.08.  Costs and Expenses.  In addition to the rights of indemnification granted  to the Administrative Agent, each Agent, the Secured Parties, the Account Bank, the Collateral  Custodian and the Backup Servicer and its or their Affiliates and officers, directors, employees  and agents thereof under Article Nine, the Borrower agrees to pay on demand all reasonable out- of-pocket costs and expenses (other than Taxes) of the Administrative Agent, each Agent, the  Secured Parties, the Account Bank and the Backup Servicer incurred in connection with the  administration (including periodic auditing), 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 the reasonable fees and out-of-pocket expenses of  counsel for the Administrative Agent, each Agent, the other Secured Parties, the Account Bank  and the Backup Servicer (including, if it is then acting as the Successor Servicer) with respect  thereto and with respect to advising such entities 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 expenses), incurred by  such entities in connection with the enforcement of this Agreement and the other documents to  be delivered hereunder or in connection herewith.  Section 13.09.  No Insolvency Proceedings.  





 






130  147032870v2  (a) Notwithstanding any prior termination of this Agreement, no Lender shall, prior  to the date which is one year and one day after the final payment of the Aggregate Unpaids,  petition, cooperate with or encourage any other Person in petitioning or otherwise invoke the  process of any Governmental Authority for the purpose of commencing or sustaining an  Insolvency Proceeding against the Borrower under any United States federal or State Insolvency  Laws or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other  similar official of the Borrower or any substantial part of its property or ordering the winding up  or liquidation of the affairs of the Borrower.  (b) Notwithstanding any prior termination of this Agreement, each party to this  Agreement hereby agrees that it shall not institute against, or join any other person in instituting  against, any Lender any Insolvency Proceeding, for one year and one day after the latest  maturing Commercial Paper Note or other debt security issued by such Lender is paid.  Section 13.10.  Recourse Against Certain Parties.  (a) No recourse under or with respect to any obligation, covenant or agreement  (including the payment of any fees or any other obligations) of each Agent or any Secured Party  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 such Person or any manager  or administrator of such Person or any incorporator, affiliate, stockholder, officer, employee or  director of such Person or of the Borrower or of any such manager or administrator, as such, 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 the Agents  and any Secured Party 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 Person, and that no personal liability whatsoever shall  attach to or be incurred by any administrator of any such Person or any incorporator,  stockholder, affiliate, officer, employee or director of such Person or of any such administrator,  as such, or any other of them, under or by reason of any of the obligations, covenants or  agreements of such Person 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  every such administrator of such Person and each incorporator, stockholder, affiliate, officer,  employee or director of such Person or of any such administrator, or any of them, for breaches  by such Person 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.  The provisions of this  Section shall survive the termination of this Agreement.  (b) Notwithstanding anything in this Agreement or any other Basic Document to the  contrary, the obligations of any Lender under this Agreement are solely the obligations of such  Lender and shall be payable at such time as funds are received by or are available to such Lender  in excess of funds necessary to pay in full all outstanding Commercial Paper Notes of such  Lender, and, to the extent funds are not available to pay such obligations, the claims relating  thereto shall not constitute a claim against such Lender but shall continue to accrue.  Each Agent,  each Secured Party and each other party to this Agreement agrees that the payment of any claim  





 






131  147032870v2  (as defined in the Bankruptcy Code) of any such party shall be subordinated to the payment in  full of all Commercial Paper Notes.  (c) The provisions of this Section shall survive the termination of this Agreement.  Section 13.11.  Patriot Act Compliance.  The Administrative Agent hereby notifies the  Borrower that pursuant to the requirements of the Patriot Act, it, and each other Lender and the  Account Bank, may be required to obtain, verify and record information that identifies the  Borrower, which information includes the name and address of the Borrower, organizational  documentation, director and shareholder information, and other information that will allow the  Administrative Agent, each Lender and the Account Bank to identify the Borrower in accordance  with the Patriot Act.  This notice is given in accordance with the requirements of the Patriot Act  and is effective for the Administrative Agent, each Lender and the Account Bank.  Section 13.12.  Execution in Counterparts; Electronic Signatures; Severability;  Integration.  This Agreement may be executed in any number of counterparts and by different  parties hereto in separate counterparts, 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.   Delivery of an executed counterpart of a signature page to this Agreement by facsimile or by  electronic mail in a “.pdf” file shall be effective as delivery of a manually executed counterpart  of this Agreement.  Each party agrees that this Agreement and any other documents to be  delivered in connection herewith may be electronically signed, and that any electronic signatures  appearing on this Agreement or such other documents are the same as handwritten signatures for  the purposes of validity, enforceability, and admissibility.  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 contains 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 other than any fee letter contemplated hereby.  Section 13.13.  Not a Novation.  Each party hereto acknowledges and agrees that this  Agreement is intended only to amend and restate their continuing obligations under the Existing  Loan Agreement in the manner set forth herein, and is not intended as a novation thereof.  [Remainder intentionally left blank] 





 






 





 






 





 






[Loan Agreement] 147032870v2 THE ADMINISTRATIVE AGENT  AND ACCOUNT BANK: JPMORGAN CHASE BANK, N.A. By: Name:  Elizabeth S. Trainor Title:    Executive Director Address for Notices: JPMorgan Chase Bank, N.A. Chase Tower, 16th Floor 10 South Dearborn Street Mail Code IL1-0079 Chicago, Illinois  60603 Attention: Asset-Backed Securities Conduit Group Facsimile No.:   (312) 244-3146 Telephone: (312) 732-4087 e-mail: elizabeth.a.slawin@jpmorgan.com abs.treasury.dept@jpmorgan.com abf.operations@jpmorgan.com 





 






[Loan Agreement] 147032870v2 CONDUIT LENDER: CHARIOT FUNDING LLC By: JPMORGAN CHASE BANK, N.A., as its  attorney-in-fact By: Name:  Elizabeth S. Trainor Title:    Executive Director Address for Notices: Chariot Funding LLC  c/o JPMorgan Chase Bank, N.A. Chase Tower, 16th Floor 10 South Dearborn Street Mail Code IL1-0079 Chicago, Illinois  60603 Attention: Asset-Backed Securities Conduit Group Facsimile No.:   (312) 244-3146 Telephone: (312) 732-4087 e-mail: elizabeth.a.slawin@jpmorgan.com abs.treasury.dept@jpmorgan.com abf.operations@jpmorgan.com 





 






[Loan Agreement] 147032870v2 COMMITTED LENDER: JPMORGAN CHASE BANK, N.A. By: Name: Elizabeth S. Trainor Title:   Executive Director Address for Notices: Chariot Funding LLC  c/o JPMorgan Chase Bank, N.A. Chase Tower, 16th Floor 10 South Dearborn Street Mail Code IL1-0079 Chicago, Illinois  60603 Attention: Asset-Backed Securities Conduit Group Facsimile No.:   (312) 244-3146 Telephone: (312) 732-4087 e-mail: elizabeth.a.slawin@jpmorgan.com abs.treasury.dept@jpmorgan.com abf.operations@jpmorgan.com JPMORGAN AGENT: JPMORGAN CHASE BANK, N.A. By: Name: Elizabeth S. Trainor Title:   Executive Director Address for Notices: JPMorgan Chase Bank, N.A. Chase Tower, 16th Floor 10 South Dearborn Street Mail Code IL1-0079 Chicago, Illinois  60603 Attention: Asset-Backed Securities Conduit Group Facsimile No.:   (312) 244-3146 Telephone: (312) 732-4087 e-mail: elizabeth.a.slawin@jpmorgan.com abs.treasury.dept@jpmorgan.com abf.operations@jpmorgan.com 





 






SA-1  147032870v2  SCHEDULE A  LENDER SUPPLEMENT (JPMORGAN LENDER GROUP)  Lender Group: JPMorgan  Agent: JPMorgan Chase Bank, N.A.  Address for Notices: JPMorgan Chase Bank, N.A.  Chase Tower, 16th Floor  10 South Dearborn Street  Mail Code IL1-0079  Chicago, Illinois  60603  Attention: Asset-Backed Securities Conduit Group  Facsimile No.:   (312) 244-3146  Telephone: (312) 732-4087  e-mail:  elizabeth.a.slawin@jpmorgan.com  abs.treasury.dept@jpmorgan.com  abf.operations@jpmorgan.com  Commitment: $150,000,000  Mandatory Commitment: $150,000,000  Committed Lender: JPMorgan Chase Bank, N.A.  Address for Notices and Investing  Office:  JPMorgan Chase Bank, N.A.  Chase Tower, 16th Floor  10 South Dearborn Street  Mail Code IL1-0079  Chicago, Illinois  60603  Attention: Asset-Backed Securities Conduit Group  Facsimile No.:   (312) 244-3146  Telephone: (312) 732-4087  e-mail:  elizabeth.a.slawin@jpmorgan.com  abs.treasury.dept@jpmorgan.com  abf.operations@jpmorgan.com  





 






SA-2  147032870v2  Wire Information: Account Title: JPMCB ABS Conduit Clearing Account  Bank Name: JPMorgan Chase Bank, N.A.  ABA/Routing: 021000021  Account Number:  626305127  Re:  SCFC Business Services LLC  Conduit Lender: Chariot Funding LLC   Address for Notices and Investing  Office:  Chariot Funding LLC  c/o JPMorgan Chase Bank, N.A.  Chase Tower, 16th Floor  10 South Dearborn Street  Mail Code IL1-0079  Chicago, Illinois  60603  Attention: Asset-Backed Securities Conduit Group  Facsimile No.:   (312) 244-3146  Telephone: (312) 732-4087  e-mail:  elizabeth.a.slawin@jpmorgan.com  abs.treasury.dept@jpmorgan.com  abf.operations@jpmorgan.com  Wire Information: Account Title: JPMCB ABS Conduit Clearing Account  Bank Name: JPMorgan Chase Bank, N.A.  ABA/Routing: 021000021  Account Number:  626305127  Re:  SCFC Business Services LLC  





 






SA-3  147032870v2  "CP Rate": With respect to any day in any Interest Period (or portion  thereof), means the per annum rate calculated to yield the  "weighted average cost" (as defined below) for such  Interest Period (or portion thereof) in respect to  Commercial Paper Notes issued by such Conduit Lender  on or after March 1, 2019; provided, that if any  component of such rate is a discount rate, in calculating  the CP Rate for such Interest Period (or portion thereof),  the rate resulting from converting such discount rate to  an interest bearing equivalent rate per annum shall be  used in calculating such component.  As used in this  definition, "weighted average cost" for any Interest  Period (or portion thereof) means the sum (without  duplication) of (i) the actual interest accrued during such  Interest Period (or portion thereof) on outstanding  Commercial Paper Notes issued by such Conduit Lender  on or after March 1, 2019 (excluding any Commercial  Paper Notes issued to and held by JPMorgan Chase Bank  or any affiliate thereof, other than such Commercial  Paper Notes held as part of the market making activities  of Conduit Lender's Commercial Paper Notes dealer),  (ii) the commissions of placement agents and dealers in  respect of such Commercial Paper Notes, (iii) any note  issuance costs attributable to such Commercial Paper  Notes not constituting dealer fees or commissions,  expressed as an annualized percentage of the aggregate  principal component thereof, (iv) the actual interest  accrued during such Interest Period (or portion thereof)  on other borrowings by such Conduit Lender (as  determined by such Conduit Lender or an Affiliate  thereof), including to fund small or odd dollar amounts  that are not easily accommodated in the commercial  paper market, which may include loans from such  Conduit Lender's agent or its affiliates (such interest rate  not to exceed, on any day, the Federal Funds Effective  Rate in effect on such day plus 0.50%), and (v)  incremental carrying costs incurred with respect to  Commercial Paper Notes maturing on dates other than  those on which corresponding funds are received by such  Conduit Lender, minus any accrual of income net of  expenses received from investment of collections  received under all receivable purchase facilities funded  substantially with Commercial Paper Notes.  





 






SB-1  147032870v2  SCHEDULE B  ELIGIBLE RECEIVABLE CRITERIA  An "Eligible Receivable" means a Receivable as to which all of the following conditions  are satisfied:  1. which was originated by DFC under an existing Dealer Agreement;  2. which at the time of underwriting, the related Obligor provided as its most  recent billing address an address located in a State of the United States;  3. for which the related Obligor is not (a) an employee of DFC or Lithia, (b)  a fleet customer or (c) the U.S. government or any State or any agency, department or  instrumentality of the U.S. government or any State or other government entity;  4. which has an original term to maturity of at least 12 months but not more  than 84 months;  5. which has a Principal Balance of at least $500 but not more than $75,000;  6. which constitutes an “account,” "tangible chattel paper" or a "payment  intangible" under and as defined in Article 9 of the UCC as then in effect;  7. which is payable in U.S. Dollars;  8. which arises under a Contract which (a) has been properly executed by the  parties thereto, (b) represents the genuine, legal, valid and binding payment obligation in writing  of the Obligor, in full force and effect, enforceable by the holder thereof in accordance with its  terms, subject to the effect of bankruptcy, insolvency, reorganization or other similar laws  affecting the enforcement of creditors rights generally, and (c) contains customary and  enforceable provisions so as to render the rights and remedies of the holder thereof against the  property subject to such Contract adequate for the realization of the benefits provided thereby;   9. which is not subject to any right of rescission, cancellation, set-off, claim,  counterclaim or defense (including the defense of usury) of the Obligor or any proceedings  pending or, to the best of the Borrower's knowledge threatened, wherein the Obligor or any  Governmental Authority has alleged the related Contract is illegal or unenforceable;   10. which does not require the Obligor to consent to or receive notice of the  transfer, sale or assignment of the rights and duties of DFC thereunder;  11. with respect to which the related Contract requires the Obligor to cause the  related Financed Vehicle to be covered by an individual physical damage insurance policy  featuring comprehensive and collision coverage, in accordance with the Credit and Collection  Policy;  





 






SB-2  147032870v2  12. which is secured by a valid, subsisting and enforceable first priority  perfected security interest, free and clear of any Lien, in favor of the Borrower in the related  Financed Vehicle with respect to which all filings have been made, which security interest has  been validly assigned by the Borrower to the Administrative Agent and with respect to which all  filings necessary in any jurisdiction to give the Administrative Agent a first priority perfected  security interest in such Receivable have been made;  13. none of Lithia, DFC or any of their Affiliates have given or loaned to any  Obligor with respect to a Receivable, directly or indirectly, any Scheduled Payment or other  amounts due or to become due under such Receivable in order to make the Receivable current;  14. to which the Borrower has good and indefeasible title to and was the sole  owner of such Receivable, free of Liens (other than Permitted Liens) of others and to which the  Seller had the full right to transfer, sell and encumber such Receivable free and clear of any  Liens other than the Liens in favor of the Administrative Agent on behalf of the Secured Parties;   15. which shall have complied with, at the time of its underwriting, and shall  remain in compliance with, all Requirements of Law, including all consumer protection and  usury laws and which, to the best of the Borrower's knowledge, was originated without fraud or  misrepresentation;   16. which was originated in the ordinary course of business of the Seller and  in accordance with the Credit and Collection Policy;   17. with respect to which there is only one original Contract within the  meaning of Article 9 of the UCC as then in effect related thereto which is in the possession of the  Collateral Custodian; such Contract has not been sold, transferred, assigned or pledged by DFC  to any Person other than the Borrower; and such Contract has not been stamped or otherwise  marked to show any interest of any other Person; and ;   18. with respect to which the related Obligor is (a) not deceased and (b) not  the subject of a pending bankruptcy proceeding;  19. which (a) at the time such Receivable was acquired by the Borrower was  not more than 30 days past due or a Defaulted Receivable and (b) is not a Defaulted Receivable  or a Delinquent Receivable;  20. which at the time of underwriting (a) did not have a Loan-to-Value Ratio  of greater than 135% and (b) did not have a Loan-to-Value Ratio (calculated deducting any  related costs, including amounts advanced in respect of accessories, insurance premiums, service  and warranty contracts, and other items customarily financed as part of a Contract, from the  related Amount Financed) of greater than 120%;  21. which at the time of underwriting (other than Receivables that do not have  a FICO Score or have a FICO Score of zero) did not have a FICO Score of less than 450;  22. with respect to which the Payment-to-Income Ratio does not exceed 20%;  





 






SB-3  147032870v2  23. with respect to which the Debt-to-Income Ratio does not exceed 60%;  24. with respect to which (a) the related Contract relates to the retail purchase  of a motor vehicle, (b) the portion of a payment allocable to interest and the portion allocable to  principal under such Contract are determined in accordance with the Simple Interest Method, (c)  such Contract provides for a fixed interest rate and level monthly payments (provided, that the  payments in the first and last months of the Receivable may be minimally different from the  level payment), and (d) the monthly payments under such Contract fully amortize the amount  financed and yield interest at the related APR over its original term;  25. with respect to which the related Contract (a) was underwritten by DFC in  accordance with the Credit and Collection Policy in effect at the time of underwriting of such  Contract, (b) satisfied in all material respects the requirements of the Credit and Collection  Policy in effect at the time of underwriting of such Contract, (c) satisfied all Applicable Law in  effect at the time of origination and (d) was not originated with Level 3 approval;  26. which the related Contract has not been amended, modified, waived,  extended or altered by the Servicer in any respect except in accordance with the Credit and  Collection Policy;   27. with respect to which the information set forth in the Schedule of  Receivables is true and correct in all material respects as of the opening of business on the  related Cutoff Date;   28. with respect to which DFC used no selection procedures that identified  such Receivable as being less desirable or valuable than other comparable motor vehicle loans  originated or acquired by DFC that otherwise meet the eligibility criteria; and  29. with respect to which no Deferral has been granted, unless all Scheduled  Payments or portions thereof that that were deferred pursuant to such Deferral were paid by the  related Obligor subsequent to the granting of such Deferral.   





 






SC-1  147032870v2  SCHEDULE C  SCHEDULE OF RECEIVABLES  (Original delivered to the Administrative Agent)  





 






SD-1  147032870v2  SCHEDULE D  LOCATION OF RECEIVABLE FILES  Driveway Finance Corporation  150 North Bartlett Street  Medford, OR  97501  





 






SF-1  147032870v2  SCHEDULE E  SCHEDULE OF DOCUMENTS  1. Loan Agreement, dated as of the Closing Date, by and among SCFC Business Services  LLC, as borrower (the "Borrower"), Driveway Finance Corporation ("DFC"), as servicer  (in such capacity, the "Servicer") and as collateral custodian for the Secured Parties (as  defined therein), the Lenders from time to time parties thereto, the Agents for the Lender  Groups (as defined therein) from time to time parties thereto (the "Agents"), and  JPMorgan Chase Bank, N.A., as administrative agent for the Lenders and the Agents (the  "Administrative Agent") and as account bank.  2. Purchase Agreement, dated as of the Closing Date, between DFC and the Borrower.  3. Escrow and Control Agreement, dated as of the Closing Date, among the Borrower,  JPMorgan Chase Bank, N.A., as escrow agent and bank, and the Administrative Agent.  4. Blocked Account Control Agreement, dated as of the Closing Date, by and among DFC,  the Administrative Agent, and the Lockbox Bank.    5. Fee Letter, dated as of the Closing Date, among DFC, the Borrower and the  Administrative Agent.  6. Performance Guaranty of Lithia Motors, Inc., dated the Closing Date.  7. Power of Attorney, dated as of the Closing Date, from the Borrower to the Administrative  Agent.  8. Opinion of Morgan, Lewis & Bockius LLP, dated the Closing Date, as to certain true sale   matters.  9. Opinion of Morgan, Lewis & Bockius LLP, dated the Closing Date, as to certain non- consolidation sale  matters.  10. Opinion of Morgan, Lewis & Bockius LLP, dated the Closing Date, as to certain security  interest matters.  11. Opinion of Morgan, Lewis & Bockius LLP, dated the Closing Date, as to certain  corporate matters, including an opinion as to the Volcker Rule.  12. Opinion of Stoel Rives LLP, dated the Closing Date, as to certain corporate and security  interest matters under Oregon law.  13. Opinion of Fried, Frank, Harris, Shriver & Jacobson LLP, dated the Closing Date, as to  certain matters relating to Lithia Motor, Inc.  





 






SF-2  147032870v2  14. Opinion of In-House Counsel to DFC, dated the Closing Date, as to certain corporate  matters.  15. Opinion of In-House Counsel to the Performance Guarantor, dated the Closing Date, as  to certain corporate matters.  





 






* - No amendments that are made to, waivers that are granted with respect to, or other modifications that  are made with respect to the Lithia Loan Agreement that would change the amount of Funded Debt that is  permitted under such Section shall be given effect hereunder unless consented to by the Administrative  Agent.  SF-1  147032870v2  SCHEDULE F  FINANCIAL COVENANTS (LITHIA)  "Financial Covenants (Lithia)" means each of:  (i) as of any date of determination, the ratio for Lithia and all Related Subsidiaries of  Lithia on a consolidated basis of (a) each such entity's total assets that may  properly be classified as current assets in accordance with GAAP, but excluding  all loans to and notes and receivables from officers, employees, directors, owners  and affiliates of Lithia plus Revolving Loan Availability at such time plus the  aggregate amount of borrowing availability under any revolving credit facilities  (taking into account any applicable borrowing base and reserve limitations)  provided to Silo Subsidiaries and permitted under Section 13.10(o) of the Lithia  Loan Agreement* to (b) Lithia's total liabilities that may properly be classified as  current liabilities in accordance with GAAP, shall not be less than 1.10 to 1.0 as  of the last day of the most recently completed fiscal quarter;   (ii) as of any date of determination, the ratio for the four consecutive fiscal quarters  ending on the last day of the most recently completed fiscal quarter of (a) (1)  EBITDAR, minus (2) dividends and other distributions in respect of Equity  Interests and amounts expended to repurchase Equity Interests from a Person that  is not a Loan Party, minus (3) income tax expense to the extent paid in cash, minus  (4) an allowance for maintenance capital expenditures in an amount equal to  $85,000 for each Dealership location, plus (5) if any Permitted Acquisition has  occurred during any Measurement Period, pro forma EBITDAR minus rental or  lease expense attributable to any new Acquisition Subsidiary or business acquired  in connection with such Permitted Acquisition, as applicable, calculated as if the  Permitted Acquisition had occurred on the first day of such Measurement Period  (it being understood and agreed that pro forma EBITDAR minus rental or lease  expense may not be included in this calculation to the extent that it results in an  annualized increase of more than 10% in Lithia's consolidated EBITDAR minus  rental or lease expense prior to such adjustment, unless Lithia provides to the  Agent and the Required Lenders the supporting calculations for such adjustment  and such other information as they may reasonably request to determine the  accuracy of such calculations); to (b) the sum for the applicable Measurement  Period of (1) cash interest, plus (2) required principal payments on Indebtedness  plus (3) rental or lease expense, shall not be less than 1.20 to 1.0; and  (iii) as of any date of determination, the ratio for Lithia and all Related Subsidiaries of  Lithia on a consolidated basis of (a) (1) the then outstanding principal balance of  all Funded Debt (minus unrestricted cash and cash equivalents in an amount not  





 






* - No amendments that are made to, waivers that are granted with respect to, or other modifications that  are made with respect to the Lithia Loan Agreement that would change the amount of Funded Debt that is  permitted under such Section shall be given effect hereunder unless consented to by the Administrative  Agent.  SF-2  147032870v2  to exceed $50,000,000), minus (2) the sum of the then outstanding principal  balance of the New Vehicle Floorplan Loans, New Vehicle Swing Line Loans,  Used Vehicle Floorplan Loans, Used Vehicle Swing Line Loans, Service Loaner  Vehicle Floorplan Loans, Service Loaner Vehicle Swing Line Loans, principal  amount of any Other Service Loaner Floorplan Financing, Funded Debt permitted  under subsection (o) of Section 13.10 of the Lithia Loan Agreement* (but only to  the extent constituting floor plan financing), Funded Debt permitted under  subsection (p) of Section 13.10 of the Lithia Loan Agreement*, and Funded Debt  permitted under subsection (r) of Section 13.10 of the Lithia Loan Agreement*  (but only to the extent not guaranteed by Lithia) and, without duplication, Funded  Debt permitted under subsection (f) of Section 13.10 of the Lithia Loan  Agreement* (but only to the extent the underlying indebtedness that is guaranteed  constitutes floor plan financing), plus (3) six times rental or lease expense for the  Measurement Period ending on such date; to (b) (1) EBITDAR for the  Measurement Period ending on such date, minus (2) interest expense with respect  to the New Vehicle Floorplan Loans, New Vehicle Swing Line Loans, Used  Vehicle Floorplan Loans, Used Vehicle Swing Line Loans, Service Loaner  Vehicle Loans, Service Loaner Vehicle Swing Line Loans and Funded Debt  permitted under subsection (o) of Section 13.10 of the Lithia Loan Agreement*  (but only to the extent constituting floor plan financing), Funded Debt permitted  under subsection (p) of Section 13.10 of the Lithia Loan Agreement*, and Funded  Debt permitted under subsection (r) of Section 13.10 of the Lithia Loan  Agreement* (but only to the extent not guaranteed by Lithia), in each case for the  Measurement Period ending on such date, shall not be greater than 5.75 to 1.0.  For purposes of the foregoing Financial Covenants (Lithia), "Lithia Loan Agreement"  means the Third Amended and Restated Loan Agreement, dated as of December 9, 2019, by and  among Lithia, Lithia's subsidiaries that are from time to time parties thereto, each financial  institution that is from time to time party thereto as a lender, and U.S. Bank National  Association, as agent for the lenders thereunder and "Related Subsidiaries of Lithia" means, as of  any date of determination, all entities that are defined as "Subsidiaries" of Lithia in accordance  with the Lithia Loan Agreement as of such date (without giving effect to any amendments to the  related definition of "Subsidiary" on or after the Closing Date other than those that have been  consented to by the Administrative Agent).  Furthermore, all capitalized terms used in the  foregoing Financial Covenants (Lithia) that are not defined in Section 1.01 of the Agreement  have the meanings assigned thereto in the Lithia Loan Agreement, without giving effect to any  amendments that are made to, waivers that are granted with respect to, or other modifications  that are made with respect to the Lithia Loan Agreement on or after the Closing Date unless the  same have been consented to by the Administrative Agent.  





 






SG-1  147032870v2  SCHEDULE G  APPROVED BACKUP SERVICERS  Vervent Inc.  





 






A-1  147032870v2  EXHIBIT A  FORM OF FUNDING REQUEST  ____________, 20__  JPMorgan Chase Bank, N.A.,    as Administrative Agent, Account Bank and as JPMorgan Agent  Chase Tower, 16th Floor  10 South Dearborn Street  Mail Code IL1-0079  Chicago, Illinois  60603  Attention:  Asset-Backed Securities     Portfolio Management  Re: SCFC Business Services LLC – Loan Agreement  Ladies and Gentlemen:  The undersigned is a Responsible Officer of SCFC Business Services LLC (the  "Borrower") and is authorized to execute and deliver this Funding Request on behalf of the  Borrower pursuant to the Amended and Restated Loan Agreement, dated as of December 31,  2020 (as amended, restated, supplemented or otherwise modified from time to time, the "Loan  Agreement"), among the Borrower, Driveway Finance Corporation, as servicer and collateral  custodian, the Lenders from time to time party thereto, the Agents for the Lender Groups from  time to time parties thereto, and JPMorgan Chase Bank, N.A., as administrative agent and  account bank.  Capitalized terms used herein that are not otherwise defined shall have the  meanings ascribed thereto in the Loan Agreement.  The Borrower hereby requests that a Loan be made under the Loan Agreement on  __________, ____ in the amount of $__________.  In connection with the foregoing, the undersigned hereby certifies, on behalf of the  Borrower, as follows:  1. As of the date hereof, the Borrowing Base is __________.  After giving effect to  the requested Loan, the Loans Outstanding will not exceed the Borrowing Base and no  Borrowing Base Deficiency will exist.  Attached to this Funding Request is a true, complete and  correct calculation of such Borrowing Base and all components thereof.  2. As of the date hereof, the Excess Concentration Amount after giving effect to the  requested Loan will be:  ______  3. All of the conditions applicable to the requested Loan as set forth in the Loan  Agreement have been satisfied as of the date hereof and will remain satisfied to the date of such  Loan, including:  





 






A-2  147032870v2  (a) each of the representations and warranties contained in  Article Five of the Loan Agreement are true and correct in all respects on  and as of the date hereof, before and after giving effect to the Loan and to  the application of the proceeds therefrom as though made on and as of the  date hereof;  (b) no event has occurred and is continuing, or would result from such  Loan or from the application of the proceeds therefrom, which constitutes a  Termination Event or Unmatured Termination Event;  (c) the Borrower is in material compliance with each of its agreements  set forth in the Loan Agreement;   (d) no Servicer Termination Event or Unmatured Servicer Termination  Event has occurred; and   (e) no adverse selection procedures were used by the Borrower with  respect to the Receivables which will become a part of the Collateral on the  Funding Date.  4. The requested Loan will not, on the Funding Date, exceed the Available Amount  and after giving effect to the requested Loan, the Loans Outstanding will not exceed the  Borrowing Base.  5. The Hedging Agreement is in effect as required by Section 6.03 of the Loan  Agreement.  6. Attached hereto is a true, correct and complete Schedule A to the Purchase  Agreement, reflecting all Receivables which will become part of the Collateral on the Funding  Date, each Receivable reflected thereon being an Eligible Receivable.  7. The Cutoff Date with respect to the Receivables is             , 20_  .  SCFC BUSINESS SERVICES LLC  By: _______________________________________  Name:    Title: 





 






B-1  147032870v2  EXHIBIT B  FORM OF ASSIGNMENT AND ACCEPTANCE  Dated __________, 20_    Reference is made to the Amended and Restated Loan Agreement, dated as of December  31, 2020 (as amended, restated, supplemented or otherwise modified from time to time, the  "Loan Agreement"), among SCFC Business Services LLC, as borrower, Driveway Finance  Corporation, as servicer and collateral custodian, the Lenders from time to time party thereto, the  Agents for the Lender Groups from time to time parties thereto, and JPMorgan Chase Bank,  N.A., as administrative agent (the "Administrative Agent") and account bank.  Capitalized terms  used herein that are not otherwise defined herein shall have the meanings ascribed thereto in the  Loan Agreement.  __________________ (the "Assignor") and ___________________ (the "Assignee")  agree as follows:  The Assignor hereby sells and assigns to the Assignee, and the Assignee hereby  purchases and assumes from the Assignor, that interest in and to all of the Assignor's rights and  obligations under the Loan Agreement as of the date hereof which represents the percentage  interest specified in Section 1 of Schedule 1 hereto of all outstanding rights and obligations of  the Assignor under the Loan Agreement, including such interest in the Commitment of the  Assignor and the Lender Advances made by the Assignor.  After giving effect to such sale and  assignment, the Commitment and the amount of Lender Advances made by the Assignee will be  as set forth in Section 2 of Schedule 1 hereto.  The Assignor represents and warrants that it is the legal and beneficial owner of the  interest being assigned by it hereunder and that such interest is free and clear of any Lien.  The Assignor and the Assignee confirm to and agree with each other and the other parties  to Loan Agreement that:  (i) other than as provided herein, the Assignor makes no representation  or warranty and assumes no responsibility with respect to any statements, warranties or  representations made in or in connection with the Loan Agreement or the execution, legality,  validity, enforceability, genuineness, sufficiency or value of the Loan Agreement or any other  instrument or document furnished pursuant thereto; (ii) the Assignee confirms that it has  received a copy of the Loan Agreement, together with copies of such financial statements and  other documents and information as it has deemed appropriate to make its own credit analysis  and decision to enter into such Assignment and Acceptance; (iii) the Assignee will,  independently and without reliance upon the Administrative Agent, the Assignor or any other  Lender party to the Loan Agreement and based on such documents and information as it shall  deem appropriate at the time, continue to make its own credit decisions in taking or not taking  action under the Loan Agreement; (iv) the Assignor and the Assignee confirm that the Assignee  is an Eligible Assignee; (v) the Assignee appoints and authorizes the Administrative Agent to  take such action as agent on its behalf and to exercise such powers under this Agreement as are  delegated to such agent by the terms hereof, together with such powers as are reasonably  





 






B-2  147032870v2  incidental thereto; (vi) the Assignee agrees that it will perform in accordance with their terms all  of the obligations which by the terms of the Loan Agreement are required to be performed by it  as a Lender, including the confidentiality provisions of Article Twelve; and (vii) this Assignment  and Acceptance meets all other requirements for such an Assignment and Acceptance set forth in  Article Eleven of the Loan Agreement.  Following the execution of this Assignment and Acceptance by the Assignor and the  Assignee, it will be delivered to the Administrative Agent for acceptance.  The effective date of  this Assignment and Acceptance (the "Assignment Date") shall be the date of acceptance thereof  by the Administrative Agent, unless a later date is specified in Section 3 of Schedule 1 hereto.  The Assignor and the Assignee agree to reimburse the Administrative Agent for all  reasonable fees, costs and expenses (including reasonable fees and out-of-pocket expenses of  counsel for the Administrative Agent) incurred by the Administrative Agent in connection with  this Assignment and Acceptance.  Upon such acceptance by the Administrative Agent, the Assignee shall be a party to the  Loan Agreement and, to the extent provided in this Assignment and Acceptance, have the rights  and obligations of a Lender thereunder, provided, that the Assignor shall, to the extent such  rights have been assigned by it under this Assignment and Acceptance, relinquish its assigned  rights and be released from its assigned obligations under the Loan Agreement (and, in the case  of an Assignment and Acceptance coving all or the remaining portion of an assigning Assignor's  rights and obligations under the Loan Agreement, Assignor shall cease to be a party thereto).  Upon such acceptance by the Administrative Agent, from and after the Assignment Date,  the Administrative Agent shall make, or cause to be made, all payments under the Loan  Agreement in respect of the interest assigned hereby (including, without limitation, all payments  of principal, interest and fees with respect thereto) to the Assignee.  The Assignor and Assignee  shall make all appropriate adjustments in payments under the Loan Agreement for periods prior  to the Assignment Date directly between themselves.  THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY, AND  CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.  





 






B-3  147032870v2  IN WITNESS WHEREOF, the Assignor and the Assignee have executed this  Assignment and Acceptance as of the __ day of ________, 20_  .  _______________, as Assignor  By:   ___________________________________  Name:  Title:  _______________, as Assignee  By:   ___________________________________  Name:  Title:  





 






B-4  147032870v2  Schedule 1  to  Assignment and Acceptance  Dated _________, 20_    Section 1.  Percentage Interest: ________%  Section 2.  Assignee's Commitment:   $_____________  Aggregate Lender Advances Owing to the  Assignee: $_____________  Section 3.  Assignment Date:  _____________, 20_    





 






C-1  147032870v2  EXHIBIT C  CREDIT AND COLLECTION POLICY  [On file with the Administrative Agent]  





 






D-1  147032870v2  EXHIBIT D  FORM OF POWER OF ATTORNEY  This Power of Attorney (this "Power of Attorney") is executed and delivered by SCFC  Business Services LLC ("Grantor") to JPMorgan Chase Bank, N.A., as Administrative Agent  ("Attorney"), pursuant to (i) the Amended and Restated Loan Agreement, dated as of December  31, 2020 (as amended, restated, supplemented or otherwise modified from time to time, the  "Loan Agreement"), among SCFC Business Services LLC, as borrower (the "Borrower"),  Driveway Finance Corporation, as servicer and collateral custodian, the Lenders from time to  time party thereto, the Agents for the Lender Groups from time to time parties thereto, and  JPMorgan Chase Bank, N.A., as administrative agent and account bank, and (ii) the other Basic  Documents.  Capitalized terms used herein that are not otherwise defined shall have the  meanings ascribed thereto in the Loan Agreement.  No person to whom this Power of Attorney is presented, as authority for Attorney to take  any action or actions contemplated hereby, shall inquire into or seek confirmation from Grantor  as to the authority of Attorney to take any action described below, or as to the existence of or  fulfillment of any condition to this Power of Attorney, which is intended to grant to Attorney  unconditionally the authority to take and perform the actions contemplated herein, and Grantor  irrevocably waives any right to commence any suit or action, in law or equity, against any person  or entity that acts in reliance upon or acknowledges the authority granted under this Power of  Attorney.  The power of attorney granted hereby is coupled with an interest and may not be  revoked or canceled by Grantor until all Aggregate Unpaids have been indefeasibly paid in full  and Attorney has provided its written consent thereto.  Grantor hereby irrevocably constitutes and appoints Attorney (and all officers, employees  or agents designated by Attorney), with full power of substitution, as its true and lawful attorney- in-fact with full irrevocable power and authority in its place and stead and in its name or in  Attorney's own name, from time to time in Attorney's discretion, to take any and all appropriate  action and to execute and deliver any and all documents and instruments that may be necessary  or desirable to accomplish the purposes of the Loan Agreement, and, without limiting the  generality of the foregoing, hereby grants to Attorney the power and right, on its behalf, without  notice to or assent by it, upon the occurrence and during the continuance of any Termination  Event, to do the following:  (a) exercise all rights and privileges of Grantor under the Purchase  Agreement (including each Purchase Agreement Supplement); (b) pay or discharge any taxes,  Liens or other encumbrances levied or placed on or threatened against Grantor or Grantor's  property; (c) defend any suit, action or proceeding brought against Grantor if Grantor does not  defend such suit, action or proceeding or if Attorney believes that it is not pursuing such defense  in a manner that will maximize the recovery to Attorney, and settle, compromise or adjust any  suit, action or proceeding described above and, in connection therewith, give such discharges or  releases as Attorney may deem appropriate; (d) file or prosecute any claim, litigation, suit or  proceeding in any court of competent jurisdiction or before any arbitrator, or take any other  action otherwise deemed appropriate by Attorney for the purpose of collecting any and all such  moneys due to Grantor whenever payable and to enforce any other right in respect of Grantor's  property; (e) sell, transfer, pledge, make any agreement with respect to or otherwise deal with,  





 






D-2  147032870v2  any of Grantor's property, and execute, in connection with such sale or action, any endorsements,  assignments or other instruments of conveyance or transfer in connection therewith; and  (f) cause the certified public accountants then engaged by Grantor to prepare and deliver to  Attorney at any time and from time to time, promptly upon Attorney's request, any reports  required to be prepared by or on behalf of Grantor under the Loan Agreement or any other Basic  Document, all as though Attorney were the absolute owner of its property for all purposes, and to  do, at Attorney's option and Grantor's expense, at any time or from time to time, all acts and  other things that Attorney reasonably deems necessary to perfect, preserve, or realize upon its  property or assets and the Liens of the Administrative Agent, as agent for the Secured Parties  thereon, all as fully and effectively as it might do.  Grantor hereby ratifies, to the extent  permitted by law, all that said attorneys shall lawfully do or cause to be done by virtue hereof.  IN WITNESS WHEREOF, this Power of Attorney is executed by Grantor as of this __  day of ________ 20__.  SCFC BUSINESS SERVICES LLC  By:   ___________________________________  Name:  Title:  Sworn to and subscribed before  me this __ day of ________, 20__  _____________________________________  Notary Public  [NOTARY SEAL]  





 






E-1  147032870v2  EXHIBIT E  FORM OF TAKE-OUT RELEASE  Reference is hereby made to the Amended and Restated Loan Agreement, dated as of  December 31, 2020 (as amended, restated, supplemented or otherwise modified from time to  time, the "Loan Agreement"), among SCFC Business Services LLC, as borrower (the  "Borrower"), Driveway Finance Corporation, as servicer (in such capacity, the "Servicer") and  collateral custodian (in such capacity, the "Collateral Custodian"), the lenders from time to time  parties thereto, the agents from time to time parties thereto and JPMorgan Chase Bank, N.A., as  the administrative agent (the "Administrative Agent") and account bank.  Capitalized terms not  defined herein shall have the meaning given such terms in the Loan Agreement.  The Borrower and the Servicer hereby represent and warrant that each condition in the  Loan Agreement and each other Basic Document, to the consummation of the Take-out to which  this Take-out Release relates, has been satisfied, including but not limited to delivery of (i) the  executed Take-out Date Certificate, in substantially the form attached hereto as Annex 1 and  (i) the executed notice, in substantially the form attached hereto as Annex 2.  Upon deposit in the Collection Account of $___________ in accordance with  Section 2.12(a)(iv) of the Loan Agreement in immediately available funds, the Administrative  Agent hereby releases all of its right, title and interest, including its Lien, in and to the following:  (a) the Receivables to be transferred by the Borrower in the related  Take-out and described in Schedule I hereto (the "Take-out Receivables" and such  Schedule, the "Schedule of Take-out Receivables"), together with the related Contracts,  whether now existing or hereafter acquired, and any accounts or obligations evidenced  thereby, any guarantee thereof, all Collections related thereto, and all monies due  (including any payments made under any guarantee or similar credit enhancement with  respect to any such Take-out Receivables) to become due or received by any Person in  payment of any of the foregoing on or after the related Take-out Date;  (b) all of the Borrower's interest in the Financed Vehicles relating to the  Take-out Receivables (including repossessed vehicles) or in any document or writing  evidencing any security interest in any such Financed Vehicle and each security interest in  each such Financed Vehicle, whether now existing or hereafter acquired, including all  proceeds from any sale or other disposition of such Financed Vehicles;  (c) all Receivable Files and the Schedule of Take-out Receivables,  relating to the Take-out Receivables, whether now existing or hereafter acquired, and all  right, title and interest of the Borrower in and to the documents, agreements and  instruments included in the such Receivable Files, including rights of recourse of the  Borrower against DFC and/or any Dealer with respect to the Receivables;  (d) all of the Borrower's interest in all Records, documents and writings  evidencing or related to the Take-out Receivables or the related Contracts;  





 






E-2  147032870v2  (e) all of the Borrower's interest in all rights to payment under all  Insurance Policies with respect to a Financed Vehicle related to a Take-out Receivable,  including any monies collected from whatever source in connection with any default of an  Obligor with respect to such Financed Vehicle and any proceeds from claims or refunds of  premiums on any such Insurance Policy, whether now existing or hereafter acquired, and  all proceeds thereof;  (f) all of the Borrower's interest in all guaranties, indemnities,  warranties, insurance (and proceeds and premium refunds thereof) and other agreements  or arrangements of whatever character from time to time supporting or securing payment  of the Take-out Receivables, whether pursuant to the related Contracts or otherwise;  (g) all of the Borrower's interest in all rights to payment under all  service contracts and other contracts and agreements associated with the Take-out  Receivables and all of the Borrower's interest in all recourse rights against the related  dealer (excluding any rights in any dealer reserve and rights under the related Dealer  Agreement);  (h) Liens, guaranties and other encumbrances in favor of or assigned or  transferred to the Borrower in and to the Take-out Receivables, whether now existing or  hereafter acquired, and the related Financed Vehicles, whether now existing or hereafter  acquired;  (i) all deposit accounts, monies, deposits, funds, accounts and  instruments relating to the foregoing;  (j) all of the Borrower's right, title and interest in and to the Purchase  Agreement (including each Purchase Agreement Supplement), relating to the Take-out  Receivables and remedies thereunder and the assignment to the Administrative Agent of  all UCC financing statements filed by the Borrower against DFC under or in connection  with the Purchase Agreement and relating to such Take-out Receivables; and  (k) all income and proceeds of the foregoing.  [The Servicer and the Borrower hereby direct the Collateral Custodian to deliver the  Receivable Files for the Take-out Receivables to __________________________________.]  





 






E-3  147032870v2  Executed as of __________, 20_  .  SCFC BUSINESS SERVICES LLC,    as Borrower  By:  _____________________________________  Name:  Title:  DRIVEWAY FINANCE CORPORATION,    as Servicer and Collateral Custodian  By:  _____________________________________  Name:  Title:  JPMORGAN CHASE BANK, N.A.,    as the Administrative Agent  By:  _____________________________________  Name:  Title:  





 






E-4  147032870v2  ANNEX 1  DRIVEWAY FINANCE CORPORATION  TAKE-OUT DATE CERTIFICATE  PURSUANT TO SECTION 2.12(a)  OF THE LOAN AGREEMENT  Driveway Finance Corporation ("DFC"), as the servicer (the "Servicer"), delivers  this certificate pursuant to Section 2.12(a) of the Amended and Restated Loan Agreement, dated  as of December 31, 2020 (as amended, restated, supplemented or otherwise modified from time to  time, the "Loan Agreement"), among SCFC Business Services LLC, as the borrower, the  Servicer, DFC, as collateral custodian, the lenders from time to time parties hereto, the agents  from time to time parties hereto and JPMorgan Chase Bank, N.A., as the administrative agent and  account bank, and hereby certifies, as of the date hereof, the following:  (a) the Borrower has sufficient funds on the related Take-out Date to  effect the Take-out in accordance with the Loan Agreement (taking into account, to the  extent necessary, the proceeds of sales of the Collateral in the Take-out, if applicable);  (b) after giving effect of the Take-out, the release by the Administrative  Agent of the related Receivables on the Take-out Date and the transfer by the Borrower or  the related Receivables on the Take-out Date, (A) no Borrowing Base Deficiency exists,  (B) neither an Unmatured Termination Event, a Termination Event, a Servicer  Termination Event or an event that with notice or the passage of time, or both, would be a  Servicer Termination Event, has occurred or results from such Take-out, and (C) the  proportion of Delinquent Receivables and Defaulted Receivables that will remain subject  to the Loan Agreement shall be no higher after giving effect to such Take-out than prior to  such Take-out;  (c) the Borrower has delivered to the Administrative Agent a list  specifying all Contracts under which the Receivables not to be released pursuant to such  Take-out arose; and  (d) the Borrower has deposited in to the Collection Account an amount  equal to all Unreimbursed Servicer Advances associated with the Receivables to be  released.  Capitalized terms used herein that are not otherwise defined shall have the meanings  ascribed thereto in the Loan Agreement.  





 






E-5  147032870v2  IN WITNESS WHEREOF, the Servicer has caused this certificate to be executed on its  behalf this ___ day of _________, 20_  .  DRIVEWAY FINANCE CORPORATION  By:   ______________________________________  Name:  Title:  





 






E-6  147032870v2  ANNEX 2  FORM OF NOTICE  Driveway Finance Corporation  150 N. Bartlett Street  Medford, Oregon 97501  __________, 20_    JPMorgan Chase Bank, N.A.,    as Administrative Agent and as JPMorgan Agent  Chase Tower, 16th Floor  10 South Dearborn Street  Mail Code IL1-0079  Chicago, Illinois  60603  Attention:  Asset-Backed Securities     Portfolio Management  Re: SCFC Business Services LLC – Loan Agreement  Ladies and Gentlemen:  Reference is made to the Amended and Restated Loan Agreement, dated as of December  31, 2020 (as amended, restated, supplemented or otherwise modified from time to time, the "Loan  Agreement"), among SCFC Business Services LLC, as borrower (the "Borrower"), Driveway  Finance Corporation, as servicer and collateral custodian, the lenders from time to time parties  thereto, the agents from time to time parties thereto and JPMorgan Chase Bank, N.A., as  administrative agent (the "Administrative Agent") and account bank.  Pursuant to Section 2.12(a)(i) of the Loan Agreement, the Borrower gives notice of its  intent to effect a Take-out on or about __________, 20_   (which date is no fewer than 15  Business Days after the date of delivery of this notice to the Administrative Agent).  Capitalized terms used herein that are not otherwise defined shall have the meanings  ascribed thereto in the Loan Agreement.  Very truly yours,  SCFC BUSINESS SERVICES LLC  By:   _____________________________________  Name:  Title:  





 






E-7  147032870v2  Schedule I  to Take-out Release  SCHEDULE OF REMOVED RECEIVABLES  





 






F-1  147032870v2  EXHIBIT F  FORM OF MONTHLY REPORT  [On File with the Administrative Agent]  





 






G-1  147032870v2  EXHIBIT G  FORMS OF U.S. TAX COMPLIANCE CERTIFICATES  





 






G-2  147032870v2  EXHIBIT G-1  [FORM OF]   U.S. TAX COMPLIANCE CERTIFICATE  (For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)  Reference is hereby made to the Amended and Restated Loan Agreement, dated  as of December 31, 2020 (as amended, supplemented or otherwise modified from time to time,  the "Loan Agreement"), among SCFC Business Services LLC, as Borrower, Driveway Finance  Corporation, as Servicer and as Collateral Custodian, the Lenders from time to time parties  thereto, the Agents from time to time parties thereto, and JPMorgan Chase Bank, N.A., as  Administrative Agent and Account Bank.    Pursuant to the provisions of Section 2.14 of the Loan Agreement, the  undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) in  respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section  881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of the Borrower within the  meaning of Section 871(h)(3)(B) of the Code and (iv) it is not a controlled foreign corporation  related to the Borrower as described in Section 881(c)(3)(C) of the Code.  The undersigned has furnished the Administrative Agent and the Borrower with a  certificate of its non-U.S. Person status on IRS Form W-8BEN or W-8BEN-E.  By executing this  certificate, the undersigned agrees that (1) if the information provided on this certificate changes,  the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2)  the undersigned shall have at all times furnished the Borrower and the Administrative Agent with  a properly completed and currently effective certificate in either the calendar year in which each  payment is to be made to the undersigned, or in either of the two calendar years preceding such  payments.   Unless otherwise defined herein, terms defined in the Loan Agreement and used  herein shall have the meanings given to them in the Loan Agreement.  [NAME OF LENDER]  By:  Name:    Title:    Date: ________ __, 20[  ]  





 






G-3  147032870v2   EXHIBIT G-2  [FORM OF]   U.S. TAX COMPLIANCE CERTIFICATE  (For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)  Reference is hereby made to the Amended and Restated Loan Agreement, dated  as of December 31, 2020 (as amended, supplemented or otherwise modified from time to time,  the "Loan Agreement"), among SCFC Business Services LLC, as Borrower, Driveway Finance  Corporation, as Servicer and as Collateral Custodian, the Lenders from time to time parties  thereto, the Agents from time to time parties thereto, and JPMorgan Chase Bank, N.A., as  Administrative Agent and Account Bank.    Pursuant to the provisions of Section 2.14 of the Loan Agreement, the  undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation  in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of  Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of the Borrower within  the meaning of Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign  corporation related to the Borrower as described in Section 881(c)(3)(C) of the Code.  The undersigned has furnished its participating Lender with a certificate of its  non-U.S. Person status on IRS Form W-8BEN or W-8BEN-E.  By executing this certificate, the  undersigned agrees that (1) if the information provided on this certificate changes, the  undersigned shall promptly so inform such Lender in writing, and (2) the undersigned shall have  at all times furnished such Lender with a properly completed and currently effective certificate in  either the calendar year in which each payment is to be made to the undersigned, or in either of  the two calendar years preceding such payments.  Unless otherwise defined herein, terms defined in the Loan Agreement and used  herein shall have the meanings given to them in the Loan Agreement.  [NAME OF PARTICIPANT]  By:  Name:    Title:    Date: ________ __, 20[  ]  





 






G-4  147032870v2  EXHIBIT G-3  [FORM OF]   U.S. TAX COMPLIANCE CERTIFICATE  (For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)  Reference is hereby made to the Amended and Restated Loan Agreement, dated  as of December 31, 2020 (as amended, supplemented or otherwise modified from time to time,  the "Loan Agreement"), among SCFC Business Services LLC, as Borrower, Driveway Finance  Corporation, as Servicer and as Collateral Custodian, the Lenders from time to time parties  thereto, the Agents from time to time parties thereto, and JPMorgan Chase Bank, N.A., as  Administrative Agent and Account Bank.    Pursuant to the provisions of Section 2.14 of the Loan Agreement, the  undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of  which it is providing this certificate, (ii) its direct or indirect partners/members are the sole  beneficial owners of such participation, (iii) with respect such participation, neither the  undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant  to a loan agreement entered into in the ordinary course of its trade or business within the  meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members  is a ten percent shareholder of the Borrower within the meaning of Section 871(h)(3)(B) of the  Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation  related to the Borrower as described in Section 881(c)(3)(C) of the Code.   The undersigned has furnished its participating Lender with IRS Form W-8IMY  accompanied by one of the following forms from each of its partners/members that is claiming  the portfolio interest exemption: (i) an IRS Form W-8BEN or W-8BEN-E or (ii) an IRS Form  W-8IMY accompanied by an IRS Form W-8BEN or IRS Form W-8BEN-E from each of such  partner's/member's beneficial owners that is claiming the portfolio interest exemption.  By  executing this certificate, the undersigned agrees that (1) if the information provided on this  certificate changes, the undersigned shall promptly so inform such Lender and (2) the  undersigned shall have at all times furnished such Lender with a properly completed and  currently effective certificate in either the calendar year in which each payment is to be made to  the undersigned, or in either of the two calendar years preceding such payments.  Unless otherwise defined herein, terms defined in the Loan Agreement and used  herein shall have the meanings given to them in the Loan Agreement.  [NAME OF PARTICIPANT]  By:  





 






G-5  147032870v2  Name:    Title:    Date: ________ __, 20[  ]  





 






G-6  147032870v2  EXHIBIT G-4  [FORM OF]   U.S. TAX COMPLIANCE CERTIFICATE  (For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)  Reference is hereby made to the Amended and Restated Loan Agreement, dated  as of December 31, 2020 (as amended, supplemented or otherwise modified from time to time,  the "Loan Agreement"), among SCFC Business Services LLC, as Borrower, Driveway Finance  Corporation, as Servicer and as Collateral Custodian, the Lenders from time to time parties  thereto, the Agents from time to time parties thereto, and JPMorgan Chase Bank, N.A., as  Administrative Agent and Account Bank.    Pursuant to the provisions of Section 2.14 of the Loan Agreement, the  undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) in respect of which  it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial  owners of such Loan(s), (iii) with respect to the extension of credit pursuant to this Loan  Agreement or any other Borrower Basic Document, neither the undersigned nor any of its direct  or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into  in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the  Code, (iv) none of its direct or indirect partners/members is a ten percent shareholder of the  Borrower within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or  indirect partners/members is a controlled foreign corporation related to the Borrower as  described in Section 881(c)(3)(C) of the Code.  The undersigned has furnished the Administrative Agent and the Borrower with  IRS Form W-8IMY accompanied by one of the following forms from each of its  partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or  W-8BEN-E or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN or IRS Form  W-8BEN-E from each of such partner's/member's beneficial owners that is claiming the portfolio  interest exemption.  By executing this certificate, the undersigned agrees that (1) if the  information provided on this certificate changes, the undersigned shall promptly so inform the  Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished  the Borrower and the Administrative Agent with a properly completed and currently effective  certificate in either the calendar year in which each payment is to be made to the undersigned, or  in either of the two calendar years preceding such payments.  Unless otherwise defined herein, terms defined in the Loan Agreement and used  herein shall have the meanings given to them in the Loan Agreement.  





 






G-7  147032870v2  [NAME OF LENDER]  By:  Name:    Title:    Date: ________ __, 20[  ]