<PAGE>

                                                                   Exhibit 10.30

================================================================================

                               SERVICING AGREEMENT

                            dated as of July 14, 2003

                                      among

                         FINANCIAL PACIFIC LEASING, LLC,
                                  as Servicer,

                       FINANCIAL PACIFIC FUNDING II, LLC,
                                   as Issuer,

                                       and

                WELLS FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
                       as Trustee and as Back-up Servicer

================================================================================

                                                             Servicing Agreement

<PAGE>

                                TABLE OF CONTENTS

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ARTICLE I             DEFINITIONS...........................................................................        1

ARTICLE II            THE SERVICER..........................................................................        1

         Section 2.01.     Representations and Warranties of Servicer.......................................        1

         Section 2.02.     Indemnities of Servicer..........................................................        3

         Section 2.03.     Merger or Consolidation of, or Assumption of the Obligations of, Servicer or
                           Back-up Servicer.................................................................        4

         Section 2.04.     Servicer and Back-up Servicer Not to Resign......................................        5

         Section 2.05.     Representations and Warranties of Back-up Servicer...............................        5

ARTICLE III           ADMINISTRATION AND SERVICING OF CONTRACTS.............................................        6

         Section 3.01.     Duties of Servicer...............................................................        6

         Section 3.02.     Collection and Allocation of Contract Payments...................................        6

         Section 3.03.     Realization Upon Contracts.......................................................        7

         Section 3.04.     Physical Damage Insurance; Other Insurance.......................................        7

         Section 3.05.     Maintenance of Security Interests in Equipment...................................        8

         Section 3.06.     Additional Covenants of Servicer.................................................        8

         Section 3.07.     Purchase of Contracts Upon Breach................................................        8

         Section 3.08.     Servicer Fee.....................................................................        9

         Section 3.09.     Monthly Servicer's Report........................................................        9

         Section 3.10.     Annual Statement as to Compliance; Notice of Default.............................        9

         Section 3.11.     Independent Certified Public Accountant's Report.................................       10

         Section 3.12.     Servicer Expenses................................................................       10

         Section 3.13.     Treatment of Issuer..............................................................       10

         Section 3.14.     Access to Records, etc...........................................................       10

         Section 3.15.     Data Report......................................................................       11

         Section 3.16.     Employee Dishonesty Policy.......................................................       12

         Section 3.17.     Sub-Servicer.....................................................................       12

         Section 3.18.     Amendment to Guidelines..........................................................       12

         Section 3.19.     Certain Reporting Requirements...................................................       13

ARTICLE IV            COLLECTIONS...........................................................................       13

         Section 4.01.     [Reserved].......................................................................       13

         Section 4.02.     Collections......................................................................       13

         Section 4.03.     Application of Collections.......................................................       14
</TABLE>

                                       -i-                   Servicing Agreement

<PAGE>

                                TABLE OF CONTENTS

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ARTICLE V             TERMINATION; TERM.....................................................................       14

         Section 5.01.     Termination of Servicer..........................................................       14

         Section 5.02.     Appointment of Successor Servicer................................................       17

         Section 5.03.     Retention and Termination of Servicer............................................       18

         Section 5.04.     Back-up Servicer as Servicer.....................................................       19

ARTICLE VI            MISCELLANEOUS PROVISIONS..............................................................       19

         Section 6.01.     Termination......................................................................       19

         Section 6.02.     Amendments.......................................................................       19

         Section 6.03.     GOVERNING LAW....................................................................       20

         Section 6.04.     Notices..........................................................................       20

         Section 6.05.     Severability of Provisions.......................................................       21

         Section 6.06.     Binding Effect...................................................................       21

         Section 6.07.     Headings and Captions............................................................       21

         Section 6.08.     Legal Holidays...................................................................       21

         Section 6.09.     Security for the Loan............................................................       21

         Section 6.10.     No Servicing Assignment..........................................................       21

         Section 6.11.     Third-Party Beneficiaries........................................................       21

         Section 6.12.     SUBMISSION TO JURISDICTION.......................................................       22

         Section 6.13.     WAIVER OF JURY TRIAL.............................................................       22

         Section 6.14.     No Proceedings...................................................................       22

         Section 6.15.     Counterparts.....................................................................       23
</TABLE>

Exhibit 3.09  --    Form of Monthly Servicer's Report

Exhibit 3.11  --    Verification Procedures

                                       -ii-                  Servicing Agreement


<PAGE>

                               SERVICING AGREEMENT

         This SERVICING AGREEMENT ("Agreement"), dated as of July 14, 2003, is
by and among Financial Pacific Leasing, LLC, a Washington limited liability
company, as Servicer (the "Company" or the "Servicer"), Financial Pacific
Funding II, LLC, a Delaware limited liability company, as Issuer (the "Issuer")
and Wells Fargo Bank Minnesota, National Association, as Trustee (in such
capacity, the "Trustee") and as Back-up Servicer (in such capacity, the "Back-up
Servicer").

                              PRELIMINARY STATEMENT

         The Issuer has entered into an Indenture, dated as of July 14, 2003 (as
amended, supplemented or otherwise modified from time to time, the "Indenture"),
with the Servicer, the Trustee and the Back-up Servicer.

         The Issuer and the Company have entered into the Amended and Restated
Acquisition Agreement, dated as of July 14, 2003 (as amended, supplemented or
otherwise modified from time to time, the "Acquisition Agreement"), relating to
the sale by the Company to the Issuer of all of the Company's right, title and
interest in and to certain Receivables and other assets which the Issuer is
pledging to the Trustee pursuant to the Indenture.

         In addition, the Issuer is pledging to the Trustee, among other things,
all of the Issuer's rights derived under this Agreement and the Acquisition
Agreement, and the Servicer agrees that all covenants and agreements made by the
Servicer herein shall also be for the benefit of the Noteholders and the Note
Insurer. For their services under this Agreement, the Servicer, the Back-up
Servicer and the Trustee will receive the compensation described herein or in
the Indenture.

                                    ARTICLE I

                                   DEFINITIONS

         Whenever used in this Agreement, capitalized terms defined in the
Indenture and used and not otherwise defined herein shall have the meanings set
forth in the Indenture. Any and all terms used in this Agreement which are
defined in the UCC shall be construed and defined in accordance with the meaning
and definition ascribed to such terms under the UCC, unless otherwise defined in
the Indenture.

                                   ARTICLE II

                                  THE SERVICER

         Section 2.01. Representations and Warranties of Servicer. The initial
Servicer makes the following representations and warranties on which the Issuer,
the Back-up Servicer, the Trustee, the Noteholders and the Note Insurer shall
rely. With respect to such representations and warranties, the Note Insurer
shall be deemed to have relied on such representations and warranties in issuing
the Policy. The representations and warranties speak as of the execution

                                                             Servicing Agreement

<PAGE>

and delivery of this Agreement, the Closing Date and each Funding Date and shall
survive the date hereof and thereof:

         (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 Washington, with power and authority to
own its properties and to conduct its business as such properties shall be
currently owned and such business is presently conducted, and had at all
relevant times, and shall have, power, authority, and legal right to service the
Contracts as provided herein.

         (b) Due Qualification. The Servicer is duly qualified to do business as
a foreign limited liability company in good standing, and has obtained all
necessary licenses and approvals, in all jurisdictions in which its ownership or
lease of property or the conduct of its business (including the servicing of the
Contracts as required by this Agreement) shall require such qualifications,
licenses and approvals and where the failure to so qualify (or to obtain such
licenses or approvals) could reasonably be expected to result in a Material
Adverse Effect.

         (c) Power and Authority. The Servicer has the power and authority to
execute and deliver this Agreement and to carry out its terms; and the
execution, delivery, and performance of this Agreement has been duly authorized
by the Servicer by all necessary action.

         (d) Binding Obligation. This Agreement and each other Transaction
Document to which the Servicer is a party constitutes a legal, valid and binding
obligation of the Servicer enforceable in accordance with its terms except as
such enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforceability of creditors'
rights generally, and by general equitable principles.

         (e) No Violation. The execution, delivery and performance by the
Servicer of this Agreement and the consummation of the transactions contemplated
hereby and the fulfillment of the terms hereof do not (A) conflict with, result
in any material breach of any of the terms and provisions of, nor constitute
(with or without notice or lapse of time) a default under, the certificate of
formation or operating agreement of the Servicer; (B) conflict with, result in
any material breach of any of the terms and provisions of, or constitute a
default under, any indenture, agreement, mortgage, deed of trust, or other
instrument to which the Servicer is a party or by which it is bound or any of
its properties are subject; (C) result in the creation or imposition of any Lien
upon any of its properties pursuant to the terms of any indenture, agreement,
mortgage, deed of trust, or other instrument; or (D) violate any law, order,
rule, or regulation applicable to the Servicer of any court or of any federal or
state regulatory body, administrative agency, or other governmental
instrumentality having jurisdiction over the Servicer or its properties, which,
in the case of clause (D), could reasonably be expected to result in a Material
Adverse Effect.

         (f) No Proceedings. There are no proceedings or investigations pending,
or to the Servicer's best knowledge, threatened, before any court, regulatory
body, administrative agency, or other governmental instrumentality having
jurisdiction over the Servicer or its properties: (A) asserting the invalidity
of this Agreement or the other Transaction Documents, (B) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement or the

                                        2                    Servicing Agreement


<PAGE>

other Transaction Documents, or (C) which, if adversely determined, would be
reasonably likely to have a Material Adverse Effect.

         (g) Approvals. All approvals, authorizations, consents, orders or other
actions of any court, governmental agency or body or official or other Person
required to be obtained by the Servicer in connection with the execution and
delivery of this Agreement have been or will be taken or obtained, and will be
in full force and effect, on or prior to the Closing Date where the failure to
take or obtain the same could be reasonably likely to have a Material Adverse
Effect.

         (h) Financial Position. (A) The consolidated balance sheets of
Financial Pacific Company as at December 31, 2002, and the related consolidating
statements of income and shareholders' equity of Financial Pacific Company and
its consolidated subsidiaries for the fiscal year then ended, certified by
Deloitte & Touche LLP, independent certified public accountants, and the
unaudited consolidating balance sheets of the initial Servicer and its
consolidated subsidiaries as at March 31, 2003, and the related consolidating
statements of income and shareholders' equity of Financial Pacific Company and
its consolidated subsidiaries for the fiscal quarters then ended, copies of
which have been furnished to the Note Insurer, fairly present in all material
respects the consolidated financial position of Financial Pacific Company and
its consolidated subsidiaries as at such dates and the consolidated results of
the operations of Financial Pacific Company and its consolidated subsidiaries
for the periods ended on such dates, all in accordance with GAAP consistently
applied, and (B) since March 31, 2003 there has been no material adverse change
in any such financial position, business or operations.

         (i) Accurate Reports. No information, exhibit, financial statement,
document, book, record or report furnished or to be furnished, in each case in
writing, by or on behalf of the Servicer to the Trustee or the Note Insurer,
pursuant to this Agreement or any other Transaction Document was inaccurate in
any material respect as of the date it was dated or as of the date so furnished,
or contained any material misstatement of fact or omitted to state a material
fact necessary to make the statements contained therein not materially
misleading in light of the circumstances made or presented.

         (j) Servicer's Records. The Issuer is identified as "Lessor No. 5," in
the records, software and reports of the Servicer.

         Section 2.02. Indemnities of Servicer.

         (a) General Indemnity. Without limiting any other rights which any such
Person may have hereunder, under any other Transaction Document or under
applicable law, the Servicer hereby agrees to indemnify the Issuer, the Trustee,
the Back-up Servicer, the Noteholders and the Note Insurer (collectively, the
"Indemnified Parties"), forthwith on demand, from and against any and all
liabilities, losses, damages, judgments, costs and expenses of any kind awarded
against or incurred by any of them arising out of or resulting from (i) any
representation or warranty made by the Servicer under or in connection with any
Transaction Document, any Monthly Servicer's Report, any Data Report or any
other written information or report delivered by or on behalf of the Servicer
pursuant hereto or thereto, which shall have been false, incorrect or misleading
in any material respect when made or deemed made, or (ii) the failure by the
Servicer to comply with any applicable law, rule or regulation with respect to
any Contracts or

                                         3                   Servicing Agreement


<PAGE>

the related Collateral, or (iii) the failure of the Servicer to perform its
duties or obligations in accordance with this Agreement or any other Transaction
Document, excluding, however, (a) liabilities, losses, damages, judgments, costs
and expenses to the extent resulting from gross negligence or willful misconduct
on the part of such Indemnified Party, (b) recourse for Defaulted Contracts and
(c) any tax upon or measured by net income of any Indemnified Party.

         (b) Trustee. The initial Servicer shall indemnify, defend, and hold
harmless the Trustee from and against all reasonable costs, reasonable expenses,
losses, claims, damages, and liabilities arising out of or incurred in
connection with the acceptance or performance of its duties contained in this
Agreement and the other Transaction Documents except to the extent that such
loss, liability, claim, damage, or expense shall have been incurred by reason of
the Trustee's willful misfeasance or gross negligence.

         (c) Termination or Expiration of Term. For purposes of this Section, in
the event of the termination of the rights and obligations of a Servicer (or any
successor thereto pursuant to Section 2.03) as Servicer pursuant to Section 5.01
of this Agreement, a resignation by such Servicer pursuant to this Agreement, or
the expiration of the Servicer's term pursuant to Section 5.03 of this
Agreement, such Servicer shall be deemed to be the Servicer pending the
assumption by a successor Servicer of the Servicer's duties pursuant to Section
5.02 of this Agreement. The provisions of this Section 2.02(c) shall in no way
affect the survival pursuant to Section 2.02(d) of the indemnification by the
Servicer provided under this Section 2.02.

         (d) Survival. The provisions of this Section 2.02 shall survive the
termination of this Agreement and the other Transaction Documents, and the
resignation or removal of the Trustee, and shall include reasonable fees and
expenses of outside counsel and expenses of litigation.

         Section 2.03. Merger or Consolidation of, or Assumption of the
Obligations of, Servicer or Back-up Servicer. (a) The initial Servicer shall not
merge or consolidate with or into, or (except for transfers of Contracts and
related assets in the ordinary course of its business), in one transaction or a
series of transactions, sell, assign or otherwise transfer all or substantially
all of its assets or controlling membership interests to, any other Person,
unless (i) either (A) such transaction is a merger or consolidation and the
Servicer is the surviving limited liability company or (B) on or prior to the
effectiveness of such transaction, the surviving entity or transferee shall
execute an agreement of assumption to perform every obligation of the Servicer
hereunder, which agreement shall be satisfactory in form and substance to the
Controlling Party, (ii) immediately after giving effect to such transaction, no
Default shall have occurred and be continuing or would reasonably be expected to
occur as a result of such transaction, (iii) the Servicer shall have delivered
to the Controlling Party an Officer's Certificate stating that such
consolidation, merger, sale, assignment or transfer and such agreement of
assumption comply with this Section 2.03 and that all conditions precedent
provided for in this Agreement relating to such transaction have been complied
with, (iv) the Servicer shall have delivered to the Controlling Party an Opinion
of Counsel stating that such agreement of assumption is legal, valid, binding
and enforceable in accordance with its terms and either (A) stating that, in the
opinion of such counsel, all financing statements and continuation statements
and amendments thereto have been executed and filed and all other actions have
been taken which are necessary fully to preserve and continue the validity,
perfection and priority of the Trustee's interest in the Contracts and reciting
the details of such filings and other actions, or (B) stating that, in the

                                        4                    Servicing Agreement


<PAGE>

opinion of such counsel, no such filing or other action shall be necessary to
preserve and continue the validity, perfection and priority of such interest and
(v) the Servicer shall have delivered notice thereof to the Rating Agencies.
Nothing in this Section 2.03 shall be deemed to release the Servicer from any of
its obligations as such.

         (b) Any Person (i) into which, the Back-up Servicer may be merged or
consolidated, (ii) which may, result from any merger or consolidation to which
the Back-up Servicer shall be a party, or (iii) which may, succeed to the
properties and assets of the Back-up Servicer substantially as a whole, shall be
the successor to the Back-up Servicer under this Agreement without further act
on the part of any of the parties to this Agreement; provided, however, that
nothing herein shall be deemed to release the Back-up Servicer from any
obligation.

         Section 2.04. Servicer and Back-up Servicer Not to Resign. Subject to
the provisions of Section 2.03, neither the Servicer nor the Back-up Servicer
may resign from the obligations and duties hereby imposed on it as Servicer or
Back-up Servicer, as the case may be, under this Agreement except upon
determination that by reason of a change in legal requirements the performance
of its duties under this Agreement would cause it to be in violation of such
legal requirements in a manner which would result in a material adverse effect
on the Servicer or the Back-up Servicer, as the case may be, and the Controlling
Party does not elect to waive the obligations of the Servicer or the Back-up
Servicer, as the case may be, to perform the duties which render it legally
unable to act or does not elect to delegate those duties to another Person.
Notice of resignation of the Servicer or the Back-up Servicer, as the case may
be, as a result of a determination as set forth in the immediately preceding
sentence shall be communicated to the Issuer, the Trustee, the Rating Agencies
and the Note Insurer at the earliest practicable time but in no event later than
two (2) Business Days following knowledge thereof (and, if such communication is
not in writing, shall be confirmed in writing at the earliest practicable time)
and any such determination shall be evidenced by an Opinion of Counsel to such
effect delivered to and reasonably satisfactory to the Controlling Party
concurrently with or promptly after such notice. No resignation of the Servicer
shall become effective until a successor Servicer acceptable to the Controlling
Party shall have assumed the responsibilities and obligations of such Servicer
in accordance with Section 5.02 of this Agreement. No resignation of the Back-up
Servicer shall become effective until an entity reasonably acceptable to the
Controlling Party shall have assumed the responsibilities and obligations of the
Back-up Servicer; provided, however, that if no such entity shall have assumed
such responsibilities and obligations of the Back-up Servicer within 30 days of
the resignation of the Back-up Servicer, the Back-up Servicer may petition a
court of competent jurisdiction for the appointment of a successor to the
Back-up Servicer acceptable to the Controlling Party.

         Section 2.05. Representations and Warranties of Back-up Servicer. The
Back-up Servicer makes the following representations and warranties on which the
Issuer, the Trustee, the Noteholders and the Note Insurer shall rely:

                  (i) The Back-up Servicer is a national banking association
         duly organized, validly existing and in good standing under the laws of
         the United States.

                                        5                    Servicing Agreement


<PAGE>

                  (ii) The Back-up Servicer has full corporate power, authority
         and legal right to execute, deliver and perform this Agreement and has
         taken all necessary action to authorize the execution, delivery and
         performance by it of this Agreement.

                  (iii) This Agreement has been duly executed and delivered by
         the Back-up Servicer and constitutes a legal, valid and binding
         obligation of the Back-up Servicer in accordance with its terms.

                                  ARTICLE III

                    ADMINISTRATION AND SERVICING OF CONTRACTS

         Section 3.01. Duties of Servicer. The Servicer (on behalf of the Issuer
and the Trustee) shall manage, service, administer and make collections on the
Contracts with reasonable care and diligence in accordance with applicable laws,
rules and regulations and with the Collection Guidelines, using that degree of
skill and care consistent with that which a prudent person servicing leases or
conditional sale contracts similar to the Contracts for itself or others would
use or, if more exacting, which the Servicer exercises with respect to all
comparable equipment leases that it services for itself or others. The
Servicer's duties shall include, without limitation, collection and posting of
all payments, responding to inquiries of Customers on such Contracts,
investigating delinquencies, sending payment invoices to Customers, reporting
tax information to Customers, accounting for collections, and furnishing monthly
and annual statements to the Trustee and the Controlling Party with respect to
distributions. Subject to the foregoing provisions of this Section 3.01, in
performance of its duties as Servicer the Servicer shall follow its currently
employed standards, policies and procedures or such other standards, policies
and procedures as the Servicer employs in the future consistent with the
business practice of other servicers in the industry servicing equipment leases
or conditional sale contracts similar to the Contracts. Without limiting the
generality of the foregoing, and subject to the servicing standards set forth in
this Agreement, the Servicer is authorized and empowered to execute and deliver,
on behalf of itself and the Trustee or either of them, any and all instruments
of satisfaction or cancellation, or partial or full release or discharge, and
all other comparable instruments, with respect to such Contracts or to the
Equipment securing, or otherwise subject to, such Contracts. If the Servicer
shall commence a legal proceeding to enforce a Contract, the Issuer shall
thereupon be deemed to have automatically assigned, solely for the purpose of
collection, such Contract to the Servicer. If in any enforcement suit or legal
proceeding it shall be held that the Servicer may not enforce a Contract on the
ground that it shall not be a real party in interest or a holder entitled to
enforce such Contract, unless the Controlling Party shall waive the enforcement
of such Contract by the Servicer, then the Issuer shall, at the Servicer's
expense and direction, and subject to obtaining such indemnity as the
Controlling Party may reasonably require, take steps to enforce such Contract,
including bringing suit in its own name. The Servicer shall prepare and furnish,
and the Issuer shall execute, any powers of attorney and other documents
reasonably necessary or appropriate from time to time to enable the Servicer to
carry out its servicing and administrative duties hereunder.

         Section 3.02. Collection and Allocation of Contract Payments. The
Servicer shall make reasonable efforts to collect all payments called for under
the terms and provisions of the Contracts as and when the same shall become due
and, subject to Section 3.01, shall follow such

                                       6                     Servicing Agreement


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collection procedures as it follows with respect to all comparable equipment
leases and conditional sale contracts that it services for itself or others. The
Servicer will be responsible for identifying payments received from the
Customers and (i) transferring such payments to the Lockbox Account within two
Business Days of receipt or (ii) if such payments were received in a post office
box subject to a Lockbox Agreement, causing the related Lockbox Bank to transfer
such payments into a related Lockbox Account that is subject to a Lockbox
Agreement as described in Section 4.02. The Servicer, for so long as the Company
is the Servicer, may grant extensions or other modifications on a Contract;
provided that such extensions or other modifications are consistent with the
Collection Guidelines. If the Servicer is not the Company, the Servicer may not
make any extension or other modification on a Contract without the prior written
consent of the Controlling Party. The Servicer may in its discretion waive any
late payment charge or any other fees that may be collected in the ordinary
course of servicing a Contract, consistent with the Collection Guidelines. The
Servicer shall not agree to any reduction of the interest rate on any Contract
(except as required by law if the related Customer is the subject of bankruptcy
or insolvency proceedings) or of the amount of any Scheduled Payment on
Contracts, or reduce the Implicit Principal Balance of any Contract (except for
actual payments of principal received), unless such modifications are consistent
with the Collection Guidelines. Notwithstanding anything to the contrary
contained in this Section 3.02, the average of the Modification Ratios for the
three most recently ended Due Periods shall not exceed 0.35%. "Modification
Ratio" means, with respect to any Due Period, the fraction, expressed as a
percentage, equal to (a) the number of Contracts affected by an extension,
waiver, reduction or other modification pursuant to this Section during such Due
Period divided by (b) the total number of Contracts as of the close of business
of the last day of such Due Period.

         Section 3.03. Realization Upon Contracts. The Servicer (on behalf of
the Issuer and the Trustee) shall use its best efforts, consistent with its
customary servicing procedures and to the extent permissible in accordance with
the Contracts and under applicable law, to repossess or otherwise convert the
ownership of the Equipment securing, or that is the subject of, any Contract
that is in default as to which the Servicer shall have determined eventual
payment in full is unlikely. In connection therewith, the Servicer shall follow
such customary and usual practices and procedures as it shall deem necessary or
advisable in its servicing of equipment lease contracts that are in default,
which may include selling the Equipment at public or private sale. The foregoing
shall be subject to the provision that, in any case in which the Equipment shall
have suffered damage, the Servicer shall not expend funds in connection with the
repair or the repossession of such Equipment unless it shall determine in its
reasonable discretion that such repair and/or repossession will increase the
proceeds ultimately recoverable with respect to such Contract by an amount
greater than the amount of such expenses. To the extent provided in this
Agreement, the Servicer shall be entitled to net its reasonable and customary
out-of-pocket costs and expenses incurred in connection with the repossession
and disposition of Equipment from the liquidation proceeds related thereto.

         Section 3.04. Physical Damage Insurance; Other Insurance. (a) The
initial Servicer, in accordance with its customary servicing procedures, shall
verify that each item of Equipment continues to be covered by a policy of
insurance with coverage amounts consistent with the requirements of the related
Contract, insuring against loss and damage due to fire, theft, collision and, in
the case of Equipment that is a titled vehicle, against other risks generally
covered by liability coverage.

                                       7                     Servicing Agreement


<PAGE>

         (b) To the extent applicable, the Servicer shall not take any action
which would result in noncoverage under any of the Insurance Policies referred
to in Section 3.04(a) which, but for the actions of the Servicer, would have
been covered thereunder. The Servicer, on behalf of the Issuer and the Trustee,
shall take all such reasonable action as shall be necessary to permit recovery
under any of the foregoing Insurance Policies. Any Insurance Proceeds collected
by the Servicer under any of the foregoing Insurance Policies shall be deposited
in the Lockbox Account within two (2) Business Days of receipt thereof. The
parties hereto acknowledge that the Servicer shall not be required to force
place any insurance coverage. In addition to such insurance maintained by the
Customers with respect to the Equipment, the initial Servicer shall maintain,
among other policies, a general liability insurance policy in the aggregate
amount of $1,000,000 and an excess liability insurance policy in umbrella form
in the aggregate amount of $8,000,000 for a total of $9,000,000 of liability
insurance. Each of such policies shall be maintained by the initial Servicer in
full force and effect and shall cover all Equipment. All premiums in respect of
such policies shall be paid by the initial Servicer from its own funds. The
Trustee and the Issuer shall be named as additional insureds on such liability
policies. The Trustee shall be listed on such policies as: "Wells Fargo Bank
Minnesota, National Association, as Trustee under the Indenture for the Series
2003-A Notes." The Servicer shall not reduce its insurance coverage with respect
to the insurance policies without the consent of the Note Insurer.

         Section 3.05. Maintenance of Security Interests in Equipment. The
Servicer and the Issuer shall take such steps as are required by applicable law
to maintain perfection of (i) the security interest created by each Contract in
the related Equipment (except that with respect to Equipment valued at less than
fifteen thousand dollars ($15,000) and related to a Contract characterized by
the Company as a true lease the Servicer shall not be required to make any
filings against the related Customer) and (ii) the interest of the Trustee in
the Collateral created by the Indenture, including but not limited to obtaining
the execution by the Customers and the recording, registering, filing,
re-recording, re-registering and refiling of all security agreements, financing
statements and continuation statements or instruments as are necessary to
maintain the security interest granted by Customers under the respective
Contracts, the Company under the Acquisition Agreement and the Issuer under the
Indenture. The Servicer is hereby authorized to take such steps as are necessary
to re-perfect or continue the perfection of such security interest of the
Company, the Issuer and the Trustee in connection with the occurrence of any
event that would cause such security interest not to be perfected.

         Section 3.06. Additional Covenants of Servicer. The Servicer shall not
release the Equipment securing any Contract from the security interest granted
by such Contract in whole or in part except in the event of payment in full by
the Customer thereunder or repossession, nor shall the Servicer impair the
rights of the Trustee in such Contracts, nor shall the Servicer amend a
Contract, except that extensions or other modifications may be granted in
accordance with Section 3.02.

         Section 3.07. Purchase of Contracts Upon Breach. The Servicer or the
Trustee shall inform the other such party and the Note Insurer promptly, in
writing, upon the discovery (or, in the case of the Trustee, upon the actual
knowledge of any Responsible Officer) of any material breach by the Servicer of
its obligations under Section 3.04, 3.05 or 3.06. With respect to breaches
pursuant to Section 3.04, 3.05 or 3.06, unless such breach shall have been cured
by the last day of the first Due Period commencing after the Servicer's receipt
of written notice of such

                                       8                     Servicing Agreement


<PAGE>

breach or the Servicer's actual knowledge of such breach, whichever is earlier
(or, at the Servicer's election, the last day of the current Due Period), the
initial Servicer shall purchase from the Issuer any Contract with respect to
which the interest of the Trustee, the Note Insurer or the Noteholders is
materially and adversely affected by such breach on such last day of such first
Due Period. In consideration of the purchase of a Contract pursuant to this
Section, the initial Servicer shall remit the Purchase Price in immediately
available funds to the Distribution Account not later than the last day of such
first Due Period. If the initial Servicer complies in a timely manner with its
repurchase obligation pursuant to this Section 3.07, then notwithstanding
anything to the contrary in this Agreement or any other Transaction Document,
the sole remedy of the Trustee with respect to a breach pursuant to Section
3.04, 3.05 or 3.06 shall be to require the initial Servicer to repurchase
Contracts pursuant to this Section 3.07; provided that the Servicer shall
indemnify each Indemnified Party against all Indemnified Amounts which may be
asserted against or incurred by any Indemnified Party, as a result of (i) third
party claims arising out of the events or facts giving rise to such breach or
(ii) failure by the Servicer to comply with such obligation to purchase;
provided further that the Indemnified Party shall not be indemnified as provided
hereunder to the extent of such Indemnified Party's own gross negligence or
willful misconduct.

         Section 3.08. Servicer Fee. The "Servicer Fee" for a Payment Date shall
equal the product of (i) one-twelfth of the Servicer Fee Rate and (ii) the
Aggregate IPB of all Contracts as of the opening of business on the first day of
the related Due Period. In addition, the Servicer shall be entitled to keep all
Servicing Charges, which amounts may be withdrawn by the Servicer from the
Lockbox Account in accordance with the Lockbox Agreement.

         Section 3.09. Monthly Servicer's Report. On each Determination Date
prior to 2:00 p.m. New York, New York time, the Servicer shall deliver to the
Trustee, and if not to be made available on the Trustee's Internet website as
described in Section 12.07(d) of the Indenture, the Rating Agencies, the Note
Insurer and the Issuer, a Monthly Servicer's Report containing all information
necessary to make the distributions pursuant to Section 12.02(d) of the
Indenture (including information regarding all releases and substitutions of
Contracts, for the Due Period preceding the date of such Monthly Servicer's
Report) and the other information specified in Exhibit 3.09. Contracts to be
purchased by the Servicer or to be purchased by the Company shall be identified
by the Servicer by account number and by Customer's name with respect to such
Contract (as specified in Schedule I to the relevant Assignment).

         Section 3.10. Annual Statement as to Compliance; Notice of Default. (a)
The initial Servicer shall deliver to the Trustee and the Note Insurer, on or
before April 30 of each year beginning April 30, 2004, an Officer's Certificate
of the Servicer, dated as of December 31 of the preceding fiscal year, stating
that (i) a review of the activities of the Servicer during the preceding
12-month period and of its performance under this Agreement has been made under
the supervision of the officer signing such Officer's Certificate and (ii) to
the best of such officer's knowledge, based on such review, the Servicer has
fulfilled all its obligations under this Agreement in all material respects
throughout such year, 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.

                                       9                     Servicing Agreement


<PAGE>

         (b) The Servicer shall deliver to the Trustee and the Note Insurer,
promptly after having obtained knowledge thereof, but in no event later than two
(2) Business Days after obtaining such knowledge, written notice in an Officer's
Certificate of the Servicer of any Default, Event of Default, Servicer Event of
Default or Trigger Event.

         Section 3.11. Independent Certified Public Accountant's Report. The
initial Servicer shall cause a firm of nationally-recognized certified public
accountants, who may also render other services to the initial Servicer or to
the Issuer, to deliver (1) to the Trustee and the Note Insurer on or before
April 30 of each year as of December 31 of the preceding fiscal year, beginning
April 30, 2004, a report addressed to the Board of Directors of Financial
Pacific Company, to the effect that such firm has examined the consolidated
financial statements of Financial Pacific Company, which financial statements
include consolidating schedules related to the initial Servicer, and issued its
report therefor and that such examination was made in accordance with generally
accepted auditing standards (except as otherwise noted therein), and accordingly
included such tests of the accounting records and such other auditing procedures
as such firm considered necessary in the circumstances; and (2) to the
Controlling Party on or before April 30 of each year, a report verifying the
information (using the procedures outlined in Exhibit 3.11 attached hereto),
including the accuracy of the calculations, on the Monthly Servicer's Reports
delivered by the initial Servicer during the prior year and tying such
information to the initial Servicer's books and records. The reports described
in clauses (1) and (2) above shall also indicate that the firm is independent of
the initial Servicer within the meaning of the Code of Professional Ethics of
the American Institute of Certified Public Accountants.

         Section 3.12. Servicer Expenses. Except as otherwise provided herein
(including without limitation Section 5.02(a)), the Servicer shall be required
to pay all expenses incurred by it in connection with its activities hereunder
including fees and disbursements of independent accountants (including but not
limited to expenses associated with the reports delivered pursuant to Section
3.11 of this Agreement), the Trustee and the Back-up Servicer (to the extent
that the fees of the Trustee and Back-up Servicer shall not be fully paid from
distributions made pursuant to Section 12.02(d) of the Indenture), taxes imposed
on the Servicer, and expenses incurred in connection with distributions and
reports made by the Servicer pursuant to the Transaction Documents.

         Section 3.13. Treatment of Issuer. The Servicer shall identify the
Issuer as "Lessor No. 5" in the records, software and reports of the Servicer in
accordance with Section II.1 of the Lockbox Agreement.

         Section 3.14. Access to Records, etc. (i) At any time and from time to
time during regular business hours, and upon at least two (2) Business Days
prior written notice (unless a Servicer Event of Default, a Default or an Event
of Default shall have occurred and be continuing, in which case no notice shall
be required), the Servicer shall permit the Issuer, the Trustee and the Note
Insurer and/or their agents or representatives, (A) to examine and make copies
of and abstracts from all books, records and documents (including, without
limitation, computer tapes and disks) in the possession or under the control of
the Servicer relating to Contracts, including, without limitation, related
contracts and other agreements with respect to the Receivables and (B) to visit
the offices and properties of the Servicer for the purpose of

                                       10                    Servicing Agreement


<PAGE>

examining such materials described in clause (i)(A) next above, and to discuss
matters relating to Contracts or the Servicer's performance hereunder or under
any other Transaction Document with any of the officers or employees of such
party having knowledge of such matters, and (ii) without limiting the provisions
of clause (i) next above, from time to time on request of the Trustee, the Note
Insurer or the Issuer, permit certified public accountants or other auditors
acceptable to the Trustee, the Note Insurer or the Issuer to conduct a review of
such party's books and records with respect to the Contracts and/or the related
Receivables.

         Section 3.15. Data Report. On each Determination Date, the Servicer
will transmit or deliver to the Trustee and Controlling Party a data report in
the form of magnetic tape or diskette or computer modem transmission, in a
format reasonably acceptable to the Controlling Party, containing such
information as the Trustee or the Controlling Party may reasonably require with
respect to the Contracts as of the close of business on the last day of the
preceding Due Period, including without limitation the information necessary for
preparation of the Monthly Servicer's Report (a "Data Report"). The Back-up
Servicer shall verify that each Data Report is in a readable and usable form and
covers all information necessary to service the Contracts, including, but not
limited to, Aggregate IPB, Available Funds, Delinquent Contracts, Defaulted
Contracts, Recoveries, prepayments and bankruptcies. The Back-up Servicer shall
use each such monthly Data Report to confirm that the Monthly Servicer's Report
delivered by the Servicer for the related Due Period is correct with respect to
the following information: beginning and ending Aggregate IPB; the Implicit
Principal Balance of Contracts that are 31-60, 61-90 and 91 or more days
delinquent; the 31 to 60 Day Delinquency Ratio; the 61 to 90 Day Delinquency
Ratio; the NPA Ratio; the sum of the Implicit Principal Balance of Defaulted
Contracts for the related Due Period; and for each of the first four Monthly
Servicer's Reports delivered after the Closing Date, confirmation of
concentrations by Customer, broker, type of Equipment, and geographic territory
as of the end of the related Due Period. The Back-up Servicer shall notify the
Servicer, the Trustee and the Note Insurer of any material discrepancies in
connection with such verification and confirmation on or before the third
Business Day following the applicable Determination Date. The Back-up Servicer
shall provide, on the Business Day prior to the related Payment Date written
certification to the Trustee and the Note Insurer that the information confirmed
pursuant to the second preceding sentence above appears complete and correct
(except with respect to any discrepancies described above). In the event that
the Back-up Servicer reports any material discrepancies, the Servicer and the
Back-up Servicer shall attempt to reconcile such discrepancies prior to the
Business Day prior to the related Payment Date, but in the absence of a
reconciliation, the Monthly Servicer's Report shall control for the purpose of
calculations and distributions with respect to the related Payment Date. In the
event that the Back-up Servicer and the Servicer are unable to reconcile
discrepancies with respect to a Monthly Servicer's Report by the end of the
calendar month in which such Payment Date occurred, the Servicer shall, if so
directed by the Controlling Party, cause a firm of nationally-recognized
independent certified public accountants acceptable to the Controlling Party, at
the Servicer's expense, to audit the Monthly Servicer's Report and, prior to the
next succeeding Determination Date, reconcile the discrepancies. The effect, if
any, of such reconciliation shall be reflected in the Monthly Servicer's Report
for such Determination Date. Other than the duties specifically set forth in
this Agreement, the Back-up Servicer shall have no obligations hereunder,
including, without limitation, to supervise, verify, monitor or administer the
performance of the Servicer. The Back-up Servicer shall have no liability for
any actions taken or omitted by the Servicer.

                                       11                    Servicing Agreement


<PAGE>

         Section 3.16. Employee Dishonesty Policy. The Servicer shall maintain
such insurance policy as it has in place as of the Closing Date that insures
against employee dishonesty, and such policy shall at all times provide coverage
in an amount not less than $3,000,000.

         Section 3.17. Sub-Servicer. With the prior written consent of the Note
Insurer, the Servicer may appoint any of its Affiliates as sub-servicer with
respect to all or part of the Collateral, provided that the Servicer shall
remain responsible for the performance of the Servicer's duties hereunder and
that following the occurrence of an Event of Default, such sub-servicing
agreement shall, if the Controlling Party so requests, be terminated. The
Back-up Servicer may sub-contract its duties hereunder in its role as Back-up
Servicer or if the Back-up Servicer becomes successor Servicer. The Back-up
Servicer may execute any of its powers hereunder or perform any duties hereunder
either directly or by or through a sub-contracted Back-up Servicer, and the
Back-up Servicer shall not be responsible for any willful misconduct or
negligence on the part of any such sub-contracted Back-up Servicer appointed by
it hereunder with due care, provided that the Rating Agency Condition shall have
been satisfied in connection with the appointment of any such sub-contracted
Back-up Servicer.

         Section 3.18. Amendment to Guidelines. The initial Servicer may (x)
make any change in the character of its business, and/or (y) amend the
Collection Guidelines in accordance with, and only in accordance with, the
following procedure:

                  (i) The initial Servicer shall deliver to the Note Insurer
         written notice of any proposed change or amendment; provided that such
         notice shall meet the requirements set forth in clause (v) below;

                  (ii) the Controlling Party shall have ten (10) Business Days
         following the date of its receipt of such written notice to reject such
         proposed change or amendment;

                  (iii) such proposed change or amendment shall not be effective
         prior to the expiration of the latest ten-Business-Day period specified
         in clause (ii) above;

                  (iv) such proposed change or amendment shall become effective
         at the expiration of the latest ten-Business-Day period specified in
         clause (ii) above unless the Controlling Party shall have delivered to
         the initial Servicer a written objection to such proposed change or
         amendment prior to the expiration of such ten-Business-Day period; and

                  (v) in order for the written notice specified in clause (i)
         above to be valid, such notice must contain (A) a representation and
         warranty to the effect that the change or amendment proposed in such
         notice will not result in any Material Adverse Effect and (B) a
         reference to this Section 3.18 and must contain the following statement
         in bold, uppercase type: "IF YOU WISH TO PREVENT THIS PROPOSED CHANGE
         OR AMENDMENT FROM BECOMING EFFECTIVE, YOU MUST DELIVER A WRITTEN
         OBJECTION TO THE AMENDMENT TO FINANCIAL PACIFIC LEASING, LLC WITHIN TEN
         BUSINESS DAYS AFTER YOUR RECEIPT OF THIS NOTICE."

                                       12                    Servicing Agreement


<PAGE>

         Section 3.19. Certain Reporting Requirements. The Issuer and the
initial Servicer will furnish, or cause to be furnished, to the Trustee and the
Note Insurer (and the Trustee shall forward the same to the Noteholders):

                  (a) Quarterly Financial Statements. As soon as available and
         in any event within 60 days after the end of each of the first three
         quarters of each fiscal year of Financial Pacific Company, copies of
         Financial Pacific Company's consolidated and consolidating quarterly
         financial reports prepared in accordance with generally accepted
         accounting principles, certified by the president, the chief financial
         officer or chief accounting officer of the initial Servicer.

                  (b) Annual Financial Statements of Financial Pacific Company.
         As soon as available and in any event within 120 days after the end of
         each fiscal year of Financial Pacific Company, a copy of Financial
         Pacific Company's combined and combining annual financial statements as
         reported on by nationally recognized independent certified public
         accountants, along with consolidated and consolidating schedules of the
         initial Servicer and the Issuer;

                  (c) Litigation. As soon as possible and in any event within
         three (3) Business Days of the Issuer's or the Servicer's knowledge
         thereof, notice of (i) any litigation, investigation or proceeding
         which may exist at any time which could have a Material Adverse Effect
         and (ii) any material adverse development in any such previously
         disclosed litigation, investigation or proceeding; and

                  (d) Other. Promptly, from time to time, such other
         information, documents, records or reports respecting the Contracts or
         the condition or operations, financial or otherwise, of the Issuer or
         the Servicer as the Trustee or the Controlling Party may from time to
         time reasonably request in order to protect the interest of the Trustee
         or the Controlling Party under or as contemplated by the Transaction
         Documents.

                                   ARTICLE IV

                                   COLLECTIONS

         Section 4.01. [Reserved].

         Section 4.02. Collections. (a) The Servicer shall instruct the
Customers to remit payments on the Contracts only by mail or electronic funds
transfer and only to a post office box or Lockbox Account that is under the
control of a Lockbox Bank pursuant to a Lockbox Agreement, except as otherwise
directed or required pursuant to Section 4.02(c). In the event that the Servicer
or the Issuer receives any amounts constituting Available Funds, it shall
deposit such amounts directly into the Lockbox Account within two Business Days
of receipt thereof.

         (b) The parties acknowledge that the Servicer has entered into and may
from time to time enter into arrangements with one or more banks or other
financial institutions reasonably acceptable to the Controlling Party (each a
"Lockbox Bank") for the receipt and processing by the Lockbox Banks of payments
on Contracts sent by Customers to post office boxes controlled by the Lockbox
Banks. The Servicer shall give the Trustee and the Controlling Party reasonable

                                       13                    Servicing Agreement


<PAGE>

prior written notice of the effectiveness of any such arrangement, the names and
addresses of the Lockbox Banks and the account number of each account maintained
by such Lockbox Bank and into which Collections will be deposited (each a
"Lockbox Account"), and shall provide the Trustee and the Controlling Party with
copies of any agreements relating to the Lockbox Accounts (which agreements
shall be in form and substance reasonably acceptable to the Controlling Party)
and such other information as they may reasonably request with respect to such
arrangements. The Servicer shall execute and deliver and shall require each
Lockbox Bank to execute and deliver, before any Collections are deposited in any
Lockbox Account maintained by such Lockbox Bank, an agreement among the
Servicer, the Trustee, the Lockbox Bank and such other Persons as the
Controlling Party may require, in form and substance reasonably satisfactory to
the Controlling Party (each a "Lockbox Agreement"), covering each such Lockbox
Account. Each Lockbox Agreement shall include a provision that, upon and after
notice by the Trustee to the Lockbox Bank, the Lockbox Bank will not withdraw or
transfer any funds from such Lockbox Account except in accordance with the
Trustee's instructions. The Trustee shall give such notice upon the direction of
the Controlling Party, and such direction from the Controlling Party shall be
given, if at all, only after the occurrence of an Event of Default. Within two
Business Days after deposit of any funds in any Lockbox Account, the Servicer
will identify the funds that constitute Available Funds and instruct the Lockbox
Bank to transfer such collected funds into the Collection Account. The Servicer
is hereby authorized (which authorization may be revoked by the Controlling
Party if an Event of Default has occurred) to direct the Lockbox Bank to
transfer any other funds that do not constitute Available Funds to such accounts
or other Persons as it may deem necessary.

         (c) Upon the occurrence and during the continuance of an Event of
Default, the Controlling Party may direct or require the Servicer to direct the
Customers to make all payments on Contracts to an account designated by the
Controlling Party.

         Section 4.03. Application of Collections. All collections on a Contract
for each Due Period shall be applied by the Servicer as follows: first, to any
Scheduled Payment, or portion thereof that is past due, second, to the Scheduled
Payment then due, third, to taxes owed by Servicer with respect to such
Contract, fourth, to insurance premiums owed by Servicer with respect to such
Contract, fifth, to other administrative fees and similar charges, sixth, to any
late charges related to such Contract, and seventh, any excess remaining
thereafter shall be applied to prepay such Contract.

                                   ARTICLE V

                                TERMINATION; TERM

         Section 5.01. Termination of Servicer. (a) Any of the following events
shall constitute a "Servicer Event of Default":

         (i)      The failure of the Servicer to deliver to the Trustee for
                  payment to the Noteholders any payments or proceeds received
                  and required to be so delivered under this Agreement, which
                  failure continues unremedied until the end of the second
                  successive Business Day;

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<PAGE>

         (ii)     The failure of the Servicer to deliver a Monthly Servicer's
                  Report, which failure continues unremedied until the end of
                  the following Business Day;

         (iii)    The failure of the Servicer to deposit any Purchase Price,
                  which failure continues unremedied until the end of the
                  following Business Day;

         (iv)     The failure of the Servicer to make remittances or deliver
                  notices pursuant to the Transaction Documents (including,
                  without limitation, the failure to make a deposit in the
                  Revenue Tax Account), which failure continues unremedied until
                  the end of the following Business Day;

         (v)      The failure of the Servicer to observe or perform in any
                  material respect any covenant or agreement in the Transaction
                  Documents which has not been remedied in accordance with the
                  terms of the Transaction Documents; or the failure of any
                  representation or warranty of the Servicer in any Transaction
                  Document to be true and correct in all material respects when
                  made, which failure continues unremedied for thirty (30) days
                  after the Servicer has knowledge of such failure of such
                  representation and warranty to be true and correct in all
                  material respects when made;

         (vi)     The entry of a decree or order for relief by a court having
                  jurisdiction in the premises in respect of the Servicer under
                  the United States Bankruptcy Code or any other applicable
                  Federal or state bankruptcy, insolvency, reorganization,
                  liquidation or other similar law now or hereafter in effect or
                  any arrangement with creditors or appointing a receiver,
                  liquidator, assignee, trustee, or sequestrator (or other
                  similar official) for the Servicer or for any substantial part
                  of its respective property, or ordering the winding up or
                  liquidation of the Servicer's affairs, and the continuance of
                  any such decree or order unstayed and in effect for a period
                  of 60 consecutive days;

         (vii)    The institution by the Servicer of proceedings to be
                  adjudicated a bankrupt or insolvent, or the consent by the
                  Servicer to the institution of bankruptcy or insolvency
                  proceedings against the Servicer, or the filing by the
                  Servicer of a petition or answer or consent seeking
                  reorganization or relief under the United States Bankruptcy
                  Code or any other applicable Federal or state bankruptcy
                  insolvency, reorganization, liquidation or other similar law
                  now or hereafter in effect, or the consent by the Servicer to
                  the filing of any such petition or to the appointment of or
                  taking possession by a receiver, liquidator, assignee,
                  custodian, trustee or sequestrator (or other similar official)
                  of the Servicer or of any substantial part of the Servicer's
                  property, or the making by the Servicer of any assignment for
                  the benefit of creditors, or the admission by it in writing of
                  its inability, or the failure by it generally, to pay its
                  debts as they become due, or the taking of corporate action by
                  the Servicer in furtherance of any such action;

         (viii)   If the Company (or any other Affiliate of Financial Pacific
                  Company) is the Servicer, the failure of the Servicer and its
                  consolidated subsidiaries to maintain Tangible Net Worth,
                  calculated at the end of each calendar quarter, beginning

                                       15                    Servicing Agreement


<PAGE>

                  with the quarter ending June 30, 2003, of not less than $20
                  million, plus 75% of net income from and including April 1,
                  2003, less the amount of dividends payable from and including
                  April 1, 2003 to Financial Pacific Company for pass-through
                  interest and principal due on its subordinated notes;

         (ix)     The Controlling Party shall not have delivered a Servicer
                  Extension Notice pursuant to which the Controlling Party
                  extends the Servicer's term for a successive quarterly term;

         (x)      The failure of the Servicer to pay any taxes then due and
                  owing from the Issuer or any Affiliate of the Issuer with
                  respect to the Collateral including, without limitation, the
                  revenue taxes imposed by the State of Washington on the
                  receipt of lease payments;

         (xi)     The occurrence of an Insurance Agreement Indenture Cross
                  Default; or

         (xii)    The occurrence of an Event of Default.

         If a Servicer Event of Default has occurred and is continuing, the
Trustee shall, upon the direction of the Controlling Party, by notice then given
in writing to the Servicer and the Note Insurer, terminate all of the rights and
obligations of the Servicer arising after the effective date of such
termination; provided that the Servicer's obligation to fund the Revenue Tax
Account and to pay the taxes imposed by the State of Washington on income earned
on leases characterized for tax purposes as conditional sales shall continue
under the Transaction Documents. The Back-up Servicer, as promptly as possible,
will assume the Servicer's rights, authority, power and obligations under the
Transaction Documents, unless the Controlling Party, in its sole and absolute
discretion, appoints another successor Servicer; provided that if the
Controlling Party does appoint another successor Servicer, the Rating Agency
Condition shall have been satisfied.

         (b) If the rights and obligations of Servicer are terminated in
accordance with this Section, the Servicer resigns pursuant to Section 2.04 of
this Agreement or the Servicer's term expires pursuant to Section 5.03 of this
Agreement, then the Servicer shall be entitled to its pro rata share of the
Servicer Fee for the number of days in the Due Period prior to the effective
date of its termination or resignation or the expiration of its term. On or
after the receipt by the Servicer of a written notice of termination delivered
pursuant to this Section, the resignation of the Servicer in accordance with
Section 2.04 of this Agreement or the expiration of the Servicer's term pursuant
to Section 5.03 of this Agreement, all authority and power of the Servicer under
this Agreement and the other Transaction Documents, whether with respect to the
Contracts or otherwise, shall, without further action, pass to and be vested in
(i) the Back-up Servicer as successor Servicer or (ii) such other successor
Servicer as may be appointed under Section 5.02; provided, however, that the
successor Servicer shall have no liability with respect to any obligation which
was required to be performed by the predecessor Servicer prior to the date the
successor Servicer becomes the Servicer or any claim of a third party based on
any alleged action or inaction of the predecessor Servicer; and, without
limitation, the Controlling Party is hereby authorized and empowered to execute
and deliver, on behalf of the predecessor Servicer, as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do

                                       16                    Servicing Agreement


<PAGE>

or accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, resignation or expiration, whether to
complete the transfer and endorsement of the Contracts and related documents, or
otherwise. The predecessor Servicer shall cooperate with the successor Servicer,
the Trustee and the Controlling Party in effecting the termination, resignation
or expiration of the responsibilities and rights of the predecessor Servicer
under this Agreement and the other Transaction Documents, including the transfer
to the successor Servicer for administration by it of all cash amounts that
shall at the time be held or should have been held by the predecessor Servicer
for deposit, or shall thereafter be received with respect to a Contract and the
delivery to the successor Servicer of all files and records concerning the
Contracts and a computer tape in readable form containing all information
necessary to enable the successor Servicer to service the Contracts and the
other property of the Issuer. To the extent not paid pursuant to the Indenture,
all reasonable out-of-pocket costs and expenses (including attorneys' fees)
incurred in connection with transferring any documents or files to the successor
Servicer and amending this Agreement to reflect such succession as Servicer
pursuant to this Section 5.01 shall be paid by the predecessor Servicer upon
demand. The predecessor Servicer shall grant the Trustee and the Controlling
Party reasonable access to the predecessor Servicer's premises during normal
business hours at the predecessor Servicer's expense. The successor Servicer
shall direct the Customers to make all payments under the Contracts directly to
the successor Servicer at the predecessor Servicer's expense (in which event the
successor Servicer shall process such payments directly).

         Section 5.02. Appointment of Successor Servicer. (A) Upon the
Servicer's receipt of notice of termination pursuant to Section 5.01, the
Servicer's resignation in accordance with Section 2.04 of this Agreement or the
expiration of the Servicer's term pursuant to Section 5.03 of this Agreement,
the predecessor Servicer shall continue to perform its functions as Servicer
under this Agreement, in the case of termination, only until the date specified
in such termination notice or, if no such date is specified in a notice of
termination or in the case of such expiration, until a successor Servicer
acceptable to the Controlling Party has assumed the obligations of the Servicer
hereunder and, in the case of resignation, until the later of (x) the date that
a successor Servicer acceptable to the Controlling Party has assumed the
obligations of the Servicer hereunder in accordance with the terms of this
Agreement and (y) the date upon which the predecessor Servicer shall become
unable to act as Servicer, as specified in the notice of resignation and
accompanying Opinion of Counsel. In the event of the termination or resignation
of, or the expiration of the term of, the Servicer, Wells Fargo Bank Minnesota,
National Association, as Back-up Servicer, shall, at the direction of the
Controlling Party, assume the obligations of Servicer hereunder on the date
specified in such written notice (the "Assumption Date") pursuant to an
assumption agreement in form and substance reasonably satisfactory to the
Controlling Party or, in the event that the Controlling Party shall have
determined that a Person other than the Back-up Servicer shall be the successor
Servicer and shall have given notice thereof to the Rating Agencies, on the date
of the execution of a written assumption agreement by such Person in form and
substance reasonably satisfactory to the Controlling Party. Notwithstanding the
Back-up Servicer's assumption of, and its agreement to perform and observe, all
duties, responsibilities and obligations of the Company as Servicer under this
Agreement arising on and after the Assumption Date, the Back-up Servicer or any
other successor to the Servicer shall have (i) no liability with respect to any
obligation which was required to be performed by the terminated Servicer prior
to the Assumption Date or any claim of a third party based on any alleged action
or inaction of the terminated Servicer, (ii) no

                                       17                    Servicing Agreement


<PAGE>

obligation to perform any repurchase or advancing obligations, if any, of the
Servicer pursuant to Sections 3.07 of this Agreement, (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 involved in this transaction (except
for those of any Person to whom such successor Servicer delegates its duties
pursuant to Section 3.17 of this Agreement), (v) no liability or obligation with
respect to any indemnification obligations of any terminated Servicer pursuant
to Section 2.02 of this Agreement and (vi) no liability to the extent that the
information necessary for servicing the Contracts has not been provided to the
successor Servicer by the terminated Servicer.

         (b) Upon appointment, the successor Servicer shall be the successor in
all respects to the predecessor Servicer and shall be subject to all the
responsibilities (except as set forth in the last sentence of paragraph (a)
above), duties, and liabilities arising thereafter relating thereto placed on
the predecessor Servicer, and shall be entitled to the Servicer Fee and all of
the rights granted to the predecessor Servicer, by the terms and provisions of
this Agreement.

         (c) The Controlling Party may exercise at any time its right to appoint
as Back-up Servicer, or as successor Servicer, a Person other than the Person
serving as Back-up Servicer or Servicer, as applicable, at the time, and shall
have no liability to the Trustee, the Company, the Issuer, the Person then
serving as Servicer or Back-up Servicer or any other Person if the Controlling
Party does so. Subject to Section 2.04, no provision of this Agreement shall be
construed as relieving the Back-up Servicer of its obligation to succeed as
successor Servicer upon the termination of the Servicer pursuant to Section 5.01
or resignation of the Servicer pursuant to Section 2.04 or expiration pursuant
to Section 5.03.

         (d) Notwithstanding anything contained in this Agreement to the
contrary, the successor Servicer is authorized to accept and rely on all of the
accounting records (including computer records) and work of the prior Servicer
relating to the Contracts (collectively, the "Predecessor Servicer Work
Product") without any audit or other examination thereof, and the successor
Servicer shall have no duty, responsibility, obligation or liability for the
acts and omissions of the prior Servicer. If any error, inaccuracy, omission or
incorrect or non-standard practice or procedure (collectively, "Errors") exist
in any Predecessor Servicer Work Product and such Errors make it materially more
difficult to service or should cause or materially contribute to the successor
Servicer making or continuing any Errors (collectively, "Continued Errors"), the
successor Servicer shall have no duty, responsibility, obligation or liability
for such Continued Errors; provided, however, that the successor Servicer agrees
to use its best efforts to prevent further Continued Errors. In the event that
the successor Servicer becomes aware of Errors or Continued Errors, it shall,
with the prior consent of the Controlling Party use its best efforts to
reconstruct and reconcile such data as is commercially reasonable to correct
such Errors and Continued Errors and to prevent future Continued Errors. The
successor Servicer shall be entitled to recover its costs thereby expended in
accordance with Section 12.02 of the Indenture.

         Section 5.03. Retention and Termination of Servicer. The Servicer
hereby covenants and agrees to act as such under this Agreement for an initial
term, commencing on the Closing Date and ending on September 30, 2003, which
term shall be extendible by the Note Insurer (provided that no Note Insurer
Default has occurred and is continuing) for successive quarterly terms ending on
each successive December 31, March 31, June 30 and September 30 (or, pursuant to
revocable written standing instructions from time to time to the Servicer and
the Trustee for any

                                       18                    Servicing Agreement


<PAGE>

specific number of terms greater than one), until the Notes have been paid in
full, all amounts due and owing to the Note Insurer have been paid in full and
the Policy has been returned to the Note Insurer in accordance with its terms.
Each such notice (including each notice pursuant to standing instructions, which
shall be deemed delivered at the end of successive quarterly terms for so long
as such instructions are in effect) (a "Servicer Extension Notice") shall be
delivered by the Note Insurer to the Servicer and the Trustee. The Servicer
hereby agrees that, as of the date hereof and upon its receipt of any such
Servicer Extension Notice, the Servicer shall become bound, for the initial term
beginning on the Closing Date and for the duration of the term covered by such
Servicer Extension Notice, to continue as the Servicer subject to and in
accordance with the other provisions of this Agreement. Until such time as a
Note Insurer Default shall have occurred and be continuing, the Trustee agrees
that if as of the fifteenth day prior to the last day of any term of the
Servicer the Trustee shall not have received any Servicer Extension Notice from
the Note Insurer, the Trustee will, within five days after, give written notice
of such non-receipt to the Note Insurer and Servicer and the Servicer's term
shall not be extended unless a Servicer Extension Notice is received on or
before the last day of such term. Notwithstanding the foregoing, in the event a
Note Insurer Default has occurred and is continuing, the Servicer Extension
Notice shall be deemed to have been delivered as of last day of the current term
of the Servicer and extended until the next quarterly period.

         Section 5.04. Back-up Servicer as Servicer. Upon the appointment of the
Back-up Servicer as the Servicer pursuant to Section 5.01 of this Agreement,
every instance of the term "Servicer" in this agreement and the other
Transaction Documents shall be deemed to mean the Back-up Servicer, unless the
term "initial Servicer" is used (which shall continue to be deemed to mean the
Company).

                                   ARTICLE VI

                            MISCELLANEOUS PROVISIONS

         Section 6.01. Termination. (a) Except with respect to a particular
party under Section 2.02 or Article V hereof, or this Article VI, the respective
duties and obligations of the parties hereto created by this Agreement shall
terminate upon the discharge of the Indenture in accordance with its terms; and
the respective duties and obligations of the Trustee shall terminate with
respect to the Trustee in the event the Trustee resigns or is replaced under the
Indenture; provided, however, that no resignation or removal of the Trustee and
no appointment of a successor Trustee shall become effective until the
acceptance of appointment by the successor Trustee under the Indenture. Upon the
termination of this Agreement pursuant to this Section 6.01(a), the Servicer
shall pay all monies with respect to the Collateral held by the Servicer and to
which the Servicer is not entitled to the Issuer or upon the Issuer's order.

         (b) This Agreement shall not be automatically terminated as a result of
an Event of Default or any action taken by the Trustee or the Controlling Party
thereafter with respect thereto.

         Section 6.02. Amendments. This Agreement may be amended or modified
from time to time by the parties hereto, but only with the prior written consent
of the Note Insurer. Promptly after the execution by the Issuer, the Servicer,
the Trustee and the Back-up Servicer of any

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<PAGE>

amendment pursuant to this Section, the Issuer shall mail to each Noteholder,
the Note Insurer, WestLB and each Rating Agency a copy of such amendment.

         Section 6.03. GOVERNING LAW. THIS AGREEMENT AND ALL MATTERS ARISING OUT
OF OR RELATING TO THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

         Section 6.04. Notices. All demands, notices and communications
hereunder shall be in writing and shall be delivered or mailed by registered or
certified United States mail, postage prepaid, and addressed, or by facsimile,
in each case as follows:

                  (a) if to the Issuer, to Financial Pacific Funding II, LLC,
         3455 S. 344 Way, Suite 300, Federal Way, WA 98001, Attention: Erik
         Weedon, Facsimile No.: (253) 568-2222, Telephone No.: (253) 568-6140;

                  (b) if to the Trustee or to the Controlling Party (if the Note
         Insurer is not the Controlling Party), to Wells Fargo Bank Minnesota,
         National Association, Sixth and Marquette Avenue, MAC N9311-161
         Minneapolis, Minnesota 55479, Attention: Corporate Trust Services --
         Asset-Backed Administration, Facsimile No.: (617) 667-3539, Telephone
         No.: (612) 667-8058;

                  (c) if to the Servicer, to Financial Pacific Leasing, LLC,
         3455 S. 344 Way, Suite 300, Federal Way, WA 98001, Attention: Erik
         Weedon, Facsimile No.: (253) 568-2222, Telephone No.: (253) 568-6140;

                  (d) if to the Back-up Servicer, to Wells Fargo Bank Minnesota,
         National Association, Sixth and Marquette Avenue, Minneapolis, MAC
         N9311-161, Minnesota 55479, Attention: Corporate Trust Services --
         Asset-Backed Administration, Facsimile No.: (612) 667-3539, Telephone
         No.: (612) 667-8058;

                  (e) if to Moody's, to Moody's, at 99 Church Street, New York,
         New York 10007 (facsimile number (212) 553-4642), Attention: ABS
         Surveillance Group;

                  (f) if to to S&P, at 55 Water Street, 40th Floor, New York,
         New York 10041 (facsimile number (212) 438-2664), Attention: ABS
         Surveillance; or

                  (e) if to the Note Insurer, to Financial Security Assurance
         Inc., Financial Security Assurance Inc., 350 Park Avenue, New York, NY
         10022, Attention: Senior Vice President -- Transaction Oversight
         Department (with a copy to the Attention of the General Counsel), Re:
         Financial Pacific Funding II, LLC, Series 2003-A, Policy No. 51429-N,
         Confirmation: (212) 826-0100, Facsimile Nos.: (212) 339-3518, (212)
         339-3529 (in each case in which notice or other communication to the
         Note Insurer refers to an Event of Default, a claim on the Policy or
         with respect to which failure on the part of the Note Insurer to
         respond shall be deemed to constitute consent or acceptance, then a
         copy of such notice or other communication should also be sent to the
         attention of each of the General Counsel and the Head-Financial
         Guaranty Group and shall be marked to indicate "URGENT MATERIAL
         ENCLOSED"). All notices and demands shall be

                                       20                    Servicing Agreement


<PAGE>

         deemed to have been given (i) at the time of the delivery thereof to
         any officer of the Person entitled to receive such notices and demands
         at the address of such Person for notices hereunder, (ii) on the third
         day after the mailing thereof to such address or (iii) when transmitted
         by facsimile (evidenced by electronic receipt), as the case may be.

         Section 6.05. Severability of Provisions. If one or more of the
provisions of this Agreement shall be for any reason whatever held invalid, such
provisions shall be deemed severable from the remaining covenants and provisions
of this Agreement, and shall in no way affect the validity or enforceability of
such remaining provisions, the rights of any parties hereto, or the rights of
the Controlling Party. To the extent permitted by law, the parties hereto waive
any provision of law which renders any provision of this Agreement prohibited or
unenforceable in any respect.

         Section 6.06. Binding Effect. This Agreement will inure to the benefit
of and be binding upon the parties hereto and their respective successors and
permitted assigns. Except as may be otherwise provided in this Agreement, no
other Person will have any right or obligation hereunder.

         Section 6.07. Headings and Captions. The table of contents and article
and section headings and captions in this Agreement are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.

         Section 6.08. Legal Holidays. In the case where the date on which any
action required to be taken, document required to be delivered or payment
required to be made is not a Business Day, such action, delivery or payment need
not be made on such date, but may be made on the next succeeding Business Day.

         Section 6.09. Security for the Loan. The Servicer and the Back-up
Servicer understand that the Issuer will pledge pursuant to the Indenture to the
Trustee, for the benefit of the Noteholders and the Note Insurer, all its right,
title and interest to this Agreement. The Servicer and the Back-up Servicer
consent to such pledge and further agree that all representations, warranties,
covenants and agreements of the Servicer and the Back-up Servicer made herein
shall also be for the benefit of and inure to the Note Insurer and the
Noteholders.

         Section 6.10. No Servicing Assignment. Notwithstanding anything to the
contrary contained herein, except as provided in Section 2.03 hereof, this
Agreement may not be assigned by the Issuer, the Servicer or the Back-up
Servicer except in accordance with the express terms hereof without the prior
written consent of the Note Insurer.

         Section 6.11. Third-Party Beneficiaries. The Note Insurer and its
successors and assigns shall be a third-party beneficiary to the provisions of
this Agreement, and shall be entitled to rely upon and directly enforce such
provisions of this Agreement so long as no Note Insurer Default shall have
occurred and be continuing. Except as expressly stated otherwise herein or in
the Basic Documents, any right of the Note Insurer to direct, appoint, consent
to, approve of or take any action under this Agreement, shall be a right
exercised by the Note Insurer in its sole and absolute discretion. The Note
Insurer may disclaim any of its rights and powers under this

                                       21                    Servicing Agreement


<PAGE>

Agreement (but not its duties and obligations under the Policy) upon delivery of
a written notice to the Trustee.

         Section 6.12. SUBMISSION TO JURISDICTION. EACH PARTY HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY:

         A.       SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR
                  PROCEEDING RELATING TO THIS AGREEMENT AND THE OTHER
                  TRANSACTION DOCUMENTS, OR FOR RECOGNITION AND ENFORCEMENT OF
                  ANY JUDGMENT IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL
                  JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK, THE
                  FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR THE
                  SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY
                  THEREOF;

         B.       CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN
                  SUCH COURTS AND, TO THE EXTENT PERMITTED BY LAW, WAIVES ANY
                  OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF
                  ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH
                  ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND
                  AGREES NOT TO PLEAD OR CLAIM THE SAME;

         C.       AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR
                  PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY
                  REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR
                  FORM OF MAIL), POSTAGE PREPAID, TO ITS ADDRESS DETERMINED IN
                  ACCORDANCE WITH SECTION 6.04 OF THIS AGREEMENT; AND

         D.       AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT
                  SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
                  SHALL LIMIT THE RIGHT TO SUE IN ANY OTHER JURISDICTION.

         Section 6.13. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.

         Section 6.14. No Proceedings. Each of the Servicer and the Issuer
agrees not to institute against, or join any other Person in instituting
against, or solicit or encourage any Person to institute against, the Issuer any
bankruptcy, reorganization, arrangement, insolvency, liquidation or similar
proceeding for one year and a day after the amounts owing under the Indenture
and the other Transaction Documents have been paid in full.

                                       22                    Servicing Agreement


<PAGE>

         Section 6.15. Counterparts. This Agreement may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same agreement.

                            [SIGNATURE PAGES FOLLOW]

                                       23                    Servicing Agreement


<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date and year first above written.

                                    FINANCIAL PACIFIC FUNDING II, LLC, as
                                        Issuer

                                    By: /s/ Peter A. Davis
                                        ---------------------------------------
                                        Name: Peter A. Davis
                                        Title: Chief Financial Officer

                                    FINANCIAL PACIFIC LEASING, LLC, as
                                        Servicer

                                    By: /s/ Peter A. Davis
                                        ---------------------------------------
                                        Name: Peter A. Davis
                                        Title: Chief Financial Officer

                                                             Servicing Agreement


<PAGE>

                                    WELLS FARGO BANK MINNESOTA,
                                        NATIONAL ASSOCIATION, as Trustee and
                                        as Back-up Servicer

                                    By: /s/ Jennifer C. Davis
                                        ---------------------------------------
                                        Name: Jennifer C. Davis
                                        Title: Assistant Vice President

                                        2                    Servicing Agreement