Exhibit 10.2



SALE AND SERVICING AGREEMENT


by and among


USAA AUTO OWNER TRUST 2010-1


as Issuer


USAA ACCEPTANCE, LLC,


as Seller


USAA FEDERAL SAVINGS BANK,


as Servicer


and


THE BANK OF NEW YORK MELLON,


as Indenture Trustee


Dated as of February 24, 2010






TABLE OF CONTENTS


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
 ARTICLE I

 	
 DEFINITIONS
 AND USAGE

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 1.1

 	
 Definitions

 	
  

 	
 1

 
	
  

 	
 SECTION 1.2

 	
 Other
 Interpretive Provisions

 	
  

 	
 1

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE II

 	
  

 	
 CONVEYANCE
 OF TRANSFERRED ASSETS

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 2.1

 	
 Conveyance
 of Transferred Assets

 	
  

 	
 2

 
	
  

 	
 SECTION 2.2

 	
 Representations
 and Warranties of the Seller as to each Receivable

 	
  

 	
 2

 
	
  

 	
 SECTION 2.3

 	
 Repurchase
 upon Breach

 	
  

 	
 2

 
	
  

 	
 SECTION 2.4

 	
 Custody of
 Receivable Files

 	
  

 	
 3

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE III

 	
 ADMINISTRATION
 AND SERVICING OF RECEIVABLES AND TRUST PROPERTY

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 3.1

 	
 Duties of
 Servicer.

 	
  

 	
 5

 
	
  

 	
 SECTION 3.2

 	
 Collection
 of Receivable Payments

 	
  

 	
 6

 
	
  

 	
 SECTION 3.3

 	
 Realization
 Upon Receivables

 	
  

 	
 7

 
	
  

 	
 SECTION 3.4

 	
 Maintenance
 of Security Interests in Financed Vehicles

 	
  

 	
 8

 
	
  

 	
 SECTION 3.5

 	
 Covenants of
 Servicer

 	
  

 	
 8

 
	
  

 	
 SECTION 3.6

 	
 Purchase of
 Receivables Upon Breach

 	
  

 	
 9

 
	
  

 	
 SECTION 3.7

 	
 Servicing
 Fee

 	
  

 	
 9

 
	
  

 	
 SECTION 3.8

 	
 Servicer’s
 Certificate

 	
  

 	
 9

 
	
  

 	
 SECTION 3.9

 	
 Annual
 Officer’s Certificate; Notice of Servicer Replacement Event

 	
  

 	
 9

 
	
  

 	
 SECTION 3.10

 	
 Annual
 Registered Public Accounting Firm Attestation Report

 	
  

 	
 10

 
	
  

 	
 SECTION 3.11

 	
 Servicer
 Expenses

 	
  

 	
 10

 
	
  

 	
 SECTION 3.12

 	
 1934 Act
 Filings

 	
  

 	
 10

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE IV

 	
 DISTRIBUTIONS;
 ACCOUNTS; STATEMENTS TO THE CERTIFICATEHOLDER AND THE NOTEHOLDERS

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 4.1

 	
 Establishment
 of Accounts

 	
  

 	
 11

 
	
  

 	
 SECTION 4.2

 	
 Remittances

 	
  

 	
 13

 
	
  

 	
 SECTION 4.3

 	
 Additional
 Deposits and Payments

 	
  

 	
 13

 
	
  

 	
 SECTION 4.4

 	
 Distributions

 	
  

 	
 14

 
	
  

 	
 SECTION 4.5

 	
 Net Deposits

 	
  

 	
 15

 
	
  

 	
 SECTION 4.6

 	
 Statements
 to Certificateholder and Noteholders

 	
  

 	
 15

 
	
  

 	
 SECTION 4.7

 	
 No Duty to
 Confirm

 	
  

 	
 16

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE V

 	
 THE SELLER

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 5.1

 	
 Representations
 and Warranties of Seller

 	
  

 	
 17

 
	
  

 	
 SECTION 5.2

 	
 Liability of
 Seller; Indemnities

 	
  

 	
 18

 


i





TABLE OF CONTENTS
(continued)


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 5.3

 	
 Merger or
 Consolidation of, or Assumption of the Obligations of, Seller

 	
  

 	
 19

 
	
  

 	
 SECTION 5.4

 	
 Limitation
 on Liability of Seller and Others

 	
  

 	
 19

 
	
  

 	
 SECTION 5.5

 	
 Seller May
 Own Notes

 	
  

 	
 19

 
	
  

 	
 SECTION 5.6

 	
 Sarbanes-Oxley
 Act Requirements

 	
  

 	
 19

 
	
  

 	
 SECTION 5.7

 	
 Compliance
 with Organizational Documents

 	
  

 	
 20

 
	
  

 	
 SECTION 5.8

 	
 Perfection
 Representations, Warranties and Covenants

 	
  

 	
 20

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VI

 	
 THE SERVICER

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 6.1

 	
 Representations
 of Servicer

 	
  

 	
 20

 
	
  

 	
 SECTION 6.2

 	
 Indemnities
 of Servicer

 	
  

 	
 21

 
	
  

 	
 SECTION 6.3

 	
 Merger or
 Consolidation of, or Assumption of the Obligations of, Servicer

 	
  

 	
 22

 
	
  

 	
 SECTION 6.4

 	
 Limitation
 on Liability of Servicer and Others

 	
  

 	
 23

 
	
  

 	
 SECTION 6.5

 	
 Delegation
 of Duties

 	
  

 	
 23

 
	
  

 	
 SECTION 6.6

 	
 The Bank Not
 to Resign as Servicer

 	
  

 	
 24

 
	
  

 	
 SECTION 6.7

 	
 Servicer May
 Own Notes

 	
  

 	
 24

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VII

 	
 REPLACEMENT
 OF SERVICER

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 7.1

 	
 Replacement
 of Servicer

 	
  

 	
 24

 
	
  

 	
 SECTION 7.2

 	
 Notification
 to Noteholders

 	
  

 	
 26

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VIII

 	
 OPTIONAL
 PURCHASE 

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 8.1

 	
 Optional
 Purchase of Trust Estate

 	
  

 	
 26

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE IX

 	
 MISCELLANEOUS
 PROVISIONS

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 9.1

 	
 Amendment

 	
  

 	
 26

 
	
  

 	
 SECTION 9.2

 	
 Protection
 of Title

 	
  

 	
 28

 
	
  

 	
 SECTION 9.3

 	
 Other Liens
 or Interests

 	
  

 	
 29

 
	
  

 	
 SECTION 9.4

 	
 Transfers
 Intended as Sale; Security Interest

 	
  

 	
 29

 
	
  

 	
 SECTION 9.5

 	
 Notices, Etc

 	
  

 	
 30

 
	
  

 	
 SECTION 9.6

 	
 Choice of
 Law

 	
  

 	
 31

 
	
  

 	
 SECTION 9.7

 	
 Headings

 	
  

 	
 31

 
	
  

 	
 SECTION 9.8

 	
 Counterparts

 	
  

 	
 31

 
	
  

 	
 SECTION 9.9

 	
 Waivers

 	
  

 	
 31

 
	
  

 	
 SECTION 9.10

 	
 Entire
 Agreement

 	
  

 	
 31

 
	
  

 	
 SECTION 9.11

 	
 Severability
 of Provisions

 	
  

 	
 31

 
	
  

 	
 SECTION 9.12

 	
 Binding
 Effect

 	
  

 	
 31

 
	
  

 	
 SECTION 9.13

 	
 Acknowledgment
 and Agreement

 	
  

 	
 32

 
	
  

 	
 SECTION 9.14

 	
 Cumulative
 Remedies

 	
  

 	
 32

 
	
  

 	
 SECTION 9.15

 	
 Nonpetition
 Covenant

 	
  

 	
 32

 
	
  

 	
 SECTION 9.16

 	
 Submission
 to Jurisdiction; Waiver of Jury Trial

 	
  

 	
 32

 


ii





TABLE OF CONTENTS
(continued)


	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
 Page

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SECTION 9.17

 	
 Limitation
 of Liability

 	
  

 	
 33

 
	
  

 	
 SECTION 9.18

 	
 Third-Party
 Beneficiaries

 	
  

 	
 33

 
	
  

 	
 SECTION 9.19

 	
 Information
 Requests

 	
  

 	
 34

 
	
  

 	
 SECTION 9.20

 	
 Regulation
 AB

 	
  

 	
 34

 
	
  

 	
 SECTION 9.21

 	
 Information
 to Be Provided by the Indenture Trustee

 	
  

 	
 34

 
	
  

 	
 SECTION 9.22

 	
 Form 8-K
 Filings

 	
  

 	
 35

 
	
  

 	
 SECTION 9.23

 	
 Reserved

 	
  

 	
 35

 
	
  

 	
 SECTION 9.24

 	
 Further
 Assurances

 	
  

 	
 35

 
	
  

 	
 SECTION 9.25

 	
 Cooperation

 	
  

 	
 35

 






	
  

 	
  

 	
  

 	
  

 
	
 Appendix A

 	
 Definitions

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 Schedule I

 	
 Representations
 and Warranties With Respect to the Receivables

 	
  

 	
  

 
	
 Schedule II

 	
 Notice
 Addresses

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 Exhibit A

 	
 Form of
 Assignment pursuant to Sale and Servicing Agreement

 	
  

 	
  

 
	
 Exhibit B

 	
 Perfection
 Representations, Warranties and Covenants

 	
  

 	
  

 
	
 Exhibit C

 	
 Servicing
 Criteria to be Addressed in Indenture Trustee’s Assessment of Compliance

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 Exhibit D

 	
 Form of
 Indenture Trustee’s Annual Certification

 	
  

 	
  

 
	
 Exhibit E

 	
 Form of
 Indenture Trustee’s Annual Certification Regarding Item 1117 and
 Item 1119 of Regulation AB

 	
  

 	
  

 


iii






          SALE AND SERVICING AGREEMENT, dated as of
February 24, 2010 (together with all exhibits, schedules and appendices hereto
and as from time to time amended, supplemented or otherwise modified and in
effect, this “Agreement”), by and among USAA AUTO OWNER TRUST 2010-1 (the “Issuer”), a Delaware
statutory trust, USAA ACCEPTANCE, LLC,
a Delaware limited liability company, as seller (the “Seller”), USAA FEDERAL SAVINGS BANK, a federally
chartered savings association (the “Bank”), as servicer (in such
capacity, the “Servicer”), and THE
BANK OF NEW YORK MELLON, a banking corporation organized under the
laws of the State of New York, as indenture trustee (the “Indenture Trustee”).


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


          WHEREAS,
the Seller is willing to sell such portfolio of motor vehicle receivables and
related property to the Issuer; and


          WHEREAS,
the Bank is willing to service such motor vehicle receivables and related
property on behalf of the Issuer;


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


ARTICLE I


DEFINITIONS AND USAGE


          SECTION
1.1 Definitions. Except as otherwise
specified herein or as the context may otherwise require, capitalized terms
used but not otherwise defined herein are defined in Appendix
A hereto, which also contains rules as to usage that are applicable
herein.


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






ARTICLE II


CONVEYANCE OF TRANSFERRED ASSETS


          SECTION
2.1 Conveyance of Transferred Assets. In consideration of the Issuer’s
sale and delivery to, or upon the order of, the Seller of all of the Notes and
the Certificate on the Closing Date, the Seller does hereby irrevocably sell,
transfer, assign and otherwise convey to the Issuer without recourse (subject
to the obligations herein) all right, title and interest of the Seller, whether
now owned or hereafter acquired, in and to the Transferred Assets, described in
the assignment substantially in the form of Exhibit A (the “Assignment”)
delivered on the Closing Date. The sale, transfer, assignment and conveyance
made hereunder will not constitute and is not intended to result in an
assumption by the Issuer of any obligation of the Seller or the Originator to
the Obligors or any other Person in connection with the Receivables or the
other assets and properties conveyed hereunder or any agreement, document or
instrument related thereto.


          SECTION
2.2 Representations and Warranties of the Seller as to each Receivable.
The Seller hereby makes the representations and warranties set forth on Schedule
I as to the Receivables sold, transferred, assigned, and otherwise conveyed
to the Issuer under this Agreement on which such representations and warranties
the Issuer relies in acquiring the Receivables. The representations and
warranties as to each Receivable shall survive the Grant of the Receivables by
the Issuer to the Indenture Trustee pursuant to the Indenture. Notwithstanding
any statement to the contrary contained herein or in any other Transaction
Document, the Seller shall not be required to notify any insurer with respect
to any Insurance Policy obtained by an Obligor.


          SECTION
2.3 Repurchase upon Breach. Upon discovery by any party hereto of a
breach of any of the representations and warranties set forth in Section 2.2
at the time such representations and warranties were made which materially and
adversely affects the interests of the Issuer or the Noteholders, the party
discovering such breach shall give prompt written notice thereof to the other
parties hereto; provided, that delivery of the Servicer’s
Certificate which identifies that Receivables are being or have been
repurchased shall be deemed to constitute prompt notice by the Servicer (if the
Bank is the Servicer) of such breach; provided, further, that the failure to give
such notice shall not affect any obligation of the Seller hereunder. If the
Seller does not correct or cure such breach prior to the end of the Collection
Period which includes the 60th day (or, if the Seller elects, an earlier date)
after the date that the Seller became aware or was notified of such breach,
then the Seller shall purchase any Receivable materially and adversely affected
by such breach from the Issuer on the Payment Date following the end of such
Collection Period (or, if the Seller elects, an earlier date). Any such breach
or failure will not be deemed to have a material and adverse effect if such
breach or failure does not affect the ability of the Issuer to collect, receive
and retain timely payment in full on such Receivable, including Liquidation
Proceeds. Any such purchase by the Seller shall be at a price equal to the
Repurchase Price. In consideration for such repurchase, the Seller shall make
(or shall cause to be made) a payment to the Issuer equal to the Repurchase
Price by depositing such amount into the Collection Account prior to 11:00
a.m., New York City time on such Payment Date, or earlier date, if elected by
the Seller. Upon payment of such Repurchase Price by the Seller, the Issuer and
the Indenture Trustee shall release and shall execute and deliver such
instruments of 


	
  

 	
  

 	
  

 
	

  

 	
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Sale and Servicing Agreement

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release,
transfer or assignment, in each case without recourse or representation, as
shall be reasonably requested of it to vest in the Seller or its designee any
Receivable repurchased pursuant hereto. It is understood and agreed that the
right to cause the Seller to purchase (or to enforce the obligations of the
Bank under the Purchase Agreement to purchase) any Receivable as described
above shall constitute the sole remedy respecting such breach available to the
Issuer and the Indenture Trustee. Neither the Owner Trustee nor the Indenture
Trustee will have any duty to conduct an affirmative investigation as to the
occurrence of any condition requiring the repurchase of any Receivable pursuant
to this Section 2.3. Notwithstanding anything herein to the contrary,
the Seller shall only be obligated to pay such Repurchase Price and repurchase
the related Receivable to the extent it receives the Repurchase Price from the
Bank pursuant to Section 3.3 of the Purchase Agreement.


          SECTION
2.4 Custody of Receivable Files.


          (a)
Custody. To assure uniform quality in servicing the Receivables and to
reduce administrative costs, the Issuer and the Indenture Trustee, upon the
execution and delivery of this Agreement, hereby revocably appoint the
Servicer, and the Servicer hereby accepts such appointment, to act solely on
behalf of and for the benefit of the Indenture Trustee as custodian of the
following documents or instruments, but only to the extent held in tangible
paper form or electronic form, which are hereby or will hereby be
constructively delivered to the Indenture Trustee (or its agent or designee),
as pledgee of the Issuer pursuant to the Indenture with respect to each
Receivable (but only to the extent applicable to such Receivable and only to
the extent held in tangible paper form) (the “Receivable Files”):


	
  

 	
  

 	
  

 
	
  

 	
 (i)

 	
 the fully
 executed original of the retail motor vehicle installment loan or promissory
 note and security agreement related to such Receivable (with respect to
 tangible chattel paper) or an “authoritative copy” (as such term is used in
 Section 9-105 of the UCC) of the Receivable (with respect to electronic
 chattel paper) or, if no such original executed Receivable or authoritative
 copy exists, a copy thereof, including any written amendments or extensions
 thereto;

 
	
  

 	
  

 	
  

 
	
  

 	
 (ii)

 	
 the original
 credit application or a photocopy thereof to the extent held in paper form;

 
	
  

 	
  

 	
  

 
	
  

 	
 (iii)

 	
 the original
 Certificate of Title or, if not yet received, evidence that an application
 therefore has been submitted with the appropriate authority or such other
 document (electronic or otherwise, as used in the applicable jurisdiction)
 that the Servicer keeps on file, in accordance with its Customary Servicing
 Practices, evidencing the security interest of the Originator in the Financed
 Vehicle; provided, however, that in lieu of being held in the Receivable
 File, the Certificate of Title may be held by a third party service provider
 engaged by the Servicer to obtain or hold Certificates of Title; and

 
	
  

 	
  

 	
  

 
	
  

 	
 (iv)

 	
 any and all
 other documents that the Servicer or the Seller keeps on file, in accordance
 with its Customary Servicing Practices, relating to a 

 





	
  

 	
  

 	
  

 
	

  

 	
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Sale and Servicing Agreement

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 Receivable,
 an Obligor or a Financed Vehicle (but only to the extent applicable to such
 Receivable and only to the extent held in tangible paper form or electronic
 form).

 



The foregoing
appointment of the Servicer is deemed to be made with due care.


          (b)
Safekeeping. The Servicer, in its capacity as custodian, shall hold the
Receivable Files for the benefit of the Issuer and the Indenture Trustee. In
performing its duties as custodian, the Servicer shall act in accordance with
its Customary Servicing Practices. The Servicer, in accordance with its Customary
Servicing Practices: (i) may maintain all or a portion of the Receivable Files
in electronic form and (ii) may maintain custody of all or any portion of the
Receivable Files with one or more of its agents or designees.


          (c)
Maintenance of and Access to Records. The Servicer will maintain each
Receivable File in the United States (it being understood that the Receivable
Files, or any part thereof, may be maintained at the offices of any Person to
whom the Servicer has delegated responsibilities in accordance with Section
6.5). The Servicer will make available to the Issuer and the Indenture
Trustee or their duly authorized representatives, attorneys or auditors a list
of locations of the Receivable Files upon request. The Servicer will provide
access to the Receivable Files, and the related accounts records, and computer
systems maintained by the Servicer at such times as the Issuer or the Indenture
Trustee direct, but only upon reasonable notice and during the normal business
hours, which do not unreasonably interfere with the Servicer’s normal
operations, at the respective offices of the Servicer.


          (d)
Release of Documents. Upon written instructions from the Indenture Trustee,
the Servicer will release or cause to be released any document in the
Receivable Files to the Indenture Trustee, the Indenture Trustee’s agent or the
Indenture Trustee’s designee, as the case may be, at such place or places as
the Indenture Trustee may designate, as soon thereafter as is practicable, to
the extent it does not unreasonably interfere with the Servicer’s normal
operations. The Servicer shall not be responsible for any loss occasioned by
the failure of the Indenture Trustee or its agent or designee to return any
document or any delay in doing so. Any document so released will be handled by
the Indenture Trustee with due care and returned to the Servicer for
safekeeping as soon as the Indenture Trustee or its agent or designee, as the
case may be, has no further need therefor.


          (e)
Instructions; Authority to Act. All instructions from the Indenture
Trustee will be in writing and signed by a Responsible Officer of the Indenture
Trustee, and the Servicer will be deemed to have received proper instructions
with respect to the Receivable Files upon its receipt of such written
instructions. 


          (f)
Custodian’s Indemnification. Subject to Section
6.2, the Servicer as custodian will indemnify the Issuer and the
Indenture Trustee for any and all claims, liabilities, obligations, losses,
compensatory damages, payments, costs, or expenses of any kind whatsoever that
may be imposed on, incurred by, or asserted against the Issuer or the Indenture
Trustee as the result of any act or omission in any way relating to the
maintenance and custody by the Servicer as custodian of the Receivable Files; provided, however,
that the Servicer will not be liable (i) to the Indenture Trustee or the Issuer
for any portion of any such amount resulting from the willful



	
  

 	
  

 	
  

 
	

  

 	
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misconduct,
bad faith or negligence of the Indenture Trustee or the Issuer or (ii) to the
Indenture Trustee for any portion of any such amount resulting from the failure
of the Indenture Trustee, the Indenture Trustee’s agent or the Indenture
Trustee’s designee to handle with due care any Certificate of Title or other
document released to the Indenture Trustee or the Indenture Trustee’s agent or
designee pursuant to Section 2.4(d).


          (g)
Effective Period and Termination. The Servicer’s appointment as
custodian will become effective as of the Cut-Off Date and will continue in
full force and effect until terminated pursuant to this Section 2.4(g).
If the Bank resigns as Servicer in accordance with Section 6.6 or if all
of the rights and obligations of the Servicer have been terminated under Section
7.1, the appointment of the Servicer as custodian hereunder may be
terminated by the Indenture Trustee, or by the Noteholders evidencing not less
than 662⁄3% of the Note Balance of the Controlling Class, in the same
manner as the Indenture Trustee or such Noteholders may terminate the rights
and obligations of the Servicer under Section 7.1. As soon as
practicable after any termination of such appointment, the Servicer will
deliver to the Indenture Trustee (or, at the direction of the Indenture
Trustee, to its agent) the Receivable Files and the related accounts and
records maintained by the Servicer at such place or places as the Indenture
Trustee may reasonably designate; provided, however, that with respect to
authoritative copies of the Receivables constituting electronic chattel paper,
the Servicer, in its sole discretion, shall either (i) continue to hold any
such authoritative copies on behalf of the Issuer and the Indenture Trustee or
the Indenture Trustee’s agent or (ii) deliver copies of such authoritative
copies and destroy the authoritative copies maintained by the Servicer prior to
its termination such that such copy delivered to the Indenture Trustee or the
Indenture Trustee’s agent becomes the authoritative copy of the Receivable
constituting electronic chattel paper.


ARTICLE III


ADMINISTRATION AND SERVICING OF

RECEIVABLES AND TRUST PROPERTY


          SECTION
3.1 Duties of Servicer. 


          (a)
The Servicer is hereby appointed by the Issuer and authorized to act as agent
for the Issuer and in such capacity shall manage, service, administer and make
collections on the Receivables in accordance with its Customary Servicing
Practices, using the degree of skill and attention that the Servicer exercises
with respect to all comparable motor vehicle receivables that it services for
itself or others. The Servicer’s duties will include collection and posting of
all payments, responding to inquiries of Obligors on such Receivables,
investigating delinquencies, sending invoices or payment coupons to Obligors,
reporting any required tax information to Obligors, accounting for collections
and furnishing monthly and annual statements to the Indenture Trustee with
respect to distributions. The Servicer is not required under the Transaction
Documents to make any disbursements via wire transfer or otherwise on behalf of
an Obligor. There are no requirements under the Receivables or the Transaction
Documents for funds to be, and funds shall not be, held in trust for an
Obligor. No payments or disbursements are required to be made by the Servicer
on behalf of the Obligor. The Servicer hereby accepts such appointment and
authorization and agrees to perform the duties of Servicer with respect to the
Receivables set forth herein.






	
  

 	
  

 	
  

 
	

  

 	
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Sale and Servicing Agreement

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          (b)
The Servicer will follow its Customary Servicing Practices and will have full
power and authority to do any and all things in connection with such managing,
servicing, administration and collection that it may deem necessary or
desirable. Without limiting the generality of the foregoing, the Servicer is
hereby authorized and empowered to execute and deliver, on behalf of itself,
the Issuer, the Owner Trustee, the Indenture Trustee, the Noteholders, the
Certificateholder, or any 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 Receivables or to the Financed Vehicles
securing such Receivables. The Servicer is hereby authorized to commence, in
its own name or in the name of the Issuer, a legal Proceeding to enforce a
Receivable or to commence or participate in any other legal Proceeding
(including a bankruptcy Proceeding) relating to or involving a Receivable, an
Obligor or a Financed Vehicle. If the Servicer commences a legal Proceeding to
enforce a Receivable, the Issuer will thereupon be deemed to have automatically
assigned such Receivable to the Servicer solely for purposes of commencing or
participating in any such Proceeding as a party or claimant, and the Servicer
is authorized and empowered by the Issuer to execute and deliver in the
Servicer’s name any notices, demands, claims, complaints, responses, affidavits
or other documents or instruments in connection with any such Proceeding. If in
any enforcement suit or legal Proceeding it is held that the Servicer may not
enforce a Receivable on the ground that it is not a real party in interest or a
holder entitled to enforce the Receivable, the Issuer will, at the Servicer’s
expense and direction, take steps to enforce the Receivable, including bringing
suit in its name or the name of the Indenture Trustee. The Issuer will furnish
the Servicer with any powers of attorney and other documents reasonably
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder. The Servicer, at its expense, will obtain on
behalf of the Issuer all licenses, if any, reasonably requested by the Seller
to be held by the Issuer in connection with ownership of the Receivables, and
will make all filings and pay all fees as may be required in connection
therewith during the term hereof.


          (c)
The Servicer hereby agrees that upon its resignation and the appointment of a
successor Servicer hereunder, the Servicer will terminate its activities as
Servicer hereunder in accordance with Section 7.1, and, in any case, in a
manner which the Indenture Trustee reasonably determines will facilitate the
transition of the performance of such activities to such successor Servicer,
and the Servicer shall cooperate with and assist such successor Servicer. 


          SECTION
3.2 Collection of Receivable Payments.


          (a)
The Servicer will make reasonable efforts to collect all payments called for
under the terms and provisions of the Receivables as and when the same become
due in accordance with its Customary Servicing Practices. Subject to Section
3.5, the Servicer may grant extensions, rebates, deferrals, amendments,
modifications or adjustments with respect to any Receivable in accordance with
its Customary Servicing Practices; provided,
however, that if the Servicer (i)
extends the date for final payment by the Obligor of any Receivable beyond the
last day of the Collection Period preceding the latest Final Scheduled Payment
Date of any Notes issued under the Indenture or (ii) reduces the Contract Rate
or Outstanding Principal Balance with respect to any Receivable other than as
required by applicable law (including, without limitation, by the
Servicemembers Civil Relief Act of 2003, as amended), it will promptly purchase
such Receivable in the manner provided in Section 3.6; provided,
further, that the Servicer shall not make any modification described
in the preceding clause (i) or (ii) that would




	
  

 	
  

 	
  

 
	

  

 	
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trigger a
repurchase pursuant to the above provisions or pursuant to Section 3.6,
in either case for the sole purpose of enabling the Servicer to purchase a
Receivable from the Issuer and provided, further, that any change
referred to in this Section 3.2 shall only be made if either (a) the Obligor
is in default or, in the judgment of the Servicer, is reasonably expected to
default in the near future, or (b) the change is to the payment due date of a
Receivable, does not exceed 25 days and is made not more than twice during the
term of such Receivable. 


          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 Receivable. Subject
to the provisos of the second sentence of the first paragraph of this Section 3.2,
the Servicer and its Affiliates may engage in any marketing practice or
promotion or any sale of any products, goods or services to Obligors with
respect to the Receivables for the account of the Servicer and/or its
Affiliates (but not the Issuer) so long as such practices, promotions or sales
are offered to obligors of comparable motor vehicle receivables serviced by the
Servicer for itself and others, whether or not such practices, promotions or
sales might indirectly result in a decrease in the aggregate amount of payments
made (but not any related contractual obligation) on the Receivables,
prepayments or faster or slower timing of the payment of the Receivables.
Notwithstanding anything in this Agreement to the contrary, the Servicer may
refinance any Receivable by (a) making a new loan to the Obligor and depositing
the full Outstanding Principal Balance of such refinanced Receivable into the
Collection Account or (b) by causing the Issuer to effect a substantive
modification to the Receivable when the request for such modification is the
result of a contact from or request of the related Obligor, in which case the
Receivable shall be deemed to be refinanced and the Servicer shall promptly
deposit the full Outstanding Principal Balance of such refinanced Receivable
into the Collection Account as soon as practical. The receivable created by
such refinancing shall not be property of the Issuer, in the case of (b) in the
prior sentence, upon the Servicer’s related payment to Issuer. The Servicer and
its Affiliates may also sell insurance or debt cancellation products, including
products which result in the repayment of some or all of the amount of a
Receivable owned by the Issuer upon the death or disability of the Obligor or
any casualty with respect to the Financed Vehicle.


          (b)
The Servicer shall not be required to make any advances of funds or guarantees
regarding collections, cash flows or distributions. Payments on the
Receivables, including payoffs, made in accordance with the related documentation
for such Receivables, shall be posted to the Servicer’s Obligor records in
accordance with the Servicer’s Customary Servicing Practices. Such payments
shall be allocated to principal, interest or other items in accordance with the
related documentation for such Receivables.


          (c)
Records documenting collection efforts shall be maintained during the period a
Receivable is delinquent in accordance with the Servicer’s Customary Servicing
Practices. Such records shall be maintained on at least a periodic basis that
is not less frequent than the Servicer’s Customary Servicing Practices, and
describe the entity’s activities in monitoring delinquent pool assets
including, for example, phone calls, letters and payment rescheduling plans in
cases where delinquency is deemed temporary (e.g., illness or unemployment) in
accordance with the Servicer’s Customary Servicing Practices.


          SECTION
3.3 Realization Upon Receivables. On behalf of the Issuer, the Servicer
will use commercially reasonable efforts, consistent with its Customary
Servicing Practices, to


	
  

 	
  

 	
  

 
	

  

 	
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repossess or
otherwise convert the ownership of the Financed Vehicle securing any Receivable
as to which the Servicer has determined eventual payment in full is unlikely
unless it determines in its sole discretion that repossession will not increase
the Liquidation Proceeds by an amount greater than the expense of such
repossession or that the proceeds ultimately recoverable with respect to such Receivable
would be increased by forbearance. The Servicer will follow such Customary
Servicing Practices as it deems necessary or advisable, which may include
selling the Financed Vehicle at public or private sale and which shall not,
except as provided below, involve the sale of all, or any portion of, a
Receivable. The foregoing shall be subject to the provision that, in any case
in which the Financed Vehicle has suffered damage, the Servicer shall not be
required to expend funds in connection with the repair or the repossession of
such Financed Vehicle unless it shall determine in its discretion that such
repair and/or repossession will increase the Liquidation Proceeds by an amount
greater than the amount of such expenses. The Servicer, in its sole discretion,
may in accordance with its Customary Servicing Practices purchase from the
Issuer any Receivable’s deficiency balance (i.e., the remaining balance of a
Receivable after deduction of all Liquidation Proceeds with respect to such
Receivable) for a purchase price equal to the fair value of the deficiency
balance as determined by the Servicer at the time of purchase by the Servicer,
which purchase price shall not be adjusted by the proceeds the Servicer
ultimately realizes from its disposition or collection efforts related to the
deficiency amount. Net proceeds of any such sale to the Servicer will
constitute Liquidation Proceeds, and the sole right of the Issuer and the
Indenture Trustee with respect to any such sold Receivables will be to receive
such Liquidation Proceeds. Upon such sale, the Servicer will mark its computer
records indicating that any such receivable sold is no longer a Receivable. The
Servicer is authorized to take any and all actions necessary or appropriate on
behalf of the Issuer to evidence the sale of the Financed Vehicle at public or
private sale or the sale of the Receivable to the Servicer pursuant to the
provisions of this paragraph free from any Lien or other interest of the Issuer
or the Indenture Trustee.


          SECTION
3.4 Maintenance of Security Interests in Financed Vehicles. The Servicer
will, in accordance with its Customary Servicing Practices, take such steps as
are necessary to maintain perfection of the security interest created by each
Receivable in the related Financed Vehicle. The provisions set forth in this
Section are the sole requirements under the Transaction Documents with respect
to the maintenance of collateral or security on the Receivables. It is
understood that the Financed Vehicles are the collateral and security for the
Receivables, but that the certificate of title with respect to a Financed
Vehicle does not constitute collateral and merely evidences such security
interest. The Issuer hereby authorizes the Servicer to take such steps as are
necessary to re-perfect such security interest on behalf of the Issuer and the
Indenture Trustee in the event of the relocation of a Financed Vehicle or for
any other reason.


          SECTION
3.5 Covenants of Servicer. Unless required by law or court order, the Servicer
will not release the Financed Vehicle securing each such Receivable from the
security interest granted by such Receivable in whole or in part except (a) in
the event of payment in full by or on behalf of the Obligor thereunder or
payment in full less a deficiency which the Servicer would not attempt to
collect in accordance with its Customary Servicing Practices, (b) in connection
with repossession or (c) except as may be required by an insurer in order to
receive proceeds from any Insurance Policy covering such Financed Vehicle.


	
  

 	
  

 	
  

 
	

  

 	
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          SECTION
3.6 Purchase of Receivables Upon Breach. Upon discovery by any party
hereto of a breach of any of the covenants set forth in Section 3.2, 3.3,
3.4 or 3.5 which materially and adversely affects the interests
of the Issuer or the Noteholders, the party discovering such breach shall give
prompt written notice thereof to the other parties hereto; provided, that delivery of the Servicer’s
Certificate, which identifies the Receivables that are being or have been
repurchased, shall be deemed to constitute prompt notice by the Servicer and
the Issuer of such breach with respect to such repurchased Receivable; provided,
further,
that the failure to give such notice shall not affect any obligation of the
Servicer hereunder. If the Servicer does not correct or cure such breach prior
to the end of the Collection Period which includes the 60th day (or, if the
Servicer elects, an earlier date) after the date that the Servicer became aware
or was notified of such breach, then the Servicer shall purchase any Receivable
materially and adversely affected by such breach from the Issuer on the Payment
Date following the end of such Collection Period. Any such breach or failure
will not be deemed to have a material and adverse effect if such breach or
failure does not affect the ability of the Issuer to receive and retain timely
payment in full on such Receivable. Any such purchase by the Servicer shall be
at a price equal to the Repurchase Price. In consideration for such repurchase,
the Servicer shall make (or shall cause to be made) a payment to the Issuer
equal to the Repurchase Price by depositing such amount into the Collection
Account prior to 11:00 a.m., New York City time on such Payment Date. Upon
payment of such Repurchase Price by the Servicer, the Issuer and the Indenture
Trustee shall release and shall execute and deliver such instruments of
release, transfer or assignment, in each case without recourse or
representation, as shall be reasonably necessary to vest in the Servicer or its
designee any Receivable repurchased pursuant hereto. It is understood and
agreed that the obligation of the Servicer to purchase any Receivable as
described above shall constitute the sole remedy respecting such breach
available to the Issuer and the Indenture Trustee.


          SECTION
3.7 Servicing Fee. On each Payment Date, the Issuer shall pay to the
Servicer the Servicing Fee in accordance with Section 4.4 for the
immediately preceding Collection Period as compensation for its services. In
addition, the Servicer will be entitled to retain all Supplemental Servicing
Fees. The Servicer also will be entitled to receive investment earnings (net of
investment losses and expenses) on funds deposited in the Collection Account
during each Collection Period.


          SECTION
3.8 Servicer’s Certificate. On or before the Determination Date
preceding each Payment Date, the Servicer shall deliver to the Indenture
Trustee, and each Paying Agent, and the Indenture Trustee shall forward such
copy to each of the Rating Agencies, a Servicer’s Certificate containing all
information necessary to make the payments, transfers and distributions
pursuant to Sections 4.3 and 4.4 on such Payment Date. At the
sole option of the Servicer, each Servicer’s Certificate may be delivered in
electronic or hard copy format.


          SECTION
3.9 Annual Officer’s Certificate; Notice of Servicer Replacement Event.
(a) So long as the Seller is filing any reports with respect to the Issuer
under the Exchange Act, the Servicer will deliver to the Rating Agencies, the
Issuer and the Indenture Trustee, on or before March 30 of each calendar
year, beginning on March 30, 2011, an Officer’s Certificate (with appropriate
insertions) providing such information as is required under Item 1123 of
Regulation AB.

	
  

 	
  

 	
  

 
	

  

 	
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          (b)
The Servicer will deliver to the Issuer, the Indenture Trustee and each Rating
Agency promptly after having obtained knowledge thereof written notice in an
Officer’s Certificate of any event which with the giving of notice or lapse of
time, or both, would become a Servicer Replacement Event. Except to the extent
set forth in this Section 3.9(b) and Sections 7.2 and 9.22
of this Agreement and Section 3.12 of the Indenture, the Transaction
Documents do not require any policies or procedures to monitor any performance
or other triggers and events of default.


          (c)
So long as the Seller is filing any reports with respect to the Issuer under
the Exchange Act, the Servicer will deliver to the Issuer, on or before
March 30 of each year, beginning on March 30, 2011, a report regarding the
Servicer’s assessment of compliance with the Servicing Criteria during the
immediately preceding calendar year (or since the Closing Date in the case of
the first such report), including disclosure of any material instance of
non-compliance identified by the Servicer, as required under paragraph (b) of
Rule 13a-18 and Rule 15d-18 of the Exchange Act and Item 1122 of Regulation AB.


          SECTION
3.10 Annual Registered Public Accounting Firm Attestation Report. So
long as the Seller is filing any reports with respect to the Issuer under the
Exchange Act, on or before the 90th day following the end of each fiscal year,
beginning with the fiscal year ending December 31, 2010, the Servicer
shall cause a firm of independent registered public accountants (who may also
render other services to the Servicer, the Seller or their respective Affiliates)
to furnish to the Indenture Trustee, the Servicer, the Seller and each Rating
Agency each attestation report on assessments of compliance with the Servicing
Criteria with respect to the Servicer or any Affiliate thereof during the
related fiscal year (or since the Closing Date in the case of the first such
report) delivered by such accountants pursuant to paragraph (c) of Rule 13a-18
or Rule 15d-18 of the Exchange Act and Item 1122 of Regulation AB. The certification required by this paragraph
may be replaced by any similar certification using other procedures or
attestation standards which are now or in the future in use by servicers of
comparable assets, or which otherwise comply with any rule, regulation, “no
action” letter or similar guidance promulgated by the Commission.


          SECTION
3.11 Servicer Expenses. The Servicer shall pay all expenses (other than
expenses described in the definition of Liquidation Proceeds) incurred by it in
connection with its activities hereunder, independent accountants, taxes
imposed on the Servicer and expenses incurred in connection with distributions
and reports to the Noteholders and the Certificateholder. The Servicer shall
also pay all fees, expenses, and indemnities of the Indenture Trustee (as
described in, and pursuant to the limitations set forth in Section 6.7
of the Indenture) and the Owner Trustee (as described in, and pursuant to the
limitations set forth in, Sections 8.1 and 8.2 of the Trust
Agreement). The compensation and indemnity obligations of the Servicer to the
Indenture Trustee hereunder and pursuant to Section 6.7 of the Indenture
shall survive the resignation or removal of the Indenture Trustee and the
Servicer, the discharge of the Indenture and the termination of this Agreement.


          SECTION
3.12 1934 Act Filings. The Issuer hereby authorizes the Servicer and the
Seller, or either of them, to prepare, sign, certify and file any and all
reports, statements and information with respect to the Issuer and/or the Notes
required to be filed pursuant to the Exchange Act, and the rules thereunder.


	
  

 	
  

 	
  

 
	

  

 	
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ARTICLE IV


DISTRIBUTIONS; ACCOUNTS;

STATEMENTS TO THE CERTIFICATEHOLDER

AND THE NOTEHOLDERS


          SECTION
4.1 Establishment of Accounts. (a) The Servicer shall cause to be
established:


	
  

 	
  

 	
  

 
	
  

 	
 (i)

 	
 For the
 benefit of the Noteholders, in the name of the Indenture Trustee, an Eligible
 Account (the “Collection Account”), bearing a designation
 clearly indicating that the funds deposited therein are held for the benefit of
 the Noteholders, which Eligible Account shall be established by and
 maintained with the Indenture Trustee or its designee. No checks shall be
 issued, printed or honored with respect to the Collection Account.

 
	
  

 	
  

 	
  

 
	
  

 	
 (ii)

 	
 For the
 benefit of the Noteholders, in the name of the Indenture Trustee, an Eligible
 Account (the “Principal Distribution Account”), which may be a subaccount of
 the Collection Account, bearing a designation clearly indicating that the
 funds deposited therein are held for the benefit of the Noteholders, which
 Eligible Account shall be established by and maintained with the Indenture
 Trustee or its designee. No checks shall be issued, printed or honored with
 respect to the Principal Distribution Account.

 
	
  

 	
  

 	
  

 
	
  

 	
 (iii)

 	
 For the
 benefit of the Noteholders, in the name of the Indenture Trustee, an Eligible
 Account (the “Reserve Account”), bearing a designation clearly
 indicating that the funds deposited therein are held for the benefit of the
 Noteholders, which Eligible Account shall be established by and maintained
 with the Indenture Trustee or its designee. No checks shall be issued,
 printed or honored with respect to the Reserve Account.

 



          (b)
Funds on deposit in the Collection Account and the Reserve Account
(collectively, with the Principal Distribution Account, the “Trust Accounts”)
shall be invested by the Indenture Trustee in Permitted Investments selected in
writing by the Servicer and of which the Servicer provides notification
(pursuant to standing instructions or otherwise); provided, that it is understood
and agreed that neither the Servicer, the Indenture Trustee nor the Issuer
shall be liable for any loss arising from such investment in Permitted
Investments. If the Bank of New York Mellon is the Indenture Trustee, in the
absence of such written investment direction, all funds shall be invested in
one or more Permitted Investments in accordance with the standing instructions
most recently given by the Servicer or should that for any reason not be
possible such funds shall be retained uninvested. All such Permitted
Investments shall be held by or on behalf of the Indenture Trustee as secured
party for the benefit of the Noteholders; provided, that on each Payment Date all
interest and other investment income (net of losses and investment expenses) on
funds on deposit in the Collection Account shall be distributed to the Servicer
as additional servicing compensation and shall not be available to pay the
distributions provided for in Section 4.4. All investments of funds on
deposit in the Trust Accounts shall mature so that


	
  

 	
  

 	
  

 
	

  

 	
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such funds
will be available by 10:00 a.m. New York City time on the next Payment Date. No
Permitted Investment shall be sold or otherwise disposed of prior to its scheduled
maturity unless a default occurs with respect to such Permitted Investment and
the Servicer directs the Indenture Trustee in writing to dispose of such
Permitted Investment. For the avoidance of doubt, with respect to each Payment
Date, any interest and other income earned on funds in deposit in the Trust
Accounts from the Business Day prior to such Payment Date through such Payment
Date shall be paid to the Servicer.


          (c)
The Indenture Trustee shall possess all right, title and interest in all funds
on deposit from time to time in the Trust Accounts and in all proceeds thereof
and all such funds, investments and proceeds shall be part of the Trust Estate.
Except as otherwise provided herein, the Trust Accounts shall be under the sole
dominion and control of the Indenture Trustee for the benefit of the
Noteholders. If, at any time, any Trust Account ceases to be an Eligible
Account, the Servicer shall promptly notify the Indenture Trustee in writing
(unless such Trust Account is an account with the Indenture Trustee) and within
10 Business Days (or such longer period as to which each Rating Agency may
consent) after becoming aware of the fact, establish a new Trust Account as an
Eligible Account and shall direct the Indenture Trustee to transfer any cash
and/or any investments to such new Trust Account. 


          (d)
With respect to the Trust Account Property, the parties hereto agree that:


	
  

 	
  

 	
  

 
	
  

 	
 (i)

 	
 any Trust
 Account Property that consists of uninvested funds shall be held solely in
 Eligible Accounts and, except as otherwise provided herein, each such
 Eligible Account shall be subject to the exclusive custody and control of the
 Indenture Trustee, and, except as otherwise provided in the Transaction
 Documents, the Indenture Trustee or its designee shall have sole signature
 authority with respect thereto;

 
	
  

 	
  

 	
  

 
	
  

 	
 (ii)

 	
 any Trust
 Account Property that constitutes Physical Property shall be delivered to the
 Indenture Trustee or its designee, in accordance with paragraph (a)
 of the definition of “Delivery” and shall be held, pending maturity or
 disposition, solely by the Indenture Trustee or any such designee;

 
	
  

 	
  

 	
  

 
	
  

 	
 (iii)

 	
 any Trust
 Account Property that is an “uncertificated security” under Article 8 of the
 UCC and that is not governed by clause (iv) below shall be delivered to the Indenture
 Trustee or its designee in accordance with paragraph (c) of the definition
 of “Delivery” and shall be maintained by the Indenture Trustee or such
 designee, pending maturity or disposition, through continued registration of
 the Indenture Trustee’s (or its designee’s) ownership of such security on the
 books of the issuer thereof; and

 
	
  

 	
  

 	
  

 
	
  

 	
 (iv)

 	
 any Trust
 Account Property that is an uncertificated security that is a “book-entry
 security” (as such term is defined in Federal Reserve Bank Operating Circular
 No. 7) held in a securities account at a Federal Reserve Bank and eligible
 for transfer through the Fedwire® Securities Service

 




	
  

 	
  

 	
  

 
	

  

 	
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 operated by
 the Federal Reserve System pursuant to Federal book-entry regulations shall
 be delivered in accordance with paragraph (b) of the definition of “Delivery” and shall be
 maintained by the Indenture Trustee or its designee or a securities
 intermediary (as such term is defined in Section 8-102(a)(14) of the UCC)
 acting solely for the Indenture Trustee or such designee, pending maturity or
 disposition, through continued book-entry registration of such Trust Account
 Property as described in such paragraph.

 



          (e)
Except for the Collection Account, the Reserve Account and the Principal
Distribution Account, there are no accounts required to be maintained under the
Transaction Documents. No checks shall be issued, printed or honored with
respect to the Collection Account, the Reserve Account or the Principal
Distribution Account.


          SECTION
4.2 Remittances. The Servicer shall deposit an amount equal to all
Collections into the Collection Account within two Business Days after
identification; provided, however, that if the Monthly Remittance
Condition is satisfied, then the Servicer shall not be required to deposit into
the Collection Account an amount equal to the Collections received during any
Collection Period until 10:00 a.m., New York City time, on the following
Payment Date (or the Business Day preceding each Payment Date if the Collection
Account is not maintained at the Indenture Trustee). The “Monthly Remittance
Condition” shall be deemed to be satisfied if (i) the Bank or one of its
Affiliates is the Servicer, (ii) no Servicer Replacement Event has occurred and
is continuing and (iii) USAA Capital Corporation has a short-term debt rating
of at least “P1” from Moody’s and “A1” from Standard & Poor’s.
Notwithstanding the foregoing, the Servicer may remit Collections to the
Collection Account on any other alternate remittance schedule (but not later
than the related Payment Date) if the Rating Agency Condition is satisfied with
respect to such alternate remittance schedule. Pending deposit into the
Collection Account, Collections may be commingled and used by the Servicer at
its own risk and are not required to be segregated from its own funds. The
Indenture Trustee shall not be deemed to have knowledge of any event or
circumstance included in the definition of Monthly Remittance Condition that
would require early remittance of such funds unless a Responsible Officer of
the Indenture Trustee has actual knowledge thereof.


          SECTION
4.3 Additional Deposits and Payments. (a) On each Payment Date, the
Servicer and the Seller will deposit into the Collection Account the aggregate
Repurchase Price with respect to Repurchased Receivables purchased by the
Servicer pursuant to Section 3.6 or the Seller pursuant to Section
2.3, respectively, on such Payment Date and the Servicer will deposit (or
will cause the applicable purchaser to deposit) into the Collection Account all
amounts, if any, to be paid under Section 8.1 in connection with the
Optional Purchase. All such deposits with respect to a Payment Date will be
made, in immediately available funds by 10:00 a.m., New York City time, on such
Payment Date related to such Collection Period.


          (b)
The Servicer will calculate the Reserve Account Excess Amount for each Payment
Date and instruct the Indenture Trustee to, on each Payment Date, withdraw from
the Reserve Account the Reserve Account Excess Amount, if any, for such Payment
Date and deposit such amount in the Collection Account.

	
  

 	
  

 	
  

 
	

  

 	
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          (c)
The Servicer will calculate the Reserve Account Draw Amount for each Payment
Date and instruct the Indenture Trustee to, on the Payment Date relating to
each Collection Period, withdraw from the Reserve Account the Reserve Account
Draw Amount and deposit such amount in the Collection Account.


          (d)
On the Closing Date the Seller will deposit (or cause to be deposited) into the
Reserve Account an amount equal to the Initial Reserve Account Deposit Amount.


          SECTION
4.4 Distributions.


          (a)
Subject to Article V of the Indenture, on each Payment Date, the
Indenture Trustee (solely based on information contained in, and as directed
by, the Servicer’s Certificate delivered on or before the related Determination
Date pursuant to Section 3.8) shall make the following deposits and
distributions, to the extent of Available Funds and the Reserve Account Draw
Amount, on deposit in the Collection Account for such Payment Date, in the
following order of priority:


	
  

 	
  

 	
  

 
	
  

 	
 (i)

 	
 first, to the Servicer, the Servicing Fee
 and all unpaid Servicing Fees with respect to prior Collection Periods;

 
	
  

 	
  

 	
  

 
	
  

 	
 (ii)

 	
 second, pro rata
 based on amounts due, to the Class A Noteholders, the Accrued Class A Note
 Interest for the related Interest Period; provided, that if there are not
 sufficient funds available to pay the entire amount of the Accrued Class A
 Note Interest, the amounts available will be applied to the payment of such
 interest on the Class A Notes on a pro rata basis;

 
	
  

 	
  

 	
  

 
	
  

 	
 (iii)

 	
 third, to the Principal Distribution Account
 for distribution to the Noteholders pursuant to Section 8.2(c) of the
 Indenture, the First Allocation of Principal, if any;

 
	
  

 	
  

 	
  

 
	
  

 	
 (iv)

 	
 fourth, to the
 Class B Noteholders, the Accrued Class B Note Interest for the related
 Interest Period;

 
	
  

 	
  

 	
  

 
	
  

 	
 (v)

 	
 fifth, to the
 Principal Distribution Account for distribution to the Noteholders in
 accordance with Section 8.2(c) of the Indenture, the Second Allocation
 of Principal, if any;

 
	
  

 	
  

 	
  

 
	
  

 	
 (vi)

 	
 sixth, to the Reserve
 Account, any additional amounts required to increase the amount in the
 Reserve Account up to the Specified Reserve Account Balance;

 
	
  

 	
  

 	
  

 
	
  

 	
 (vii)

 	
 seventh, to the Owner Trustee and the
 Indenture Trustee, fees, expenses and indemnification amounts due and owing
 under this Agreement, the Trust Agreement and the Indenture, as applicable,
 which have not been previously paid; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (viii)

 	
 eighth, to the
 Servicer, legal expenses and costs incurred pursuant to Section 6.4(b);
 and

 





	
  

 	
  

 	
  

 
	

  

 	
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 (ix)

 	
 ninth, to or at
 the direction of the Certificateholder, any funds remaining.

 



Notwithstanding
any other provision of this Section 4.4, following the occurrence
and during the continuation of an Event of Default which has resulted in an
acceleration of the Notes, the Indenture Trustee shall apply all amounts on
deposit in the Collection Account pursuant to Section 5.4(b) of the
Indenture.


          (b)
After the payment in full of the Notes and all other amounts payable under Section 4.4(a),
all Collections shall be paid to or in accordance with the instructions
provided from time to time by the Certificateholder.


          SECTION
4.5 Net Deposits. If the Monthly Remittance Condition is satisfied, the
Servicer shall be permitted to deposit into the Collection Account only the net
amount distributable to Persons other than the Servicer and its Affiliates on
the Payment Date. The Servicer shall, however, account as if all of the
deposits and distributions described herein were made individually.


          SECTION
4.6 Statements to Certificateholder and Noteholders. On or before each
Determination Date, the Servicer shall deliver to the Indenture Trustee, each
Paying Agent and the Rating Agencies, and the Indenture Trustee shall make
available on its website, as described below to the Issuer and to each Noteholder
of record as of the most recent Record Date, a statement setting forth for the
Collection Period and Payment Date relating to such Determination Date the
following information (to the extent applicable):


          (a)
the aggregate amount being paid on such Payment Date in respect of interest on
and principal of each Class of Notes;


          (b)
the Class A-1 Note Balance, the Class A-2 Note Balance, the Class A-3 Note
Balance, the Class A-4 Note Balance and the Class B Note Balance in each case
after giving effect to payments on such Payment Date;


          (c)
(i) the amount on deposit in the Reserve Account as of the beginning and end of
the related Collection Period, (ii) the Specified Reserve Account Balance for
such Payment Date, (iii) the amount deposited in the Reserve Account in respect
of such Payment Date, if any, (iv) the Reserve Account Draw Amount and the
Reserve Account Excess Amount, if any, to be withdrawn from the Reserve Account
on such Payment Date, (v) the balance on deposit in the Reserve Account on such
Payment Date after giving effect to withdrawals therefrom and deposits thereto
in respect of such Payment Date and (vi) the change in such balance from the
immediately preceding Payment Date;


          (d)
the First Allocation of Principal and the Second Allocation of Principal for
such Payment Date;


          (e)
the Net Pool Balance and the Principal Factor as of the close of business on
the last day of the preceding Collection Period;


          (f)
the amount of the Servicing Fee to be paid to the Servicer with respect to the
related Collection Period and the amount of any unpaid Servicing Fees;


	
  

 	
  

 	
  

 
	

  

 	
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          (g)
the amount of the Class A Noteholders’ Interest Carryover Shortfall and the
Class B Noteholders’ Interest Carryover Shortfall, if any, on such Payment Date
and the change in such amounts from the preceding Payment Date; 


          (h)
the aggregate Repurchase Price with respect to Repurchased Receivables with
respect to the related Collection Period; and


          (i)
the amount of Collections for the related Collection Period.


          No
disbursements shall be made directly by the Servicer to a Noteholder, and the
Servicer shall not be required to maintain any investor record relating to the
posting of disbursements or otherwise.


          The
Indenture Trustee will make available via the Indenture Trustee’s internet
website all reports or notices required to be provided by the Indenture Trustee
under this Section 4.6. Any information that is disseminated in
accordance with the provisions of this Section 4.6 shall not be required
to be disseminated in any other form or manner; provided, however,
any such information that must be delivered to the Rating Agencies under this Section
4.6 shall be sent by the Servicer by electronic mail to each Rating Agency.
The Indenture Trustee will make no representations or warranties as to the
accuracy or completeness of such documents and will assume no responsibility
therefor.


          The
Indenture Trustee’s internet website shall be initially located at
gctinvestorreporting.bnymellon.com or at such other address as shall be
specified by the Indenture Trustee from time to time in writing to the
Noteholders, the Servicer, the Issuer or any Paying Agent. The Indenture
Trustee will forward a hard copy of the reports or notices required to be
provided by the Indenture Trustee under this Section 4.6 to each
Noteholder promptly after it becomes aware that the reports or notices are not
accessible on its internet website. In connection with providing access to the
Indenture Trustee’s internet website, the Indenture Trustee may require
registration and the acceptance of a disclaimer. The Indenture Trustee shall
not be liable for the dissemination of information in accordance with this
Agreement.


          SECTION
4.7 No Duty to Confirm. The Indenture Trustee shall have no duty or
obligation to verify or confirm the accuracy of any of the information or
numbers set forth in the Servicer’s Certificate delivered by the Servicer to
the Indenture Trustee, and the Indenture Trustee shall be fully protected in
relying upon such Servicer’s Certificate.


	
  

 	
  

 	
  

 
	

  

 	
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ARTICLE V


THE SELLER


          SECTION
5.1 Representations and Warranties of Seller. The Seller makes the
following representations and warranties as of the Closing Date on which the
Issuer will be deemed to have relied in acquiring the Transferred Assets. The
representations and warranties speak as of the execution and delivery of this
Agreement and will survive the conveyance of the Transferred Assets to the
Issuer pursuant to this Agreement and the pledge thereof by the Issuer to the
Indenture Trustee pursuant to the Indenture:


          (a)
Existence and Power. The Seller is a limited liability company validly
existing and in good standing under the laws of the State of Delaware and has,
in all material respects, all power and authority required to carry on its
business as it is now conducted. The Seller has obtained all necessary licenses
and approvals in each jurisdiction where the failure to do so would materially
and adversely affect the ability of the Seller to perform its obligations under
the Transaction Documents or affect the enforceability or collectibility of the
Receivables or any other part of the Transferred Assets.


          (b)
Authorization and No Contravention. The execution, delivery and
performance by the Seller of each Transaction Document to which it is a party
(i) have been duly authorized by all necessary limited liability company action
on the part of the Seller and (ii) do not contravene or constitute a default
under (A) any applicable law, rule or regulation, (B) its organizational
documents or (C) any material agreement, contract, order or other instrument to
which it is a party or its property is subject (other than violations which do
not affect the legality, validity or enforceability of any of such agreements
and which, individually or in the aggregate, would not materially and adversely
affect the transactions contemplated by, or the Seller’s ability to perform its
obligations under, the Transaction Documents). 


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


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


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



	
  

 	
  

 	
  

 
	

  

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


          SECTION
5.2 Liability of Seller; Indemnities. The Seller shall be liable in
accordance herewith only to the extent of the obligations specifically
undertaken by the Seller under this Agreement, and hereby agrees to the
following: 


          (a)
The Seller shall indemnify, defend, and hold harmless the Issuer, the Owner
Trustee, the Indenture Trustee, the Noteholders and the Certificateholder from
and against any claim, loss, liability or expense incurred by reason of (i) the
Seller’s willful misfeasance, bad faith, or negligence in the performance of
its duties under this Agreement, or by reason of reckless disregard of its
obligations and duties under this Agreement and (ii) the Seller’s violation of
federal or State securities laws in connection with the registration or the
sale of the Notes.


          (b)
The Seller will pay any and all taxes levied or assessed upon the Issuer or
upon all or any part of the Trust Estate.


          (c)
Indemnification under this Section 5.2 will survive the resignation or
removal of the Owner Trustee or the Indenture Trustee and the termination of
this Agreement and will include, without limitation, reasonable fees and
expenses of counsel and expenses of litigation. If the Seller has made any
indemnity payments pursuant to this Section 5.2 and the Person to or on
behalf of whom such payments are made thereafter collects any of such amounts
from others, such Person will promptly repay such amounts to the Seller,
without interest.


          (d)
The Seller’s obligations under this Section 5.2 are obligations solely
of the Seller and will not constitute a claim against the Seller to the extent
that the Seller does not have funds sufficient to make payment of such
obligations. In furtherance of and not in derogation of the foregoing, the
Issuer, the Servicer, the Indenture Trustee and the Owner Trustee, by entering
into or accepting this Agreement, acknowledge and agree that they have no
right, title or interest in or to the Other Assets of the Seller. To the extent
that, notwithstanding the agreements and provisions contained in the preceding
sentence, the Issuer, the Servicer, the Indenture Trustee or the Owner Trustee
either (i) asserts an interest or claim to, or benefit from, Other Assets, or
(ii) is deemed to have any such interest, claim to, or benefit in or from Other
Assets, whether by operation of law, legal process, pursuant to applicable
provisions of insolvency laws or otherwise (including by virtue of Section
1111(b) of the Bankruptcy Code or any successor provision having similar effect
under the Bankruptcy Code), then the Issuer, the Servicer, the Indenture
Trustee or the Owner Trustee further acknowledges and agrees that any such
interest, claim or benefit in or from Other Assets is and will be expressly
subordinated to the indefeasible payment


	
  

 	
  

 	
  

 
	

  

 	
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in full,
which, under the terms of the relevant documents relating to the securitization
or conveyance of such Other Assets, are entitled to be paid from, entitled to
the benefits of, or otherwise secured by such Other Assets (whether or not any
such entitlement or security interest is legally perfected or otherwise
entitled to a priority of distributions or application under applicable law,
including insolvency laws, and whether or not asserted against the Seller),
including the payment of post-petition interest on such other obligations and
liabilities. This subordination agreement will be deemed a subordination
agreement within the meaning of Section 510(a) of the Bankruptcy Code. The
Issuer, the Servicer, the Indenture Trustee and the Owner Trustee each further acknowledges
and agrees that no adequate remedy at law exists for a breach of this Section 5.2(d)
and the terms of this Section 5.2(d) may be enforced by an action
for specific performance. The provisions of this Section 5.2(d) will be
for the third party benefit of those entitled to rely thereon and will survive
the termination of this Agreement. 


          SECTION
5.3 Merger or Consolidation of, or Assumption of the Obligations of, Seller.
Any Person (i) into which the Seller may be merged or consolidated, (ii)
resulting from any merger, conversion, or consolidation to which the Seller is
a party, (iii) succeeding to the business of the Seller, or (iv) more than 50%
of the voting stock or voting power and 50% or more of the economic equity of
which is owned directly or indirectly by United Services Automobile
Association, which Person in any of the foregoing cases executes an agreement
of assumption to perform every obligation of the Seller under this Agreement,
will be the successor to the Seller under this Agreement without the execution
or filing of any document or any further act on the part of any of the parties
to this Agreement. The Seller shall provide notice of any merger, conversion,
consolidation, or succession pursuant to this Section 5.3 to the Rating
Agencies. 


          SECTION
5.4 Limitation on Liability of Seller and Others. The Seller and any
officer or employee or agent of the Seller may rely in good faith on the advice
of counsel or on any document of any kind, prima facie properly executed and
submitted by any Person respecting any matters arising hereunder. The Seller
will not be under any obligation to appear in, prosecute, or defend any legal
action that is not incidental to its obligations under this Agreement, and that
in its opinion may involve it in any expense or liability.


          SECTION
5.5 Seller May Own Notes. The Seller, and any Affiliate of the Seller,
may in its individual or any other capacity become the owner or pledgee of
Notes with the same rights as it would have if it were not the Seller or an
Affiliate thereof, except as otherwise expressly provided herein or in the
other Transaction Documents. Except as set forth herein or in the other
Transaction Documents, Notes so owned by the Seller or any such Affiliate will
have an equal and proportionate benefit under the provisions of this Agreement
and the other Transaction Documents, without preference, priority, or
distinction as among all of the Notes. Unless all Notes are owned by the
Issuer, the Seller, the Servicer, the Administrator or any of their respective
Affiliates, any Notes owned by the Issuer, the Seller, the Servicer, the
Administrator or any of their respective Affiliates shall be disregarded with
respect to the determination of any request, demand, authorization, direction,
notice, consent, vote or waiver hereunder or under any other Transaction
Document.


          SECTION
5.6 Sarbanes-Oxley Act Requirements. To the extent any documents are
required to be filed or any certification is required to be made with respect
to the Issuer or the


	
  

 	
  

 	
  

 
	

  

 	
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Notes pursuant
to the Sarbanes-Oxley Act, the Issuer hereby authorizes the Servicer and the
Seller, or either of them, to prepare, sign, certify and file any such
documents or certifications on behalf of the Issuer. 


          SECTION
5.7 Compliance with Organizational Documents. The Seller shall comply
with its limited liability company agreement and other organizational
documents.


          SECTION
5.8 Perfection Representations, Warranties and Covenants. The Seller
hereby makes the perfection representations, warranties and covenants attached
hereto as Exhibit B to the Issuer and the Indenture Trustee and the Issuer
shall be deemed to have relied on such representations, warranties and
covenants in acquiring the Transferred Assets.


ARTICLE VI


THE SERVICER


          SECTION
6.1 Representations of Servicer. The Servicer makes the following
representations and warranties as of the Closing Date on which the Issuer will
be deemed to have relied in acquiring the Transferred Assets. The
representations and warranties speak as of the execution and delivery of this
Agreement and will survive the conveyance of the Transferred Assets to the
Issuer pursuant to this Agreement and the pledge thereof by the Issuer to the
Indenture Trustee pursuant to the Indenture: 


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


          (b)
Authorization and No Contravention. The execution, delivery and
performance by the Servicer of the Transaction Documents to which it is a party
(i) have been duly authorized by all necessary action on the part of the
Servicer and (ii) do not contravene or constitute a default under (A) any
applicable law, rule or regulation, (B) its organizational documents or (C) any
material agreement, contract, order or other instrument to which it is a party
or its property is subject (other than violations which do not affect the
legality, validity or enforceability of any of such agreements and which,
individually or in the aggregate, would not materially and adversely affect the
transactions contemplated by, or the Servicer’s ability to perform its
obligations under, the Transaction Documents). 


          (c)
No Consent Required. No approval or authorization by, or filing with,
any Governmental Authority is required in connection with the execution,
delivery and performance by the Servicer of any Transaction Document other than
(i) UCC filings, (ii) approvals and authorizations that have previously been
obtained and filings that have previously been made and (iii) approvals,
authorizations or filings which, if not obtained or made, would not have a
material adverse effect on the enforceability or collectibility of the Receivables
or would not


	
  

 	
  

 	
  

 
	

  

 	
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materially and
adversely affect the ability of the Servicer to perform its obligations under
the Transaction Documents.


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


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


          (f)
Fidelity Bond. The Servicer shall not be required to maintain a fidelity
bond or errors and omissions policy.


          SECTION
6.2 Indemnities of Servicer. The Servicer will be liable in accordance
herewith only to the extent of the obligations specifically undertaken by the
Servicer under this Agreement, and hereby agrees to the following:


          (a)
The Servicer will defend, indemnify and hold harmless the Issuer, the Owner
Trustee, the Indenture Trustee, the Noteholders, the Certificateholder and the
Seller from and against any and all costs, expenses, losses, damages, claims
and liabilities, arising out of or resulting from the use, ownership or
operation by the Servicer or any Affiliate thereof of a Financed Vehicle. 


          (b)
The Servicer will indemnify, defend and hold harmless the Issuer, the Owner
Trustee and the Indenture Trustee from and against any taxes that may at any
time be asserted against any such Person with respect to the transactions
contemplated herein or in the other Transaction Documents, if any, including,
without limitation, any sales, gross receipts, general corporation, tangible
personal property, privilege, or license taxes (but, in the case of the Issuer,
not including any taxes asserted with respect to, and as of the date of, the
conveyance of the Receivables to the Issuer or the issuance and original sales
of the Notes, or asserted with respect to ownership of the Receivables, or
federal or other Applicable Tax State income taxes arising out of the
transactions contemplated by this Agreement and the other Transaction
Documents) and costs and expenses in defending against the same. For the
avoidance of doubt, the Servicer will not indemnify for any costs, expenses,
losses, claims, damages or liabilities due to the credit risk of the Obligor
and for which reimbursement would constitute recourse for uncollectible
Receivables.


	
  

 	
  

 	
  

 
	

  

 	
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          (c)
The Servicer will indemnify, defend and hold harmless the Issuer, the Owner
Trustee, the Indenture Trustee, the Noteholders, the Certificateholder and the
Seller from and against any and all costs, expenses, losses, claims, damages,
and liabilities to the extent that such cost, expense, loss, claim, damage, or
liability arose out of, or was imposed upon any such Person through, the
negligence, willful misfeasance, or bad faith of the Servicer in the
performance of its duties under this Agreement or any other Transaction
Document to which it is a party, or by reason of its failure to perform its
obligations or of reckless disregard of its obligations and duties under this
Agreement or any other Transaction Document to which it is a party; provided,
however,
that the Servicer will not indemnify for any costs, expenses, losses, claims,
damages or liabilities arising from its breach of any covenant for which the
repurchase of the affected Receivables is specified as the sole remedy pursuant
to Section 3.6.


          (d)
The Servicer will compensate and indemnify the Owner Trustee to the extent and
subject to the conditions set forth in Sections 8.1 and 8.2 of
the Trust Agreement. The Servicer will compensate and indemnify the Indenture
Trustee to the extent and subject to the conditions set forth in Section 6.7
of the Indenture, except to the extent that any cost, expense, loss, claim,
damage or liability arises out of or is incurred in connection with the
performance by the Indenture Trustee of the duties of a successor Servicer
hereunder.


          (e)
Indemnification under this Section 6.2 by the Bank (or any successor
thereto pursuant to Section 6.6 or Section 7.1) as Servicer, with
respect to the period such Person was the Servicer, will survive the
termination of such Person as Servicer or a resignation by such Person as
Servicer as well as the termination of this Agreement and the Trust Agreement
or the resignation or removal of the Owner Trustee or the Indenture Trustee and
will include reasonable fees and expenses of counsel and expenses of
litigation. If the Servicer has made any indemnity payments pursuant to this Section
6.2 and the Person to or on behalf of whom such payments are made
thereafter collects any of such amounts from others, such Person will promptly
repay such amounts to the Servicer, without interest.


          (f)
Neither the Servicer nor any of the directors or officers or employees or
agents of the Servicer shall be under any liability to the Issuer, the
Noteholders or the Certificateholders, except as provided under this Agreement,
for any action taken or for refraining from the taking of any action pursuant
to this Agreement or for errors in judgment; provided, however,
that this provision shall not protect the Servicer or any such Person against
any liability that would otherwise be imposed by reason of willful misfeasance
or bad faith in the performance of duties or by reason of reckless disregard of
obligations and duties under this Agreement, or by reason of negligence in the
performance of its duties under this Agreement. The Servicer and any director,
officer or employee or agent of the Servicer may rely in good faith on any
Opinion of Counsel or on any Officer’s Certificate of the Seller or certificate
of auditors believed to be genuine and to have been signed by the proper party
in respect of any matters arising under this Agreement.


          The
provisions of this Section 6.2 shall survive termination of this
Agreement and satisfaction and discharge of the Indenture.


          SECTION
6.3 Merger or Consolidation of, or Assumption of the Obligations of,
Servicer. Any Person (i) into which the Servicer may be merged or
consolidated, (ii) resulting



	
  

 	
  

 	
  

 
	

  

 	
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from any
merger, conversion, or consolidation to which the Servicer is a party, (iii)
succeeding to the business of the Servicer or (iv) 50% or more of the equity of
which is owned, directly or indirectly, by the United Services Automobile
Association, which Person in any of the foregoing cases executes an agreement of
assumption to perform every obligation of the Servicer under this Agreement,
will be the successor to the Servicer under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties to this Agreement. The Servicer shall provide prior notice of the
effective date of any merger, conversion, consolidation or succession pursuant
to this Section 6.3 to the Rating Agencies, the Indenture Trustee and
the Seller. The Servicer shall provide the Seller in writing such information
as reasonably requested by the Seller to comply with its Exchange Act reporting
obligations with respect to a successor Servicer.


          SECTION
6.4 Limitation on Liability of Servicer and Others. (a) Neither the
Servicer nor any of the directors or officers or employees or agents of the
Servicer will be under any liability to the Issuer, the Indenture Trustee, the
Owner Trustee, the Noteholders or the Certificateholder, except as provided
under this Agreement, for any action taken or for refraining from the taking of
any action pursuant to this Agreement or for errors in judgment; provided, however,
that this provision will not protect the Servicer or any such Person against
any liability that would otherwise be imposed by reason of willful misfeasance
or bad faith in the performance of duties or by reason of its failure to
perform its obligations or of reckless disregard of obligations and duties
under this Agreement, or by reason of negligence in the performance of its
duties under this Agreement (except for errors in judgment). The Servicer and
any director, officer or employee or agent of the Servicer may rely in good
faith on any Opinion of Counsel or on any Officer’s Certificate of the Seller
or certificate of auditors believed to be genuine and to have been signed by
the proper party in respect of any matters arising under this Agreement.


          (b)
Except as provided in this Agreement, the Servicer will not be under any
obligation to appear in, prosecute, or defend any legal action that is not
incidental to its duties to service the Receivables in accordance with this
Agreement, and that in its opinion may involve it in any expense or liability; provided, however,
that the Servicer may undertake any reasonable action that it may deem
necessary or desirable in respect of this Agreement and the rights and duties
of the parties to this Agreement and the interests of the Noteholders and the
Certificateholder under this Agreement. In such event, the legal expenses and
costs of such action and any liability resulting therefrom will be expenses,
costs and liabilities of the Issuer, and the Servicer shall be entitled to be
reimbursed therefor. Any amounts due the Servicer pursuant to this subsection
shall be payable on a Payment Date in accordance with Section 4.4(a).


          SECTION
6.5 Delegation of Duties. The Servicer may, at any time without notice
or consent, delegate (a) any or all of its duties (including, without
limitation, its duties as custodian) under the Transaction Documents to any of
its Affiliates or (b) specific duties (including, without limitation, its
duties as custodian) to sub-contractors who are in the business of performing
such duties; provided,
that no such delegation shall relieve the Servicer of its responsibility with
respect to such duties and the Servicer shall remain obligated and liable to
the Issuer and the Indenture Trustee for its duties hereunder as if the
Servicer alone were performing such duties. For any servicing activities
delegated to third parties in accordance with this Section 6.5, the


	
  

 	
  

 	
  

 
	

  

 	
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Servicer shall
follow such policies and procedures to monitor the performance of such third
parties and compliance with such servicing activities as the Servicer follows
with respect to comparable motor vehicle receivables serviced by the Servicer
for its own account. 


          SECTION
6.6 The Bank Not to Resign as Servicer. Subject to the provisions of Sections
6.3 and 6.5, the Bank will not resign from the obligations and
duties hereby imposed on it as Servicer under this Agreement except upon
determination that the performance of its duties under this Agreement is no
longer permissible under applicable law. Notice of any such determination
permitting the resignation of the Bank will be communicated to the Issuer and
the Indenture Trustee at the earliest practicable time (and, if such
communication is not in writing, will be confirmed in writing at the earliest
practicable time) and any such determination will be evidenced by an Opinion of
Counsel to such effect delivered to the Issuer and the Indenture Trustee
concurrently with or promptly after such notice. No such resignation will
become effective until a successor Servicer has (i) assumed the
responsibilities and obligations of the Bank as Servicer and (ii) provided in
writing the information reasonably requested by the Seller to comply with its
reporting obligations under the Exchange Act with respect to a replacement
Servicer.


          SECTION
6.7 Servicer May Own Notes. The Servicer, and any Affiliate of the
Servicer, may, in its individual or any other capacity, become the owner or
pledgee of Notes with the same rights as it would have if it were not the
Servicer or an Affiliate thereof, except as otherwise expressly provided herein
or in the other Transaction Documents. Except as set forth herein or in the
other Transaction Documents, Notes so owned by or pledged to the Servicer or
such Affiliate will have an equal and proportionate benefit under the
provisions of this Agreement, without preference, priority or distinction as
among all of the Notes.


ARTICLE VII


REPLACEMENT OF SERVICER


          SECTION
7.1 Replacement of Servicer.


          (a)
If a Servicer Replacement Event shall have occurred and be continuing, the
Indenture Trustee may or, at the direction of 662⁄3% of the Note Balance of
the Controlling Class shall, by notice given to the Servicer, the Owner
Trustee, the Issuer, the Administrator, the Noteholders and each Rating Agency,
terminate the rights and obligations of the Servicer under this Agreement with
respect to the Receivables. In the event the Servicer is terminated pursuant to
this Section 7.1 or resigns as Servicer pursuant to Section 6.6
with respect to servicing the Receivables, the Indenture Trustee, acting at the
direction of 662⁄3% of the Note Balance of the Controlling Class, shall
appoint a successor Servicer. Upon the Servicer’s receipt of notice of
termination the predecessor Servicer will continue to perform its functions as
Servicer under this Agreement only until the date specified in such termination
notice or, if no such date is specified in such termination notice, until
receipt of such notice. If a successor Servicer has not been appointed at the
time when the predecessor Servicer ceases to act as Servicer in accordance with
this Section 7.1, the Indenture Trustee without further action will
automatically be appointed the successor Servicer. Notwithstanding the above,
the Indenture Trustee, if it is legally unable or is unwilling to so act, will
appoint, or petition a court of competent jurisdiction to appoint a 


	
  

 	
  

 	
  

 
	

  

 	
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successor
Servicer. Any successor Servicer shall be an established institution having a
net worth of not less than $100,000,000 and whose regular business includes the
servicing of comparable motor vehicle receivables having an aggregate
outstanding principal amount of not less than $50,000,000.


          (b)
Noteholders holding not less than a majority of the Note Balance of the
Controlling Class may waive any Servicer Replacement Event. Upon any such
waiver, such Servicer Replacement Event shall cease to exist and be deemed to
have been cured and not to have occurred for every purpose of this Agreement,
but no such waiver shall extend to any prior, subsequent or other Servicer
Replacement Event or impair any right consequent thereto.


          (c) If replaced, the Servicer agrees that it will use commercially reasonable
efforts to effect the orderly and efficient transfer of the servicing of the
Receivables to a successor Servicer. The Servicer agrees to cooperate with the
Successor Servicer in effecting the termination of the responsibilities and
rights of the Servicer hereunder, including, without limitation, the transfer
to the Successor Servicer for administration by it of all cash amounts which
shall at the time be held by the Servicer for deposit, or have been deposited
by the Servicer, in the Collection Account, or for its own account in
connection with its services hereafter or thereafter received with respect to
the Collateral. The Servicer shall transfer to the Successor Servicer all
records held by the Servicer relating to the Collateral in such electronic form
as the Successor Servicer may reasonably request and (ii) any Receivable Files
in the Servicer’s possession. The Servicer will provide access to the
Receivable Files, and the related accounts records, and computer systems
maintained by the Servicer at such times as the Success Servicer direct, but
only upon reasonable notice and during normal business hours, which do not
unreasonably interfere with the Servicer’s normal operations, at the respective
offices of the Servicer. All reasonable costs and expenses incurred in
connection with transferring the Receivable Files to the successor Servicer and
all other reasonable costs and expenses incurred in connection with the
transfer to the successor Servicer related to the performance by the Servicer
hereunder will be paid by the predecessor Servicer upon presentation of
reasonable documentation of such costs and expenses.


          (d)
Upon the effectiveness of the assumption by the successor Servicer of its
duties pursuant to this Section 7.1, the successor Servicer shall be the
successor in all respects to the Servicer in its capacity as Servicer under
this Agreement with respect to the Receivables, and shall be subject to all the
responsibilities, duties and liabilities relating thereto, except with respect
to the obligations of the predecessor Servicer that survive its termination as
Servicer, including indemnification obligations as set forth in Section
6.2(e). In such event, the Indenture Trustee and the Owner Trustee are
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 or accomplish all other acts or things
necessary or appropriate to effect the purposes of such termination and
replacement of the Servicer, whether to complete the transfer and endorsement
of the Receivables and related documents, or otherwise. No Servicer shall
resign or be relieved of its duties under this Agreement, as Servicer of the
Receivables, until a newly appointed Servicer for the Receivables shall have
assumed the responsibilities and obligations of the resigning or terminated
Servicer under this Agreement. 

	
  

 	
  

 	
  

 
	

  

 	
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          (e)
In connection with such appointment, the Indenture Trustee may make such arrangements
for the compensation of the successor Servicer out of Available Funds as it and
such successor Servicer will agree; provided, however,
that no such compensation will be in excess of the amount paid to the
predecessor Servicer under this Agreement. 


          SECTION
7.2 Notification to Noteholders. Upon any termination of, or appointment
of a successor to, the Servicer pursuant to this Article VII, the
Indenture Trustee will give prompt (but in any event, within (5) Business Days
of such termination or appointment) written notice thereof to the Owner
Trustee, the Issuer, the Administrator, each Rating Agency and to the
Noteholders at their respective addresses of record.


ARTICLE VIII


OPTIONAL PURCHASE


          SECTION
8.1 Optional Purchase of Trust Estate. The Servicer shall have the right
at its option (the “Optional Purchase”) to purchase (and/or to designate
one or more other persons to purchase) some or all of the Receivables from the
Issuer on any Payment Date if both of the following conditions are satisfied:
(a) the Net Pool Balance as of the last day of the related Collection Period
has declined to 10% or less of the Net Pool Balance as of the Cut-Off Date and
(b) the sum of the Optional Purchase Price and Available Funds for such Payment
Date would be sufficient to pay (x) the amounts required to be paid under
clauses first
through fifth
of Section 4.4(a) and (y) the Outstanding Note Balance (after giving
effect to the payments described in the preceding clause (x)). The aggregate
purchase price for the Receivables (the “Optional Purchase Price”) shall
equal the lesser of (x) the aggregate principal amounts of the Receivables
(assuming that Receivables that were more than 30 days past due as of the last
day of the related Collection Period have a principal balance of zero) and (y)
the fair market value of the Receivables (assuming that Receivables that were
more than 30 days past due as of the last day of the related Collection Period
have a fair market value of zero), which amount shall be deposited by or at the
direction of the Servicer into the Collection Account on the Redemption Date.
If the Servicer exercises the Optional Purchase, the Notes shall be redeemed
and in each case in whole but not in part on the related Payment Date for the
Redemption Price. Upon any such Optional Purchase, any funds remaining in the
Reserve Account will be distributed to or at the direction of the
Certificateholder. 


ARTICLE IX


MISCELLANEOUS PROVISIONS


          SECTION
9.1 Amendment.


          (a)
Any term or provision of this Agreement may be amended by the Seller and the
Servicer without the consent of the Indenture Trustee, any Noteholder, the
Issuer, the Owner Trustee or any other Person subject to subsections (e)
and (f) of this Section 9.1 and the satisfaction of one of the
following conditions:

	
  

 	
  

 	
  

 
	

  

 	
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 (i)

 	
 the Seller
 or the Servicer delivers an Opinion of Counsel to the Indenture Trustee to
 the effect that such amendment will not materially and adversely affect the
 interests of the Noteholders; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (ii)

 	
 the Seller
 or the Servicer delivers an Officer’s Certificate of the Seller or Servicer,
 respectively, to the Indenture Trustee to the effect that such amendment will
 not materially and adversely affect the interests of the Noteholders; or

 
	
  

 	
  

 	
  

 
	
  

 	
 (iii)

 	
 the Seller
 or the Servicer delivers to the Indenture Trustee written confirmation from
 each Rating Agency that such amendment will not cause it to downgrade,
 qualify or withdraw its rating assigned to any of the Notes;

 



          (b)
Subject to subsections (e) and (f) of this Section 9.1,
any term or provision of this Agreement may be amended by the Seller and the
Servicer but without the consent of the Indenture Trustee, any Noteholder, the
Issuer, the Owner Trustee or any other Person to add, modify or eliminate any
provisions as may be necessary or advisable in order to enable the Seller, the
Servicer or any of their Affiliates to comply with or obtain more favorable
treatment under any law or regulation or any accounting rule or principle, it
being a condition to any such amendment that the Rating Agency Condition shall
have been satisfied.


          (c) Subject to subsections (e) and (f) of this Section 9.1,
this Agreement (including Appendix A) may also be amended from time to
time by the Seller, the Servicer and the Indenture Trustee, with the consent of
the Noteholders evidencing not less than a majority of the Outstanding Note
Balance of the Controlling Class, for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this
Agreement or of modifying in any manner the rights of the Noteholders; provided,
that no such amendment shall (i) reduce the interest rate or principal amount
of any Note or change or delay the Final Scheduled Payment Date of any Note
without the consent of the Holder of such Note, or (ii) reduce the percentage
of the Note Balance, the Holders of which are required to consent to any matter
without the consent of the Holders of at least the percentage of the Note
Balance which were required to consent to such matter before giving effect to
such amendment; provided,
further,
that in the case of any amendment pursuant to this Section 9.1(c), the
Indenture Trustee may not agree to any such amendment if such amendment failed
to comply with the requirements of Section 9.2 of the Indenture. It will not be
necessary for the consent of Noteholders to approve the particular form of any
proposed amendment or consent, but it will be sufficient if such consent
approves the substance thereof. The manner of obtaining such consents (and any
other consents of Noteholders provided for in this Agreement) and of evidencing
the authorization of the execution thereof by Noteholders will be subject to
such reasonable requirements as the Indenture Trustee may prescribe, including
the establishment of record dates pursuant to the Note Depository Agreement.


          (d)
Prior to the execution of any amendment to this Agreement, the Servicer shall
provide written notification of the substance of such amendment to each Rating
Agency; and promptly after the execution of any such amendment or consent, the
Servicer shall furnish a copy of such amendment or consent to each Rating
Agency and the Indenture Trustee. Any written 



	
  

 	
  

 	
  

 
	

  

 	
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confirmation
received from any Rating Agency that an amendment will not cause it to
downgrade, qualify or withdraw its rating on the Notes shall not create any
presumption that such amendment does not materially and adversely affect the
interests of the Noteholders. 


          (e)
Prior to the execution of any amendment to this Agreement, the Seller, the
Owner Trustee and the Indenture Trustee shall be entitled to receive and
conclusively rely upon an Opinion of Counsel stating that the execution of such
amendment is authorized or permitted by this Agreement and that all conditions
precedent to the execution and delivery of such amendment have been satisfied.
Prior to the execution of any amendment to this Agreement without the consent
of the Owner Trustee and Indenture Trustee, as applicable, such Person shall be
entitled to receive an Opinion of Counsel to the effect that such amendment
shall not materially and adversely affect the Owner Trustee’s or Indenture
Trustee’s, as applicable, own rights, privileges, indemnities, duties or
obligations under this Agreement; provided
that such Opinion of Counsel shall not be given by counsel that is also an
employee of the Seller, the Servicer or their respective Affiliates.
Furthermore, notwithstanding anything to the contrary herein, this Agreement
may not be amended in any way that would materially and adversely affect the
Owner Trustee’s or the Indenture Trustee’s, as applicable, own rights,
privileges, indemnities, duties or obligations under this Agreement, the
Transaction Documents or otherwise without the prior written consent of such
Person.


          (f)
Notwithstanding any provision of this Section 9.1 to the contrary, the
permitted activities of the Issuer may be significantly changed only with the
approval of the Holders of at least a majority of the Notes held by entities
other than the Seller, its Affiliates and its agents.


          SECTION
9.2 Protection of Title.


          (a)
The Seller shall authorize and file such financing statements and cause to be
authorized and filed such continuation and other statements, all in such manner
and in such places as may be required by law fully to preserve, maintain and
protect the interest of the Issuer and the Indenture Trustee under this
Agreement in the Receivables. The Seller shall deliver (or cause to be
delivered) to the Issuer file-stamped copies of, or filing receipts for, any
document filed as provided above.


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


          (c) The Servicer shall maintain (or shall cause its Sub-Servicer to maintain) in
accordance with its Customary Servicing Practices accounts and records as to
each Receivable accurately and in sufficient detail to permit (i) the reader
thereof to know at any time the status of such Receivable, including payments
and recoveries made and payments owing (and the nature 

	
  

 	
  

 	
  

 
	

  

 	
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of each) and
(ii) reconciliation between payments or recoveries on (or with respect to) each
Receivable and the amounts from time to time deposited in the Collection
Account in respect of such Receivable.


          (d)
The Servicer shall maintain (or shall cause its Sub-Servicer to maintain) its
computer systems so that, from time to time after the conveyance under this
Agreement of the Receivables, the master computer records (including any backup
archives, it being understood that any such backup archives may not reflect
such interest until thirty-five (35) days after the applicable changes are made
to such master computer records) that refer to a Receivable shall indicate
clearly the interest of the Issuer in such Receivable and that such Receivable
is owned by the Issuer and has been pledged to the Indenture Trustee pursuant
to the Indenture. Indication of the Issuer’s interest in a Receivable shall not
be deleted from or modified on such computer systems until, and only until, the
related Receivable shall have been paid in full, repurchased by the Seller
pursuant to Section 2.3 hereof, repurchased by the Bank pursuant to Section
3.3 of the Purchase Agreement or purchased by the Servicer in accordance
with Section 3.6 hereof.


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


          (f)
The Servicer, upon receipt of reasonable prior notice, shall permit the
Indenture Trustee, the Owner Trustee and their respective agents at any time
during normal business hours, to the extent it does not unreasonably interfere
with the Servicer’s normal operations, to inspect, audit and, to the extent
permitted by applicable law, make copies of and abstracts from Servicer’s (or
any Sub-Servicer’s) records regarding any Receivable.


          (g)
Upon request, the Servicer shall furnish to the Issuer or to the Indenture
Trustee, within five Business Days, a list of all Receivables (by contract
number and name of Obligor) then owned by the Issuer, together with a
reconciliation of such list to each of the Servicer’s Certificates furnished
before such request indicating removal of Receivables from the Issuer.


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


          SECTION
9.4 Transfers Intended as Sale; Security Interest.


          (a)
Each of the parties hereto expressly intends and agrees that the transfers
contemplated and effected under this Agreement are complete and absolute sales
and transfers 


	
  

 	
  

 	
  

 
	

  

 	
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rather than
pledges or assignments of only a security interest and shall be given effect as
such for all purposes. It is further the intention of the parties hereto that
the Receivables and related Transferred Assets shall not be part of the
Seller’s estate in the event of a bankruptcy or insolvency of the Seller. The
sales and transfers by the Seller of Receivables and related Transferred Assets
hereunder are and shall be without recourse to, or representation or warranty
(express or implied) by, the Seller, except as otherwise specifically provided herein.
The limited rights of recourse specified herein against the Seller are intended
to provide a remedy for breach of representations and warranties relating to
the condition of the property sold, rather than to the collectibility of the
Receivables. 


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


	
  

 	
  

 	
  

 
	
  

 	
 (i)

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

 
	
  

 	
  

 	
  

 
	
  

 	
 (ii)

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

 
	
  

 	
  

 	
  

 
	
  

 	
 (iii)

 	
 The
 possession by the Issuer, or the Servicer as the Issuer’s agent, of the
 Receivable Files and any other property as constitute instruments, money,
 negotiable documents or chattel paper shall be deemed to be “possession by
 the secured party” or possession by the purchaser or a Person designated by
 such purchaser, for purposes of perfecting the security interest pursuant to
 the New York UCC and the UCC of any other applicable jurisdiction; and

 
	
  

 	
  

 	
  

 
	
  

 	
 (iv)

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

 



          SECTION
9.5 Notices, Etc. All demands, notices and communications hereunder
shall be in writing and shall be delivered or mailed by registered or certified
first-class United States mail, postage prepaid, hand delivery, prepaid courier
service, or by facsimile, and addressed in each case as set forth on Schedule
II hereto or at such other address as shall be designated in a written
notice to the other parties hereto. Any notice required or permitted to be
mailed to a Noteholder shall be given by first class mail, postage prepaid, at
the address of such Noteholder as shown in the Note Register. Delivery shall
occur only upon receipt or reported 

	
  

 	
  

 	
  

 
	

  

 	
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tender of such
communication by an officer of the recipient entitled to receive such notices
located at the address of such recipient for notices hereunder; provided, however, that any notice to a
Noteholder mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the Noteholder
shall receive such notice.


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


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


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


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


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


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


          SECTION
9.12 Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and permitted
assigns. This Agreement shall create and constitute the continuing obligations
of the parties hereto in 


	
  

 	
  

 	
  

 
	

  

 	
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accordance
with its terms, and shall remain in full force and effect until such time as
the parties hereto shall agree.


          SECTION
9.13 Acknowledgment and Agreement. By execution below, the Seller
expressly acknowledges and consents to the pledge, assignment and Grant of a
security interest in the Receivables and the other Transferred Assets by the
Issuer to the Indenture Trustee pursuant to the Indenture for the benefit of
the Noteholders. In addition, the Seller hereby acknowledges and agrees that
for so long as the Notes are outstanding, the Indenture Trustee will have the
right to exercise all powers, privileges and claims of the Issuer under this
Agreement.


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


          SECTION
9.15 Nonpetition Covenant. Each party hereto agrees that, prior to the
date which is one year and one day after payment in full of all obligations of
each Bankruptcy Remote Party in respect of all securities issued by any
Bankruptcy Remote Party (i) such party shall not authorize any Bankruptcy
Remote Party to commence a voluntary winding-up or other voluntary case or
other Proceeding seeking liquidation, reorganization or other relief with
respect to such Bankruptcy Remote Party or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect in any jurisdiction
or seeking the appointment of an administrator, a trustee, receiver,
liquidator, custodian or other similar official with respect to such Bankruptcy
Remote Party or any substantial part of its property or to consent to any such
relief or to the appointment of or taking possession by any such official in an
involuntary case or other Proceeding commenced against such Bankruptcy Remote
Party, or to make a general assignment for the benefit of, its creditors
generally, any party hereto or any other creditor of such Bankruptcy Remote
Party, and (ii) none of the parties hereto shall commence or join with any
other Person in commencing any Proceeding against such Bankruptcy Remote Party
under any bankruptcy, reorganization, liquidation or insolvency law or statute
now or hereafter in effect in any jurisdiction. This Section 9.15 shall
survive the termination of this Agreement; provided, that the foregoing shall in no
way limit the rights of the parties hereto to pursue any other creditor rights
or remedies that such Persons may have against the Issuer under applicable law.


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


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


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


	
  

 	
  

 	
  

 
	

  

 	
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          (c) agrees that service of process in any such action or Proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to such Person at its
address determined in accordance with Section 9.5; 


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


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


          SECTION
9.17 Limitation of Liability.


          (a)
Notwithstanding anything contained herein to the contrary, this Agreement has
been executed and delivered by Wells Fargo Delaware Trust Company, National
Association, not in its individual capacity but solely as Owner Trustee, and in
no event shall it have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or under the
Notes or any of the other Transaction Documents or in any of the certificates,
notices or agreements delivered pursuant thereto, as to all of which recourse
shall be had solely to the assets of the Issuer. Under no circumstances shall
the Owner Trustee be personally liable for the payment of any indebtedness or
expense of the Issuer or be liable for the breach or failure of any obligations,
representation, warranty or covenant made or undertaken by the Issuer under the
Transaction Documents. For the purposes of this Agreement, in the performance
of its duties or obligations hereunder, the Owner Trustee shall be subject to,
and entitled to the benefits of, the terms and provisions of Articles VI,
VII and VIII of the Trust Agreement.


          (b)
Notwithstanding anything contained herein to the contrary, this Agreement has
been executed and delivered by The Bank of New York Mellon, not in its
individual capacity but solely as Indenture Trustee, and in no event shall it
have any liability for the representations, warranties, covenants, agreements
or other obligations of the Issuer under the Notes or any of the other
Transaction Documents or in any of the certificates, notices or agreements
delivered pursuant thereto, as to all of which recourse shall be had solely to
the assets of the Issuer. Under no circumstances shall the Indenture Trustee be
personally liable for the payment of any indebtedness or expense of the Issuer
or be liable for the breach or failure of any obligations, representation,
warranty or covenant made or undertaken by the Issuer under the Transaction
Documents. For the purposes of this Agreement, in the performance of its duties
or obligations hereunder, the Indenture Trustee shall be subject to, and
entitled to the benefits of, the terms and provisions of Article VI of
the Indenture provided, that the obligations under Section 6.1(a) of the
Indenture shall only be applicable to the performance of the Indenture
Trustee’s duties and obligations under the Indenture and shall not be
applicable to the Indenture Trustee’s performance hereunder.


          SECTION
9.18 Third-Party Beneficiaries. This Agreement shall inure to the benefit
of and be binding upon the parties hereto, the Noteholders and the
Certificateholder and their respective successors and permitted assigns and the
Owner Trustee shall be an express third 



	
  

 	
  

 	
  

 
	

  

 	
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party
beneficiary hereof and may enforce the provisions hereof as if it were a party
hereto. Except as otherwise provided in this Section 9.18, no other
Person will have any right hereunder.


          SECTION
9.19 Information Requests. The parties hereto shall provide any
information reasonably requested by the Servicer, the Issuer, the Seller or any
of their Affiliates, in order to comply with or obtain more favorable treatment
under any current or future law, rule, regulation, accounting rule or
principle.


          SECTION
9.20 Regulation AB. The Servicer shall cooperate fully with the Seller
and the Issuer to deliver to the Seller and the Issuer (including any of its
assignees or designees) any and all statements, reports, certifications,
records and any other information necessary in the good faith determination of
the Seller or the Issuer to permit the Seller to comply with the provisions of
Regulation AB, together with such disclosures relating to the Servicer and the
Receivables, or the servicing of the Receivables, reasonably believed by the
Seller to be necessary in order to effect such compliance.


          SECTION
9.21 Information to Be Provided by the Indenture Trustee. 


	
  

 	
  

 
	
  

 	
           (a)
 For so long as the Seller is filing reports under the Exchange Act with
 respect to the Issuer, the Indenture Trustee shall (i) on or before the fifth
 Business Day of each month, notify the Seller, in writing, of any Form 10-D
 Disclosure Item with respect to the Indenture Trustee, together with a
 description of any such Form 10-D Disclosure Item in form and substance reasonably
 satisfactory to the Seller; provided, however, that subject to clauses (b)(iv)
 and (b)(v), the Indenture Trustee shall not be required to provide
 such information in the event that there has been no change to the
 information previously provided by the Indenture Trustee to Seller, and (ii)
 as promptly as practicable following notice to or discovery by a Responsible
 Officer of the Indenture Trustee of any changes to such information, provide
 to the Seller, in writing, such updated information.

 
	
  

 	
  

 
	
  

 	
           (b)
 As soon as available but no later than March 15 of each calendar year for so
 long as the Seller is filing reports under the Exchange Act with respect to
 the Issuer, commencing on March 15, 2011, the Indenture Trustee shall:

 






	
  

 	
  

 
	
  

 	
           (i)
 deliver to the Seller a report regarding the Indenture Trustee’s assessment
 of compliance with the Servicing Criteria during the immediately preceding
 calendar year, (or since the Closing Date in the case of the first such
 report) as required under paragraph (b) of Rule 13a-18, Rule 15d-18 of the
 Exchange Act and Item 1122 of Regulation AB. Such report shall be signed by a
 Responsible Officer of the Indenture Trustee, and shall address each of the
 Servicing Criteria specified in Exhibit C or such other criteria as
 mutually agreed upon by the Seller and the Indenture Trustee;

 
	
  

 	
  

 
	
  

 	
           (ii)
 cause a firm of registered public accountants that is qualified and
 independent within the meaning of Rule 2-01 of Regulation S-X under the
 Securities Act to deliver to the Seller a report for inclusion in the
 Seller’s filing of Exchange Act Form 10-K with respect to the Issuer that
 attests to, and reports on, the assessment of compliance made by the
 Indenture Trustee and delivered to the Seller pursuant to the preceding
 paragraph. 

 




	
  

 	
  

 	
  

 
	

  

 	
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Sale and Servicing Agreement

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 Such
 attestation shall be in accordance with Rules 1-02(a)(3) and 2-02(g) of
 Regulation S-X under the Securities Act and the Exchange Act;

 
	
  

 	
  

 
	
  

 	
           (iii)
 deliver to the Seller and any other Person that will be responsible for
 signing the certification (a “Sarbanes Certification”) required by
 Rules 13a-14(d) and 15d-14(d) under the Exchange Act (pursuant to Section 302
 of the Sarbanes-Oxley Act) on behalf of the Issuer or the Seller, a back-up
 certification substantially in the form attached hereto as Exhibit D
 or such form as mutually agreed upon by the Seller and the Indenture Trustee;

 
	
  

 	
  

 
	
  

 	
           (iv)
 notify the Seller in writing of any affiliations or relationships (as
 described in Item 1119 of Regulation AB) between the Indenture Trustee and
 any Item 1119 Party, provided, that no such notification need
 be made if the affiliations or relationships are unchanged from those
 provided in the notification in the prior calendar year; and

 
	
  

 	
  

 
	
  

 	
           (v)
 deliver to the Seller the certification substantially in the form attached
 hereto as Exhibit E, or such other form as is mutually agreed upon by
 the Seller and the Indenture Trustee regarding any affiliations or
 relationships (as described in Item 1119 of Regulation AB) between the
 Indenture Trustee and any Item 1119 Party and any Form 10-D Disclosure Item.

 



The Indenture
Trustee acknowledges that the parties identified in clause (iii) above
may rely on the certification provided by the Indenture Trustee pursuant to
such clause in signing a Sarbanes Certification and filing such with the
Commission.


          SECTION
9.22 Form 8-K Filings. So long as the Seller is filing Exchange Act
Reports with respect to the Issuer, the Indenture Trustee shall promptly notify
the Seller of any Reportable Event set forth in clauses (a), (d) or (f) of the
definition thereof (other than any such Reportable Event as to which the Seller
or the Servicer has actual knowledge), but in no event later than two (2)
Business Days after a Responsible Officer of the Indenture Trustee has actual
knowledge of such Reportable Event and has determined, or should have
reasonably determined, that such an event constitutes a Reportable Event.


          SECTION
9.23 Reserved. 


          SECTION
9.24 Further Assurances. The Seller and the Servicer agree to do and
perform, from time to time, any and all acts and to execute any and all further
instruments required or reasonably requested by the Owner Trustee or the
Indenture Trustee more fully to effect the purposes of this Agreement.


          SECTION
9.25 Cooperation. The parties hereto acknowledge and agree that the
purpose of Sections 9.21 and 9.22 is to facilitate compliance by
the Seller and Servicer with the provisions of Regulation AB and related rules
and regulations of the Commission. Neither the Seller nor the Servicer shall
exercise its right to request delivery of information or other performance
under these provisions other than in good faith in order to comply with the
Securities Act, the Exchange Act, the rules and regulations of the Commission
under the Securities Act and the Exchange Act and any comments or requests of
the Commission. The Indenture Trustee acknowledges that interpretations of the
requirements of Regulation AB may change over time, whether due to interpretive
guidance provided by the Commission or its staff, 

	
  

 	
  

 	
  

 
	

  

 	
35


 	
Sale and Servicing Agreement

(USAA 2010-1)

 







consensus
among participants in the asset-backed securities markets or consensus among
counsel to the parties hereto, and agrees to reasonably cooperate with the
Seller to deliver to the Seller and Servicer such information necessary in the
good faith determination of the Seller and Servicer to permit the Seller or
such Servicer to comply with the provisions of Regulation AB.


	
  

 	
  

 	
  

 
	

  

 	
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Sale and Servicing Agreement

(USAA 2010-1)

 









          IN
WITNESS WHEREOF, the parties have caused this Agreement to be duly executed by
their respective officers thereunto duly authorized as of the day and year
first above written.


	
  

 	
  

 	
  

 
	
  

 	
 USAA ACCEPTANCE, LLC,
 as Seller

 
	
  

 	
  

 
	
  

 	
 By:

 	
 /s/ Edwin T. McQuiston

 
	
  

 	
  

 	

 


 
	
  

 	
  

 	
 Name: Edwin
 T. McQuiston

 
	
  

 	
  

 	
 Title:
 Senior Vice President and Treasurer

 
	
  

 	
  

 
	
  

 	
 USAA FEDERAL SAVINGS BANK,
 as Servicer

 
	
  

 	
  

 
	
  

 	
 By:

 	
 /s/ Timothy P. Booker

 
	
  

 	
  

 	

 


 
	
  

 	
  

 	
 Name:
 Timothy P. Booker

 
	
  

 	
  

 	
 Title: Vice
 President

 






	
  

 	
  

 	
  

 
	

  

 	
S-1


 	
Sale and Servicing Agreement

(USAA 2010-1)

 
















	
  

 	
  

 	
  

 
	
  

 	
 USAA AUTO OWNER TRUST 2010-1,
 as Issuer

 
	
  

 	
  

 
	
  

 	
 By:

 	
 Wells Fargo
 Delaware Trust Company, National Association,

 
	
  

 	
  

 	
 not in its
 individual capacity but

 
	
  

 	
  

 	
 solely as
 Owner Trustee

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
 /s/ Rosemary Kennard

 
	
  

 	
  

 	

 


 
	
  

 	
  

 	
 Name: Rosemary Kennard

 
	
  

 	
  

 	
 Title: Vice President

 





	
  

 	
  

 	
  

 
	

  

 	
S-2


 	
Sale and Servicing Agreement

(USAA 2010-1)

 















	
  

 	
  

 	
  

 
	
  

 	
 THE BANK OF NEW YORK MELLON,
 not in its individual capacity but solely as Indenture Trustee

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
 /s/ Michael Burack

 
	
  

 	
  

 	

 


 
	
  

 	
  

 	
 Name:  Michael Burack

 
	
  

 	
  

 	
 Title: Senior Associate

 






	
  

 	
  

 	
  

 
	

  

 	
S-3


 	
Sale and Servicing Agreement

(USAA 2010-1)

 












APPENDIX A



DEFINITIONS


          The
following terms have the meanings set forth, or referred to, below:


          “Accrued
Class A Note Interest” means, with respect to any Payment Date, the
sum of the Class A Noteholders’ Monthly Accrued Interest for such Payment Date
and the Class A Noteholders’ Interest Carryover Shortfall for such Payment
Date.


          “Accrued
Class B Note Interest” means, with respect to any Payment Date, the
sum of the Class B Noteholders’ Monthly Accrued Interest for such Payment Date
and the Class B Noteholders’ Interest Carryover Shortfall for such Payment
Date.


          “Act” has the
meaning set forth in Section 11.3(a) of the Indenture.


          “Administration
Agreement” means the Administration Agreement, dated as of the Closing
Date, between the Administrator and the Issuer and acknowledged by the
Indenture Trustee, as the same may be amended and supplemented from time to
time.


          “Administrator”
means the Bank, or any successor Administrator under the Administration
Agreement.


          “Affiliate” means, for any specified
Person, any other Person which, directly or indirectly, controls, is controlled
by or is under common control with such specified Person and “affiliated” has a
meaning correlative to the foregoing. For purposes of this definition,
“control” means the power, directly or indirectly, to cause the direction of
the management and policies of a Person.


          “Applicable Tax State” means, as of any date, each
State as to which any of the following is then applicable: (a) a State in which
the Owner Trustee maintains its Corporate Trust Office, (b) a State in which
the Owner Trustee maintains its principal executive offices, and (c) the State
of Texas.


          “Authenticating Agent”
means any Person authorized by the Indenture Trustee to act on behalf of the
Indenture Trustee to authenticate and deliver the Notes.


          “Authorized Newspaper”
means a newspaper of general circulation in The City of New York, printed in
the English language and customarily published on each Business Day, whether or
not published on Saturdays, Sundays and holidays.


          “Authorized Officer”
means (a) with respect to the Issuer, (i) any officer of the Owner Trustee who
is authorized to act for the Owner Trustee in matters relating to the Issuer
and who is identified on the list of Authorized Officers delivered by the Owner
Trustee to the Indenture Trustee on the Closing Date or (ii) so long as the
Administration Agreement is in effect, any officer of the Administrator who is
authorized to act for the Administrator in matters relating to the Issuer
pursuant to the Administration Agreement and who is identified on the list of
Authorized Officers delivered by the Administrator to the Owner Trustee and the
Indenture Trustee on the Closing Date (as such list may be modified or
supplemented from time to time 



Appendix A to the Sale and Servicing 
Agreement (USAA 2010-1) 





thereafter)
and (b) with respect to the Owner Trustee, the Note Registrar (if other than
the Indenture Trustee) and the Servicer, any officer of the Owner Trustee, the
Note Registrar (if other than the Indenture Trustee) or the Servicer, as
applicable, who is authorized to act for the Owner Trustee, the Note Registrar
(if other than the Indenture Trustee) or the Servicer, as applicable, in
matters relating to the Owner Trustee, the Note Registrar (if other than the
Indenture Trustee) or the Servicer and who is identified on the list of
Authorized Officers delivered by each of the Owner Trustee and the Servicer to
the Indenture Trustee on the Closing Date or by the Note Registrar on the date
of its appointment as such (as such list may be modified or supplemented from
time to time thereafter).


          “Available Funds”
means, for any Payment Date and the related Collection Period, an amount equal
to the sum of the following amounts: (i) all Collections received by the
Servicer during such Collection Period, (ii) the sum of the Repurchase Prices
deposited into the Collection Account with respect to each Receivable that is
to become a Repurchased Receivable on such Payment Date and (iii) the Reserve
Account Excess Amount for such Payment Date.


          “Available Funds Shortfall Amount” means,
as of any Payment Date, the amount by which the amounts required to be paid
pursuant to clauses first through
fifth
of Section 4.4(a) of the Sale and Servicing Agreement exceeds the
Available Funds for such Payment Date.


          “Bank”
means USAA Federal Savings Bank, a federally chartered savings association.


          “Bankruptcy Code” means the United States
Bankruptcy Code, 11 U.S.C. 101 et seq., as amended.


          “Bankruptcy
Remote Party” means
each of the Seller, the Issuer, any other trust created by the Seller or any
limited liability company or corporation wholly-owned by the Seller.


          “Benefit Plan”
means (i) any “employee benefit plan” as defined in Section 3(3) of ERISA that
is subject to Title I of ERISA, (ii) a “plan” subject to Section 4975 of the
Code or (iii) any entity deemed to hold the assets of any of the foregoing by
reason of an employee benefit plan’s or other plan’s investment in such entity.


          “Book-Entry Notes”
means a beneficial interest in the Notes, ownership and transfers of which
shall be made through book entries by a Clearing Agency as described in Section
2.10 of the Indenture.


          “Business Day”
means any day other than a Saturday, a Sunday or a day on which banking
institutions in the states of Delaware, Texas or New York, or in the state in
which the Corporate Trust Office of the Indenture Trustee is located, are
authorized or obligated by law, executive order or government decree to be
closed.


          “Certificate”
means a certificate evidencing the beneficial interest of the Certificateholder
in the Issuer, substantially in the form of Exhibit A to the Trust
Agreement.


          “Certificate of Title” means, with respect
to any Financed Vehicle, the certificate of title or other documentary evidence
of ownership of such Financed Vehicle as issued by the department, agency or
official of the jurisdiction (whether in paper or electronic form) in which 


A-2





such Financed
Vehicle is titled responsible for accepting applications for, and maintaining
records regarding, certificates of title and liens thereon.


          “Certificate of Trust” means the
certificate of trust for the Issuer filed by the Owner Trustee pursuant to the
Statutory Trust Statute.


          “Certificateholder”
means the Holder of a Certificate.


          “Class”
means a group of Notes whose form is identical except for variation in
denomination, principal amount or owner, and references to “each Class” thus
mean each of the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the
Class A-4 Notes and the Class B Notes.


          “Class A
Noteholders” means, collectively, the Class A-1 Noteholders, the
Class A-2 Noteholders, the Class A-3 Noteholders and the Class A-4 Noteholders.


          “Class A
Noteholders’ Interest Carryover Shortfall” means, with respect to
any Payment Date, the excess of the Class A Noteholders’ Monthly Accrued
Interest for the preceding Payment Date and any outstanding Class A
Noteholders’ Interest Carryover Shortfall on such preceding Payment Date, over
the amount in respect of interest that is actually paid to Noteholders of Class
A Notes on such preceding Payment Date, plus interest on the amount of interest
due but not paid to Noteholders of Class A Notes on the preceding Payment Date,
to the extent permitted by law, at the respective Interest Rates borne by such
Class A Notes for the related Interest Period.


          “Class A
Noteholders’ Monthly Accrued Interest” means, with respect to any
Payment Date, the aggregate interest accrued for the related Interest Period on
the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the Class A-4
Notes at the respective Interest Rate for such Class on the Note Balance of the
Notes of each such Class on the immediately preceding Payment Date or the
Closing Date, as the case may be, after giving effect to all payments of
principal to the Noteholders of the Notes of such Class on or prior to such
preceding Payment Date. 


          “Class A
Notes” means, collectively, the Class A-1 Notes, the Class A-2
Notes, the Class A-3 Notes and the Class A-4 Notes.


          “Class A-1 Final Scheduled Payment Date”
means the Payment Date occurring on March 15, 2011.


          “Class A-1 Interest Rate”
means 0.27436% per annum (computed on the basis of the actual number of days
elapsed during the applicable Interest Period, but assuming a 360-day year).


          “Class A-1 Note Balance”
means, at any time, the Initial Class A-1 Note Balance reduced by all payments
of principal made prior to such time on the Class A-1 Notes.


          “Class A-1 Noteholder” means
the Person in whose name a Class A-1 Note is registered on the Note Register.


A-3





          “Class A-1 Notes”
means the Class of auto loan asset backed notes designated as Class A-1 Notes,
issued in accordance with the Indenture.


          “Class A-2 Final Scheduled Payment Date”
means the Payment Date occurring on June 15, 2012.


          “Class A-2 Interest Rate”
means 0.63% per annum (computed on the basis of a 360-day year of twelve 30-day
months).


          “Class A-2 Note Balance”
means, at any time, the Initial Class A-2 Note Balance reduced by all payments
of principal made prior to such time on the Class A-2 Notes.


          “Class A-2 Noteholder” means
the Person in whose name a Class A-2 Note is registered on the Note Register.


          “Class A-2 Notes”
means the Class of auto loan asset backed notes designated as Class A-2 Notes,
issued in accordance with the Indenture.


          “Class A-3
Final Scheduled Payment Date” means the Payment Date occurring on
June 16, 2014.


          “Class A-3
Interest Rate” means 1.30% per annum (computed on the basis of a
360-day year of twelve 30-day months).


          “Class A-3
Note Balance” means, at any time, the Initial Class A-3 Note Balance
reduced by all payments of principal made prior to such time on the Class A-3
Notes.


          “Class A-3
Noteholder” means the Person in whose name a Class A-3 Note is
registered on the Note Register.


          “Class A-3
Notes” means the Class of auto loan asset backed notes designated as
Class A-3 Notes, issued in accordance with the Indenture.


          “Class A-4
Final Scheduled Payment Date” means the Payment Date occurring on
September 15, 2015.


          “Class A-4 Interest Rate”
means 2.14% per annum (computed on the basis of a 360-day year of twelve 30-day
months).


          “Class A-4 Note Balance”
means, at any time, the Initial Class A-4 Note Balance reduced by all payments
of principal made prior to such time on the Class A-4 Notes.


          “Class A-4 Noteholder” means
the Person in whose name a Class A-4 Note is registered on the Note Register.


          “Class A-4 Notes”
means the Class of auto loan asset backed notes designated as Class A-4 Notes,
issued in accordance with the Indenture.


A-4





          “Class B
Final Scheduled Payment Date” means the Payment Date occurring on
July 15, 2016.


          “Class B
Interest Rate” means 2.96% per annum (computed on the basis of a
360-day year of twelve 30-day months).


          “Class B Note
Balance” means, at any time, the Initial Class B Note Balance
reduced by all payments of principal made prior to such time on the Class B
Notes.


          “Class B
Noteholder” means the Person in whose name a Class B Note is
registered on the Note Register.


          “Class B
Noteholders’ Interest Carryover Shortfall” means, with respect to
any Payment Date, the excess of the Class B Noteholders’ Monthly Accrued
Interest for the preceding Payment Date and any outstanding Class B
Noteholders’ Interest Carryover Shortfall on such preceding Payment Date, over
the amount in respect of interest that is actually paid to Noteholders of Class
B Notes on such preceding Payment Date, plus interest on the amount of interest
due but not paid to Noteholders of Class B Notes on the preceding Payment Date,
to the extent permitted by law, at the Class B Interest Rate for the related
Interest Period.


          “Class B Noteholders’
Monthly Accrued Interest” means, with respect to any Payment Date,
the aggregate interest accrued for the related Interest Period on the Class B
Notes at the Class B Interest Rate on the Class B Note Balance on the
immediately preceding Payment Date or the Closing Date, as the case may be,
after giving effect to all payments of principal to the Class B Noteholders on
or prior to such preceding Payment Date.


          “Class B
Notes” means the Class of auto loan asset backed notes designated as
Class B Notes, issued in accordance with the Indenture.


          “Clearing Agency”
means an organization registered as a “clearing agency” pursuant to Section 17A
of the Exchange Act and shall initially be DTC.


          “Clearing Agency
Participant” means a broker, dealer, bank or other financial
institution or other Person for which from time to time a Clearing Agency
effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.


          “Closing Date”
means February 24, 2010.


          “Code” means the Internal Revenue Code of
1986, as amended, modified or supplemented from time to time, and any successor
law thereto, and the regulations promulgated and the rulings issued thereunder.


          “Collateral” has the meaning set forth
in the Granting Clause of the Indenture.


          “Collection Account”
means the trust account established and maintained pursuant to Section 4.1
of the Sale and Servicing Agreement.


A-5





          “Collection Period” means the period
commencing on the first day of each calendar month and ending on the last day
of such calendar month (or, in the case of the initial Collection Period, the
period commencing on the close of business on the Cut-Off Date and ending on
February 28, 2010). As used herein, the “related” Collection Period with
respect to a Payment Date shall be deemed to be the Collection Period which
precedes such Payment Date.


          “Collections” means, with respect to any Receivable and to
the extent received by the Servicer on or after the Cut-Off Date, (i) any
monthly payment by or on behalf of the Obligor thereunder, (ii) any full or
partial prepayment of such Receivable, (iii) all Liquidation Proceeds and (iv)
any other amounts received by the Servicer which, in accordance with the Customary
Servicing Practices, would customarily be applied to the payment of accrued
interest or to reduce the Outstanding Principal Balance of such Receivable; provided,
however, that the term “Collections” in
no event will include (1) for any Payment Date, any amounts in respect of any
Receivable the Repurchase Price of which has been included in the Available
Funds on such Payment Date or a prior Payment Date, (2) any Supplemental
Servicing Fees or (3) rebates of premiums with respect to the cancellation or
termination of any Insurance Policy, extended warranty or service contract. 


          “Commission”
means the U.S. Securities and Exchange Commission.


          
“Contract Rate” means, with
respect to a Receivable, the rate per annum at which interest accrues under the
retail motor vehicle installment loan evidencing such Receivable. Such rate may
be less than the “Annual Percentage Rate” disclosed in the Receivable.


          “Controlling Class” shall
mean, subject to the proviso contained in the last paragraph of the definition
of “Outstanding”, with respect to any Notes Outstanding, the Class A Notes
(voting together as a single Class) as long as any Class A Notes are
Outstanding, and thereafter the Class B Notes as long as any Class B Notes are
Outstanding (excluding, in each case, Notes held by the Seller or any of its
Affiliates unless all of the Notes are then owned by the Seller or its
Affiliates).


          “Controlling
Person” shall mean a Person, other than a Benefit Plan, that has
discretionary authority or control with respect to the assets of the Issuer or
who provides investment advice for a direct or indirect fee with respect to
those assets, or any affiliate of such Person. 


          “Corporate Trust Office”
means:


          (a)
as used with respect to the Indenture Trustee, the principal office of the
Indenture Trustee at which at any particular time its corporate trust business
shall be administered which office at date of the execution of the Indenture is
located at 101 Barclay Street, 4 West, New York, New York 10286, Attention:
Corporate Trust Administration – USAA 2010-1, or at such other address as the
Indenture Trustee may designate from time to time by notice to the Noteholders,
the Administrator, the Servicer and the Issuer, or the principal corporate
trust office of any successor Indenture Trustee (the address of which the
successor Indenture Trustee will notify the Noteholders, the Administrator, the
Servicer and the Owner Trustee); and


A-6





          (b)
as used with respect to the Owner Trustee, the corporate trust office of the
Owner Trustee, 919 North Market Street, Suite 1600, Wilmington, Delaware 19801
or at such other address as the Owner Trustee may designate by notice to the
Certificateholder and the Seller, or the principal corporate trust office of
any successor Owner Trustee (the address of which the successor Owner Trustee
will notify the Certificateholder and the Seller).


          “Customary Servicing
Practices” means
the customary servicing practices of the Servicer or any Sub-Servicer with
respect to all comparable motor vehicle receivables that the Servicer or such
Sub-Servicer, as applicable, services for itself or others, as such practices
may be changed from time to time, it being understood that the Servicer and the
Sub-Servicers may not have the same “Customary
Servicing Practices”. 


          “Cut-Off Date” means January 31, 2010.


          “Default”
means any occurrence that is, or with notice or lapse of time or both would
become, an Event of Default.


          “Defaulted Receivable”
means, with respect to any Collection Period, any Receivable (i) that the
Servicer determines is unlikely to be paid in full or (ii) with respect to
which at least 5% of a scheduled payment is 120 or more days delinquent as of the
end of a calendar month. The Outstanding Principal Balance of any Receivable
that becomes a “Defaulted Receivable”
will be deemed to be zero as of the date it becomes a “Defaulted Receivable”.


          “Definitive Note”
means a definitive fully registered Note issued pursuant to Section 2.12
of the Indenture.


          “Delivery” when used with respect to Trust
Account Property means:


          (a)
with respect to (I) bankers’ acceptances, commercial paper, negotiable
certificates of deposit and other obligations that constitute “instruments” (as
defined in Section 9-102(47) of the UCC) and are susceptible of physical
delivery, transfer of actual possession thereof to the Indenture Trustee or its
nominee or custodian by physical delivery to the Indenture Trustee or its
nominee or custodian endorsed to, or registered in the name of, the Indenture
Trustee or its nominee or custodian or endorsed in blank, and (II) with respect
to a “certificated security” (as defined in Section 8-102(a)(4) of the UCC) transfer
of actual possession thereof (i) by physical delivery of such certificated
security to the Indenture Trustee or its nominee or custodian endorsed to, or
registered in the name of, the Indenture Trustee or its nominee or custodian or
endorsed in blank, or to another person, other than a “securities intermediary”
(as defined in Section 8-102(a)(14) of the UCC), who acquires possession of the
certificated security on behalf of the Indenture Trustee or its nominee or
custodian or, having previously acquired possession of the certificate,
acknowledges that it holds for the Indenture Trustee or its nominee or
custodian or (ii) by delivery thereof to a “securities intermediary”, endorsed
to or registered in the name of the Indenture Trustee or its nominee or custodian,
or endorsed in blank, and the making by such “securities intermediary” of
entries on its books and records identifying such certificated securities as
belonging to the Indenture Trustee or its nominee or custodian and the sending
by such “securities intermediary” of a confirmation of the purchase of such
certificated security by the Indenture Trustee or its nominee or custodian (all
of the foregoing, “Physical Property”), 


A-7





and, in any
event, any such Physical Property in registered form shall be in the name of
the Indenture Trustee or its nominee or custodian; and such additional or
alternative procedures as may hereafter become appropriate to effect the
complete transfer of ownership of any such Trust Account Property to the
Indenture Trustee or its nominee or custodian, consistent with changes in
applicable law or regulations or the interpretation thereof; 


          (b)
with respect to any securities issued by the U.S. Treasury, the Federal Home
Loan Mortgage Corporation, the Federal National Mortgage Association or the
other government agencies, instrumentalities and establishments of the United
States identified in Appendix A to Federal Reserve Bank Operating Circular No.
7 as in effect from time to time that is a “book-entry security” (as such term
is defined in Federal Reserve Bank Operating Circular No. 7) held in a
securities account and eligible for transfer through the Fedwire®
Securities Service operated by the Federal Reserve System pursuant to Federal
book-entry regulations, the following procedures, all in accordance with
applicable law, including applicable Federal regulations and Articles 8 and 9
of the UCC: book-entry registration of such Trust Account Property to an
appropriate securities account maintained with a Federal Reserve Bank by a
“participant” (as such term is defined in Federal Reserve Bank Operating
Circular No. 7) that is a “depository institution” (as defined in Section
19(B)(1)(A) of the Federal Reserve Act) pursuant to applicable Federal
regulations, and issuance by such depository institution of a deposit advice or
other written confirmation of such book-entry registration to the Indenture
Trustee or its nominee or custodian of the purchase by the Indenture Trustee or
its nominee or custodian of such book-entry securities; the making by such
depository institution of entries in its books and records identifying such
book entry security held through the Federal Reserve System pursuant to Federal
book-entry regulations or a security entitlement thereto as belonging to the
Indenture Trustee or its nominee or custodian and indicating that such
depository institution holds such Trust Account Property solely as agent for
the Indenture Trustee or its nominee or custodian; and such additional or
alternative procedures as may hereafter become appropriate to effect complete
transfer of ownership of any such Trust Account Property to the Indenture
Trustee or its nominee or custodian, consistent with changes in applicable law
or regulations or the interpretation thereof; and


          (c)
with respect to any item of Trust Account Property that is an “uncertificated
security” (as defined in Section 8-102(a)(18) of the UCC) and that is not
governed by clause (b) above, (i) registration on the books and records
of the issuer thereof in the name of the Indenture Trustee or its nominee or
custodian, or (ii) registration on the books and records of the issuer thereof
in the name of another person, other than a securities intermediary, who
acknowledges that it holds such uncertificated security for the benefit of the
Indenture Trustee or its nominee or custodian.


          “Depositor” means the Seller
in its capacity as Depositor under the Trust Agreement.


          “Determination Date”
means the second Business Day preceding the related Payment Date, beginning
March 11, 2010.


          “Dollar” and “$” mean
lawful currency of the United States of America.


          “DTC” means
The Depository Trust Company, and its successors.


A-8





          “Eligible Account”
means either (a) a segregated account with an Eligible Institution or (b) a
segregated trust account with the corporate trust department of a depository
institution acting in its fiduciary capacity organized under the laws of the
United States of America or any one of the states thereof or the District of
Columbia (or any domestic branch of a foreign bank), having corporate trust
powers and acting as trustee for funds deposited in such account, so long as
the long-term unsecured debt of such depository institution shall have a credit
rating from each Rating Agency in one of its generic rating categories which
signifies investment grade. Any such trust account may be maintained with the
Owner Trustee, the Indenture Trustee or any of their respective Affiliates, if
such accounts meet the requirements described in clause (b) of the
preceding sentence.


          “Eligible Institution”
means a depository institution or trust company (which may be the Owner
Trustee, the Indenture Trustee or any of their respective Affiliates) organized
under the laws of the United States of America or any one of the states thereof
or the District of Columbia (or any domestic branch of a foreign bank) (a)
which at all times has either (i) a long-term senior unsecured debt rating of
“Aa2” or better by Moody’s and “AA-” or better by Standard & Poor’s or such
other rating that is acceptable to each Rating Agency, as evidenced by a letter
from such Rating Agency to the Issuer or the Indenture Trustee, (ii) a
certificate of deposit rating of “P-1” by Moody’s and “A-1+” by Standard &
Poor’s or (iii) such other rating that is acceptable to each Rating Agency, as
evidenced by a letter from such Rating Agency to the Issuer or the Indenture
Trustee and (b) whose deposits are insured by the Federal Deposit Insurance Corporation;
provided, that a foreign financial institution shall be deemed to satisfy clause
(b) if such foreign financial institution meets the requirements of Rule
13k-1(b)(1) under the Exchange Act (17 CFR §240.13k-1(b)(1)).


          “Eligible Receivable”
means a Receivable meeting all of the criteria set forth on Schedule I
of each of the Purchase Agreement and the Sale and Servicing Agreement as of
the Closing Date.


          “ERISA” means
the Employee Retirement Income Security Act of 1974, as amended.


          “Event of Default”
has the meaning set forth in Section 5.1 of the Indenture.


          “Exchange Act”
means the Securities Exchange Act of 1934, as amended.


          “Exchange Act
Reports” means any reports on Form 10-D, Form 8-K and Form 10-K filed
or to be filed by the Seller with respect to the Issuer under the Exchange Act.


          “FDIC Rule”
means the Federal Deposit Insurance Corporation’s rule regarding the treatment
by the FDIC, as receiver or conservator of an insured depository institution,
of financial assets transferred by the institution in connection with a
securitization or participation (12 C.F.R. § 360.6).


          “Final Scheduled Payment
Date” means, with
respect to (i) the Class A-1 Notes, the Class A-1 Final Scheduled Payment Date,
(ii) the Class A-2 Notes, the Class A-2 Final Scheduled Payment Date, (iii) the
Class A-3 Notes, the Class A-3 Final Scheduled Payment Date, (iv) the Class A-4
Notes, the Class A-4 Final Scheduled Payment Date and (v) the Class B Notes,
the Class B Final Scheduled Payment Date.


A-9






          “Financed Vehicle”
means an automobile or light-duty truck, together with all accessions thereto,
securing an Obligor’s indebtedness under the applicable Receivable.


          “First
Allocation of Principal” means, with respect to any Payment Date, an
amount equal to the excess, if any, of (a) the Note Balance of the Class A
Notes as of such Payment Date (before giving effect to any principal payments
made on the Class A Notes on such Payment Date) over (b) the Net Pool Balance
as of the end of the related Collection Period; provided, however,
that the “First Allocation of Principal” shall not exceed the Note Balance of
the Class A Notes; provided, further, that the “First
Allocation of Principal” for any Payment Date on and after the Final Scheduled
Payment Date for any Class of Class A Notes shall not be less than the amount
that is necessary to reduce the Note Balance of that Class of Class A Notes to
zero.


          “Form 10-D
Disclosure Item” means, with respect to any Person, (a) any legal
proceedings pending against such Person or of which any property of such Person
is then subject, or (b) any proceedings known to be contemplated by
governmental authorities against such Person or of which any property of such
Person would be subject, in each case that would be material to the
Noteholders.


          “GAAP” means
generally accepted accounting principles in the USA, applied on a materially
consistent basis.


          “Governmental Authority”
means any (a) Federal, state, municipal, foreign or other governmental entity,
board, bureau, agency or instrumentality, (b) administrative or regulatory
authority (including any central bank or similar authority) or (c) court or
judicial authority.


          “Grant” means mortgage,
pledge, bargain, sell, warrant, alienate, remise, release, convey, assign,
transfer, create, grant a lien upon and a security interest in and right of
set-off against, deposit, set over and confirm pursuant to the Indenture. A
Grant of the Collateral or of any other agreement or instrument shall include
all rights, powers and options (but none of the obligations) of the Granting
party thereunder, including the immediate and continuing right to claim for,
collect, receive and give receipt for principal and interest payments in
respect of the Collateral and all other moneys payable thereunder, to give and
receive notices and other communications, to make waivers or other agreements,
to exercise all rights and options, to bring proceedings in the name of the
Granting party or otherwise and generally to do and receive anything that the
Granting party is or may be entitled to do or receive thereunder or with
respect thereto. Other forms of the verb “to Grant” shall have correlative
meanings.


          “Holder”
means, as the context may require, the Certificateholder or a Noteholder or
both.


          “Indenture”
means the Indenture, dated as of the Closing Date, between the Issuer and
Indenture Trustee, as the same may be amended and supplemented from time to
time.


          “Indenture Trustee”
means The Bank of New York Mellon, a banking corporation organized under the
laws of the State of New York, not in its individual capacity but as indenture
trustee under the Indenture, or any successor trustee under the Indenture.


A-10





          “Independent”
means, when used with respect to any specified Person, that such Person (i) is
in fact independent of the Issuer, any other obligor upon the Notes, the
Administrator and any Affiliate of any of the foregoing Persons, (ii) does not
have any direct financial interest or any material indirect financial interest
in the Issuer, any such other obligor upon the Notes, the Administrator or any
Affiliate of any of the foregoing Persons and (iii) is not connected with the
Issuer, any such other obligor upon the Notes, the Administrator or any
Affiliate of any of the foregoing Persons as an officer, employee, promoter,
underwriter, trustee, partner, director or Person performing similar functions.


          “Independent Certificate”
means a certificate or opinion to be delivered to the Indenture Trustee under
the circumstances described in, and otherwise complying with, the applicable
requirements of Section 11.1 of the Indenture, made by an independent
appraiser or other expert appointed by an Issuer Order, and such opinion or
certificate shall state that the signer has read the definition of
“Independent” in this Appendix A and that the signer is Independent
within the meaning thereof.


          “Initial Class A-1 Note
Balance” means $252,000,000.


          “Initial Class A-2 Note
Balance” means $179,000,000.


          “Initial Class A-3 Note
Balance” means $399,000,000.


          “Initial Class A-4 Note Balance”
means $152,502,000.


          “Initial Class B Note Balance”
means $17,500,000.


          “Initial Note Balance”
means, for any Class, the Initial Class A-1 Note Balance, the Initial Class A-2
Note Balance, the Initial Class A-3 Note Balance, the Initial Class A-4 Note
Balance or the Initial Class B Note Balance, as applicable, or with respect to
the Notes generally, the sum of the foregoing.


          “Initial Reserve Account Deposit Amount”
means an amount equal to $5,000,011.35.


          “Insolvency Event” means, with respect to
any Person, (i) the filing of a decree or order for relief by a court having
jurisdiction in the premises in respect of such Person in an involuntary case
under any applicable federal or state bankruptcy, insolvency or other similar
law now or hereafter in effect, or appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of such Person, or
ordering the winding-up or liquidation of such Person’s affairs, and such
decree or order shall remain unstayed and in effect for a period of 90
consecutive days or (ii) the commencement by such Person of a voluntary case
under any applicable federal or state bankruptcy, insolvency or other similar
law now or hereafter in effect, or the consent by such Person to the entry of
an order for relief in an involuntary case under any such law, or the consent
by such Person to the appointment or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official of
such Person, or the making by such Person of any general assignment for the
benefit of creditors, or the failure by such Person generally to pay its debts
as such debts become due, or the taking of action by such Person in furtherance
of any of the foregoing.


A-11





          “Insurance Policy”
means (i) any theft and physical damage insurance policy maintained by the
Obligor under a Receivable, providing coverage against loss or damage to or
theft of the related Financed Vehicle, and (ii) any credit life or credit
disability insurance maintained by an Obligor in connection with any
Receivable.


          “Interest Period” means, with respect to
any Payment Date, (a) with respect to the Class A-1 Notes from and including
the Closing Date (in the case of the first Payment Date) or from and including
the most recent Payment Date to but excluding that Payment Date (for example,
for a Payment Date in February, the Interest Period is from and including the
Payment Date in January to but excluding the Payment Date in February) based
upon actual days elapsed and a 360-day year and (b) for each other Class of
Notes, from and including the 15th day of the calendar month
preceding each Payment Date (or from and including the Closing Date in the case
of the first Payment Date) to but excluding the 15th day of the
following month based upon a 360-day year of twelve 30-day months.


          “Interest
Rate” means (a) with respect to the Class A-1 Notes, the Class A-1
Interest Rate, (b) with respect to the Class A-2 Notes, the Class A-2 Interest
Rate, (c) with respect to the Class A-3 Notes, the Class A-3 Interest Rate, (d)
with respect to the Class A-4 Notes, the Class A-4 Interest Rate or (e) with
respect to the Class B Notes, the Class B Interest Rate.


          “Issuer”
means USAA Auto Owner Trust 2010-1, a Delaware statutory trust established
pursuant to the Trust Agreement and the filing of the Certificate of Trust,
until a successor replaces it and, thereafter, means such successor.


          “Issuer Order”
and “Issuer
Request” means a written order or request of the Issuer signed in
the name of the Issuer by any one of its Authorized Officers and delivered to
the Indenture Trustee.


          “Item 1119
Party” means the Seller, the Bank, the Servicer, the Indenture
Trustee, the Owner Trustee, any underwriter of the Notes and any other material
transaction party identified by the Seller or the Bank to the Indenture Trustee
and the Owner Trustee in writing.


          “Lien” means,
for any asset or property of a Person, a lien, security interest, mortgage,
pledge or encumbrance in, of or on such asset or property in favor of any other
Person, except any Permitted Lien.


          “Liquidation
Proceeds” means, with respect to any Receivable, (a) insurance
proceeds received by the Servicer with respect to the Insurance Policies, (b)
amounts received by the Servicer in connection with such Receivable pursuant to
the exercise of rights under such Receivable and (c) the monies collected by
the Servicer (from whatever source, including proceeds of a sale of a Financed
Vehicle or a deficiency balance recovered from the Obligor after the charge-off
of such Receivable) on such Receivable, in the case of each of the foregoing clauses (a) through (c), net of any expenses
(including, without limitation, any auction, painting, repair or refurbishment
expenses in respect of the related Financed Vehicle) incurred by the Servicer
in connection therewith and any payments required by law to be remitted to the
Obligor; provided, however, that the Repurchase Price for
any Receivable shall not constitute “Liquidation
Proceeds”.


A-12





          “Monthly Remittance Condition” has the
meaning set forth in Section 4.2 of the Sale and Servicing Agreement.


          “Moody’s” means Moody’s Investors
Service, Inc., or any successor that is a nationally recognized statistical rating
organization.


          “Net Pool Balance” means, as
of any date, the aggregate Outstanding Principal Balance of all Receivables of
the Issuer on such date.


          “Note”
means a Class A-1 Note, Class A-2 Note, Class A-3 Note, Class A-4 Note or Class
B Note, in each case substantially in the form of Exhibit A to the
Indenture.


          “Note Balance” means, with respect to any
date of determination, for any Class, the Class A-1 Note Balance, the Class A-2
Note Balance, the Class A-3 Note Balance, the Class A-4 Note Balance or the
Class B Note Balance, as applicable, or with respect to the Notes generally,
the sum of all of the foregoing.


          “Note Depository Agreement” means the
agreement, dated as of the Closing Date, between the Issuer and DTC, as the
initial Clearing Agency relating to the Notes, as the same may be amended or
supplemented from time to time.


          “Note Owner”
means, with respect to a Book-Entry Note, the Person who is the beneficial
owner of such Book-Entry Note, as reflected on the books of the Clearing Agency
or a Person maintaining an account with such Clearing Agency (directly as a
Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).


          “Note Register”
and “Note
Registrar” have the respective meanings set forth in Section 2.4
of the Indenture.


          “Noteholder”
means, as the context requires, all of the Class A-1 Noteholders, the Class A-2
Noteholders, the Class A-3 Noteholders, the Class A-4 Noteholders and the Class
B Noteholders, or any of the Class A-1 Noteholders, the Class A-2 Noteholders,
the Class A-3 Noteholders, the Class A-4 Noteholders or the Class B
Noteholders.


          “Obligor”
means, for any Receivable, each Person obligated to pay such Receivable.


          “Officer’s Certificate” means (i) with
respect to the Issuer, a certificate signed by any Authorized Officer of the
Issuer and (ii) with respect to the Seller or the Servicer, a certificate
signed by the chairman of the board, the president, any executive vice
president, any vice president, the treasurer, any assistant treasurer or the
controller of the Seller or the Servicer, as applicable.


          
“Opinion of
Counsel” means one or more written opinions of counsel who may,
except as otherwise expressly provided in the Indenture or any other applicable
Transaction Document, be employees of or counsel to the Issuer, the Servicer,
the Seller or the Administrator, and which opinion or opinions comply with any
applicable requirements of the Transaction Documents and are in form and
substance reasonably satisfactory to the recipient(s). Opinions of Counsel need



A-13





address
matters of law only and may be based upon stated assumptions as to relevant
matters of fact.


          “Optional Purchase” has the
meaning set forth in Section 8.1 of the Sale and Servicing Agreement.


          “Optional Purchase Price” has the meaning
set forth in Section 8.1 of the Sale and Servicing Agreement.


          “Originator”
means, with respect to any Receivable, the Bank.


          “Other Assets” means any assets (or interests therein) (other than the
Trust Estate) conveyed or purported to be conveyed by the Seller to another
Person or Persons other than the Issuer, whether by way of a sale, capital
contribution or by virtue of the granting of a lien.


          “Outstanding”
means, as of any date, all Notes (or all Notes of an applicable Class)
theretofore authenticated and delivered under the Indenture except:


          (i)
Notes (or Notes of an applicable Class) theretofore cancelled by the Note
Registrar or delivered to the Note Registrar for cancellation;


          (ii)
Notes (or Notes of an applicable Class) or portions thereof the payment for
which money in the necessary amount has been theretofore deposited with the
Indenture Trustee or any Paying Agent in trust for the related Noteholders (provided, however,
that if such Notes are to be redeemed, notice of such redemption has been duly
given pursuant to the Indenture or provision therefor, satisfactory to the
Indenture Trustee, has been made); and 


          (iii)
Notes (or Notes of an applicable Class) in exchange for or in lieu of other
Notes (or Notes of such Class) that have been authenticated and delivered
pursuant to the Indenture unless proof satisfactory to the Indenture Trustee is
presented that any such Notes are held by a bona fide purchaser;


provided, that in determining
whether Noteholders holding the requisite aggregate principal amount of
Outstanding Notes have given any request, demand, authorization, direction,
notice, consent, vote or waiver hereunder or under any Transaction Document,
Notes owned by the Issuer, the Seller or any of their respective Affiliates
shall be disregarded and deemed not to be Outstanding unless all of the Notes
are then owned by the Issuer, the Seller or any of their respective Affiliates,
except that, in determining whether the Indenture Trustee shall be protected in
relying upon any such request, demand, authorization, direction, notice, consent,
vote or waiver, only Notes that a Responsible Officer of the Indenture Trustee
knows to be so owned shall be so disregarded. Notes so owned that have been
pledged in good faith may be regarded as Outstanding if the pledgee thereof
establishes to the satisfaction of the Indenture Trustee such pledgee’s right
so to act with respect to such Notes and that such pledgee is not the Issuer,
the Seller or any of their respective Affiliates.


          “Outstanding Principal Balance”
means, with respect to any Receivable as of any date, the outstanding principal
balance of such Receivable calculated in accordance with the Customary
Servicing Practices; provided, however, that the
Outstanding Principal Balance of 


A-14





any Receivable
that became a Defaulted Receivable will be deemed to be zero as of the date it
becomes a Defaulted Receivable.


          “Owner Trustee”
means Wells Fargo Delaware Trust Company, National Association, a national
banking association, not in its individual capacity but solely as owner trustee
under the Trust Agreement, and any successor Owner Trustee thereunder.


          “Paying Agent”
means the Indenture Trustee or any other Person that meets the eligibility
standards for the Indenture Trustee set forth in Section 6.11 of the
Indenture and is authorized by the Issuer to make the payments to and
distributions from the Collection Account and the Principal Distribution
Account, including the payment of principal of or interest on the Notes on
behalf of the Issuer.


          “Payment Date” means the 15th
day of each calendar month beginning March 15, 2010; provided, however,
whenever a Payment Date would otherwise be a day that is not a Business Day,
the Payment Date shall be the next Business Day. As used herein, the “related”
Payment Date with respect to a Collection Period shall be deemed to be the
Payment Date which immediately follows such Collection Period.


          “Payment Default” has the
meaning set forth in Section 5.4(a) of the Indenture.


          “Permitted Investments” means (a) evidences of
indebtedness, maturing within thirty (30) days after the date of loan thereof,
issued by, or guaranteed by the full faith and credit of, the federal
government of the USA, (b) repurchase agreements with banking institutions or
broker-dealers registered under the Exchange Act which are fully secured by
obligations of the kind specified in clause (a) and which are accounted
for as borrowings (and not sales), (c) money market funds (i) rated not lower
than the highest rating category from Moody’s and “AAAm” or “AAAm-g” from
Standard & Poor’s or (ii) which are otherwise acceptable to each Rating
Agency, as evidenced by a letter from such Rating Agency to the Issuer or the
Indenture Trustee, in each case including money market funds for which the
Indenture Trustee acts as sponsor, administrator or in a similar capacity and
for which the Indenture Trustee in such capacity receives a fee, or (d)
commercial paper (including commercial paper of any Affiliate of the Seller,
the Servicer, the Indenture Trustee or the Owner Trustee) rated, at the time of
the investment or contractual commitment to invest therein, at least “A-1+” (or
the equivalent) by Standard & Poor’s and at least “P-1” (or the equivalent)
by Moody’s.


          “Permitted
Liens” means (a) the interest
of the parties under the Transaction Documents, (b) any liens for taxes not due
and payable or the amount of which is being contested in good faith by
appropriate proceedings and (c) any liens of mechanics, suppliers, vendors,
materialmen, laborers, employees, repairmen and other like liens securing
obligations which are not due and payable or the amount or validity of which is
being contested in good faith by appropriate proceedings.


          “Person”
means any individual, corporation, limited liability company, estate,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization or government or any
agency or political subdivision thereof.


A-15





          “Physical Property” has the
meaning specified in the definition of “Delivery” above.


          “Predecessor Note”
means, with respect to any particular Note, every previous Note evidencing all
or a portion of the same debt as that evidenced by such particular Note; provided, however, for
the purpose of this definition, any Note authenticated and delivered under Section 2.5
of the Indenture in lieu of a mutilated, destroyed, lost or stolen Note shall
be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen
Note.


          “Principal Distribution Account” means the
account by that name established and maintained pursuant to Section 4.1
of the Sale and Servicing Agreement. 


          “Principal Factor” means,
with respect to the Notes or any Class of Notes on any Payment Date, a
nine-digit decimal figure equal to the Note Balance of the Notes or such Class
of Notes, as applicable, as of the end of the preceding Collection Period
divided by the Note Balance of the Notes or such Class of Notes, as applicable,
as of the Closing Date. The Principal Factor will be 1.000000000 as of the
Closing Date; thereafter, the Principal Factor will decline to reflect
reductions in the Note Balance of the Notes or such Class of Notes, as
applicable.


          “Proceeding”
means any suit in equity, action at law or other judicial or administrative
proceeding.


          “Purchase Agreement” means
the Purchase Agreement, dated as of the Closing Date, between the Bank and the
Seller, as amended, modified or supplemented from time to time.


          “Purchased
Assets” has the meaning set forth in Section 2.1 of the
Purchase Agreement.


          “Qualified
Institutional Buyer” means a “qualified institutional
buyer” as defined in Rule 144A under the Securities Act.


          “Rating Agency” means either or each of
Moody’s and Standard & Poor’s, as indicated by the context. 


          “Rating Agency Condition”
means, with respect to any event or circumstance and each Rating Agency, either
(a) written confirmation by such Rating Agency that the occurrence of such
event or circumstance will not cause it to downgrade, qualify or withdraw its
rating assigned to any of the Notes or (b) in the case of Moody’s only, that
such Rating Agency shall have been given notice of such event or circumstance
at least ten days prior to the occurrence of such event or circumstance (or, if
ten days’ advance notice is impracticable, as much advance notice as is
practicable) and such Rating Agency shall not have issued any written notice
that the occurrence of such event or circumstance will cause it to downgrade,
qualify or withdraw its rating assigned to the Notes. Notwithstanding the
foregoing, no Rating Agency has any duty to review any notice given with
respect to any event, and it is understood that such Rating Agency may not
actually review notices received by it prior to or after the expiration of the
ten (10) day period described in (b) above. Further, each Rating Agency
retains the right to downgrade, qualify or withdraw its rating assigned to all
or any of the Notes at any time in its sole judgment even if the Rating Agency
Condition with respect to an event had been previously satisfied pursuant to clause
(a) or clause (b) above.


A-16





          “Realized
Losses” shall mean, for any Collection Period and for each
Receivable that became a Defaulted Receivable during such Collection Period,
the excess of the Outstanding Principal Balance of each such Receivable over
Liquidation Proceeds received with respect to such Receivable during such Collection
Period, to the extent allocable to principal.


          “Receivable”
means any retail motor vehicle installment loan with respect to a new or used
automobile or light-duty truck which shall appear on the Schedule of
Receivables and all Related Security in connection therewith which has not been
released from the lien of the Indenture.


          “Receivable Files”
has the meaning set forth in Section 2.4(a) of the Sale and Servicing
Agreement.


          “Record Date”
means, unless otherwise specified in any Transaction Document, with respect to
any Payment Date or Redemption Date, (i) for any Definitive Notes and for the
Certificates, the close of business on the last Business Day of the calendar
month immediately preceding the calendar month in which such Payment Date or
Redemption Date occurs and (ii) for any Book-Entry Notes, the close of business
on the Business Day immediately preceding such Payment Date or Redemption Date.


          “Records”
means, for any Receivable, all contracts, books, records and other documents or
information (including computer programs, tapes, disks, software and related
property and rights, to the extent legally transferable) relating to such
Receivable or the related Obligor.


          “Recoveries”
shall mean, with respect to any Collection Period, all amounts received by the
Servicer with respect to any Defaulted Receivable during any Collection Period
following the Collection Period in which such Receivable became a Defaulted
Receivable, net of any fees, costs and expenses incurred by the Servicer in
connection with the collection of such Receivable and any payments required by
law to be remitted to the Obligor.


          “Redemption Date”
means, in the case of a redemption of the Notes pursuant to Section 10.1
of the Indenture, the Payment Date specified by the Administrator or the Issuer
pursuant to Section 10.1 of the Indenture.


          “Redemption Price”
means an amount equal to the sum of (a) unpaid principal amount of the Notes
redeemed plus
(b) accrued and unpaid interest thereon at the applicable Interest Rate for the
Notes being so redeemed, up to but excluding the Redemption Date.


          “Registered Holder”
means the Person in whose name a Note is registered on the Note Register on the
related Record Date.


          “Regulation
AB” means Subpart 229.1100 – Asset Backed Securities (Regulation
AB), 17 C.F.R. §§229.1100-229.1123, as such regulation may be amended from time
to time and subject to such clarification and interpretation as have been
provided by the Commission in the adopting release (Asset-Backed Securities,
Securities Act Release No. 33-8518. 70 Fed. Reg. 1,506, 1,531 (January 7,
2005)) or by the staff of the Commission, or as may be, provided in writing by
the Commission or its staff from time to time.


A-17





          “Related Security”
means, for any Receivable, (i) the security interest in the related Financed
Vehicle, (ii) any proceeds from claims on any Insurance Policy (if such
Receivable became a Defaulted Receivable after the Cut-Off Date), (iii) any
other property securing the Receivables and (iv) all proceeds of the foregoing.


          “Reportable
Event” means any event required to be reported on Form 8-K, and in
any event, the following:


          (a)
entry into a material definitive agreement related to the Issuer or the Notes
or an amendment to a Transaction Document, even if the Seller is not a party to
such agreement (e.g., a servicing agreement with a servicer contemplated by
Item 1108(a)(3) of Regulation AB);


          (b)
termination of a Transaction Document (other than by expiration of the
agreement on its stated termination date or as a result of all parties
completing their obligations under such agreement), even if the Seller is not a
party to such agreement (e.g., a servicing agreement with a servicer
contemplated by Item 1108(a)(3) of Regulation AB);


          (c)
with respect to the Servicer only, the occurrence of a Servicer Replacement
Event;


          (d)
an Event of Default;


          (e)
the resignation, removal, replacement or substitution of the Indenture Trustee
or the Owner Trustee; and


          (f)
with respect to the Indenture Trustee only, a required distribution to Holders
of the Notes is not made as of the required Payment Date under the Indenture.


          “Repurchase Price” means,
with respect to any Repurchased Receivable, a price equal to the Outstanding
Principal Balance of such Receivable plus any unpaid accrued interest related
to such Receivable accrued to and including the end of the Collection Period
preceding the date that such Repurchased Receivable was purchased by the Bank,
the Servicer or the Seller, as applicable.


          “Repurchased Receivable”
means a Receivable purchased by the Bank pursuant to Section 3.3 of the
Purchase Agreement, by the Servicer pursuant to Sections 3.6 and 8.1
of the Sale and Servicing Agreement or by the Seller pursuant to Section 2.3
of the Sale and Servicing Agreement.


          “Reserve Account”
means the account designated as such, established and maintained pursuant to Section
4.1 of the Sale and Servicing Agreement.


          “Reserve Account Draw
Amount” means, for any Payment Date, the amount withdrawn from the
Reserve Account, equal to the lesser of (a) the Available Funds Shortfall
Amount, if any, and (b) the amount on deposit in the Reserve Account on such
Payment Date.


          “Reserve Account Excess Amount”
means, with respect to any Payment Date, an amount equal to the excess, if any,
of (a) the amount of cash or other immediately available funds in the 


A-18





Reserve
Account on that Payment Date, after giving effect to all deposits to and
withdrawals from the Reserve Account relating to that Payment Date, over (b)
the Specified Reserve Account Balance with respect to that Payment Date.


          “Responsible Officer”
means, (a) with respect to the Indenture Trustee, any officer within the
corporate trust department of the Indenture Trustee, including any vice
president, assistant vice president, assistant secretary, assistant treasurer,
trust officer or any other officer of the Indenture Trustee who customarily
performs functions similar to those performed by the persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of such person’s knowledge of and familiarity with the
particular subject, who, in each case, shall have direct responsibility for the
administration of the Indenture, (b) with respect to the Owner Trustee, any
officer within the Corporate Trust Office of the Owner Trustee and having direct
responsibility for the administration of the Issuer, including any Managing
Director, Director, Vice President, Assistant Vice President, Assistant
Treasurer, Assistant Secretary or Associate, or any other officer customarily
performing functions similar to those performed by any of the above designated
officers and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer’s knowledge of and
familiarity with the particular subject and (c) with respect to the Servicer,
the Seller or the Administrator, any officer of such Person having direct
responsibility for the transactions contemplated by the Transaction Documents,
including the President, Treasurer or Secretary or any Vice President, Controller,
Assistant Vice President, Assistant Treasurer, Assistant Secretary, or any
other officer customarily performing functions similar to those performed by
any of the above designated officers and also, with respect to a particular
matter, any other officer to whom such matter is referred because of such
officer’s knowledge of and familiarity with the particular subject.


          “Sale and Servicing Agreement”
means the Sale and Servicing Agreement, dated as of the Closing Date, among the
Seller, the Issuer, the Servicer and the Indenture Trustee, as the same may be
amended, modified or supplemented from time to time. 


          “Sarbanes
Certification” has the meaning set forth in Section 9.21(b)(iii)
of the Sale and Servicing Agreement.


          “Sarbanes-Oxley Act” means the
Sarbanes-Oxley Act of 2002, as amended, modified or supplemented from time to
time, and any successor law thereto.


          “Schedule of Receivables”
means the schedule of Receivables transferred to the Issuer on the Closing
Date.


          “Second
Allocation of Principal” means, with respect to any Payment Date, an
amount equal to the excess, if any, of (a) the sum of the Note Balance of the
Class A Notes and the Class B Notes minus the First Allocation of Principal for
such Payment Date, over (b) the Net Pool Balance as of the end of the related
Collection Period; provided, however, that the Second
Allocation of Principal for any Payment Date on and after the Final Scheduled
Payment Date for the Class A Notes or the Class B Notes shall not be less than
the amount that is necessary to reduce the Class A Note Balance or the Class B
Note Balance, as applicable, to zero (after the application of the First
Allocation of Principal).


A-19





          “Securities Act”
means the Securities Act of 1933, as amended.


          “Seller” means USAA
Acceptance, LLC, a Delaware limited liability company.


          “Servicer” means the Bank,
initially, and any replacement Servicer appointed pursuant to the Sale and
Servicing Agreement.


          “Servicer Replacement
Event” means any one or more of the following that shall have
occurred and be continuing:


          (a)
any failure by the Servicer to deliver or cause to be delivered any required
payment to the Indenture Trustee for distribution to the Noteholders, which
failure continues unremedied for five Business Days after discovery thereof by
a Responsible Officer of the Servicer or receipt by the Servicer of written
notice thereof from the Indenture Trustee or Noteholders evidencing a majority
of the aggregate principal amount of the Outstanding Notes, voting together as
a single Class;


          (b)
any failure by the Servicer to duly observe or perform in any material respect
any other of its covenants or agreements in the Sale and Servicing Agreement,
which failure materially and adversely affects the rights of the Issuer or the
Noteholders, and which continues unremedied for 90 days after discovery thereof
by a Responsible Officer of the Servicer or receipt by the Servicer of written
notice thereof from the Indenture Trustee or Noteholders evidencing a majority
of the aggregate principal amount of the Outstanding Notes, voting together as
a single Class (it being understood that no Servicer Replacement Event will
result from a breach by the Servicer of any covenant for which the repurchase
of the affected Receivable is specified as the sole remedy pursuant to Section
2.3 or Section 3.6 of the Sale and Servicing Agreement);


          (c)
any representation or warranty of the Servicer made in any Transaction Document
to which the Servicer is a party or by which it is bound or any certificate
delivered pursuant to the Sale and Servicing Agreement proves to have been
incorrect in any material respect when made, which failure materially and
adversely affects the rights of the Issuer or the Noteholders, and which
failure continues unremedied for 90 days after discovery thereof by a
Responsible Officer of the Servicer or receipt by the Servicer of written
notice thereof from the Indenture Trustee or Noteholders evidencing a majority
of the aggregate principal amount of the Outstanding Notes, voting together as
a single Class (it being understood that any repurchase of a Receivable by the
Bank pursuant to Section 3.3 of the Purchase Agreement, by the Seller pursuant
to Section 2.3 of the Sale and Servicing Agreement or by the Servicer
pursuant to Section 3.6 of the Sale and Servicing Agreement shall be
deemed to remedy any incorrect representation or warranty with respect to such
Receivable); or


          (d)
the Servicer suffers a Insolvency Event;


provided, however, that a delay or failure of
performance referred to under clause (a) above for a period of 90 days
will not constitute a Servicer Replacement Event if such delay or failure was
caused by force majeure or other similar occurrence as certified by the
Servicer in an Officer’s Certificate of the Servicer delivered to the Indenture
Trustee.


A-20





          The
existence or occurrence of any “material instance of noncompliance” (within the
meaning of Item 1122 of Regulation AB) shall not create any presumption that
any event in clauses (a), (b) or (c) above has occurred.


          “Servicer’s Certificate”
means the certificate delivered pursuant to Section 3.8 of the Sale and
Servicing Agreement.


          “Servicing
Criteria” means the “servicing criteria” set forth in Item 1122(d)
of Regulation AB.


          “Servicing Fee” means, for any Payment
Date, the product of (A) one-twelfth (or, in the case of the first Payment
Date, a fraction, the numerator of which is the number of days from but not
including the Cut-Off Date to and including the last day of the first
Collection Period and the denominator of which is 360), (B) the Servicing Fee
Rate and (C) the Net Pool Balance as of the first day of the related Collection
Period (or, in the case of the first Payment Date, as of the Cut-Off Date).


          “Servicing Fee Rate” means
0.50% per annum.


          “Simple Interest Method”
means the method of calculating interest due on a motor vehicle receivable on a
daily basis based on the actual outstanding principal balance of the receivable
on that date.


          “Simple Interest Receivable”
means any motor vehicle receivable pursuant to which the payments due from the
Obligors during any month are allocated between interest, principal and other
charges based on the actual date on which a payment is received and for which
interest is calculated using the Simple Interest Method.


          
“Specified
Reserve Account Balance” shall mean for a Payment Date the lesser of
(i) the aggregate principal balance of the Outstanding Notes as of the current
Payment Date and (ii) the greater of (a) 1.00% of the Net Pool Balance as of
the last day of the related Collection Period and (b) 0.50% of the Net Pool
Balance as of the Cut-Off Date. The Specified Reserve Account Balance may be
reduced to a lesser amount as determined by the Depositor, if each of Moody’s
and Standard & Poor’s shall have confirmed in writing to the Indenture
Trustee that such action will not result in a withdrawal or reduction on any if
its ratings of the Notes.


          “Standard & Poor’s”
means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc., or any successor that is a nationally recognized statistical
rating organization.


          “Statutory Trust Statute” means Chapter 38 of
Title 12 of the Delaware Code, 12 Del. Code § 3801 et seq.


          “Sub-Servicer” means any Affiliate of the
Servicer or any sub-contractor to whom any or all duties of the Servicer
(including, without limitation, its duties as custodian) under the Transaction
Documents have been delegated in accordance with Section 6.5 of the Sale
and Servicing Agreement.


A-21





          “Supplemental Servicing
Fees” means any and all (i) late fees, (ii) extension fees, (iii)
non-sufficient funds charges and (iv) any and all other administrative fees or
similar charges allowed by applicable law with respect to any Receivable.


          “TIA” or “Trust Indenture Act”
means the Trust Indenture Act of 1939, as amended and as in force on the date
hereof, unless otherwise specifically provided.


          “Transaction Documents” means the Indenture, the
Notes, the Note Depository Agreement, the Sale and Servicing Agreement, the
Purchase Agreement, the Administration Agreement and the Trust Agreement, as
the same may be amended or modified from time to time.


          “Transferred
Assets” means (a) the Purchased Assets, (b) all of the Seller’s
rights under the Purchase Agreement and (c) all proceeds of the foregoing.


          “Trust Account Property”
means the Trust Accounts, all amounts and investments held from time to time in
any Trust Account (whether in the form of deposit accounts, Physical Property,
book-entry securities, uncertificated securities or otherwise), and all
proceeds of the foregoing.


          “Trust Accounts” has the
meaning set forth in Section 4.1 of
the Sale and Servicing Agreement.


          “Trust Agreement”
means the Trust Agreement, dated as of February 9, 2010, as amended and
restated by the Amended and Restated Trust Agreement, dated as of the Closing
Date, between the Seller and the Owner Trustee, as the same may be amended and
supplemented from time to time.


          “Trust Estate” means all money, accounts,
chattel paper, general intangibles, goods, instruments, investment property and
other property of the Issuer, including without limitation (i) the Receivables
acquired by the Issuer under the Sale and Servicing Agreement, the Related
Security relating thereto and Collections thereon on or after the Cut-Off Date,
(ii) the Receivable Files, (iii) the rights of the Issuer to the funds on
deposit from time to time in the Trust Accounts and any other account or
accounts established pursuant to the Indenture or Sale and Servicing Agreement
and all cash, investment property and other property from time to time credited
thereto and all proceeds thereof (including investment earnings, net of losses
and investment expenses, on amounts on deposit therein), (iv) the rights of the
Seller, as buyer, under the Purchase Agreement, (v) the rights of the Issuer
under the Sale and Servicing Agreement and (vi) all proceeds (as defined in
9-102(64) of the UCC) of the foregoing.


          “UCC” means,
unless the context otherwise requires, the Uniform Commercial Code as in effect
in the relevant jurisdiction, as amended from time to time.


          “United States”
or “USA” means the United States
of America (including all states, the District of Columbia and political
subdivisions thereof).


          The
foregoing definitions shall be equally applicable to both the singular and
plural forms of the defined terms. Unless otherwise inconsistent with the terms
of this Agreement, 


A-22





all accounting
terms used herein shall be interpreted, and all accounting determinations
hereunder shall be made, in accordance with GAAP. Amounts to be calculated
hereunder shall be continuously recalculated at the time any information
relevant to such calculation changes.


A-23






SCHEDULE I


REPRESENTATIONS AND WARRANTIES WITH RESPECT
TO THE RECEIVABLES


	
  

 	
  

 
	
           (a)
 Characteristics of Receivables. Each Receivable: 

 
	
  

 	
  

 
	
  

 	
           (i)
 has been fully and properly executed or electronically authenticated (as
 defined in the UCC) by the Obligor thereto; 

 
	
  

 	
  

 
	
  

 	
           (ii)
 has been originated or acquired directly by the Originator in accordance with
 its customary practices; 

 
	
  

 	
  

 
	
  

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

 
	
  

 	
  

 
	
  

 	
           (iv)
 contains customary and enforceable provisions such that the rights and
 remedies of the holder thereof are adequate for realization against the
 collateral of the benefits of the security; 

 
	
  

 	
  

 
	
  

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

 
	
  

 	
  

 
	
  

 	
           (vi)
 provides for interest at the Contract Rate specified in the Schedule of
 Receivables; and 

 
	
  

 	
  

 
	
  

 	
           (vii)
 was originated in the United States. 

 
	
  

 	
  

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

 
	
  

 	
  

 
	
  

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

 
	
  

 	
  

 
	
  

 	
           (ii)
 each Receivable has a Contract Rate of no less than 3.49% and not more than
 17.94%; 

 
	
  

 	
  

 
	
  

 	
           (iii)
 each Receivable had an original term to maturity of not more than 72 months
 and not less than 12 months and each Receivable has a remaining term to
 maturity, as of the Cut-Off Date, of 8 months or more; 

 






	
  

 	
  

 	
  

 
	

  

 	
I-1


 	
Schedule I to the

Sale and Servicing Agreement 

 
















	
  

 	
  

 
	
  

 	
           (iv)
 each Receivable has an Outstanding Principal Balance as of the Cut-Off Date
 of greater than or equal to $803.01; 

 
	
  

 	
  

 
	
  

 	
           (v)
 no Receivable has a scheduled maturity date later than December 28, 2015; 

 
	
  

 	
  

 
	
  

 	
           (vi)
 no Receivable was more than 30 days past due as of the Cut-Off Date; 

 
	
  

 	
  

 
	
  

 	
           (vii)
 as of the Cut-Off Date, no Receivable was noted in the records of the
 Servicer as being the subject of any pending bankruptcy or insolvency
 Proceeding; 

 
	
  

 	
  

 
	
  

 	
           (viii)
 no Receivable is subject to a force-placed Insurance Policy on the related
 Financed Vehicle; 

 
	
  

 	
  

 
	
  

 	
           (ix)
 each Receivable is a Simple Interest Receivable; and 

 
	
  

 	
  

 
	
  

 	
           (x)
 each of the Receivables were selected using selection procedures that were
 not known or intended by the Bank to be adverse to the Noteholders. 

 



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


          (d)
Compliance with Law. Each Receivable complied at the time it was
originated or made, in all material respects with all requirements of
applicable federal, state and local laws, and regulations thereunder,
including, to the extent applicable, usury laws, the Federal Truth in Lending
Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act, the
Federal Trade Commission Act, the Fair Debt Collection Practices Act, the Fair
Credit Billing Act, the Magnuson-Moss Warranty Act, Federal Reserve Board
Regulations B and Z, the Servicemembers Civil Relief Act of 2003, as amended,
state adaptations of the National Consumer Act and of the Uniform Consumer
Credit Code and any other consumer credit, equal opportunity and disclosure
laws applicable to that Receivable.


          (e)
Binding Obligation. Each
Receivable constitutes the legal, valid and binding payment obligation in
writing of the Obligor, enforceable in all material respects by the holder
thereof in accordance with its terms, subject, as to enforcement, to applicable
bankruptcy, insolvency, reorganization, liquidation or other similar laws and
equitable principles relating to or affecting the enforcement of creditors’
rights generally.


          (f)
Receivable in Force. Each Receivable has not been satisfied,
subordinated or rescinded nor has the related Financed Vehicle been released
from the lien granted by the Receivable in whole or in part.


          (g)
No Waiver. As of the
Cut-Off Date, no provision of a Receivable has been waived.


          (h)
No Default. Except for payment delinquencies continuing for a period of
not more than 30 days as of the Cut-Off Date, the records of the Servicer did
not disclose that any 



	
  

 	
  

 	
  

 
	

  

 	
I-2


 	
Schedule I to the

Sale and Servicing Agreement 

 









default,
breach, violation or event permitting acceleration under the terms of the
Receivable existed as of the Cut-Off Date or that any continuing condition that
with notice or lapse of time, or both, would constitute a default, breach,
violation or event permitting acceleration under the terms of the Receivable
had arisen as of the Cut-Off Date. 


          (i)
Insurance. Each Receivable
requires the Obligor thereunder to insure the Financed Vehicle under a physical
damage insurance policy.


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


          (k)
Assignment. No Receivable
has been originated in, or is subject to the laws of, any jurisdiction under
which the sale, transfer, assignment, conveyance or pledge of such Receivable
would be unlawful, void, or voidable. The Seller has not entered into any
agreement with any Obligor that prohibits, restricts or conditions the
assignment of the related Receivable.


          (l)
Good Title. It is the
intention of the Seller that the sale, contribution, transfer, assignment and
conveyance herein contemplated constitute an absolute sale, contribution,
transfer, assignment and conveyance of the Receivables and that the Receivables
not be part of the Seller’s estate in the event of the filing of a bankruptcy
petition by or against the Seller under any bankruptcy law. No Receivable has
been sold, transferred, assigned, conveyed or pledged to any Person other than
pursuant to the Transaction Documents. As of the Closing Date and immediately
prior to the sale and transfer herein contemplated, the Seller had good and
marketable title to each Receivable free and clear of all Liens, and,
immediately upon the sale and transfer thereof, the Issuer will have good and
marketable title to each Receivable, free and clear of all Liens (other than
Permitted Liens).


          (m)
Filings. All filings
(including, without limitation, UCC filings) necessary in any jurisdiction to
give the Issuer a first priority, validly perfected ownership interest in the
Receivables (other than the Related Security with respect thereto), and to give
the Indenture Trustee a first priority perfected security interest therein,
will be made within ten days of the Closing Date.


          (n)
Priority. The Receivable
is not pledged, assigned, sold, subject to a security interest, or otherwise
conveyed other than pursuant to the Transaction Documents. The Seller has not
authorized the filing of and is not aware of any financing statements against
the Bank or the Seller that include a description of collateral covering the
Receivables other than any financing statement relating to security interests
granted under the Transaction Documents or that have been terminated. The Sale
and Servicing Agreement creates a valid and continuing security interest in the
Receivable (other than the Related Security with respect thereto) in favor of
the Issuer which security interest is prior to all other Liens (other than
Permitted Liens) and is enforceable as such against all other creditors of and
purchasers and assignees from the Seller.






	
  

 	
  

 	
  

 
	

  

 	
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Schedule I to the

Sale and Servicing Agreement 

 










          (o)
Characterization of Receivables. Each
Receivable constitutes either “tangible chattel paper,” “electronic chattel
paper,” an “account,” a “promissory note” or a “payment intangible,” each as
defined in the UCC.


          (p)
One Original. With respect
to any Receivable constituting electronic chattel paper, there is only one
“authoritative copy” (as such term is used in Section 9-105 of the UCC) of the
Receivable or with respect to any Receivable constituting tangible chattel
paper for which an original executed copy exists, there is no more than one
original executed copy of such Receivable and none of the instruments, tangible
chattel paper or electronic chattel paper that constitute or evidence the
Receivables has any marks or notations indicating that it has been pledged,
assigned or otherwise conveyed to any Person other than to a party to the
Transaction Documents.


          (q)
No Defenses. The Seller has no knowledge either of any facts which would
give rise to any right of rescission, set-off, counterclaim or defense, or of
the same being asserted or threatened, with respect to any Receivable.


          (r)
No Repossession. As of the Cut-Off Date, no Financed Vehicle shall have
been repossessed.




	
  

 	
  

 	
  

 
	

  

 	
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Schedule I to the

Sale and Servicing Agreement 

 









SCHEDULE II 


NOTICE ADDRESSES


If to the
Issuer: 


c/o Wells
Fargo Delaware Trust Company, National Association

919 North Market Street, Suite 1600

Wilmington, Delaware 19801

Attention: Corporate Trust Administration

Telephone: (302) 575-2004

Facsimile: (302) 575-2006 


with copies to
the Administrator, USAA Federal Savings Bank and the Indenture Trustee 


If to the
Owner Trustee: 


Wells Fargo
Delaware Trust Company, National Association

919 North Market Street, Suite 1600

Wilmington, Delaware 19801

Telecopier No.: (302) 575-2006

Attention: Sandra Battaglia 


If to the
Indenture Trustee: 


The Bank of
New York Mellon

101 Barclay Street, 4 West

New York, New York 10286

Telecopier No.: (212) 815-3986 

Attention: Corporate Trust Administration – USAA 2010-1 


If to the
Bank, the Servicer or the Administrator: 


USAA Federal
Savings Bank

10750 McDermott Freeway

San Antonio, Texas 78288

Telecopier No.: (877) 442-4802

Attention: Mike Broker, Vice President 


If to the
Seller: 


USAA
Acceptance, LLC

10750 McDermott Freeway

San Antonio, Texas 78288

Telecopier No.: (877) 442-4802

Attention: Mike Broker, Vice President 




	
  

 	
  

 	
  

 
	

  

 	
II-1


 	

Schedule II to the

Sale and Servicing Agreement 

 








If to Moody’s:



Moody’s
Investors Service, Inc.

7 World Trade Center

250 Greenwich Street

New York, New York 10007

Telecopier No.: (212) 298-7139

Attention: ABS Monitoring Group 


If to Standard
& Poor’s: 


Standard &
Poor’s Ratings Services

55 Water Street

New York, New York 10041

Telecopier No.: (212) 438-2664 

Attention: Asset Backed Surveillance Group 



	
  

 	
  

 	
  

 
	

  

 	
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Schedule II to the

Sale and Servicing Agreement 

 









EXHIBIT A


FORM OF ASSIGNMENT PURSUANT TO

SALE AND SERVICING AGREEMENT


February 24, 2010


          For
value received, in accordance with the Sale and Servicing Agreement (the “Agreement”),
dated as of February 24, 2010, between USAA Auto Owner Trust 2010-1, a Delaware
statutory trust (the “Issuer”), USAA Acceptance, LLC, a Delaware limited
liability company (the “Seller”), USAA Federal Savings Bank, a federally
chartered savings association (the “Bank”), and The Bank of New York
Mellon, a banking corporation organized under the laws of the State of New York
as indenture trustee, on the terms and subject to the conditions set forth in
the Agreement, the Seller does hereby transfer, assign, set over, sell and
otherwise convey to the Issuer without recourse (subject to the obligations in
the Agreement) on the Closing Date, all of its right, title and interest in, to
and under the Receivables set forth on the schedule of Receivables delivered by
the Seller to the Issuer on the date hereof, the Collections on or after the
Cut-Off Date, the Receivable Files and the Related Security relating thereto,
together with all of Seller’s rights under the Purchase Agreement and all
proceeds of the foregoing; which sale shall be effective as of the Cut-Off
Date. 


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


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


          Capitalized
terms used herein and not otherwise defined shall have the meaning assigned to
them in the Agreement. 


[Remainder of page intentionally left blank]



	
  

 	
  

 	
  

 
	

  

 	
A-1


 	

Exhibit A to the

Sale and Servicing Agreement 

 












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


	
  

 	
  

 	
  

 
	
  

 	
 USAA ACCEPTANCE, LLC

 
	
  

 	
  

 	
  

 
	
  

 	
 By: 

 	
  

 
	
  

 	
  

 	

 


 
	
  

 	
 Name: 

 
	
  

 	
 Title: 

 








	
  

 	
  

 	
  

 
	

  

 	
A-2


 	

Exhibit A to the

Sale and Servicing Agreement 

 









EXHIBIT B 


PERFECTION REPRESENTATIONS, WARRANTIES AND
COVENANTS


In addition to
the representations, warranties and covenants contained in the Agreement, the
Seller hereby represents, warrants and covenants to the Issuer and the
Indenture Trustee as follows on the Closing Date: 


General


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


2. The
Receivables constitute “chattel paper” (including “electronic chattel paper”
and “tangible chattel paper”), “accounts,” “instruments” or “general
intangibles,” within the meaning of the applicable UCC. 


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


Creation


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


5. The related
Originator has received all consents and approvals to the sale of the
Receivables hereunder to the Issuer required by the terms of the Receivables
that constitute instruments. 


Perfection


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





	
  

 	
  

 	
  

 
	

  

 	
B-1


 	

Exhibit B to the

Sale and Servicing Agreement 

 









7. With
respect to Receivables that constitute instruments or tangible chattel paper,
either: 


(i) all
original executed copies of each such instrument or tangible chattel paper have
been delivered to the Indenture Trustee; or 


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


(iii) the
Servicer received possession of such instruments or tangible chattel paper
after the Indenture Trustee received a written acknowledgment from the Servicer
that the Servicer is acting solely as agent of the Indenture Trustee. 


Priority


8. Neither the
Seller nor the Bank has authorized the filing of, and is not aware of, any
financing statements against either the Seller or the Bank that include a
description of collateral covering the Receivables other than any financing
statement (i) relating to the conveyance of the Receivables by the Bank to the
Seller under the Purchase Agreement, (ii) relating to the conveyance of the
Receivables by the Seller to the Issuer under the Sale and Servicing Agreement,
(iii) relating to the security interest granted to the Indenture Trustee under
the Indenture or (iv) that has been terminated. 


9. Neither the
Seller nor the Bank is aware of any material judgment, ERISA or tax lien
filings against either the Seller or the Bank. 


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



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


Survival of Perfection Representations


12.
Notwithstanding any other provision of the Sale and Servicing Agreement or any
other Transaction Document, the perfection representations, warranties and
covenants contained in this Exhibit B shall be continuing, and remain in
full force and effect until such time as all obligations under the Transaction
Documents and the Notes have been finally and fully paid and performed. 





	
  

 	
  

 	
  

 
	

  

 	
B-2


 	

Exhibit B to the

Sale and Servicing Agreement 

 









No Waiver


13. The
parties to the Sale and Servicing Agreement shall provide the Rating Agencies
with prompt written notice of any material breach of the perfection
representations, warranties and covenants contained in this Exhibit B,
and shall not, without satisfying the Rating Agency Condition, waive a breach
of any of such perfection representations, warranties or covenants. 


Servicer to Maintain Perfection and Priority


14. The
Servicer covenants that, in order to evidence the interests of the Seller and
Issuer under the Sale and Servicing Agreement and the Indenture Trustee under
the Indenture, Servicer shall take such action, or execute and deliver such
instruments as may be necessary or advisable (including, without limitation,
such actions as are requested by the Indenture Trustee) to maintain and
perfect, as a first priority perfected security interest, the Indenture
Trustee’s security interest in the Receivables. The Servicer shall, from time
to time and within the time limits established by law, prepare and file, all
financing statements, amendments, continuations, initial financing statements
in lieu of a continuation statement, terminations, partial terminations,
releases or partial releases, or any other filings necessary or advisable to
continue, maintain and perfect the Indenture Trustee’s security interest in the
Receivables as a first-priority perfected security interest. 




	
  

 	
  

 	
  

 
	

  

 	
B-3


 	

Exhibit B to the

Sale and Servicing Agreement 

 










EXHIBIT C


SERVICING CRITERIA TO BE ADDRESSED IN 

INDENTURE TRUSTEE’S ASSESSMENT OF COMPLIANCE


The assessment of compliance to be delivered
by the Indenture Trustee shall address, at a minimum, the criteria identified
below as 
“Applicable Servicing Criteria”1:


	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Servicing Criteria

 	
  

 	
 Applicable

 Servicing Criteria

 
	

 


 	
  

 	

 


 
	
 Reference

 	
  

 	
 Criteria

 	
  

 	
  

 
	

 


 	
  

 	

 


 	
  

 	
  

 
	
  

 	
  

 	
 General Servicing Considerations

 	
  

 	
  

 
	
 1122(d)(1)(i)

 	
  

 	
 Policies and procedures are
 instituted to monitor any performance or other triggers and events of default
 in accordance with the transaction agreements.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(1)(ii)

 	
  

 	
 If any material servicing
 activities are outsourced to third parties, policies and procedures are
 instituted to monitor the third party’s performance and compliance with such
 servicing activities.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(1)(iii)

 	
  

 	
 Any requirements in the
 transaction agreements to maintain a back-up servicer for the pool assets are
 maintained.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(1)(iv)

 	
  

 	
 A fidelity bond and errors and
 omissions policy is in effect on the party participating in the servicing
 function throughout the reporting period in the amount of coverage required
 by and otherwise in accordance with the terms of the transaction agreements.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Cash Collection and Administration

 	
  

 	
  

 
	
 1122(d)(2)(i)

 	
  

 	
 Payments on pool assets are
 deposited into the appropriate custodial bank accounts and related bank
 clearing accounts no more than two business days following receipt, or such
 other number of days specified in the transaction agreements.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(2)(ii)

 	
  

 	
 Disbursements made via wire
 transfer on behalf of an obligor or to an investor are made only by
 authorized personnel.

 	
  

 	
 X

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(2)(iii)

 	
  

 	
 Advances of funds or guarantees
 regarding collections, cash flows or distributions, and any interest or other
 fees charged for such advances, are made, reviewed and approved as specified
 in the transaction agreements.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(2)(iv)

 	
  

 	
 The related accounts for the
 transaction, such as cash reserve accounts or accounts established as a form
 of overcollateralization, are separately maintained (e.g., with respect to
 commingling of cash) as set forth in the transaction agreements.

 	
  

 	
 X

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(2)(v)

 	
  

 	
 Each custodial account is
 maintained at a federally insured depository institution as set forth in the
 transaction agreements. For purposes of this criterion, “federally insured
 depository institution” with respect to a foreign financial institution means
 a foreign financial institution that meets the requirements of Rule
 13k-1(b)(1) of the Securities Exchange Act.

 	
  

 	
 X2

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(2)(vi)

 	
  

 	
 Unissued checks are safeguarded
 so as to prevent unauthorized access.

 	
  

 	
  

 








1 Each assessment of compliance delivered by
the Indenture Trustee shall be made only toward such portion(s) of the
servicing criteria applicable to the Indenture Trustee and not such other
portion(s) applicable to other persons. 


2 Assessment of compliance to be given by
Indenture Trustee shall be only with respect to trust accounts maintained by
the Indenture Trustee under the Sale and Servicing Agreement and the Indenture.



	
  

 	
  

 	
  

 
	
  

 	
 C-1

 	
 Exhibit C to the 

 Sale and Servicing Agreement

 














	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Servicing Criteria

 	
  

 	
 Applicable

 Servicing Criteria

 
	

 


 	
  

 	

 


 
	
 Reference

 	
  

 	
 Criteria

 	
  

 	
  

 
	

 


 	
  

 	

 


 	
  

 	
  

 
	
 1122(d)(2)(vii)

 	
  

 	
 Reconciliations are prepared on a
 monthly basis for all asset-backed securities related bank accounts,
 including custodial accounts and related bank clearing accounts. These
 reconciliations are (A) mathematically accurate; (B) prepared within 30
 calendar days after the bank statement cutoff date, or such other number of
 days specified in the transaction agreements; (C) reviewed and approved by
 someone other than the person who prepared the reconciliation; and (D)
 contain explanations for reconciling items. These reconciling items are
 resolved within 90 calendar days of their original identification, or such
 other number of days specified in the transaction agreements.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Investor Remittances and Reporting

 	
  

 	
  

 
	
 1122(d)(3)(i)

 	
  

 	
 Reports to investors, including
 those to be filed with the Commission, are maintained in accordance with the
 transaction agreements and applicable Commission requirements. Specifically,
 such reports (A) are prepared in accordance with timeframes and other terms
 set forth in the transaction agreements; (B) provide information calculated
 in accordance with the terms specified in the transaction agreements; (C) are
 filed with the Commission as required by its rules and regulations; and (D)
 agree with investors’ or the trustee’s records as to the total unpaid
 principal balance and number of pool assets serviced by the Servicer.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(3)(ii)

 	
  

 	
 Amounts due to investors are
 allocated and remitted in accordance with timeframes, distribution priority
 and other terms set forth in the transaction agreements.

 	
  

 	
 X
(solely with respect to

 remittances)

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(3)(iii)

 	
  

 	
 Disbursements made to an investor
 are posted within two business days to the Servicer’s investor records, or
 such other number of days specified in the transaction agreements.

 	
  

 	
 X

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(3)(iv)

 	
  

 	
 Amounts remitted to investors per
 the investor reports agree with cancelled checks, or other form of payment,
 or custodial bank statements.

 	
  

 	
 X

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Pool Asset Administration

 	
  

 	
  

 
	
 1122(d)(4)(i)

 	
  

 	
 Collateral or security on pool
 assets is maintained as required by the transaction agreements or related
 asset pool documents.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(ii)

 	
  

 	
 Pool assets and related documents
 are safeguarded as required by the transaction agreements

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(iii)

 	
  

 	
 Any additions, removals or
 substitutions to the asset pool are made, reviewed and approved in accordance
 with any conditions or requirements in the transaction agreements.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(iv)

 	
  

 	
 Payments on pool assets,
 including any payoffs, made in accordance with the related pool asset
 documents are posted to the Servicer’s obligor records maintained no more
 than two business days after receipt, or such other number of days specified
 in the transaction agreements, and allocated to principal, interest or other
 items (e.g., escrow) in accordance with the related asset pool documents.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(v)

 	
  

 	
 The Servicer’s records regarding
 the accounts and the accounts agree with the Servicer’s records with respect
 to an obligor’s unpaid principal balance.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(vi)

 	
  

 	
 Changes with respect to the terms
 or status of an obligor’s account (e.g., loan modifications or re-agings) are
 made, reviewed and approved by authorized personnel in accordance with the
 transaction agreements and related pool asset documents.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(vii)

 	
  

 	
 Loss mitigation or recovery actions
 (e.g., forbearance plans, modifications and deeds in lieu of foreclosure,
 foreclosures and repossessions, as applicable) are initiated, conducted and
 concluded in accordance with the timeframes or other requirements established
 by the transaction agreements.

 	
  

 	
  

 






	
  

 	
  

 	
  

 
	
  

 	
 C-2

 	
 Exhibit C to the 

 Sale and Servicing Agreement

 













	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Servicing Criteria

 	
  

 	
 Applicable

 Servicing Criteria

 
	

 


 	
  

 	

 


 
	
 Reference

 	
  

 	
 Criteria

 	
  

 	
  

 
	

 


 	
  

 	

 


 	
  

 	
  

 
	
 1122(d)(4)(viii)

 	
  

 	
 Records documenting collection
 efforts are maintained during the period a pool asset is delinquent in
 accordance with the transaction agreements. Such records are maintained on at
 least a monthly basis, or such other period specified in the transaction
 agreements, and describe the entity’s activities in monitoring delinquent pool
 assets including, for example, phone calls, letters and payment rescheduling
 plans in cases where delinquency is deemed temporary (e.g., illness or
 unemployment).

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(ix)

 	
  

 	
 Adjustments to interest rates or
 rates of return for pool assets with variable rates are computed based on the
 related pool asset documents.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(x)

 	
  

 	
 Regarding any funds held in trust
 for an obligor (such as escrow accounts): (A) such funds are analyzed, in
 accordance with the obligor’s Account documents, on at least an annual basis,
 or such other period specified in the transaction agreements; (B) interest on
 such funds is paid, or credited, to obligors in accordance with applicable
 Account documents and state laws; and (C) such funds are returned to the obligor
 within 30 calendar days of full repayment of the related Accounts, or such
 other number of days specified in the transaction agreements.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(xi)

 	
  

 	
 Payments made on behalf of an
 obligor (such as tax or insurance payments) are made on or before the related
 penalty or expiration dates, as indicated on the appropriate bills or notices
 for such payments, provided that such support has been received by the
 servicer at least 30 calendar days prior to these dates, or such other number
 of days specified in the transaction agreements.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(xii)

 	
  

 	
 Any late payment penalties in
 connection with any payment to be made on behalf of an obligor are paid from
 the servicer’s funds and not charged to the obligor, unless the late payment
 was due to the obligor’s error or omission.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(xiii)

 	
  

 	
 Disbursements made on behalf of
 an obligor are posted within two business days to the obligor’s records
 maintained by the servicer, or such other number of days specified in the
 transaction agreements. 

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(xiv)

 	
  

 	
 Delinquencies, charge-offs and
 uncollectible accounts are recognized and recorded in accordance with the
 transaction agreements.

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1122(d)(4)(xv)

 	
  

 	
 Any external enhancement or other
 support, identified in Item 1114(a)(1) through (3) or Item 1115 of Regulation
 AB, is maintained as set forth in the transaction agreements.

 	
  

 	
  

 






	
  

 	
  

 	
  

 
	
  

 	
 C-3

 	
 Exhibit C to the 

 Sale and Servicing Agreement

 









EXHIBIT D 


FORM OF INDENTURE TRUSTEE’S ANNUAL
CERTIFICATION 


Re: USAA AUTO OWNER TRUST 2010-1 


                    The
Bank of New York Mellon, not in its individual capacity but solely as indenture
trustee (the “Indenture Trustee”), certifies to USAA Acceptance, LLC
(the “Seller”), and its officers, with the knowledge and intent that
they will rely upon this certification, that: 


	
  

 	
  

 
	
  

 	
           (1)
 It has reviewed the report on assessment of the Indenture Trustee’s
 compliance provided in accordance with Rules 13a-18 and 15d-18 under the
 Securities Exchange Act of 1934, as amended (the “Exchange Act”), and
 Item 1122 of Regulation AB (the “Servicing Assessment”) (collectively,
 the “Indenture Trustee Information”); 

 
	
  

 	
  

 
	
  

 	
           (2)
 To the best of its knowledge, the Indenture Trustee Information, taken as a
 whole, does not contain any untrue statement of a material fact or omit to
 state a material fact necessary to make the statements made, in the light of
 the circumstances under which such statements were made, not misleading with
 respect to the period of time covered by the Indenture Trustee Information;
 and 

 
	
  

 	
  

 
	
  

 	
           (3)
 To the best of its knowledge, all of the information required to be provided
 by the Indenture Trustee pursuant to Sections 9.21 and 9.22 of
 the Agreement has been provided to the Seller. 

 






	
  

 	
  

 	
  

 
	
  

 	
 THE BANK OF
 NEW YORK MELLON, not in its 

 individual capacity but solely as Indenture Trustee

 
	
  

 	
  

 	
  

 
	
  

 	
 Date:

 	
  

 
	
  

 	
  

 	

 


 






	
  

 	
  

 	
  

 
	
  

 	
 D-1

 	
 Exhibit D to the 

 Sale and Servicing Agreement

 









EXHIBIT E 


FORM OF INDENTURE TRUSTEE’S ANNUAL
CERTIFICATION 

REGARDING ITEM 1117 AND ITEM 1119 OF REGULATION AB


          Reference
is made to the Form 10-K of USAA Acceptance, LLC with respect to USAA Auto
Owner Trust 2010-1 (the “Form 10-K”) for the fiscal year ended December
31, 20[   ]. Capitalized terms used but not otherwise defined
herein shall have the respective meanings given to them in the Form 10-K. 


          The
Bank of New York Mellon, a banking corporation organized under the laws of the
State of New York (“BNY”), does hereby certify to the Sponsor, the
Seller and the Issuing Entity that: 


               1.
As of the date of the Form 10-K, there are no pending legal proceedings against
BNY or proceedings known to be contemplated by governmental authorities against
BNY that would be material to the investors in the Notes. 


               2.
As of the date of the Form 10-K, there are no affiliations, as contemplated by
Item 1119 of Regulation AB, between BNY and any of USAA Federal Savings Bank
(in its capacity as Sponsor, Originator, Servicer and Administrator), USAA
Acceptance, LLC, the Indenture Trustee, the Owner Trustee and the Issuing
Entity, or any affiliates of such parties. 


          IN
WITNESS WHEREOF, BNY has caused this certificate to be executed in its
corporate name by an officer thereunto duly authorized. 


Dated:
____________, 20[    ] 


	
  

 	
  

 	
  

 
	
  

 	
 THE BANK OF
 NEW YORK MELLON, as 

 Indenture Trustee

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 
	
  

 	
  

 	

 


 
	
  

 	
 Name:

 
	
  

 	
 Title:

 






	
  

 	
  

 	
  

 
	

  

 	
 E-1


 	
 Exhibit E to the 

 Sale and Servicing Agreement