EX-10.4






Exhibit 10.4




SUBSERVICING AGREEMENT




dated as of March 2, 2007




between




PALISADES COLLECTION, L.L.C.,




as the Servicer,




and




WOLPOFF & ABRAMSON, L.L.P.,




as the Subservicer




 









 





SUBSERVICING AGREEMENT




     THIS SUBSERVICING AGREEMENT is entered into effective as of March 2, 2007 (as amended,
supplemented or otherwise modified from time to time, the “Subservicing Agreement”),
between PALISADES COLLECTION, L.L.C., a Delaware limited liability company (together with its
successors and assigns, the “Servicer”), and WOLPOFF & ABRAMSON, L.L.P (the
“Subservicer”).



RECITALS




          1. The Servicer has entered into a servicing agreement, of even date herewith (as amended,
supplemented or modified from time to time, the “Servicing Agreement”), with Palisades
Acquisition XVI, LLC (the “Borrower”) and BMO Capital Markets Corp. (“BMO CM”)
pursuant to which, on the terms and subject to the conditions set forth therein, the Servicer has
agreed to service, among other receivables, the Receivables for the benefit of the Borrower.



          2. The Borrower and BMO CM, as collateral agent for the benefit of certain secured parties
(the “Collateral Agent”) pursuant to the Receivables Financing Agreement, have entered into
a security agreement, of even date herewith, pursuant to which the Borrower has granted to the
Collateral Agent, security interest in, among other things, collections on the Receivables.



          3. The Servicer has requested Subservicer to undertake certain collecting and servicing
responsibilities in respect of the Receivables, and the Subservicer is willing to undertake such
responsibilities and accept such bailment, acknowledging that such subservicing activities are
undertaken for the benefit of both the Borrower and, for as long as a security interest is
outstanding, the Collateral Agent, for the benefit of secured parties.



     NOW, THEREFORE, in consideration of the mutual agreements herein contained, the Servicer and
the Subservicer hereby agree as follows:



ARTICLE 1.

DEFINITIONS




     Section 1.01 Definitions.



     Whenever used in this Subservicing Agreement, the following words and phrases, unless the
context otherwise requires, shall have the meanings specified in this Article (such meanings to be
equally applicable to both the singular and plural forms of the terms defined and to all genders):



     “Administrator” means BMO CM in such capacity under the Receivables Financing
Agreement.



     “Accepted Servicing Practices” means those accepted, customary and prudent servicing
practices in the industry for the same type of assets as the Receivables and designed in a manner
to maximize the value of the Receivables.



 









 





     “Bankruptcy Code” means Title 11 of the United States Code, as amended.



     “Borrower” has the meaning set forth in the first Recital.



     “Business Day” means any day on which commercial banks in Chicago, Illinois, New
Jersey or New York City are not authorized or required to be closed.



     “Collateral” means all property of the Borrower wherever located, whether now or
hereafter existing, owned, licensed, leased, consigned, arising or acquired, including, without
limitation, all of the Borrower’s right, title and interest in and to all Receivables and other
Receivable Assets; all funds on deposit in the Collection Account to the extent constituting
payments or other proceeds of the Receivables, together with all certificates and instruments, if
any, from time to time evidencing the foregoing, and all investments made with such funds, all
claims thereunder or in connection therewith, and interest, dividends, moneys, instruments,
securities and other property from time to time received or receivable in respect of any or all of
the foregoing; and all products and proceeds (including, without limitation, insurance proceeds and
Liquidation Proceeds) of, and additions, improvements and accessions to, and books and records
describing or used in connection with, all and any of the property described above.



     “Collateral Agent” has the meaning set forth in the second Recital.



     “Collection Account” means that certain bank account numbered 379-573-9 maintained
with the Collection Account Bank, which is identified as the “Palisades Acquisition XVI, LLC
Collection Account.”



     “Collection Account Bank” means Harris N.A. or any replacement therefor pursuant to
the Receivables Financing Agreement.



     “Collections” means, with respect to any Receivable, all funds (net of any Liquidation
Expenses) (a) received by the Subservicer from or on behalf of the related Obligors in payment of
any amounts owed (including, without limitation, principal, finance charges, interest and all other
amounts and charges) in respect of such Receivable from and after the Cutoff Date or (b) applied to
such amounts owed by such Obligors (including, without limitation, through the liquidation of
Collateral or insurance payments or proceeds on account of any casualty loss with respect to any
collateral or property of the Obligor or any other party directly or indirectly liable for payment
of such Receivable and available to be applied thereon).



     “Collection Period” means with respect to a Distribution Date, the period from and
including the first day of the month preceding the month in which such Distribution Date occurs to
and including the last day of the month preceding the month of such Distribution Date. Each
Collection Period shall consist of a calendar month.



     “Cutoff Date” mean the date set forth in the Purchase Agreement.



     “Exempted Receivables” means Judgment Asset Receivables and Paying Receivables.



     “Judgment Asset Receivables” means each Receivable (a) that is in active litigation
or (b) for which a judgment has been rendered within the preceding 120 days or (c) that is in post



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judgment enforcement or (d) at any time prior the second anniversary of this Subservicing
Agreement, that has been identified by the Subservicer as subject to litigation; provided, however,
in the case of a sale by the Borrower of Receivables that are judgments that are non-liquidating
and have no post-judgment enforcement activity occurring or imminent, such Receivables shall not be
deemed to be Judgment Asset Receivables.



     “Liquidation Expenses” means all court costs, arbitration fees and costs and
reasonable out-of-pocket expenses that are incurred by the Subservicer or a vendor in connection
with the collection or liquidation of any Receivable or related collateral, if any, such expenses
including, without limitation, legal and arbitration fees and expenses (including, but not limited
to, service of process fees), any file fees and foreclosure or repossession expenses and any
unreimbursed amount expended by the Subservicer or any vendor pursuant to Section 3.02 (to
the extent such amount is reimbursable under the terms of Section 3.02) respecting the
related Receivable.



     “Liquidation Proceeds” means cash received in connection with the collection or
liquidation of Receivables or related collateral, if any, whether through sale or otherwise.



     “List of Receivables” means each of the list of Receivables attached as Schedule 2
hereto, as the same may be amended, supplemented or replaced from time to time.



     “Material Adverse Effect” means with respect to any event or circumstance, a material
adverse effect on: (a) the business, assets, financial condition or operations of Subservicer; (b)
the ability of any of the Subservicer to perform its obligations under the Subservicing Agreement;
(c) the validity, enforceability or collectibility of this Subservicing Agreement; (d) the status,
existence, perfection or priority of (i) the Borrower’s ownership interest, or the Collateral
Agent’s security interest, in the Receivables or the other Collateral or (e) the validity,
enforceability or the level of collectibility of a material amount of the Receivables.



     “Obligor” means a Person obligated to make payments with respect to a Receivable.



     “Officer’s Certificate” means a certificate signed by the Chief Executive Officer, the
President, the Chief Financial Officer, a Manager or any Vice President of the Subservicer, as the
case may be, and delivered to the Servicer , as required by this Subservicing Agreement.



     “Paying Receivables” means each Receivable, the Obligor of which (a) is currently
paying under a payment plan or (b) accounts that have active garnishments, attachments, lien
proceedings or other involuntary, judicial executions or (c) has committed to enter into a payment
plan or to remit the full or agreed settlement amount thereof within the next 60 days.



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



     “Purchase Agreement” means the purchase and sale agreement, dated as of February 5,
2007, between Great Seneca Financial Corporation, Platinum Financial Services Corporation, Monarch
Capital Corporation, Colonial Credit Corporation, Centurion Capital Corporation, Sage Financial
Limited and Hawker Financial Corporation and Palisades Acquisition XV, LLC.



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     “Receivable” means those credit card and other consumer installment credit agreement
accounts and receivables (including, without limitation, judgments) included on the List of
Receivables.



     “Receivables Assets” means the assets consisting of (i) the Receivables, including
all interest, finance charges, principal and other amounts received on or with respect to the
Receivables (other than payments received on the Receivables before the applicable Cut-off Date);
(ii) the Receivable Files; (iii) collateral, if any, that secures a Receivable; (iv) all rights to
insurance proceeds and Liquidation Proceeds; and (v) the proceeds of the foregoing and the rights
to enforce the foregoing.



     “Receivable Files” means, with respect to each Receivable, the file (on paper or
electronic medium) containing any original documents, agreements, judgments or instruments relating
to such Receivable in the Subservicer’s possession or control including, without limitation, any
bill of sale, loan agreement, any guarantees, any security agreement, any UCC financing statement,
any pledge agreements, any indemnification agreements, any judgment or court orders and any
assignment, supplement, reinstatement, extension, endorsement or modification thereof.



     “Receivables Financing Agreement” shall mean that certain receivables financing
agreement, of even date herewith, among the Borrower, the Servicer, BMO CM, as collateral agent and
administrator, Fairway Finance Company, LLC and Bank of Montreal.



     “Servicer” has the meaning set forth in the Preamble.



     “Subservicer Termination Event” has the meaning set forth in Section 5.01.



     “Servicing Agreement” has the meaning set forth in the Preamble.



     “Subservicer” has the meaning set forth in the Preamble.



     “Subservicing Agreement” has the meaning set forth in the Preamble.



     “Subservicing Fee” means as to any Collection Period and any Receivable, the monthly
fee payable to the Subservicer, which shall be the product of the percentage applicable to the
class of Receivable for such Receivable, as set forth on Schedule 1 hereto, multiplied by the
Collections on such Receivable received during such Collection Period.



     “Transfer Date” means the Closing Date, as set forth in the Purchase Agreement.



     “Unmatured Subservicer Termination Event” shall mean any event that, if it continues
uncured, will, with lapse of time or notice or lapse of time and notice, constitute a Subservicer
Termination Event.



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ARTICLE 2.

REPRESENTATIONS, WARRANTIES AND COVENANTS




     Section 2.01 Representations, Warranties and Covenants of Subservicer. (a) The
Subservicer hereby represents, warrants and covenants to the Servicer that:



               (i) the Subservicer is duly organized, validly existing and in good standing as a limited
liability partnership under the laws of the District of Columbia and is qualified to transact
business in and is in good standing under the laws of each state in which it is necessary for it to
be so qualified in order to carry on its business as now being conducted and has all licenses
necessary to carry on its business as now being conducted; the Subservicer has the full power and
authority to own its property, to carry on its business as presently conducted, and to execute,
deliver and perform this Subservicing Agreement; the execution, delivery and performance of this
Subservicing Agreement and the consummation of the transactions contemplated hereby have been duly
and validly authorized by all necessary limited liability parntership action on the part of the
Subservicer; and this Subservicing Agreement evidences the legal, valid, binding and enforceable
obligation of the Subservicer, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar law affecting creditors’ rights generally and by
general principles of equity;



               (ii) except for such consents, licenses, approvals or authorizations obtained on or prior to
the date hereof, the Subservicer is not required to obtain the consent of any other party or obtain
the consent, license, approval or authorization of, or make any registration or declaration with,
any governmental authority, bureau or agency in connection with the execution, delivery,
performance, validity or enforceability of this Subservicing Agreement;



               (iii) the consummation of the transactions contemplated by this Subservicing Agreement and
the fulfillment of the terms hereby will not result in the breach of any term or provision of the
organizational documents of the Subservicer or result in the breach of any term or provision of, or
conflict with or constitute a default under or result in the acceleration of any obligation under,
any agreement, indenture or loan or credit agreement or other instrument to which the Subservicer
or its property is subject, or result in the violation of any law, rule, regulation, order,
judgment or decree to which the Subservicer or its property are subject;



               (iv) the Subservicer is not a party to, bound by or in breach or violation of any indenture
or other agreement or instrument, or subject to or in violation of any statute, order or regulation
of any court, regulatory body, administrative agency or governmental body having jurisdiction over
it, that materially and adversely affects, or may in the future be reasonably expected to
materially and adversely affect, the ability of the Subservicer to perform its obligations under
this Subservicing Agreement;



               (v) there are no actions, suits or proceedings pending or, to the knowledge of the
Subservicer, threatened against the Subservicer, before or by any court, administrative agency,
arbitrator or governmental body with respect to any of the transactions contemplated by



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this Subservicing Agreement, that will, if determined adversely to the Subservicer, affect the
validity or enforceability hereof or materially and adversely affect the Subservicer’s ability to
perform its obligations under this Subservicing Agreement;



               (vi) [reserved];



               (vii) as of the Transfer Date, the Subservicer (i) is not “insolvent” (as such terms is
defined in §101(32)(A) of the Bankruptcy Code), (ii) is able to pay its debts as they become due,
and (iii) does not have unreasonably small capital for the business in which it is engaged or for
any business or transaction in which it is about to engage;



               (viii) all certificates, reports, financial statements and similar writings furnished by the
Subservicer at anytime to the Servicer under or in connection with this Subservicing Agreement have
been, and all such certificates, reports, financial statements and similar writings hereafter
furnished by the Subservicer to such parties will be, true and accurate in every respect material
to the transactions contemplated hereby on the date as of which any such certificate, report,
financial statement or similar writing was or will be delivered, and shall not omit to state any
material facts or any facts necessary to make the statements contained therein, in light of the
circumstances under which they were made, not materially misleading;



               (ix) the Subservicer will comply in all material respects with all applicable laws, rules,
regulations and orders of all governmental authorities (including those which relate to the
Receivables) the violation of which could have a Material Adverse Effect;



               (x) the Subservicer will preserve and maintain its limited liability partnership existence,
rights, franchises and privileges in the jurisdiction of its organization, and qualify and remain
qualified in good standing as a foreign organization in the jurisdiction where its principal place
of business and its chief executive office are located and in each other jurisdiction where the
failure to preserve and maintain such existence, rights, franchises, privileges and qualifications
could have a Material Adverse Effect.



               (xi) the Subservicer will keep books and records that accurately reflect all of Subservicer’s
business affairs and transactions, maintain and implement administrative and operating procedures
(including, without limitation, an ability to re-create records evidencing the Receivables in the
event of the destruction of the originals thereof) and keep and maintain all documents, books,
records and other information reasonably necessary or advisable for the collection of all
Receivables;



               (xii) except in connection with litigation, actions and proceedings in the ordinary course
and relating to the Receivables relating to the Subservicer’s servicing duties as contemplated by
the Accepted Servicing Practices, the Subservicer will furnish to the Servicer:




          (1) As soon as possible, and in any event within three Business Days after, the
Subservicer receives notice thereof, any settlement of, judgment



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(including a judgment with respect to the liability phase of a bifurcated
trial) in or commencement of, any labor controversy, litigation, investigation,
action or proceeding of the type described in Section 2.01(v) and, upon the
Servicer’s request, copies of all non-confidential or non-privileged documentation
relating thereto;




          (2) As soon as possible and in any event within three Business Days of the
Subservicer’s knowledge thereof, notice of any material adverse development in
previously disclosed litigation, investigation or proceeding;




          (3) Promptly and in any event within three Business Days of the Subservicer’s
knowledge thereof, notice of any other event or circumstance that, in the reasonable
judgment of the Subservicer, could have a Material Adverse Effect on the
Subservicer;




          (4) As soon as possible and in any event within three Business Days after the
occurrence of each Subservicer Termination Event and each Unmatured Subservicer
Termination Event, notice of such occurrence setting forth details of such event and
the action that Subservicer proposes to take with respect thereto; and




          (5) Promptly, from time to time, such other information, documents, records or
reports respecting the Receivables, or the condition or operations, financial or
otherwise, of the Subservicer as the Servicer may from time to time reasonably
request.



               (xiii) subject to Section 2.01(a)(x), the Subservicer will maintain all licenses,
permits, charters and registrations which are material to the performance of its obligations under
this Subservicing Agreement;



               (xiv) except pursuant to, or as contemplated by, this Subservicing Agreement, the Subservicer
shall not sell, assign (by operation of law or otherwise) or otherwise dispose of, or create or
suffer to exist voluntarily or, for a period in excess of 10 days, involuntarily any Adverse Claims
naming the Subservicer as debtor upon or with respect to any of the Collateral;



               (xv) the Subservicer will not make any change in its instructions to Obligors regarding
payments to be made to the Subservicer that could adversely affect the collectibility of any
Receivable;



               (xvi) the Subservicer shall ensure that, with respect to each Receivable (excluding up to
$100,000 of Receivables in the aggregate) related to judgments, all required notices and recordings
with respect to the related transfer of such Receivable have been filed or otherwise made of record
with the applicable court on the first date after the Transfer Date when



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the Subservicer makes any filings or appearances with such court, except where in the
reasonable judgment of the Subservicer, filing of such notices and recordings is not cost-effective
and in the best interests of the Borrower; and



               (xvii) the Subservicer will maintain with responsible insurance companies, such insurance as
may be required by any law or governmental regulation or court decree or order applicable to it and
such other insurance, to such extent and against such hazards and liabilities, as is customarily
maintained by companies similarly situated, including, without limitation (1) an errors and
omissions insurance policy and (2) a blanket employee dishonest coverage.



     (b) Upon discovery by the Servicer of a breach of any of the representations and warranties
set forth in this Section 2.01, the party discovering such breach shall give prompt written
notice thereof to the other parties.



     Section 2.02 Servicer Indemnity. The Subservicer hereby agrees to indemnify the
Servicer (the “Servicer Indemnified Party”) forthwith on demand, from and against any and
all damages, losses, claims, liabilities and related costs and expenses, including reasonable
attorneys’ fees and disbursements (“Servicer Indemnified Amounts”) awarded against or
incurred by such Servicer Indemnified Party arising out of or relating to (a) actions taken or
omitted by the Subservicer with respect to the Receivables, including the failure of the
Subservicer to perform its obligations in accordance with the provisions of this Subservicing
Agreement, excluding, however, Servicer Indemnified Amounts to the extent determined by a court of
competent jurisdiction to have resulted from the negligence, bad faith or willful misconduct on the
part of the Servicer Indemnified Party and (b) the breach of any representation or warranty made by
the Subservicer under this Agreement.



     Section 2.03 Subservicer Indemnity. Palisades Collection, L.L.C. hereby agrees to
indemnify the Subservicer (the “Subservicer Indemnified Party”) forthwith on demand, from
and against any and all damages, losses, claims, liabilities and related costs and expenses,
including reasonable attorneys’ fees and disbursements (“Subservicer Indemnified Amounts”)
awarded against or incurred by such Subservicer Indemnified Party arising out of or relating
actions taken or omitted by Palisades Collection, L.L.C. with respect to the Receivables,
excluding, however, Subservicer Indemnified Amounts (i) to the extent determined by a court of
competent jurisdiction to have resulted from the negligence, bad faith or willful misconduct on the
part of the Subservicer Indemnified Party or (ii) arising out of or relating to errors or omissions
in connection with the servicing of the Receivables prior to the Transfer Date or the origination
of the Receivables.



ARTICLE 3.

ADMINISTRATION AND SERVICING OF RECEIVABLES




     Section 3.01 Subservicer to Service. The Subservicer shall service and administer the
Receivables on behalf of the Borrower and the Collateral Agent (for the benefit of the Secured
Parties) and shall have full power and authority, acting alone and/or through third party



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vendors as provided in Section 4.01, to do any and all things that it may deem
reasonably necessary or desirable in connection with such servicing and administration and that do
not violate any of the material terms of this Subservicing Agreement or the Accepted Servicing
Practices. Consistent with the terms of this Subservicing Agreement and the Accepted Servicing
Practices, the Subservicer may waive, modify or vary any term of any Receivable or consent to the
postponement of strict compliance with any such term or in any manner, grant indulgence to any
Obligor under a Receivable if, in the Servicer’s reasonable determination, such waiver,
modification, postponement or indulgence is not adverse to the interests of the Borrower, the
Collateral Agent or any of the Secured Parties. The Subservicer shall have 75% settlement
authority on the full balance owed inclusive of interest and costs unless given other settlement
authority by the Servicer in writing. Without limiting the generality of the foregoing, the
Subservicer in the name of the Servicer or in the name of the Borrower is hereby authorized and
empowered by the Servicer when the Subservicer believes it appropriate in its best judgment to
execute and deliver, on behalf of the Borrower, any and all instruments of satisfaction or
cancellation, or of partial or full release or discharge and all other comparable instruments, with
respect to the Receivables. The Subservicer shall maintain on its electronic system of record,
data on the accounts containing complete notes and documentation of all payments, credits, and any
other servicing activities.



     The Subservicer shall service and administer the Receivables in accordance with applicable
law, including the Fair Debt Collection Practices Act of 1968, as amended, and comparable state
statutes, and by employing such procedures (including collection procedures) and degree of care, in
each case as are customarily employed by the Subservicer in servicing and administering contracts
owned or serviced by the Subservicer comparable to the Receivables. The Subservicer shall take all
actions that are necessary or desirable to maintain continuous perfection of security interests
granted by the Obligors in any collateral securing the Receivables, including, but not limited to,
recording, registering, giving notice, obtaining consents, filing, re-recording, re-registering and
refiling security agreements, financing statements, continuation statements, notices, recordings or
communications with court or other instruments as are necessary to maintain the security interest
granted by the Obligors under the respective Receivables. The Subservicer shall comply at all
times in all material respects with the Accepted Servicing Practices and shall not take any action
to impair the Collateral Agent’s security interest in any Receivable or related collateral, if any,
except to the extent allowed under this Subservicing Agreement, consistent with Accepted Servicing
Practices or required by law.



     The Subservicer may perform any of its duties pursuant to this Subservicing Agreement,
including those delegated to it pursuant to this Subservicing Agreement, through third party
vendors appointed by the Subservicer; provided, that, in each such delegation (i) the
Servicer shall have the right to look solely to the Subservicer for performance, and (iii) the
terms of each third party vendor agreement shall provide that, except with respect to Exempted
Receivables, such agreement and the rights and obligations of the related vendor thereunder shall
automatically, and without any further action by any other Person, terminate upon the termination
of the Subservicer hereunder and that the Subservicer shall provide appropriate notice to each such
vendor). Notwithstanding any such delegation of a duty, the Subservicer shall remain obligated and
liable for the performance of such duty as if the Subservicer were performing such duty.




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     The Subservicer may take such actions as are necessary to discharge its duties as the
Subservicer in accordance with this Subservicing Agreement, including the power to execute and
deliver on behalf of the Borrower such instruments and documents as may be customary, necessary or
desirable in connection with the performance of the Subservicer’s duties under this Subservicing
Agreement (including consents, waivers and discharges relating to the Receivables and related
collateral, if any, and such instruments or documents as may be necessary to effect liquidation of
any Receivable or related collateral, if any). In furtherance thereof, the Servicer hereby
irrevocably appoints the Subservicer as its attorney-in-fact to execute on its behalf such
documents or instruments as are necessary to effect the liquidation of any Receivable or related
collateral, if any.



     Section 3.02 Collection of Receivable Payments; Collection Account. The Subservicer
shall comply in all material respects with generally accepted collection industry standards and
policies and procedures of the Subservicer and shall at all times in all material respects follow
the Accepted Servicing Practices in collecting and attempting to collect all payments called for
under the terms and provisions of the Receivables, and shall use servicing procedures generally
accepted in the collection industry for similar accounts and as otherwise expressly provided by
this Subservicing Agreement; provided, however, that the Subservicer shall not be
obligated to institute any action unless it determines in its good faith judgment that Liquidation
Proceeds that would be realized in connection therewith would be sufficient for the reimbursement
in full of the Liquidation Expenses related thereto. If the Subservicer determines that it shall
not commence any legal action with respect to a Receivable pursuant to the provisions of the prior
sentence, notwithstanding anything else in this Subservicing Agreement to the contrary, the
Servicer shall have the right to remove such Receivable from this Subservicing Agreement at any
time thereafter. With respect to 335,161 Receivables in the amount of $896,543,655.18 identified
as priority and non-priority in the “pre-litigation” category of the Diligence File (as defined in
the Purchase Agreement), if the Subservicer does not initiate litigation within eighteen months of
the date of this Subservicing Agreement, notwithstanding anything else in this Subservicing
Agreement to the contrary, the Servicer shall have the right to remove such applicable Receivables
from this Subservicing Agreement at any time thereafter. With respect to all other Receivables in
the “pre-litigation” category, upon written notice from one party to this Subservicing Agreement to
the other that litigation should be initiated with respect to any such Receivable, if the
Subservicer does not initiate litigation within 180 days of such notice, notwithstanding anything
else in this Subservicing Agreement to the contrary, the Servicer shall have the right to remove
such applicable Receivables from this Subservicing Agreement at any time thereafter. In connection
with such action, the Subservicer shall follow such practices and procedures required by
Section 3.01 and make advances of its own funds for any out-of-pocket expenses incurred.
The Subservicer shall be reimbursed for Liquidation Expenses (including advances) by retention of
the required reimbursement from Liquidation Proceeds and shall deposit the excess of such proceeds
in the Collection Account.



     Subject to Section 3.06 (which provides that, except in the instances set forth therein,
the remittance of Collections shall net the related Servicing Fees), the Subservicer shall
deposit in an attorney trust account no later than 1 Business Day following receipt thereof and in
the Collection Account no later than 1 Business Day thereafter:



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               (i) All Liquidation Proceeds, including, without limitation, all principal, finance charges,
interest, late payment fees and extension fees, insurance proceeds and all other amounts and
charges but net of (x) charge backs (attributable to errors in posting, returned checks), (y)
rights of offset for amounts that should not have been paid or that must be refunded as the result
of a successful claim or defense under bankruptcy or similar laws and (z) proceeds to be retained
by the Servicer for reimbursement of Liquidation Expenses; and



               (ii) Any other proceeds of any Receivables or property acquired in respect thereof and any
other Collections received by the Subservicer.


From the time of receipt of any of the amounts specified in the preceding two clauses of this
paragraph until deposit thereof in the Collection Account, the Subservicer shall keep such funds in
an attorney trust account. The Subservicer shall not deposit or otherwise credit to the Collection
Account, or cause or permit to be so deposited or credited by any Person, any amounts not
representing proceeds of the Collateral. The Subservicer agrees that it has no ownership right or
interest in amounts on deposit in the Collection Account, except that which may arise indirectly
through a right to receive distributions from the Collection Account under this Subservicing
Agreement. The Subservicer shall have the right to request the Servicer request the Collateral
Agent to withdraw the following amounts from the Collection Account for payment to the Subservicer
on a monthly basis after such time as the Servicer is permitted to request such amounts: (a)
chargebacks attributable to errors in posting, returned checks, or rights of offset for amounts
that should not have been paid or that must be refunded as a result of a successful claim or
defense under bankruptcy or similar laws (to the extent such amounts have not already been retained
by the Subservicer pursuant to clause (i) and (ii) of this paragraph) and (b)
amounts deposited in error by the Subservicer (and the Servicer may rely on the Subservicer’s
calculation of such chargebacks and amounts).




     In those cases where a vendor is subservicing a Receivable pursuant to a vendor agreement, the
Subservicer shall cause the vendor, pursuant to such agreement, to deposit all Collections received
by such vendor (in respect of the Receivables being subserviced by such vendor) with the
Subservicer within, using reasonable efforts, seven days, but in no event later than one month, and
the Subservicer shall deposit such Collections within 1 Business Day of receipt thereafter into the
Collection Account (net of any servicing fee (not in excess of the Subservicing Fee with respect
thereto)).



     Section 3.03 Custodial Arrangements.



          (a) Subject to the terms and conditions of this Section, the Subservicer shall maintain
custody and possession of the Receivable Files with respect to the Receivables (for the benefit of
the Secured Parties).




          (b) To the extent any Receivable Files or any portion thereof are held by the Subservicer in
accordance with Section 3.03(a), the Subservicer agrees to act with reasonable care, using
that degree of skill and care that it exercises with respect to similar contracts owned and/or
serviced by it. The Subservicer shall promptly report to the Servicer any material failure by it
to hold such Receivable Files as herein provided and shall promptly take appropriate action



11









 







to remedy such failure. In connection with holding any Receivable Files, the Subservicer
agrees not to assert, and shall cause each related vendor not to assert any beneficial ownership
interests in the Receivables. The Subservicer agrees to indemnify the Servicer, Collateral Agent,
the other Secured Parties and the Borrower, and their respective officers, directors, employees,
partners and agents for any and all liabilities, obligations, losses, damages, payments, costs, or
expenses of any kind whatsoever that may be imposed on or incurred by any such Person arising from
the negligence or willful misconduct of the Subservicer in holding of the Receivable Files pursuant
to Section 3.03(a); provided, however, that the Subservicer will not be
liable to the extent that any such amount resulted from the gross negligence or willful misconduct
of such Person.



          (c) The Subservicer shall not, without the prior consent of the Servicer, deliver or release
to the Borrower or any other Person any Receivable Files (or the security interest in the related
collateral, if any) except (i) to vendors, (ii) in the ordinary course of its business in
connection with the release of collateral securing such Receivable after satisfaction of the
related indebtedness thereunder and (iii) in connection with a sale of a Receivable by the
Borrower. Upon the request of the Servicer following the occurrence of a Subservicer Termination
Event, the Subservicer shall deliver to the Servicer all Receivable Files held by the Subservicer
unless the Subservicer is terminated as a result of a termination of the Servicer under the
Servicing Agreement, in which case the Subservicer shall deliver all Receivables Files to the
Collateral Agent.




     Section 3.04 Reports to Servicer.



          (a) On a weekly basis, the Subservicer shall prepare and deliver a collection report, showing,
among other things, (i) collections, (ii) proceeds from sales and (iii) cost reimbursements and
cost advance, in each case in the aggregate and by type of Receivable, in a form mutually
acceptable to the parties hereto.




          (b) Upon reasonable request by Servicer, in a format reasonably acceptable to the Servicer,
the Subservicer shall furnish the names, addresses and phone numbers of any attorney, collector or
other person who is not an employee of the Subservicer and, as of the last day of such calendar
quarter, was seeking to collect any account and a list of the accounts that are being collected by
such person. The Subservicer shall make available on a secure website information with respect to
the accounts containing data available in fields, and in a format, acceptable to the Servicer,
including job, bank and pertinent collection information, and shall provide the Servicer with
secure, remote access to such website. From time to time, upon reasonable request, the
Administrator shall have the right to obtain information about the Receivables from the
Subservicer. In addition, the Subservicer will monitor all judgments and, on a monthly basis, the
Subservicer will identify which of such judgments will and will not be renewed by the Subservicer
120 days prior to date of renewal of such Judgments.




          (c) The Subservicer shall notify the Servicer immediately in writing if any of the following
shall occur: (i) any Subservicer Termination Event or Unmatured Subservicer Termination Event;
(ii) any class action or coordinated multiple plaintiff action shall be instituted



12









 







or threatened in writing with respect to any Receivables or (iii) any governmental official
shall institute, or threaten to institute any investigation or proceeding relating to any account.



     Section 3.05 Annual Statement as to Compliance and Audit. The Subservicer will
deliver to the Servicer on or before April 15 of each year, beginning with April 15, 2008, an
Officer’s Certificate stating that (i) a review of the activities of the Subservicer during the
preceding calendar year and of performance under this Subservicing Agreement has been made under
such officer’s supervision, (ii) to the best of such officer’s knowledge, based on such review, the
Subservicer has fulfilled all its obligations under this Subservicing Agreement throughout such
year, or, if there has been a default in the fulfillment of any such obligation, specifying each
such default known to such officer and the nature and status thereof and (iii) to the best of such
officer’s knowledge, each vendor has fulfilled its obligations, or, if there has been a default in
the fulfillment of such obligations, specifying such default known to such officer and the nature
and status thereof.



     The Subservicer shall provide to the Servicer, within 120 days of the end of each fiscal year,
annual audited financial statements for the Subservicer prepared in accordance with generally
accepted accounting principles, consistently applied, by an independent certified public accounting
firm of national standing



     Section 3.06 Servicing Compensation. The Subservicer, as compensation for its
activities hereunder, shall be entitled to receive the Subservicing Fee, which shall be payable by
the Servicer no later than the seventh calendar day of each month or, if such day, is not a
Business Day, the next such Business Day; provided, however, (i) in all instances
with respect to Exempted Receivables and (ii) in all instances other than with respect to Exempted
Receivables, prior to the occurrence of a Subservicer Termination Event or Unmatured Subservicer
Termination Event (which has not been waived), the Subservicer may withhold the Subservicing Fee
payable thereto with respect to any Collections from the amount to be deposited thereby into the
Collection Account.



     The Subservicer shall be required to pay all expenses incurred by it in connection with its
servicing activities hereunder (including payment of the fees and expenses of any vendor) and shall
not be entitled to reimbursement therefor except as specifically provided in Section 3.02.



     Section 3.07 Receivable Reviews. To the extent permitted under applicable law any
time during regular business hours and upon at least five Business Days’ prior notice (so long as
no Subservicer Termination Event or Unmatured Subservicer Termination Event has occurred within
such calendar year), the Subservicer shall permit the Servicer and the Administrator, their agents,
representatives or designees (i) to examine and make copies of, and abstracts from, the Receivable
Files and of all books, records and documents (including, without limitation, computer tapes and
disks) in possession or under control of the Subservicer or any vendor (to the extent permissible
under the related vendor agreement) relating to the Receivables, (ii) to cause such books and
records to be audited by independent public accounts selected by the Servicer or its designee and
(iii) to visit the offices and properties of the Subservicer for the purposes of examining such
materials described above, and to discuss matters



13









 







related to the Receivables with any of the officers and employees of the Subservicer having
knowledge of such matters. Any activities undertaken by the Servicer or its designee in connection
with items (i) through (iii) above, shall be at the expense of the Servicer; provided,
however that the Servicer shall not be required to pay for more than two audits in any
calendar year unless a Subservicer Termination Event or Unmatured Subservicer Termination Event has
occurred and is continuing, in which event such audits may be as frequently as the Administrator
may determine in its sole discretion.



ARTICLE 4.

VENDORS




     Section 4.01 Agreements Between Subservicer and Vendors. The Subservicer, with the
prior written consent of the Servicer, may enter into vendor agreement with one or more third party
vendors for the servicing and administration of certain of the Receivables. References in this
Subservicing Agreement to actions taken or to be taken by the Subservicer in servicing the
Receivables include actions taken or to be taken by a vendor on behalf of the Subservicer. Each
vendor will service the Receivables in a manner materially consistent with this Subservicing
Agreement. The Subservicer hereby acknowledges that it is holding the Receivable Files and any
other items of the Collateral in its possession from time to time for the related Receivables as
bailee of Borrower and the Collateral Agent (for the benefit of the Secured Parties) in accordance
with Section 3.03.



     Section 4.02 Obligation of Subservicer. Notwithstanding any agreement with a vendor,
any of the provisions of this Subservicing Agreement relating to agreements or arrangements between
the Subservicer or a vendor or reference to actions taken through a vendor or otherwise, the
Subservicer shall remain obligated to the Servicer, the Borrower and the Collateral Agent for the
servicing and administering of the Receivables in accordance with the provisions of Section
3.01 without diminution of such obligation or liability by virtue of such arrangements or by
virtue of indemnification from a vendor and to the same extent and under the same terms and
conditions as if the Subservicer alone were servicing and administering the Receivables. The
Subservicer shall be entitled to enter into any agreement with a vendor for indemnification of the
Subservicer and nothing contained in this Subservicing Agreement shall be deemed to limit or modify
such indemnification.



     Section 4.03 No Contractual Relationship Between a Vendor and the Servicer. Any
vendor agreement that may be entered into and any other transactions or services relating to the
Receivables involving a vendor in its capacity as such shall be deemed to be between a vendor and
the Subservicer alone and the Servicer shall not be deemed a party thereto and shall have no
claims, rights, obligations, duties or liabilities with respect to a vendor except as set forth in
Section 4.04.



     Section 4.04 Assumption or Termination of Vendor Agreement by Servicer. In the event
the Subservicer shall for any reason no longer be the subservicer of the Receivables (including by
reason of a Subservicer Termination Event) pursuant to this Subservicing



14









 







Agreement, the Servicer shall have the right, in its sole discretion, to terminate all of the
rights and obligations of any vendor under the related vendor agreement.



ARTICLE 5.

SUBSERVICER TERMINATION EVENT




     Section 5.01 Subservicer Termination Event. “Subservicer Termination Event,”
wherever used herein, means any one of the following events:



               (i) the Subservicer shall fail to deposit all amounts required to be deposited in the
Collection Account when required to be deposited under this Subservicing Agreement and such failure
shall continue unremedied for 1 Business Day after the Subservicer has knowledge or notice thereof,
other than with respect to administrative errors not to exceed $10,000 of Collections in any
Collection Period for which such grace period shall be 5 Business Days after the Subservicer has
knowledge or notice thereof; or



               (ii) the Subservicer shall fail to observe or perform in any material respect any other of
the covenants or agreements on the part of the Subservicer contained in this Subservicing Agreement
or any other Transaction Document to which it is a party and such failure shall continue unremedied
for a period of twenty (20) days after the Subservicer has knowledge or notice thereof;



               (iii) a decree or order of a court or agency or supervisory authority having jurisdiction in
the premises in an involuntary case under any present or future federal or state bankruptcy,
insolvency or similar law or appointing a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered against the Subservicer;



               (iv) the Subservicer shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar
proceedings of, or relating to, the Subservicer or of, or relating to, all or substantially all of
the property of the Subservicer;



               (v) the Subservicer shall admit in writing its inability to pay its debts generally as they
become due, file a petition to take advantage of, or commence a voluntary case under, any
applicable insolvency or reorganization statute, make an assignment for the benefit of its
creditors, or voluntarily suspend payment of its obligations;



               (vi) the Subservicer shall have breached any of the representations and warranties set forth
in Section 2.01 in any material respect and the Subservicer shall have failed to cure such
breach within ten (10) days of its receipt of a notice of such breach;



               (vii) a Servicer Termination Event shall have occurred under the Servicing Agreement; or



15









 





               (viii) a Termination Event shall have occurred under the Receivables Financing Agreement.



     If a Subservicer Termination Event shall occur (which has not been waived), then, and in each
and every such case, the Servicer may, by notice in writing to the Subservicer (with a copy to the
Adminstrator, the Borrower and the Collateral Agent), terminate all of the rights and obligations
of the Subservicer under this Subservicing Agreement and in and to the Subservicer’s interest in
and to the Receivables and the proceeds thereof (except with respect to the Subservicer’s right to
collect Exempted Receivables pursuant to the terms of this Agreement), subject to compensation,
rights of reimbursement, indemnity and limitation on liability to which the Subservicer is then
entitled. Upon the effective date of such termination, all authority and power of the Subservicer
under this Subservicing Agreement, whether with respect to the Receivables or otherwise, shall
terminate. The Subservicer agrees to cooperate with such responsibilities and rights hereunder,
including, without limitation, the transfer pursuant to such termination. If the Subservicer is
terminated pursuant to this Section 5.01, then the Subservicer shall bear all of the costs
and expenses of transferring the duties and obligations of the Subservicer; provided,
however, that if the Subservicer fails to bear all such costs and expenses any successor
shall be entitled to reimbursement from amounts realized on the related collateral, if any, by
retention of such amounts prior to the distribution of any Collections from the Collection Account
in accordance with the Receivables Financing Agreement.



     Section 5.02 Term of Subservicer. (a) Except with respect to Exempted Receivables,
upon notice, the Subservicer may be removed by the Servicer, such removal to become effective upon
such date as specified in such notice upon the consent of the Administrator, which consent shall
not be unreasonably withheld or delayed. The Servicer shall be entitled to sell, on behalf of
Borrower, any and all Receivables (subject to the requirements of the Receivables Financing
Agreement and related documents), including Exempted Receivables; provided, in the case of Exempted
Receivables, except in connection with a Subservicer Termination Event pursuant to clauses (iii),
(iv) and (v) of Section 5.01, or occurrences of fraud, theft, willful misconduct or bankruptcy that
the Subservicer shall be retained as subservicer of such Receivables on terms materially similar to
the ones in this Subservicing Agreement.



     (b) The initial term of this Subservicing Agreement, except with respect to Exempted
Receivables, shall be two years, beginning on the date of this Subservicing Agreement, and shall be
renewable for additional terms upon the mutual agreement of the Servicer and Subservicer.



ARTICLE 6.

MISCELLANEOUS PROVISIONS




     Section 6.01 Amendments, Etc. No amendment, modification or waiver of, or consent
with respect to, any provision of this Subservicing Agreement shall be effected unless the same
shall be in writing and signed and delivered by each of the parties hereto and consented to by the
Administrator (which consent shall not be unreasonably withheld), and then any such waiver or
consent shall be effected only in the specific instance and for the specific purpose for which
given.



16









 





     Section 6.02 Acknowledgment of Subservicer. The Subservicer hereby agrees that upon
request from the Collateral Agent after the occurrence of a Termination Event which does not have
the effect of terminating the Subservicer under this Subservicing Agreement, the Subservicer shall
provide all services described in this Subservicing Agreement for the benefit of the Collateral
Agent (for the benefit of the Secured Parties) in accordance with the terms of this Subservicing
Agreement.



     Section 6.03 Notices. Any notice required or permitted to be given under this
Subservicing Agreement shall be in writing and shall be mailed by express mail, postage prepaid, or
personally delivered to an officer of the receiving party. All such communications shall be
mailed, sent or delivered to the parties at their respective addresses as set forth opposite their
respective signatures to this Subservicing Agreement, or as to any party at such other address as
shall be designated by such party in a written notice to each other party complying as to delivery
with the terms of this Section. All such notices and other communications shall, if properly
addressed and sent by pre-paid courier service, be deemed given when received; any notice or other
communication, if transmitted by facsimile, shall be deemed given when transmitted and receipt
thereof has been confirmed by telephone or electronic means.



     Section 6.04 GOVERNING LAW. THIS SUBSERVICING AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK OTHER THAN THOSE SET FORTH
IN SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK.



     Section 6.05 Successors and Assigns. This Subservicing Agreement shall be binding
upon and shall inure to the benefit of the parties hereto, the Borrower, the Collateral Agent, the
Secured Parties and their successors and assigns; provided, however, that the
Subservicer may not assign its rights, obligations or duties hereunder without the prior written
consent of the Servicer and the Administrator (which consent shall not be unreasonably withheld),
except as otherwise set forth in this Subservicing Agreement.



     Section 6.06 Attorney’s Liens. The Subservicer has and shall be deemed to have waived
any and all attorney’s liens against any Receivables subserviced hereunder. The Subservicer shall
require any attorney or other vendor engaged to service any Receivables to waive any and all
attorney’s liens and such attorneys and other vendors shall be deemed to have made such waiver.



     Section 6.07 Quantum Meruit. In the event of a dispute between the Servicer and the
Subservicer relating to the performance required hereunder, the Subservicer agrees to waive its
rights to pursue any legal action for payment pursuant to or based upon the equitable remedy of
quantum meruit.



     Section 6.08 Employment. The Subservicer hereby covenants and agrees that, for the
first two years of this Subservicing Agreement, the Subservicer shall remain in the collection



17









 







business and Ronald M. Abramson and Stuart J. Wolpoff will remain employed by the Subservicer
in a senior capacity.



     Section 6.09 Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Subservicing 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 Subservicing Agreement and shall
in no way affect the validity or enforceability of the other provisions of this Subservicing
Agreement.



     Section 6.10 Consent to Jurisdiction. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO
THIS SUBSERVICING AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED
STATES FEDERAL COURT SITTING IN NEW YORK, NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS
SUBSERVICING AGREEMENT, EACH OF THE BORROWER AND THE SERVICER CONSENTS, FOR ITSELF AND IN RESPECT
OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH OF THE BORROWER AND THE
SERVICER IRREVOCABLY WAIVES, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ANY OBJECTION, INCLUDING ANY
OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, THAT IT MAY NOW
OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF
THIS SUBSERVICING AGREEMENT OR ANY DOCUMENT RELATED HERETO.



     Section 6.11 Survival. The rights and remedies with respect to the indemnification
provisions of Section 2.02 shall be continuing and shall survive any termination of this Agreement
and any termination of Subservicer’s rights to act as a “Subservicer” hereunder.



     Section 6.12 Counterparts. This Subservicing Agreement may be executed in two or more
counterparts, each of which shall be an original, but all of which together shall constitute one
and the same instrument.



     Section 6.13 Third Party Beneficiaries. Each party hereto acknowledges and agrees
that the Lender, the Administrator and the Collateral Agent are third party beneficiaries under
this Agreement and shall have the full power to enforce its rights and benefits granted hereunder.



[Signature page follows]





18









 








     IN WITNESS WHEREOF, the Servicer and the Subservicer have caused their names to be signed
hereto by their respective officers thereunto duly authorized, all as of the day and year first
above written.



	 	 	 	 	 
	 	WOLPOFF & ABRAMSON, L.L.P.,

as subservicer

 	 
	 	By:  	/s/ Ronald Abramson
 	 
	 	 	Name:   Ronald Abramson 	 
	 	 	Title:  Managing Partner 	 
	 
	 	ADDRESS:



702 King Farm Blvd.

5th Floor

Rockville, MD 20850

 	 
	 	 	 
	 	 	 
	 	 	 
	 



Subservicing Agreement




S-1









 








	 	 	 	 	 
	 	PALISADES COLLECTION, L.L.C.,

as Servicer

 	 
	 	By:  	/s/ Mitchell Cohen
 	 
	 	 	Name:  	Mitchell Cohen 	 
	 	 	Title:  	Manager 	 
	 
	 	ADDRESS:



210 Sylvan Avenue

Englewood Cliffs, NJ 07632

 	 
	 	 	 
	 	 	 
	 	 	 
	 



Subservicing Agreement





S-2











 





SCHEDULE 1




SUBSERVICING FEE SCHEDULE




	 	 	 	 	 
	CLASS OF RECEIVABLE	 	PERCENTAGE	 
	All Receivables directly being serviced by the Subservicer;
provided, for the purposes of clarification, that any
Receivable subserviced by a vendor under this Subservicing
Agreement, will not be deemed to be directly serviced by the
Subservicer
	 	 	24%	
	All other Receivables
	 	 	30%	





For the purposes of this Schedule, “Exempted Receivables” shall not be a class hereunder. When
determining the applicable class for an “Exempted Receivable,” such class shall instead be related
to the Receivable underlying such Exempted Receivable.




Subservicing
Agreement





S1-1









 








SCHEDULE 2




LIST OF RECEIVABLES




Subservicing Agreement




S2-1









 








	 	 	 	 	 	 	 
	ARTICLE 1.
	 	DEFINITIONS	 	 	1	 
	 
	 	 	 	 	 	 
	Section 1.01
	 	Definitions
	 	 	1	 
	 
	 	 	 	 	 	 
	ARTICLE 2.
	 	REPRESENTATIONS, WARRANTIES AND COVENANTS	 	 	5	 
	 
	 	 	 	 	 	 
	Section 2.01
	 	Representations, Warranties and Covenants of Subservicer
	 	 	5	 
	Section 2.02
	 	Servicer Indemnity
	 	 	8	 
	Section 2.03
	 	Subservicer Indemnity
	 	 	8	 
	 
	 	 	 	 	 	 
	ARTICLE 3.
	 	ADMINISTRATION AND SERVICING OF RECEIVABLES	 	 	8	 
	 
	 	 	 	 	 	 
	Section 3.01
	 	Subservicer to Servicer
	 	 	8	 
	Section 3.02
	 	Collection of Receivable Payments; Collection Account
	 	 	10	 
	Section 3.03
	 	Custodial Arrangements
	 	 	11	 
	Section 3.04
	 	Reports to Servicer
	 	 	12	 
	Section 3.05
	 	Annual Statement as to Compliance and Audit
	 	 	13	 
	Section 3.06
	 	Servicing Compensation
	 	 	13	 
	Section 3.07
	 	Receivable Reviews
	 	 	13	 
	 
	 	 	 	 	 	 
	ARTICLE 4.
	 	VENDORS	 	 	14	 
	 
	 	 	 	 	 	 
	Section 4.01
	 	Agreements Between Subservicer and Vendors
	 	 	14	 
	Section 4.02
	 	Obligation of Subservicer
	 	 	14	 
	Section 4.03
	 	No Contractual Relationship Between a Vendor and the Servicert
	 	 	14	 
	Section 4.04
	 	Assumption or Termination of Vendor Agreement by Servicer
	 	 	14	 
	 
	 	 	 	 	 	 
	ARTICLE 5.
	 	SUBSERVICER TERMINATION EVENT	 	 	15	 
	 
	 	 	 	 	 	 
	Section 5.01
	 	Subservicer Termination Event
	 	 	15	 
	Section 5.02
	 	Term of Subservicer
	 	 	16	 
	 
	 	 	 	 	 	 
	ARTICLE 6.
	 	MISCELLANEOUS PROVISIONS	 	 	17	 
	 
	 	 	 	 	 	 
	Section 6.01
	 	Amendments, Etc
	 	 	17	 
	Section 6.02
	 	Acknowledgment of Subservicer
	 	 	17	 
	Section 6.03
	 	Notices
	 	 	17	 
	Section 6.04
	 	GOVERNING LAW
	 	 	17	 
	Section 6.05
	 	Successors and Assigns
	 	 	17	 
	Section 6.06
	 	Attorney’s Liens
	 	 	17	 
	Section 6.07
	 	Quantum Meruit
	 	 	17	 
	Section 6.08
	 	Employment
	 	 	18	 
	Section 6.09
	 	Severability of Provision
	 	 	18	 
	Section 6.10
	 	Consent to Jurisdiction
	 	 	18	 
	Section 6.11
	 	Survival
	 	 	18	 
	Section 6.12
	 	Counterparts
	 	 	18	 
	Section 6.13
	 	Third Party Beneficiaries
	 	 	18	 






Subservicing
Agreement




S-5









 








	 	 	 
	Exhibits	 	 
	 
	 	 
	Exhibit A

	 	List of Receivables






Subservicing
Agreement





S-6